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Approximately 4% of Construction Products Distribution's employees are unionized. Collective bargaining agreements are renegotiated in the normal course of business. While labour disruptions are not expected, there is always risk associated with the negotiation process that could have an adverse impact on the segment and Superior.
SUPERIOR PLUS CORP.Condensed Consolidated Balance Sheets---------------------------------------------------------------------------- March 31, December 31,(unaudited, millions of Canadian dollars) Notes 2013 2012(1)----------------------------------------------------------------------------AssetsCurrent AssetsCash and cash equivalents 33.9 7.6Trade and other receivables 4&12 412.3 389.0Prepaid expenses 27.4 24.7Inventories 173.6 213.7Unrealized gains on derivative financial instruments 12 11.5 16.6----------------------------------------------------------------------------Total Current Assets 658.7 651.6----------------------------------------------------------------------------Non-Current AssetsProperty, plant and equipment 6 826.8 829.9Intangible assets 37.3 39.6Goodwill 189.1 189.1Notes and finance lease receivables 10.2 10.1Deferred tax 13 288.7 303.1Unrealized gains on derivative financial instruments 12 11.6 12.9----------------------------------------------------------------------------Total Non-Current Assets 1,363.7 1,384.7----------------------------------------------------------------------------Total Assets 2,022.4 2,036.3--------------------------------------------------------------------------------------------------------------------------------------------------------Liabilities and EquityCurrent LiabilitiesTrade and other payables 8 305.1 314.1Deferred revenue 9 12.3 18.2Borrowing 10 56.9 59.7Convertible unsecured subordinated debentures 11&21 24.7 50.0Dividends and interest payable 15.4 7.3Unrealized losses on derivative financial instruments 12 23.6 36.5----------------------------------------------------------------------------Total Current Liabilities 438.0 485.8----------------------------------------------------------------------------Non-Current LiabilitiesBorrowing 10 457.0 574.7Convertible unsecured subordinated debentures 11 451.7 475.1Other liabilities 9 0.7 1.0Provisions 7 17.4 17.6Employee future benefits 46.8 54.0Deferred tax 13 4.9 2.5Unrealized losses on derivative financial instruments 12 55.6 42.6----------------------------------------------------------------------------Total Non-Current Liabilities 1,034.1 1,167.5--------------------------------------------------------------------------------------------------------------------------------------------------------Total Liabilities 1,472.1 1,653.3----------------------------------------------------------------------------EquityCapital 1,787.5 1,646.5Deficit (1,195.6) (1,209.4)Accumulated other comprehensive loss (41.6) (54.1)----------------------------------------------------------------------------Total Equity 14 550.3 383.0----------------------------------------------------------------------------Total Liabilities and Equity 2,022.4 2,036.3--------------------------------------------------------------------------------------------------------------------------------------------------------(1) December 31, 2012 has been restated for the impact of adopting IAS 19 Employee Benefits, amendments on January 1, 2013. Refer to Note 2.See accompanying Notes to the Condensed Consolidated Financial Statements.SUPERIOR PLUS CORP.Condensed Consolidated Statement of Changes in Equity---------------------------------------------------------------------------- Share(unaudited millions of Canadian Capital Contributed Total dollars) Surplus(1) Capital----------------------------------------------------------------------------January 1, 2012 1,629.8 3.3 1,633.1Impact of adopting IAS 19, Employee Benefits, amendments (note 2) - - -----------------------------------------------------------------------------Restated as at January 1, 2012 1,629.8 3.3 1,633.1 Net earnings - - - Shares issued under Dividend Reinvestment Plan 3.6 - 3.6 Dividends declared to shareholders - - - Unrealized foreign currency losses on translation of foreign operations - - - Actuarial defined benefit gains - - - Income tax expense on other comprehensive loss - - -----------------------------------------------------------------------------March 