NOT FOR RELEASE OR DISSEMINATION INTO THE UNITED STATES
Q1 2023 Financial Highlights(1):
- Revenues of $609.1 million
- Gross Margin at 16.1%
- EBITDA(2) amounted to $44.8 million
- Net Earnings(4) amounted to $14.9 million
- Quarterly dividend of $0.14 per share declared(4)
VANCOUVER, British Columbia, May 11, 2023 (GLOBE NEWSWIRE) -- Doman Building Materials Group Ltd. (“Doman” or “the Company”) (TSX:DBM; DBM.NT.A) announced today its first quarter 2023 financial results(1) for the period ended March 31, 2023.
For the three-month period ended March 31, 2023(1), consolidated revenues amounted to $609.1 million, compared to $851.3 million in the same period in 2022. The decrease in revenues is largely due to the impact of construction materials pricing, which peaked in the comparative period in 2022. The Company’s sales by product group in the period were made up of 75% construction materials, compared to 81% last year, with the remaining balance resulting from specialty and allied products of 21%, and other of 4%.
Gross margin dollars were $98.2 million in the three-month period versus $132.6 million in the comparative quarter of 2022. Gross margin percentage increased to 16.1% in the quarter, an improvement from 15.6% achieved in the same quarter of 2022.
EBITDA(2) for the three-month period ended March 31, 2023(1), amounted to $44.8 million, compared to $78.1 million in the same period in 2022.
The Company declared a $0.14 per share(3) quarterly dividend during the first quarter, which was paid on April 14, 2023, to shareholders of record at the close of business on March 31, 2023.
“Despite the impact of a highly volatile pricing environment during the past year, and overall lower wood products pricing on a year-over-year basis, we are pleased with the continued level of activity in our key markets and the strength in our gross margin," commented Amar S. Doman, Chairman of the Board. "We continue to see reasonable demand, along with price volatility in certain categories, which is familiar territory for our team as we remain focused on growth and overall cost management.”
Reconciliation of Net Earnings to Earnings before Interest, Tax, Depreciation and Amortization:
| Three months ended March 31, | ||||
| 2023 | 2022 | |||
| (in thousands of dollars) | $ | $ | ||
| Net earnings | 14,911 | 42,028 | ||
| Provision for income taxes | 2,259 | 11,462 | ||
| Finance costs | 10,557 | 8,391 | ||
| Depreciation and amortization | 17,114 | 16,218 | ||
| EBITDA | 44,841 | 78,099 | ||
About Doman Building Materials Group Ltd.
Doman is headquartered in Vancouver, British Columbia and trades on the Toronto Stock Exchange under the symbol DBM and is a leading North American distributor of building materials and is Canada's only fully integrated national distributor in the building materials and related products sector. Doman operates several distinct divisions: CanWel Building Materials with multiple treating plant, planing facilities and distribution centres coast-to-coast in all major cities and strategic locations across Canada; founded in 1959, Hixson Lumber Company in the central United States, with 19 treating plants, two specialty planing mills and five specialty sawmills located in eight states, headquartered in Dallas, Texas, distributing, producing and treating lumber, fencing and building materials; California Cascade in the western United States near Portland, Oregon, San Francisco and Los Angeles, California with treating facilities and distribution of building materials, lumber and renovation products; founded in 1935, the Honsador Building Products Group in 14 locations in the State of Hawaii, with treating facilities, truss plants and distribution of a wide range of building materials, lumber, renovation and electrical products. The Company’s operations also include timber ownership and management of private timberlands and forest licenses, and agricultural post-peeling and pressure treating through its fibre division. Please see our filings on SEDAR under Doman Building Materials Group Ltd. (formerly, CanWel Building Materials Group Ltd.) for additional information.
