Algo Group announces third quarter 2006 results
16 November 2006
Algo Group Inc. (TSX: AO) today announced results for its third quarter ended September 30, 2006.
For the third quarter, sales were $8.3 million compared with $7.5 million for the same period in 2005, an increase of $0.8 million. The Company recorded a loss from continuing operations of $0.6 million, or $0.00 per share, compared to a loss of $1.9 million, or $0.01 per share, for the same quarter last year.
Year-to-date sales for the period ended September 30, 2006 were $22.6 million, compared with $21.7 million for the same period in 2005, representing an increase of $0.9 million. The loss from continuing operations for the period was $4.3 million or $0.03 per share compared with a loss of $2.5 million or $0.02 per share for the previous year.
Shortly after the completion of the third quarter, the Company sold certain assets relating to the US operations of its Fashion Fabrics business segment. In addition, the Company has decided to liquidate the remaining assets of this unit.
The operating results reported below for both the current and prior periods' segregate the discontinued operations:
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FINANCIAL HIGHLIGHTS
(in thousands of dollars except per share amounts)
For the nine months For the three months
ended September 30 ended September 30
2006 2005 2006 2005
Sales $ 22,601 $ 21,720 $ 8,258 $ 7,533
Loss from
continuing
operations (4,316) (2,491) (642) (1,864)
Net Loss (4,521) (2,299) (1,058) (1,493)
Loss per share
(basic and
diluted) from
continuing
operations (0.03) (0.02) (0.00) (0.01)
Net loss per
share (basic
and diluted) (0.03) (0.02) (0.01) (0.01)
Weighted average
number of
shares
outstanding 155,973,281 110,877,721 157,378,560 125,867,691
>>
The loss from continuing operations for the third quarter of 2006 decreased by $1.2 million compared to the same quarter last year. Total sales were up $0.8 million for the quarter compared to the same period last year, while cost of sales and expenses remained flat at $8.6 million.
Sector Review
Ladies' Fashion Apparel sales decreased by $0.6 million to $1.8 million in the third quarter of 2006 from $2.4 million in the same period of 2005, as a result of a general slowdown in the market. The loss for this segment increased to $0.7 million from $0.5 million a year ago.
Sportswear sales increased by $1.0 million to reach $5.7 million for the quarter from $4.7 million for the same quarter last year. The segment contributed a profit of $0.8 million for the quarter compared to a profit of $0.3 million for the third quarter of 2005.
Licensed Brands is a business segment that was established in the early part of 2005. For the third quarter of 2006, sales increased to $0.6 million compared to $0.4 million for the same period last year. The segment reported a profit of $12,000 compared to a loss of $32,000 for the third quarter of 2005.
Home Furnishings is a new business segment established in early 2006. It markets linens, decorative cushions, towels, comforters and related products. These products are imported from Asia and sold to major retailers. This segment contributed $22,000 of sales for the quarter and recorded a loss of $92,000.
Outlook
The Company continues to pursue its strategy of developing stronger and closer relationships with its core customers and enhancing its product lines. The benefits from the investment and development of new products and brands that began in the latter part of 2005 should become evident late in 2006 and in 2007.
Algo Group Profile
Algo Group is a leading Canadian manufacturer and importer of ladies' fashion apparel, as well as men's, boy's and children's sportswear that is marketed throughout North America. The Company also imports home furnishing products that it markets to retailers in North America.
Forward-looking statements
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Except for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of the Company. These statements are based on suppositions and uncertainties as well as on management's best possible evaluation of future events. Such factors may include, without excluding other considerations, fluctuations in quarterly results, evolution in customer demand for the Company's products and services, the impact of price pressures exerted by competitors, and general market trends or economic changes. As a result, readers are advised that actual results may differ from expected results.
For further information: Algo Group Inc.: Ken Labelle, C.A., Chief Financial Officer, (514) 908-7804; Investor Relations: Rick Leckner, Maison Brison, (514) 731-0000
Source: newswire
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