31, 2012 1,633.4 3.3 1,636.7---------------------------------------------------------------------------- Net earnings - - - Option value associated with redemption of convertible debentures - (0.8) (0.8) Shares issued under Dividend Reinvestment Plan 10.6 - 10.6 Dividends declared to shareholders - - - Unrealized foreign currency losses on translation of foreign operations - - - Actuarial defined benefit gains - - -----------------------------------------------------------------------------December 31, 2012 1,644.0 2.5 1,646.5---------------------------------------------------------------------------- Net earnings - - - Option value associated with redemption of convertible debentures - (0.4) (0.4) Shares issued under Dividend Reinvestment Plan 3.6 - 3.6 Issuance of common shares 137.8 137.8 Dividends declared to shareholders - - - Unrealized foreign currency gains on translation of foreign operations - - - Actuarial defined benefit gains - - - Income tax expense on other comprehensive loss - - -----------------------------------------------------------------------------March 31, 2013 1,785.4 2.1 1,787.5----------------------------------------------------------------------------SUPERIOR PLUS CORP.Condensed Consolidated Statement of Changes in Equity---------------------------------------------------------------------------- Accumulated other(unaudited millions of Canadian comprehensive dollars) Deficit loss Total----------------------------------------------------------------------------January 1, 2012 (1,228.2) (55.3) 349.6Impact of adopting IAS 19, Employee Benefits, amendments (note 2) (4.0) 4.1 0.1----------------------------------------------------------------------------Restated as at January 1, 2012 (1,232.2) (51.2) 349.7 Net earnings 27.9 - 27.9 Shares issued under Dividend Reinvestment Plan - - 3.6 Dividends declared to shareholders (16.7) - (16.7) Unrealized foreign currency losses on translation of foreign operations - (6.5) (6.5) Actuarial defined benefit gains - 5.1 5.1 Income tax expense on other comprehensive loss - (1.1) (1.1)----------------------------------------------------------------------------March 31, 2012 (1,221.0) (53.7) 362.0---------------------------------------------------------------------------- Net earnings 62.1 - 62.1 Option value associated with redemption of convertible debentures - - (0.8) Shares issued under Dividend Reinvestment Plan - - 10.6 Dividends declared to shareholders (50.5) - (50.5) Unrealized foreign currency losses on translation of foreign operations - (2.5) (2.5) Actuarial defined benefit gains - 2.1 2.1----------------------------------------------------------------------------December 31, 2012 (1,209.4) (54.1) 383.0---------------------------------------------------------------------------- Net earnings 31.4 - 31.4 Option value associated with redemption of convertible debentures - - (0.4) Shares issued under Dividend Reinvestment Plan - - 3.6 Issuance of common shares 137.8 Dividends declared to shareholders (17.6) - (17.6) Unrealized foreign currency gains on translation of foreign operations - 7.8 7.8 Actuarial defined benefit gains - 6.1 6.1 Income tax expense on other comprehensive loss - (1.4) (1.4)----------------------------------------------------------------------------March 31, 2013 (1,195.6) (41.6) 550.3----------------------------------------------------------------------------(1) Contributed surplus represents Superior's equity reserve for the option value associated with the issuance of convertible unsecured subordinated debentures and warrants.See accompanying Notes to the Condensed Consolidated Financial Statements.SUPERIOR PLUS CORP.Condensed Consolidated Statement of Net Earnings and Total Comprehensive Income---------------------------------------------------------------------------- Three Months Three Months(unaudited, millions of Canadian Ended March Ended March dollars except per share amounts) Notes 31, 2013 31, 2012(1)----------------------------------------------------------------------------REVENUES 17 1,049.9 1,065.9Cost of sales (includes products & services) 17 (796.8) (827.8)----------------------------------------------------------------------------Gross profit 253.1 238.1----------------------------------------------------------------------------EXPENSES Selling, distribution and administrative costs 17 179.1 180.3 Finance expense 17 18.5 21.4 Unrealized losses on derivative