Forward-Looking Statements
This press release may contain forward-looking information and forward-looking statements which reflect the current view of Danier with respect to the Company's objectives, plans, goals, strategies, future growth, results of operations, financial and operating performance and business prospects and opportunities. Wherever used, the words "may", "will", "anticipate", "intend", "estimate", "expect", "plan", "believe" and similar expressions identify forward-looking statements and forward-looking information. Forward-looking statements and forward-looking information should not be read as guarantees of future events, performance or results, and will not necessarily be accurate indications of whether, or the times at which, such events, performance or results will be achieved. All of the statements in this press release containing forward-looking statements or forward-looking information, if any, are qualified by these cautionary statements.
Forward-looking statements and forward-looking information are based on information available at the time they are made, underlying estimates, opinions and assumptions made by management and management's good faith belief with respect to future events, performance and results and are subject to inherent risks and uncertainties surrounding future expectations generally. For additional information with respect to Danier's inherent risks and uncertainties, reference should be made to Danier's continuous disclosure materials filed from time to time with the Canadian Securities Regulatory Authorities, including the Company's most recent annual information form, quarterly and annual reports and financial statements and notes thereto, and supplementary information, which are available on SEDAR at www.sedar.com and in the Investor Relations section of the Company's website at www.danier.com. Additional risks and uncertainties not presently known to the Company or that Danier currently believes to be less significant may also adversely affect the Company.
Danier cautions readers that such factors and uncertainties are not exhaustive and that should certain risks or uncertainties materialize, or should underlying estimates or assumptions prove incorrect, actual events, performance and results may vary significantly from those expected. There can be no assurance that the actual results, performance, events or activities anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. Potential investors and other readers are urged to consider these factors carefully in evaluating forward-looking information and forward-looking statements and are cautioned not to place undue reliance on any forward-looking information or forward-looking statements. Danier disclaims any intention or obligation to update or revise any forward-looking information or forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable laws.
About Danier
Danier Leather Inc. is a leading integrated designer, manufacturer, distributor and retailer of high-quality fashion-oriented leather apparel and accessories. The Company's merchandise is marketed exclusively under the well-known Danier brand name and is available at its 90 shopping mall, street-front and power centre stores. Corporations and other organizations can obtain Danier products for use as incentives and premiums for employees, suppliers and customers through Canada Sportswear Corp. For more information about the Company and our products, visit www.danier.com.
DANIER LEATHER INC.CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE EARNINGS(thousands of Canadian dollars, except per share amounts and number of shares) - unaudited-------------------------------------------------------------------------------------------------------------------------------------------------------- For the 13 Weeks Ended For the 26 Weeks Ended --------------------------- --------------------------- December 29, December 24, December 29, December 24, 2012 2011 2012 2011 --------------------------------------------------------Revenue $ 66,128 $ 59,487 $ 89,226 $ 81,578Cost of sales (Note 12) 30,202 26,328 41,709 36,729 --------------------------------------------------------Gross profit 35,926 33,159 47,517 44,849 Selling, general and administrative expenses (Note 12) 24,393 21,402 40,810 36,969 Interest income (37) (19) (103) (57) Interest expense 13 11 31 33 --------------------------------------------------------Earnings before income taxes 11,557 11,765 6,779 7,904Provision for income taxes (Note 13) 3,153 3,299 1,833 2,206 --------------------------------------------------------Net earnings and comprehensive earnings $ 8,404 $ 8,466 $ 4,946 $ 5,698 -------------------------------------------------------- --------------------------------------------------------Net earnings per share: Basic $ 1.92 $ 1.83 $ 1.10 $ 1.23 Diluted $ 1.86 $ 1.77 $ 1.06 $ 1.19Weighted average number of shares outstanding: Basic 4,370,014 4,629,878 4,508,458 4,643,017 Diluted 4,525,044 4,777,651 4,655,189 4,796,672Number of shares outstanding at period end 3,859,501 4,631,835 3,859,501 4,631,835See accompanying notes to the consolidated financial statementsDANIER LEATHER INC.CONSOLIDATED STATEMENTS OF FINANCIAL POSITION(thousands of Canadian dollars) - unaudited-------------------------------------------------------------------------------------------------------------------------------------------------------- Dec 29, Dec 24, June 30, 2012 2011 2012 ---------------------------------------------------ASSETSCurrent Assets Cash and cash equivalents (Note 3) $ 30,849 $ 31,803 $ 34,332 Accounts receivable 1,351 1,686 517 Income taxes recoverable - - 426 Inventories (Note 4) 32,061 36,789 24,891 