PR Newswire | Jul 15, 2021 04:20PM EDT

07/15 15:20 CDT

Jewett-Cameron Announces 3rd Quarter Financial Results NORTH PLAINS, Ore., July 15, 2021

NORTH PLAINS, Ore., July 15, 2021 /PRNewswire/ -- Jewett-Cameron Trading Company Ltd. (NASDAQ: JCTCF) today reported financial results for the third quarter and nine month periods of fiscal 2021 ended May 31, 2021.

Sales for the third quarter of fiscal 2021 totaled approximately $21.6 million compared to sales of $16.2 million for the third quarter of fiscal 2020. Income from operations was $2,638,010 compared to $1,913,582 for the third quarter ended May 31, 2020. Net income after other items and income taxes for the current quarter was $2,414,477, or $0.69 per share, compared to net income of $1,396,973, or $0.40 per share, in the same quarter of 2020.

For the nine months ended May 31, 2021, Jewett-Cameron reported sales of $42.4 million compared to sales of $30.9 million for the nine months ended May 31, 2020. Net income was $2,849,839, or $0.82 per share, compared to net income of $1,216,089, or $0.33 per share, in the first nine months of fiscal 2020.

Net income for both the three and nine month periods ended May 31, 2021 were positively affected by a one-time gain of $687,387 related to the forgiveness of the Company's PPP loans.

"We are pleased with the higher level of sales and net income in the current periods, which continues to reflect the success of our ongoing corporate strategy," said CEO Charlie Hopewell. "All of our sales channels showed sales increases, with many customers boosting both the volume of individual products and the number of different products in their orders. However, the worldwide supply chain disorder is having a negative effect on our operations and margins, which may continue for the remainder of fiscal 2021 and into fiscal 2022."

As of May 31, 2021, the Company's cash position was approximately $2.2 million. Due to higher customer demand and logistical issues, the Company tapped its line of credit in the third quarter. The borrowing totaled $996,010 as of May 31, 2021. In June 2021, the Company's line of credit was increased from $3.0 million to $5.0 million.

About Jewett-Cameron Trading Company Ltd.

Jewett-Cameron Trading Company is a holding company that, through its subsidiaries (Jewett-Cameron Companies), operate out of facilities located in North Plains, Oregon. Those businesses consist of the manufacturing and distribution of patented and patent pending specialty metal products, wholesale distribution of wood products, and seed processing and sales. Examples of the Company's brands include Lucky Dog(r), Animal House(r) and AKC (used under license from the American Kennel Club) for pet enclosures and kennels; Adjust-A-Gate, Fit-Right(tm), LIFETIME POST(tm) and Perimeter Patrol(r) for gates and fencing; Early Start, Spring Gardener(tm), and Weatherguard for greenhouses; and TrueShade(r) for patio umbrellas, furniture covers and canopies.

Forward-looking Statements

The information in this release contains certain forward-looking statements that anticipate future trends and events. These statements are based on certain assumptions that may prove to be erroneous and are subject to certain risks, including but not limited to, the uncertainties of the Company's new product introductions, the risks of increased competition and technological change in the Company's industry, and other factors detailed in the Company's SEC filings. Accordingly, actual results may differ, possibly materially, from predictions contained herein.

JEWETT-CAMERON TRADING COMPANY LTD.

CONSOLIDATED BALANCE SHEETS

(Expressed in U.S. Dollars)

(Prepared by Management)

(Unaudited)

May 31, August 31, 2021 2020

ASSETS

Current assets

Cash and cash equivalents $ 2,170,046 $ 3,801,037

Accounts receivable, net of allowance of $Nil 11,051,061 6,274,426(August 31, 2020 - $Nil)

Inventory, net of allowance of $250,000 (August 7,767,640 9,198,14631, 2020 - $65,000)

Prepaid expenses 2,580,856 1,036,128

Total current assets 23,569,603 20,309,737

Property, plant and equipment, net 3,799,402 2,967,565

Intangible assets, net 12,910 659

Total assets $ 27,381,915 $ 23,277,961

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Accounts payable $ 1,557,721 $ 1,095,061