financial instruments 12 8.3 2.4---------------------------------------------------------------------------- 205.9 204.1----------------------------------------------------------------------------Net earnings before income taxes 47.2 34.0 Income tax expense 13 (15.8) (6.1)----------------------------------------------------------------------------Net earnings 31.4 27.9----------------------------------------------------------------------------Net earnings 31.4 27.9Other comprehensive income (loss): Unrealized foreign currency gains (losses) on translation of foreign operations 7.8 (6.5) Actuarial defined benefit gains 6.1 5.1 Reclassification of derivative gains previously deferred - - Income tax expense on other comprehensive income (loss) (1.4) (1.1)---------------------------------------------------------------------------- Other comprehensive income (loss) 12.5 (2.5)----------------------------------------------------------------------------Total comprehensive income for the period 43.9 25.4--------------------------------------------------------------------------------------------------------------------------------------------------------Net Earnings per Share Basic 15 $ 0.28 $ 0.25 Diluted 15 $ 0.27 $ 0.24----------------------------------------------------------------------------(1) Three months ended March 31, 2012 has been restated for the impact of adopting IAS 19 Employee Benefits, amendments on January 1, 2013. Refer to Note 2.See accompanying Notes to the Condensed Consolidated Financial Statements.SUPERIOR PLUS CORP.Condensed Consolidated Statement of Cash Flows Three months Three months ended March ended March(unaudited, millions of Canadian dollars) Notes 31, 2013 31, 2012(1)----------------------------------------------------------------------------OPERATING ACTIVITIESNet earnings for the period 31.4 27.9Adjustments for: Depreciation included in selling, distribution and administrative costs 6 10.3 10.6 Amortization of intangible assets 3.9 6.3 Depreciation included in cost of sales 6 10.3 10.9 Amortization of customer contract- related costs 0.7 0.9 Losses on disposal of assets 0.4 0.4 Unrealized losses on derivative financial instruments 12 8.3 2.4 Customer contract-related costs (0.2) (0.4) Finance expense recognized in net earnings 18.5 21.4 Income tax expense recognized in net earnings 15.8 6.1 (Increase) Decrease in non-cash operating working capital 16 (4.1) 34.4----------------------------------------------------------------------------Net cash flows from operating activities 95.3 120.9Income taxes received - 0.4Interest paid (4.7) (4.9)----------------------------------------------------------------------------Cash flows from operating activities 90.6 116.4----------------------------------------------------------------------------INVESTING ACTIVITIESPurchase of property, plant and equipment 6 (11.7) (6.0)Proceeds from disposal of property, plant and equipment 6 0.5 0.9----------------------------------------------------------------------------Cash flows used in investing activities (11.2) (5.1)----------------------------------------------------------------------------FINANCING ACTIVITIESNet repayment of revolving term bank credits and other debt (123.6) (92.2)Repayment of finance lease obligations (3.9) (3.6)Redemption of 5.75% convertible debentures (50.0) -Proceeds from issuance of common shares 143.9 -Issue costs on issuance of common shares (6.1) -Proceeds from the dividend reinvestment program 3.6 3.6Dividends paid to shareholders (16.9) (16.7)----------------------------------------------------------------------------Cash flows used in financing activities (53.0) (108.9)--------------------------------------------------------------------------------------------------------------------------------------------------------Net increase in cash and cash equivalents 26.4 2.4Cash and cash equivalents, beginning of period 7.6 5.2Effect of translation of foreign currency-denominated cash and cash equivalents (0.1) (0.3)----------------------------------------------------------------------------Cash and cash equivalents, end of period 33.9 7.3----------------------------------------------------------------------------(1) Three months ended March 31, 2012 has been restated for the impact of adopting IAS 19 Employee Benefits, amendments on January 1, 2013. Refer to Note 2.See accompanying Notes to the Condensed Consolidated Financial Statements.
