Volume for the first quarter was 156,415 metric tonnes, as opposed to 172,754 metric tonnes in the comparable quarter of last year, a decrease of approximately 16,300 metric tonnes. Industrial volume was higher by approximately 4,700 metric tonnes due to the gain of additional volume with existing and new customers. Consumer volume was higher by approximately 500 metric tonnes due mainly to timing in customers' retail promotions. Liquid volume also increased by approximately 300 metric tonnes due mainly to timing in some deliveries and increases in deliveries to existing customers. These increases were offset with lower export volume of approximately 21,800 metric tonnes due to sugar sold under a special quota to the U.S in fiscal 2012. A special quota of 136,078 metric tonnes was opened, effective October 3, 2011 by the U.S. Department of Agriculture, of which 25,000 metric tonnes was allocated specifically to Canada and the balance of 111,078 to global suppliers on a first-come, first-served basis. The Company, through its cane refineries, was able to enter approximately 10,000 metric tonnes against the global quota by the time it closed on October 25, 2011. As the sole producer of Canadian origin sugar in Taber Alberta, the Company was able to enter approximately 17,600 metric tonnes by the time that quota closed on November 30, 2011.
Revenues for the quarter were $33.4 million lower than the previous year's comparable quarter, due to the lower level of sales achieved during the quarter and to an average lower value of raw sugar in fiscal 2013.
As previously mentioned, gross margin of $30.6 million for the quarter does not reflect the economic margin of the Company, as it includes a gain of $1.1 million for the mark-to-market of derivative financial instruments explained earlier. We will therefore comment on adjusted gross margin results.
For the quarter, adjusted gross margin decreased by approximately $8.2 million, when compared to the same quarter of last year, due in large part to lower volume. On a per metric tonne basis, adjusted gross margin was $189.02 compared to $218.74 for the first quarter of last year. The decrease in the adjusted gross margin rate of $29.72 is due mainly to the sales mix, as a higher margin rate was realized on export sales under the special quota in the first quarter of fiscal 2012.
Distribution and administration and selling costs were comparable to the first quarter of fiscal 2012.
Finance costs for the quarter include a mark-to-market gain of $0.5 million as compared to a gain of $0.8 million in fiscal 2012, for the interest rate swap entered into in July 2008. Without the above mark-to-market adjustments, finance expenses for the quarter were lower by approximately $1.0 million due mainly to the write-off of $0.6 million of deferred financing charges as a result of the early redemption of the third series convertible debentures in the first quarter of fiscal 2012 and to lower borrowings.
Provision for income taxes was higher by $1.4 million from the comparable quarter of fiscal 2012, but when adjusted for the variance of net deferred taxes on derivative financial instruments of negative $3.8 million, the provision for income taxes was approximately $2.4 million lower than the comparable quarter of fiscal 2012. The main reason for that decrease is due to the lower profitability at the operating level.
Statement of quarterly results
The following is a summary of selected financial information of the consolidated financial statements and non-GAAP measures of the Company for the last eight quarters.
---------------------------------------------------------------------------- QUARTERS -------------------------------------------------------(In thousands of dollars, except for volume, margin rate and per share 2013 2012 information) (Unaudited) (Unaudited) ------------------------------------------------------- 1-Q 4-Q 3-Q 2-Q 1-Q----------------------------------------------------------------------------Volume (MT) 156,415 164,539 157,786 146,494 172,754 -------------------------------------------------------Revenues 142,376 150,469 147,687 144,132 175,805Gross margin 30,639 18,077 18,207 17,923 23,654EBIT 23,698 11,072 11,180 11,583 16,769Net earnings 16,133 6,944 6,909 6,528 9,880Gross margin rate per MT 195.88 109.86 115.39 122.35 136.92Per shareNet earnings Basic 0.17 0.07 0.07 0.07 0.11 Diluted 0.16 0.07 0.07 0.07 0.10Non-GAAP MeasuresAdjusted gross margin 29,567 21,696 19,642 23,065 37,789Adjusted EBIT 22,626 14,691 12,615 16,725 30,904Adjusted net earnings 14,887 9,782 7,641 9,841 19,761Adjusted gross margin rate per MT 189.02 131.86 124.49 157.45 218.74Adjusted net earnings per share Basic 0.16 0.10 0.08 0.10 0.22 Diluted 0.15 0.10 0.08 0.10 0.19-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- QUARTERS ---------------------------------(In thousands of dollars, except for volume, margin rate and per share 2011 information) (Unaudited) --------------------------------- 4-Q 3-Q 2-Q------------------------------------------------------Volume (MT) 170,880 163,001 155,500 ---------------------------------Revenues 160,866 150,892 149,418Gross margin 33,507 11,637 11,686EBIT 25,679 5,061 4,512Net earnings 16,531 1,249 1,496Gross margin rate per MT 196.08 71.39 75.15Per shareNet earnings Basic 0.19 0.01 0.02 Diluted 0.16 0.01 0.02Non-GAAP MeasuresAdjusted gross margin 25,486 17,637 14,007Adjusted EBIT 17,658 11,061 6,833Adjusted net earnings 10,919 5,847 2,799Adjusted gross margin rate per MT 149.15 108.20 90.08Adjusted net earnings per share Basic 0.12 0.07 0.03 Diluted 0.11 0.07 0.03------------------------------------------------------------------------------------------------------------
