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Company: Jewett-Cameron Trading Company Ltd.
Ticker: NASDAQ: JCTCF
Sector: Industrials
Investor Contact: Robert Blum

Jewett-Cameron Announces 1st Quarter Financial Results

NORTH PLAINS, Ore., Jan. 14, 2020 — Jewett-Cameron Trading Company Ltd. (NASDAQ: JCTCF) today reported financial results for the first quarter of fiscal 2020 ended November 30, 2019.

Sales for the first quarter of fiscal 2020 totaled $7.1 million compared to sales of $9.1 million for the first quarter of fiscal 2019. Net loss for the current quarter was ($6,621), or ($0.00) per share, compared to net income of $349,694, or $0.08 per share, in the year-ago quarter.

“Several of our major accounts postponed their expected purchases during the quarter,” said CEO Charlie Hopewell. “The delay may be related to the timing of reduced tariffs on some of our products, as we received notice during the quarter that a number of our metal products imported from China have been reclassified and are no longer subject to the 25% tariff. During the quarter, we also continued to invest in our infrastructure while rationalizing our product offerings by deciding to discontinue our involvement in Industrial Tools through the closure of our MSI-Pro Division. Although all these changes come with initial costs, we believe they will help to better position the Company for the future.”

As of November 30, 2019, the Company’s cash position was approximately $8.97 million, and there was no borrowing against its $3.0 million line of credit. The Company has also continued to use its excess cash to repurchase and cancel common shares. Subsequent to the end of the fiscal period, the Company privately repurchased for cancelation a total of 490,120 common shares from two large shareholders. The shares were repurchased by the Company at a price of $7.89 per share, calculated as the Volume Weighted Average Price (VWAP) of all the shares traded on NASDAQ during the first quarter of fiscal 2020. The total cost of the share repurchases was $3,867,047. The Company has historically utilized its cash position by implementing share repurchase programs as an effective method of enhancing shareholder value, and the Board of Directors will consider implementing new share repurchase plans in the future.

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 patented and patent pending specialty metal products, wholesale distribution of wood products, and seed processing and sales. The Company’s brands include Lucky Dog, Animal House and AKC licensed products in the expanding pet market; fencing products under the Adjust-A-Gates, Fit-Right, Perimeter Patrol, and LIFETIME POST™ systems brands; Early Start, Spring Gardner, and Weatherguard for greenhouses; and TrueShade for patio umbrellas, furniture covers and canopies. Additional information about the Company and its products can be found the Company’s website at www.jewettcameron.com.

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)

November 30, 2019

August 31, 2019

ASSETS

Current assets

Cash and cash equivalents

$

8,969,249

$

9,652,310

Accounts receivable, net of allowance of $Nil (August 31, 2019 – $Nil)

2,164,026

2,835,952

Inventory, net of allowance of $165,000 (August 31, 2019 – $119,357)

7,280,126

6,377,805

Note receivable

997

1,197

Prepaid expenses

568,815

393,539

Prepaid income taxes

201,956

223,420

Total current assets

19,185,169

19,484,223

Property, plant and equipment, net

2,708,144

2,727,406

Intangible assets, net

2,912

3,048

Total assets

$

21,896,225

$

22,214,677

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities

Accounts payable

$

238,133

$

410,027

Accrued liabilities

1,186,744

1,312,580

Total current liabilities

1,424,877

1,722,607

Deferred tax liability

47,103

61,204

Total liabilities

1,471,980

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

3,971,282 common shares (August 31, 2019 – 3,971,282)

936,903

936,903

Additional paid-in capital

618,707

618,707

Retained earnings

18,868,635

18,875,256

Total stockholders’ equity

20,424,245

20,430,866

Total liabilities and stockholders’ equity

$

21,896,225

$

22,214,677

JEWETT-CAMERON TRADING COMPANY LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Expressed in U.S. Dollars)

(Prepared by Management)

(Unaudited)

Three Months

Ended

November 30,

2019

Three Months
Ended

November 30,

2018

SALES

$

7,055,178

$

9,066,100

COST OF SALES

5,006,835

6,757,014

GROSS PROFIT

2,048,343

2,309,086

OPERATING EXPENSES

Selling, general and administrative expenses

649,010

556,148

Depreciation and amortization

48,148

50,870

Wages and employee benefits

1,362,059

1,223,059

2,059,217

1,830,077

Income from continuing operations

(10,874)

479,009

OTHER ITEMS

Interest and other income

11,615

17,151

Income before income taxes

741

496,160

Income tax expense

(7,362)

(146,466)

Net (loss) income

$

(6,621)

$

349,694

Basic earnings per common share

$

(0.00)

$

0.08

Diluted earnings per common share

$

(0.00)

$

0.08

Weighted average number of common shares outstanding:

Basic

3,971,282

4,256,361

Diluted

3,971,282

4,256,361

JEWETT-CAMERON TRADING COMPANY LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in U.S. Dollars)

(Prepared by Management)

(Unaudited)

Three Months
Ended
November 30,

Three Months
Ended
November 30,

2019

2018

CASH FLOWS FROM OPERATING ACTIVITIES

Net (loss) income

$

(6,621)

$

349,694

Items not involving an outlay of cash:

Depreciation and amortization

48,148

50,870

Deferred income taxes

(14,101)

4,826

Changes in non-cash working capital items:

Decrease (increase) in accounts receivable

671,926

417,942

(Increase) in inventory

(902,321)

(1,121,813)

Decrease in note receivable

200

1,903

(Increase) in prepaid expenses

(175,276)

(157,361)

Increase (decrease) in accounts payable and accrued liabilities

(297,730)

536,032

Decrease in prepaid income taxes

21,464

114,310

Increase in income taxes payable

27,330

Net cash provided by (used by) operating activities

(654,311)

223,733

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment

(28,750)

Net cash used in investing activities

(28,750)

CASH FLOWS FROM FINANCING ACTIVITIES

Redemption of common stock

(893,376)

Net cash used in financing activities

(893,376)

Net decrease in cash

(683,061)

(669,643)

Cash, beginning of period

9,652,310

6,097,463

Cash, end of period

$

8,969,249

$

5,427,820

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

Cision View original content:http://www.prnewswire.com/news-releases/jewett-cameron-announces-1st-quarter-financial-results-300986969.html

SOURCE Jewett-Cameron Trading Company Ltd.

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