For further information regarding Doman please contact:
Ali Mahdavi
Investor Relations
416-962-3300
ali.mahdavi@domanbm.com
Certain statements in this press release may constitute “forward-looking” statements. When used in this press release, forward-looking statements often but not always, can be identified by the use of forward-looking words such as, including but not limited to, “may”, “will”, “would”, “should”, “expect”, “believe”, “plan”, “intend”, “anticipate”, “predict”, “remain”, “estimate”, “potential”, “forecast”, “budget”, “schedule”, “continue”, “could”, “might”, “project”, “targeting”, "future" and other similar terminology or the negative or inverse of such words or terminology. Forward-looking information in this news release includes, without limitation, statements with respect to: the ultimate impact (express or implied) of: a) fluctuations in commodity and construction materials pricing; b) the performance of recently acquired businesses; and c) the novel coronavirus COVID-19 (“COVID-19”) pandemic, on the Company’s operational and financial results and on consumer behavior and economic activity, including but not limited to the first quarter and full-year 2023 results, which impact is difficult to estimate or quantify as it will depend on, inter alia, the duration of the contagion, the impact of government policies, and the pace of economic recovery. These forward-looking statements reflect the current expectations of Doman’s management regarding future events and operating performance, but involve other known and unknown or unpredictable risks, uncertainties and other factors which may cause the actual results, performance or achievements of Doman, including but not limited, to sales, earnings, cash flow from operations, EBITDA(2) generated, dividends generated or paid by Doman, including whether at the rate as of the date hereof or some other dividend rate in the future which may be lower than either of the preceding rates discussed therein, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements should therefore be construed in the light of such factors. Actual events could differ materially from those projected herein and depend on a number of factors. These factors include but are not limited to those set out in the Company’s annual information form dated March 31, 2023, and other public filings. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. In addition, a number of material factors or assumptions were utilized or applied in making the forward-looking statements, and may include, but are not limited to, assumptions regarding the performance of the Canadian and U.S. economies, the relative stability of or level of interest rates, exchange rates, volatility of commodity prices, availability or more limited availability of access to equity and debt capital markets to fund, at acceptable costs, Doman’s future growth plans, the implementation and success of the integration of Doman’s acquisitions and customer and supplier retention, the ability of Doman to refinance its debts as they mature, the Canadian and United States housing and building materials markets; the direct and indirect effect of the U.S. housing market and economy; exchange rate fluctuations between the Canadian and US dollar; retention of key personnel; Doman’s ability to sustain its level of sales and earnings margins; Doman’s ability to grow its business long term and to manage its growth; Doman’s management information systems upon which it is dependent are not impaired or compromised by breaches of Doman’s cybersecurity; Doman’s insurance is sufficient to cover losses that may occur as a result of its operations; international trade and tariff risks, political risks, the amount of Doman’s cash flow from operations; tax laws; and the extent of Doman’s future acquisitions and capital spending requirements or planning as well as the general level of economic activity, in Canada and the U.S., and abroad, discretionary spending and unemployment levels; the effect of general economic conditions, including market demand for Doman’s products, and prices for such products; the effect of forestry, land use, environmental and other governmental regulations; and the risk of losses from fires, floods and other natural disasters and unemployment levels. There is a risk that some or all of these assumptions may prove to be incorrect. These and other factors could cause or contribute to actual results differing materially from those contemplated by forward-looking statements. Accordingly, readers should not place undue reliance on any forward-looking statements or information. These forward-looking statements speak only as of the date of this press release. We caution that the foregoing factors that may affect future results are not exhaustive. When relying on our forward-looking statements to make decisions with respect to Doman, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Neither Doman nor any of its associates or directors, officers, partners, affiliates, or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements in these communications will actually occur. You are cautioned not to place undue reliance on these forward-looking statements. Except as required by applicable securities laws and legal or regulatory obligations, Doman is not under any obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
| (1) | Please refer to our Q1 2023 MD&A and Financial Statements for further information. Our Q1 2023 Financial Statements filings are reported under International Financial Reporting Standards (“IFRS”). | |
| (2) | In the discussion, reference is made to EBITDA, which represents earnings from continuing operations before interest, including amortization of deferred financing costs, provision for income taxes, depreciation, and amortization. This is not a generally accepted earnings measure under IFRS and does not have a standardized meaning under IFRS, and therefore the measure as calculated by Doman may not be comparable to similarly-titled measures reported by other companies. EBITDA is presented as we believe it is a useful indicator of a company’s ability to meet debt service and capital expenditure requirements and because we interpret trends in EBITDA as an indicator of relative operating performance. EBITDA should not be considered by an investor as an alternative to net earnings or cash flows as determined in accordance with IFRS. For a reconciliation of EBITDA to the most directly comparable measures calculated in accordance with IFRS refer to “Reconciliation of Net Earnings to Earnings before Interest, Tax, Depreciation and Amortization (EBITDA) and Adjusted EBITDA”. | |
| (3) | On March 15, 2023, Doman declared a quarterly dividend of $0.14 per share, which was paid on April 14, 2023, to shareholders of record on March 31, 2023. Please refer to our Q1 2023 MD&A and Financial Statements for more information. |