Bank indebtedness 996,010 -

Current portion of notes payable - 342,326

Income taxes payable 230,190 40,596

Accrued liabilities 2,290,235 2,016,300

Total current liabilities 5,074,156 3,494,283

Long-term liabilities

Notes payable - 338,381

Deferred tax liability 39,184 96,952

Total liabilities 5,113,340 3,929,616

Stockholders' equity

Capital stock

Authorized

21,567,564 common shares, without par value

10,000,000 preferred shares, without par value

Issued

3,489,161 common shares (August 31, 2020 - 823,171 821,2843,481,162)

Additional paid-in capital 687,211 618,707

Retained earnings 20,758,193 17,908,354

Total stockholders' equity 22,268,575 19,348,345

Total liabilities and stockholders' equity $ 27,381,915 $ 23,277,961

JEWETT-CAMERON TRADING COMPANY LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Expressed in U.S. Dollars)

(Prepared by Management)

(Unaudited)

Three Month Nine Month Period Ended Period Ended May 31, May 31,

2021 2020 2021 2020

SALES $ 21,619,952 $ 16,241,239 $ 42,396,591 $ 30,918,345

COST OF SALES 16,037,702 11,931,746 31,239,866 22,555,253

GROSS PROFIT 5,582,250 4,309,493 11,156,725 8,363,092

OPERATING EXPENSES

Selling, general and 966,299 706,079 2,556,902 2,118,999administrative expenses

Depreciation and 69,353 54,781 175,171 160,992amortization

Wages and employee 1,908,588 1,635,051 5,226,021 4,343,412benefits

2,944,240 2,395,911 7,958,094 6,623,403

Income from operations 2,638,010 1,913,582 3,198,631 1,739,689

OTHER ITEMS

Gain on sale ofproperty, plant - 2,200 - 2,600and equipment

Gain on 687,387 687,387extinguishment of debt

Interest and other (6,282) 3,217 (283) 21,414income

681,105 5,417 687,104 24,014

Income before income 3,319,115 1,918,999 3,885,735 1,763,703taxes

Income tax expense (904,638) (522,026) (1,035,896) (547,614)

Net income $ 2,414,477 $ 1,396,973 $ 2,849,839 $ 1,216,089

Basic earnings per $ 0.69 $ 0.40 $ 0.82 $ 0.33common share

Diluted earnings per $ 0.69 $ 0.40 $ 0.82 $ 0.33common share

Weighted average numberof common sharesoutstanding:

Basic 3,489,161 3,481,162 3,485,525 3,672,858

Diluted 3,489,161 3,481,162 3,485,525 3,672,858

JEWETT-CAMERON TRADING COMPANY LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in U.S. Dollars)

(Prepared by Management)

(Unaudited)

Nine Month Period Ended May 31,

2021 2020

CASH FLOWS FROM OPERATING ACTIVITIES

Net income $ 2,849,839 $ 1,216,089

Items not involving an outlay of cash:

Depreciation and amortization 175,171 160,992

Stock-based compensation expense 70,391 -

(Gain) on sale of property, plant and equipment - (2,600)

Gain on extinguishment of debt (680,707) -

Deferred income tax expense (57,768) 39,571

Changes in non-cash working capital items:

(Increase) in accounts receivable (4,776,635) (4,044,507)

Decrease (increase) in inventory 1,430,506 (408,282)

(Increase) in notes receivable - (561,813)

(Increase) in prepaid expenses (1,544,728) (942,541)

Decrease in prepaid income taxes - 101,686

Increase in accounts payable and accrued 736,595 1,448,292liabilities

Increase in income taxes payable 189,594 -

Net cash (used in) provided by operating activities (1,607,742) (2,993,113)

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment (1,019,259) (207,469)

Proceeds from sale of property, plant and

equipment - 3,900

Net cash provided by (used in) investing activities (1,019,259) (203,569)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from bank indebtedness 996,010 -

Increase in notes payable - 680,707

Redemption of common stock - (3,867,046)

Net cash provided by (used in) financing activities 996,010 (3,186,339)

Net (decrease) in cash (1,630,991) (6,383,021)

Cash, beginning of period 3,801,037 9,652,310

Cash, end of period $ 2,170,046 $ 3,269,289

Contact: Charlie Hopewell, Chief Executive Officer, (503) 647-0110

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SOURCE Jewett-Cameron Trading Company Ltd.