Goodfellow Inc. (TSX: GDL) (the “Company” or “Goodfellow”) announced today its financial results for the third quarter of fiscal year 2023.

For the three months ended August 31, 2023, the Company reported net earnings of $6.2 million or $0.72 per share compared to net earnings of $10.6 million or $1.24 per share a year ago, while consolidated sales were $139.2 million compared to $167.6 million last year.

For the nine months ended August 31, 2023, the Company reported net earnings of $12.6 million or $1.47 per share compared to net earnings of $28.2 million or $3.30 per share a year ago, while consolidated sales were $387.4 million compared to $481.9 million last year.

In the third quarter of 2023, Goodfellow continued to experience the effects of deteriorating economic conditions on the forest products and building materials industry. As demand slowed, a surplus of inventory developed within the market which challenged growth and put downward pressure on prices. Despite these headwinds, Goodfellow focused on reconciliation and renewal of its inventories of diversified product categories, as well as leveraging its value-added capabilities to deliver a positive result for Q3.

The Board of Directors declared an eligible dividend of $0.50 per share payable on November 2, 2023 to shareholders of record at the close of business on October 19, 2023. This dividend is designated as an eligible dividend under the Income Tax Act (Canada). The declaration, timing, amount and payment of future dividends remain at the discretion of the Board of Directors.

About Goodfellow

Goodfellow is a diversified manufacturer of value-added lumber products, as well as a wholesale distributor of building materials and floor coverings. Goodfellow has a distribution footprint from coast-to-coast in Canada servicing commercial and residential sectors through lumber yard retailer networks, manufacturers, industrial and infrastructure project partners, and floor covering specialists. Goodfellow also leverages its value-added product capabilities to serve lumber markets internationally. Goodfellow Inc. is a publicly traded company, and its shares are listed on the Toronto Stock Exchange under the symbol “GDL”.

GOODFELLOW INC.
Consolidated Statements of Comprehensive Income
For the three and nine months ended August 31, 2023 and 2022
(in thousands of dollars, except per share amounts)
Unaudited
         
  For the three months ended For the nine months ended
  August 312023 August 31 2022 August 312023 August 31 2022
  $ $ $ $
         
Sales 139,155 167,574 387,406 481,886
Expenses        
Cost of goods sold 107,535 129,715 301,829 374,716
Selling, administrative and general expenses 22,220 22,126 66,143 65,464
Net financial costs 802 1,038 1,997 2,484
  130,557 152,879 369,969 442,664
         
Earnings before income taxes 8,598 14,695 17,437 39,222
         
Income taxes 2,407 4,115 4,882 10,983
         
Total comprehensive income 6,191 10,580 12,555 28,239
         
         
Net earnings per share – Basic and Diluted 0.72 1.24 1.47 3.30
GOODFELLOW INC.
Consolidated Statements of Financial Position
(in thousands of dollars)
Unaudited
       
  As at As at As at
  August 31 2023 November 302022 August 31 2022
  $ $ $
Assets      
Current Assets      
Cash 7,973 3,420 2,279
Trade and other receivables 66,235 64,423 76,201
Income taxes receivable 3,946 2,439 33
Inventories 113,346 112,294 142,082
Prepaid expenses 2,177 2,555 3,237
Total Current Assets 193,677 185,131 223,832
       
Non-Current Assets      
Property, plant and equipment 32,906 32,269 31,148
Intangible assets 1,644 2,096 2,235
Right-of-use assets  11,697 14,999 14,614
Defined benefit plan asset 11,829 11,620 10,441
Other assets 777 802 802
Total Non-Current Assets 58,853 61,786 59,240
Total Assets 252,530 246,917 283,072
       
Liabilities      
Current Liabilities      
Bank indebtedness - - 31,590
Trade and other payables 37,551 36,286 42,744
Provision 2,253 2,281 370
Current portion of lease liabilities 4,863 4,969 4,836
Total Current Liabilities 44,667 43,536 79,540
       
