MONTREAL, 25 November 2021 / CNW Telbec / – Sportscene Group Inc. (“Sportscene” or “the Company”); (TSXV: SPS) today announced its financial results for the fourth quarter and the year ended August 29, 2021.
“We ended our fiscal year in a good position thanks to the receipt of various government grants, the complete reopening of our dining rooms in June as well as the diversification of our revenues, particularly our retail product offering. We also benefited from the participation of Canadians. in the Stanley Cup final, ”said Jean Bédard, President and CEO.
“We are particularly grateful for the collective efforts of our employees, franchisees and partners who have helped us adapt and even innovate in this new operating environment,” concluded Mr. Bédard.
Financial performance for the fourth quarter ended August 29, 2021
The increase of 31.2%, or $ 6.3 million, the consolidated revenues of the Company, to $ 26.4 million, results mainly from the relaxation of public health measures allowing the complete reopening of the dining rooms of our restaurant. However, compared to the fourth quarter of fiscal 2019, before the pandemic, the Company’s consolidated revenues decreased by 21.2%, compared to $ 33.5 million. Revenues from catering, franchising and other segments increased by $ 90.1 million compared to fiscal 2020, while revenues from the retail segment decreased by $ 2.8 million, or 26.9%, to $ 7.5 millions. Supply chain issues and larger orders in the fourth quarter of last year, when new accounts receivable were in their inventory, accounted for part of the reduction.
Consolidated adjusted EBITDA(1) for the fourth quarter was $ 6.3 million, an increase of 110.8% or $ 3.3 million support from government grants and gross margin improvements following the reopening of restaurant dining rooms across the network.
Sportscene ended the fourth quarter of fiscal 2021 with a net profit of $ 2.4 million Where $ 0.28 per share (basic and diluted), compared to the net profit of $ 0.7 million Where $ 0.09 per share (basic and diluted) in the same quarter of the previous fiscal year.
Financial performance for fiscal year 2021
Sportscene’s consolidated revenues for fiscal 2021 decreased by 38.3% or $ 42.1 million, To $ 67.7 million. The COVID-19 pandemic and associated government-imposed public health measures resulted in a significant slowdown in the restaurant, franchise and other business segments particularly in the first three quarters of the fiscal year. However, retail trade revenues increased by 6.5% to reach $ 31.1 million thanks to the efforts made in recent years to develop the offer and the distribution network.
Consolidated adjusted EBITDA(1) for fiscal year 2021 increased by 6.7%, or $ 0.7 million, To $ 11.1 million. The decline in consolidated revenues and consolidated gross margins caused by a more restrictive operating environment in the context of the COVID-19 pandemic has been mitigated by various government support measures, the reopening of catering activities since the fourth quarter , the diversification of activities towards the distribution sector and the efforts devoted to cost optimization.
Sportscene ended fiscal 2021 with a net profit of $ 0.6 million Where $ 0.07 per share (basic and diluted), compared to a net loss of $ 4.0 million Where $ 0.45 per share (basic and diluted) during the previous financial year when a $ 4.7 million a depreciation charge was noted in the context of the COVID-19 pandemic.
Important subsequent event
At November 18, 2021, the Company announced that it had entered into a definitive merger agreement under which Jean Bédard, President and CEO of Sportscene, and a consortium of Quebec investors led by Corporation Financière Champlain will acquire, through of a newly incorporated company, all of the issued and outstanding Class A shares of Sportscene, with the exception of 1.7 million shares held, directly or indirectly, by Jean Bédard, for a cash consideration of $ 7.25 per share. Under the Transaction, Sportscene will therefore become a private company and its shares will cease to be listed on the TSX Venture Exchange. For more information on the Transaction, please refer to the Company’s press release published on November 18, 2021.