Prepaid expenses 345 426 799 --------------------------------------------------- 64,606 70,704 60,965Non-current Assets Property and equipment (Note 5) 16,661 15,315 15,012 Computer software (Note 6) 586 891 726 Deferred income tax asset (Note 13) 2,041 1,786 1,909 --------------------------------------------------- $ 83,894 $ 88,696 $ 78,612 --------------------------------------------------- ---------------------------------------------------LIABILITIESCurrent Liabilities Payables and accruals (Note 8) $ 18,684 $ 16,010 $ 10,161 Deferred revenue 1,867 2,135 1,463 Sales return provision (Note 9) 1,716 1,451 124 Income taxes payable 111 583 - --------------------------------------------------- 22,378 20,179 11,748Non-current LiabilitiesDeferred lease inducements and rent liability 1,406 1,392 1,373 --------------------------------------------------- 23,784 21,571 13,121 ---------------------------------------------------SHAREHOLDERS' EQUITY Share capital (Note 10) 11,580 14,959 15,040 Contributed surplus 971 945 925 Retained earnings 47,559 51,221 49,526 --------------------------------------------------- 60,110 67,125 65,491 --------------------------------------------------- $ 83,894 $ 88,696 $ 78,612 --------------------------------------------------- ---------------------------------------------------Contingencies, Guarantees and Commitments (Notes 15 and 16)Approved by the Board of DirectorsJanuary 30, 2013See accompanying notes to the consolidated financial statementsDANIER LEATHER INC.CONSOLIDATED STATEMENTS OF CASH FLOW(thousands of Canadian dollars) - unaudited-------------------------------------------------------------------------------------------------------------------------------------------------------- For the 13 Weeks Ended For the 26 Weeks Ended --------------------------- ---------------------------- December 29, December 24, December 29, December 24, 2012 2011 2012 2011 --------------------------------------------------------Cash provided by (used in)OPERATING ACTIVITIES Net earnings $ 8,404 $ 8,466 $ 4,946 $ 5,698 Adjustments for: Amortization of property and equipment 777 774 1,501 1,605 Amortization of computer software 90 90 178 179 Impairment loss on property and equipment 327 21 327 21 Amortization of deferred lease inducements (24) (36) (57) (76) Proceeds from deferred lease inducement - 128 - 128 Straight line rent expense 46 17 90 22 Stock-based compensation 23 2 46 17 Interest income (37) (19) (103) (57) Interest expense 13 11 31 33 Provision for income taxes 3,153 3,299 1,833 2,206 Changes in working capital (Note 14) 13,993 9,388 2,920 (1,649) Interest paid - - - (12) Interest received 40 12 121 69 Income taxes paid (529) (934) (1,336) (2,008) --------------------------------------------------------Net cash generated from operating activities 26,276 21,219 10,497 6,176 --------------------------------------------------------FINANCING ACTIVITIES Subordinate voting shares issued - 12 - 12 Subordinate voting shares repurchased (10,465) - (10,465) (530) --------------------------------------------------------Net cash (used in) generated from financing activities (10,465) 12 (10,465) (518) --------------------------------------------------------INVESTING ACTIVITIES Acquisition of property and equipment (1,521) (1,502) (3,477) (2,537) Acquisition of computer software (25) (16) (38) (16) --------------------------------------------------------Net cash used in investing activities (1,546) (1,518) (3,515) (2,553) --------------------------------------------------------Increase (decrease) in cash and cash equivalents 14,265 19,713 (3,483) 3,105Cash and cash equivalents, beginning of period 16,584 12,090 34,332 28,698 --------------------------------------------------------Cash and cash equivalents, end of period $ 30,849 $ 31,803 $ 30,849 $ 31,803 -------------------------------------------------------- --------------------------------------------------------See accompanying notes to the consolidated financial statementsDANIER LEATHER INC.CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY(thousands of Canadian dollars) - unaudited-------------------------------------------------------------------------------------------------------------------------------------------------------- Accumulated Other Share Contributed Comprehensive Retained Capital Surplus Income Earnings Total -------------------------------------------------------------Balance - June 30, 2012 $ 15,040 $ 925 $ - $ 49,526 $ 65,491 Net earnings - - - 4,946 4,946 Stock-based compensation related to stock options - 46 - - 46 Share repurchases (net of tax) (3,460) - - (6,913) (10,373) -------------------------------------------------------------Balance - December 29, 2012 $ 11,580 $ 971 $ - $ 47,559 $ 60,110 ------------------------------------------------------------- Accumulated Other Share Contributed Comprehensive Retained Capital Surplus Income Earnings Total -------------------------------------------------------------Balance - June 25, 2011 $ 15,160 $ 934 $ - $ 45,834 $ 61,928 Net earnings - - - 5,698 5,698 Stock-based compensation related to stock options - 17 - - 17 Exercise of stock options 18 (6) 12 Share repurchases (219) - - (311) (530) -------------------------------------------------------------Balance - December 24, 2011 $ 14,959 $ 945 $ - $ 51,221 $ 67,125 -------------------------------------------------------------See accompanying notes to the consolidated financial statements DANIER LEATHER INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTSFor the 13 week and 26 week periods ended December 29, 2012 and December 24, 2011 (unless otherwise stated, all amounts are in thousands of Canadian dollars) - unaudited
