Goodfellow Reports its Results for the Three Months Ended February 28, 2017

DELSON, QUEBEC--(Marketwired - April 17, 2017) - Goodfellow Inc. (TSX:GDL) announced today its financial results for the three months ended February 28, 2017. The Company reported a net loss of $(5.4) million or $(0.63) per share compared to $(0.9) million or $(0.11) per share a year ago. Consolidated sales for the three months ended February 28, 2017 were $113.5 million compared to $108.7 million last year. Sales in Canada during the first quarter of fiscal 2017 decreased 3% compared to the same period a year ago mainly due to a decrease in volume of Pressure Treated wood sales. On the other hand, sales in the export market and the USA increased by 61% and 63%, respectively, due to increasing demand of hardwood lumber products and we are optimistic with our ability to maintain the volumes in the coming months. On the operating side, Selling, Direct and Administrative costs decreased by 1.3%. The slight decrease shows actions taken to reduce overhead staff. The benefits of these costs cutting measures will start to appear in the second quarter of Fiscal 2017. As a result, direct, selling, and administrative expenses decreased to $21.0 million ($21.3 million last year).

"Moving in the right direction - best summarizes the results of our first Quarter. All measures are being taken to ensure the company returns to its historic profitable operating situation by year-end 2017" said Patrick Goodfellow, President and Chief Executive Officer. "Despite a difficult first quarter, we are confident that all measures taken should be well reflected by the end of the second quarter at the end of May. We remain confident to re-establish profitability short term".

Goodfellow Inc. is a distributor of lumber products, building materials, and hardwood flooring products. Goodfellow shares trade on the Toronto Stock Exchange under the symbol GDL.

GOODFELLOW INC. Consolidated Statements of Comprehensive Income For the three months ended February 28, 2017 and February 29, 2016 (in thousands of dollars, except per share amounts) Unaudited
		For the three months ended
		February 28 2017		February 29 2016
		$		$
Sales		113,490		108,659
Expenses
	Cost of goods sold	99,103		87,979
	Selling, administrative and general expenses	21,018		21,303
	Net financial costs	952		635
		121,073		109,917
Earnings before income taxes		(7,583	)	(1,258	)
Income taxes		(2,182	)	(352	)
Total comprehensive loss		(5,401	)	(906	)
Net loss per share - Basic and diluted		(0.63	)	(0.11	)

GOODFELLOW INC. Consolidated Statements of Financial Position (in thousands of dollars) Unaudited
		As at	As at	As at
		February 28	November 30	February 29
		2017	2016	2016
		$	$	$
Assets
Current Assets
	Cash	935	703	1,983
	Trade and other receivables	70,570	64,255	86,494
	Income taxes receivable	9,336	6,598	-
	Inventories	113,065	115,391	131,676
	Prepaid expenses	2,611	4,863	8,077
Total Current Assets		196,517	191,810	228,230
Non-Current Assets
	Property, plant and equipment	38,085	38,693	39,388
	Intangible assets	5,347	5,428	3,630
	Defined benefit plan asset	2,240	2,234	4,937
	Investment	3,606	3,403	3,000
Total Non-Current Assets		49,278	49,758	50,955
Total Assets		245,795	241,568	279,185
Liabilities
Current liabilities
	Bank indebtedness	86,170	94,113	90,163
	Trade and other payables	48,332	30,721	54,084
	Income taxes payable	-	-	997
	Provision	932	963	1,112
	Current portion of long-term debt	124	136	208
Total Current Liabilities		135,558	125,933	146,564
Non-Current Liabilities
	Provision	488	475	490
	Long-term debt	95	126	219
	Deferred income taxes	3,296	3,296	4,718
	Defined benefit plan obligation	1,066	1,045	-
Total Non-Current Liabilities		4,945	4,942	5,427
Total Liabilities		140,503	130,875	151,991
Shareholders' equity
	Share capital	9,152	9,152	9,152
	Retained earnings	96,140	101,541	118,042
		105,292	110,693	127,194
Total Liabilities and Shareholders' Equity		245,795	241,568	279,185

GOODFELLOW INC. Consolidated Statements of Cash Flows For the three months ended February 28, 2017 and February 29, 2016 (in thousands of dollars) Unaudited
			For the three months ended
			February 28 2017		February 29 2016
			$		$
Operating Activities
	Net Earnings		(5,401	)	(906	)
	Adjustments for :
		Depreciation	949		798
		Accretion expense on provision	12		13
		Decrease in provision	(30	)	-
		Income taxes	(2,182	)	(352	)
		Loss on disposal of property, plant and equipment	12		-
		Interest expense	692		434
		Funding in deficit (excess) of pension plan expense	16		(125	)
		Share of the profits of a joint venture	(203	)	-
			(6,135	)	(138	)
	Changes in non-cash working capital items		15,867		(35,514	)
	Interest paid		(685	)	(656	)
	Income taxes paid		(556	)	(553	)
			14,626		(36,723	)
Net Cash Flows from Operating Activities			8,491		(36,861	)
Financing Activities
	Net (decrease) increase in bank loans		(11,000	)	13,000
	Net increase in banker's acceptances		-		28,000
	Increase in long-term debt		-		490
	Reimbursement of long-term debt		(43	)	(736	)
			(11,043	)	40,754
Investing Activities
	Acquisition of property, plant and equipment		(210	)	(366	)
	Increase in intangible assets		(89	)	(683	)
	Proceeds on disposal of property, plant and equipment		26		-
	Business acquisitions, net of cash acquired		-		(4,208	)
			(273	)	(5,257	)
Net cash outflow			(2,825	)	(1,364	)
Cash position, beginning of period			(1,910	)	(1,816	)
Cash position, end of period			(4,735	)	(3,180	)
Cash position is comprised of :
	Cash		935		1,983
	Bank overdraft		(5,670	)	(5,163	)
			(4,735	)	(3,180	)

GOODFELLOW INC. Consolidated Statements of Change in Shareholders' Equity For the three months ended February 28, 2017 and February 29, 2016 (in thousands of dollars) Unaudited
		Share Capital	Retained Earnings		Total
		$	$		$
Balance as at November 30, 2015 (Audited)		9,152	118,948		128,100
	Net loss	-	(906	)	(906	)
Total comprehensive loss		-	(906	)	(906	)
Balance as at February 29, 2016		9,152	118,042		127,194
Balance as at November 30, 2016 (Audited)		9,152	101,541		110,693
	Net loss	-	(5,401	)	(5,401	)
Total comprehensive loss		-	(5,401	)	(5,401	)
Balance as at February 28, 2017		9,152	96,140		105,292