Forward-looking Statements Disclaimer
This press release contains forward-looking statements relating to the Company. Statements based on management’s current expectations involve known and unknown inherent risks and uncertainties, including risks associated with public health issues such as those resulting from the COVID-19 pandemic. Actual results may differ from expectations. The reader is cautioned not to place undue reliance on forward-looking information. The Company assumes no obligation to update or revise forward-looking statements as a result of new information, future events or other changes, except as required by applicable laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
About Groupe Sportscene
Groupe Sportscene Inc. is a pioneer and leader in the atmospheric restaurant niche in Quebec. Since 1984, it operates the La Cage – Sports Brewery Chain of restaurants (“La Cage”) which stands out for its sporting atmosphere and its cuisine based on fresh and local products. With a strong brand image, La Cage is established throughout the province and currently has 38 branches. Sportscene continues to diversify its catering activities, in particular through the operation of PF Chang’s, an Asian cuisine restaurant and its catering activity for special events, making the Company a key player in of Quebec catering sector. In addition to its catering activities, Sportscene is active in the sale of The cage and Moishes branded products in grocery stores, ready meals and ready-to-cook boxes.
Non-IFRS measures
The following measures used by the Company are not recognized measures under International Financial Reporting Standards (“IFRS”):
|
(1) |
“Consolidated adjusted EBITDA” corresponds to “income before financial expenses, depreciation, amortization, loss (income) net of joint ventures and income taxes”, from which other (gains) losses are excluded and to which the share of income before financial expenses , depreciation and income tax of joint ventures is added. See “Reconciliation of Non-IFRS Financial Measures” below. |
Reconciliation of non-IFRS financial measures
(verified, in thousands of $)
|
Fourth trimester |
Fiscal year |
|||
|
August 29 |
August 30 |
August 29 |
August 30 |
|
|
Profit before financial expenses, depreciation, net |
||||
|
loss (income) from joint ventures and income taxes |
5,053 |
3 453 |
7,420 |
5 564 |
|
Other (gains) losses |
52 |
(699) |
(431) |
4,053 |
|
Government assistance deducted from depreciation and |
||||
|
financial expenses(1) |
689 |
– |
3 453 |
– |
|
Loss (income) before financial charges, depreciation and |
||||
|
income taxes of joint ventures(2) |
477 |
222 |
653 |
786 |
|
Consolidated adjusted EBITDA |
6,271 |
2 976 |
11,095 |
10,403 |
|
(1) |
In accordance with IFRS, part of the government rent assistance has been charged against the amortization of user rights and interest on rental debts. These amounts have been included in the calculation of Consolidated Adjusted EBITDA since they are considered to be monetary items. |
|
(2) |
For further details, see note 18, “Investments in joint ventures“, of the appendix to the consolidated annual accounts. |
For more information on the results of operations and financial condition of Sportscene Group Inc., please consult the annual MD&A and consolidated financial statements and accompanying notes for the year ended. August 29, 2021, available on SEDAR.
Interim condensed consolidated statements of comprehensive income
(Verified, in thousands of Canadian dollars, excluding earnings per share and number of shares outstanding)
|
Fiscal year |
||
|
August 29 |
August 30 |
|
|
2021 |
2020 |
|
|
$ |
$ |
|
|
Income |
67,724 |
109,848 |
|
Cost of sales |
36,202 |
48,372 |
|
Selling and administrative expenses, excluding depreciation |
24,533 |
51 859 |
|
Other (gains) losses (1) |
(431) |
4,053 |
|
Profit before financial expenses, depreciation, amortization, net loss (income) from joint ventures and income tax |
7,420 |
5 564 |
|
Amortization |
5 335 |
9,469 |
|
Financial expenditure |
1,129 |
2 122 |
|
Net loss (income) from joint ventures |
45 |
(136) |
|
6,509 |
11 455 |
|
|
Income (loss) before income tax |
911 |
(5,891) |
|
Tax expense (recovery) |
299 |
(1,851) |
|
Net and comprehensive income |
612 |
(4,040) |
|
Net and comprehensive income (loss) attributable to: |
||
|
The shareholders of the Company |
579 |
(3,863) |
|
Non-majority interests |
33 |
(177) |
|
Net and comprehensive income |
612 |
(4,040) |
|
Income (loss) per share (in dollars): |
||
|
Basic |
0.07 |
(0.45) |
|
Diluted |
0.07 |
(0.45) |
|
Weighted average number of Class A shares outstanding (in thousands): |
||
|
Basic |
8,579 |
8 548 |
|
Diluted |
8 722 |
8 548 |
|
(1) |
Other (gains) losses include gains / losses on disposal of property, plant and equipment, losses on impairment of non-current assets, gains on business combinations and gains on disposal of interests in joint ventures. For more details, refer to note 8 to the annual consolidated financial statements. |
Sportscene SOURCE Group Inc.
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