Stella-Jones Reports 2019 Third Quarter Results

Financial News
Typography
  • EBITDA up 22% to $96.1 million, driven by increased gross margins as well as by the adoption of IFRS 16, Leases
  • Net income and diluted EPS increased to $53.7 million and $0.78 per share
  • Solid operating cash flow used to reduce debt by $63.7 million and to repurchase shares totalling $30.0 million
  • Sales reached $626.6 million, down $3.4 million compared to 2018, impacted primarily by lower sales in the logs and lumber product category

MONTREAL, Nov. 07, 2019 -- Stella-Jones Inc. (TSX: SJ) (“Stella-Jones” or the “Company”) today announced financial results for its third quarter ended September 30, 2019.

“We are pleased with our third quarter results, which saw sales in our utility pole, railway tie and industrial product categories increase due to a combination of higher pricing and increased volume. Third quarter sales increased year-over-year when adjusting for the impact of lower lumber costs, which are primarily a pass-through to customers. Our sales were negatively impacted by $20.2 million in the logs and lumber product category due to these lower lumber costs and sales in the residential lumber product category also declined for this reason, but were partially offset by higher volumes. Profitability increased, driven by improved pricing, lower lumber costs, a positive product mix and improved operational efficiencies,” stated Éric Vachon, President and CEO of Stella-Jones.

“In the quarter, we used our solid cash flow mainly to reduce our leverage by $63.7 million and to repurchase shares totalling $30.0 million. As expected, excluding the logs and lumber product category, we plan on concluding fiscal 2019 with higher year-over-year sales and margins. For 2020, we expect continued overall growth in sales and profitability driven by our three core product categories,” concluded Mr. Vachon.

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Source: Stella-Jones

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