Non-Current Liabilities      
Provision 837 634 2,281
Lease liabilities 8,867 12,537 12,338
Deferred income taxes 3,431 3,431 3,151
Total Non-Current Liabilities 13,135 16,602 17,770
Total Liabilities 57,802 60,138 97,310
       
Shareholders’ Equity      
Share capital 9,388 9,419 9,424
Retained earnings 185,340 177,360 176,338
  194,728 186,779 185,762
Total Liabilities and Shareholders’ Equity 252,530 246,917 283,072
GOODFELLOW INC.
Consolidated Statements of Cash Flows
For the three and nine months ended August 31, 2023 and 2022
(in thousands of dollars)
Unaudited
 
For the three months ended For the nine months ended
  August 312023 August 312022 August 312023 August 312022
      $ $ $ $
Operating Activities        
Net earnings 6,191 10,580 12,555 28,239
Adjustments for:        
  Depreciation and amortization of:        
    Property, plant and equipment 856 636 2,396 1,788
    Intangible assets 151 153 452 455
    Right-of-use assets 1,164 1,175 3,609 3,365
Gain on disposal of property, plant and equipment - (10) (181) (45)
Accretion expense on provision 68 25 204 76
Provision - (34) (29) 428
Income taxes 2,407 4,115 4,882 10,983
Interest expense 341 508 910 1,007
Interest on lease liabilities 146 152 286 430
Funding in excess of pension plan expense (69) (15) (209) (44)
Other 152 (13) 13 (38)
  11,407 17,272 24,888 46,644
         
Changes in non-cash working capital items 30,890 29,012 (1,234) (39,462)
Interest paid (436) (539) (1,176) (1,426)
Income taxes paid (352) (3,070) (6,389) (20,038)
  30,102 25,403 (8,799) (60,926)
Net Cash Flows from Operating Activities 41,509 42,675 16,089 (14,282)
         
Financing Activities        
Net (decrease) increase in bank loans - (5,000) - 6,000
Net (decrease) increase in banker’s acceptances (28,000) (35,000) - 18,000
Payment of lease liabilities (1,304) (1,282) (4,096) (3,702)
Redemption of shares (62) - (332) -
Dividends paid - - (4,274) (3,425)
Net Cash Flows from Financing Activities (29,366) (41,282) (8,702) 16,873
         
Investing Activities        
Acquisition of property, plant and equipment (1,357) (1,002) (3,040) (2,914)
Increase in intangible assets - - - (40)
Proceeds on disposal of property, plant and equipment - 10 188 45
Dividend from joint venture 25 - 25 -
Dissolution of the joint venture (7) - (7) -
Net Cash Flows from Investing Activities (1,339) (992) (2,834) (2,909)
         
Net cash inflow (outflow) 10,804 401 4,553 (318)
Cash position, beginning of period (2,831) (3,712) 3,420 (2,993)
Cash position, end of period 7,973 (3,311) 7,973 (3,311)
         
Cash position is comprised of:        
Cash 7,973 2,279 7,973 2,279
Bank overdraft - (5,590) - (5,590)
  7,973 (3,311) 7,973 (3,311)
GOODFELLOW INC.
Consolidated Statements of Changes in Shareholders’ Equity
For the nine months ended August 31, 2023 and 2022
(in thousands of dollars)
Unaudited
   
  Share Capital Retained Earnings Total
  $ $ $
       
Balance as at November 30, 2021 9,424 151,524 160,948
       
Net earnings - 28,239 28,239
       
Total comprehensive income - 28,239 28,239
       
Dividend - (3,425) (3,425)
       
Balance as at August 31, 2022 9,424 176,338 185,762
       
Balance as at November 30, 2022 9,419 177,360 186,779
       
Net earnings - 12,555 12,555
       
Total comprehensive income - 12,555 12,555
       
Dividend - (4,274) (4,274)
Redemption of Shares (31) (301) (332)
       
Balance as at August 31, 2023 9,388 185,340 194,728
From: Goodfellow Inc.
  Patrick Goodfellow
  President and CEO
  T: 450 635-6511
  F: 450 635-3730
  info@goodfellowinc.com
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