PR Newswire | Jul 15, 2020 04:25PM EDT

07/15 15:25 CDT

Jewett-Cameron Announces 3rd Quarter Financial Results NORTH PLAINS, Ore., July 15, 2020

NORTH PLAINS, Ore., July 15, 2020 /PRNewswire/ -- Jewett-Cameron Trading Company Ltd. (NASDAQ: JCTCF) today reported financial results for the third quarter and nine month periods of fiscal 2020 ended May 31, 2020.

Sales for the third quarter of fiscal 2020 totaled approximately $16.2 million compared to sales of $16.7 million for the third quarter of fiscal 2019. Income from operations was $1,913,582 compared to $1,506,638 for the third quarter ended May 31, 2019. Net income after other items and income taxes for the current quarter was $1,396,973, or $0.40 per share, compared to $1,098,210, or $0.27 per share, in the same quarter of 2019.

For the nine months ended May 31, 2020, Jewett-Cameron reported sales of $30.9 million compared to sales of $33.6 million for the nine months ended May 31, 2019. Net income was $1,216,089, or $0.33 per share, compared to net income of $1,567,534, or $0.36 per share, in the first nine months of fiscal 2019.

"The Company has been navigating the COVID-19 pandemic well to date, with our DIY and Pet Products performing solidly," said CEO Charlie Hopewell. "We are maintaining strict safety protocols across all our operations, and have no cases of COVID among any of our personnel. The pandemic has not changed our plans to introduce new products and continue our efforts to widen our offerings through both existing and new sales channels".

As of May 31, 2020, the Company's cash position was approximately $3.2 million, and there was no borrowing against its $3.0 million line of credit.

About Jewett-Cameron Trading Company Ltd.

Jewett-Cameron Trading Company is a holding company that, through its subsidiaries, operates out of facilities located in North Plains, Oregon. Jewett-Cameron Company's business consists of the manufacturing and distribution of specialty metal products and wholesale distribution of wood products to home centers and other retailers located primarily in the United States. Greenwood Products is a processor and distributor of industrial wood and other specialty building products principally to customers in the marine and transportation industries in the United States. MSI-PRO is an importer and distributor of pneumatic air tools, industrial clamps, and the Avenger Products line of sawblades and other products. Jewett-Cameron Seed Company is a processor and distributor of agricultural seeds. JC USA provides professional and administrative services, including accounting and credit services, to its subsidiary companies.

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, 2020 2019

ASSETS

Current assets

Cash and cash equivalents $ 3,269,289 $ 9,652,310

Accounts receivable, net of allowance of $Nil (August 31, 2019 - $Nil) 6,880,459 2,835,952

Inventory, net of allowance of $32,538 (August 31, 2019 - $119,357) 6,786,087 6,377,805

Notes receivable 563,010 1,197

Prepaid expenses 1,336,080 393,539

Prepaid income taxes 121,734 223,420

Total current assets 18,956,659 19,484,223

Property, plant and equipment, net 2,774,912 2,727,406

Intangible assets, net 719 3,048

Total assets $ 21,732,290 $ 22,214,677

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Accounts payable $ 1,520,610 $ 410,027

Current portion of notes payable 302,536 -

Accrued liabilities 1,650,289 1,312,580

Total current liabilities 3,473,435 1,722,607

Long-term liabilities

Notes payable 378,171

Deferred tax liability 100,775 61,204

Total liabilities 3,952,381 1,783,811

Stockholders' equity

Capital stock

Authorized

21,567,564 common shares, without par value

10,000,000 preferred shares, without par value

Issued

3,481,162 common shares (August 31, 2019 - 3,971,282) 821,284 936,903

Additional paid-in capital 618,707 618,707

Retained earnings 16,339,918 18,875,256

Total stockholders' equity 17,779,909 20,430,866

Total liabilities and stockholders' equity $ 21,732,290 $ 22,214,677

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,

2020 2019 2020 2019

SALES $ 16,241,239 $ 16,692,241 $ 30,918,345 $ 33,615,516

COST OF SALES 11,931,746 13,054,487 22,555,253 25,907,388

GROSS PROFIT 4,309,493 3,637,754 8,363,092 7,708,128

OPERATING EXPENSES

Selling, general andadministrative 706,079 759,708 2,118,999 1,721,743expenses

Depreciation and 54,781 47,141 160,992 143,413amortization

Wages and employee 1,635,051 1,324,267 4,343,412 3,799,700benefits

(2,395,911) (2,131,116) (6,623,403) (5,664,856)

Income from operations 1,913,582 1,506,638 1,739,689 2,043,272

OTHER ITEMS

Gain on sale ofproperty, plant and 2,200 - 2,600 105,366equipment

Interest and other 3,217 7,033 21,414 33,368income

5,417 7,033 24,014 138,734

Income before income 1,918,999 1,513,671 1,763,703 2,182,006taxes

Income tax expense (522,026) (415,461) (547,614) (614,472)

Net income $ 1,396,973 $ 1,098,210 $ 1,216,089 $ 1,567,534

Basic earnings per $ 0.40 $ 0.27 $ 0.33 $ 0.36common share

Diluted earnings per $ 0.40 $ 0.27 $ 0.33 $ 0.36common share

Weighted averagenumber of commonshares outstanding:

Basic 3,481,162 4,022,587 3,672,858 4,318,128

Diluted 3,481,162 4,022,587 3,672,858 4,318,128

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,

2020 2019

CASH FLOWS FROM OPERATING ACTIVITIES

Net income $ 1,216,089 $ 1,567,534

Items not involving an outlay of cash:

Depreciation and amortization 160,992 143,413

(Gain) on sale of property, plant and equipment (2,600) (105,366)

Deferred income tax expense 39,571 3,997

Changes in non-cash working capital items:

(Increase) in accounts receivable (4,044,507) (2,972,532)

(Increase) decrease in inventory (408,282) 1,173,224

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

(Increase) decrease in prepaid expenses (942,541) 21,268

Decrease (increase) in prepaid income taxes 101,686 (65,975)

Increase (decrease) in accounts payable and accrued liabilities 1,448,292 (82,148)

Net cash (used in) provided by operating activities (2,993,113) (316,585)

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment (207,469) (8,112)

Proceeds from sale of property, plant and 3,900 327,077 equipment

Net cash provided by (used in) investing activities (203,569) 318,965

CASH FLOWS FROM FINANCING ACTIVITIES

Increase in notes payable 680,707 -

Redemption of common stock (3,867,046) (2,661,848)

Net cash (used in) financing activities (3,186,339) (2,661,848)

Net (decrease) increase in cash (6,383,021) (2,659,468)

Cash, beginning of period 9,652,310 6,097,463

Cash, end of period $ 3,269,289 $ 3,437,995

Contact: Charlie Hopewell, President & CEO, (503) 647-0110

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SOURCE Jewett-Cameron Trading Company Ltd.