Leon's 4Q sales slip 0.9%, net income grows 14.6%
By Furniture Today Staff -- Furniture Today, March 1, 2004
TORONTO — TORONTO — Leon's Furniture, this country's second-largest furniture and bedding merchant, said fourth-quarter sales slipped 0.9% to C$137.2 million, although net income grew 14.6% to C$16.3 million.
For the year, sales increased 1.5% to C$456.4 million, and net income rose 0.9% to C$38.9 million.
Including C$133.4 million in sales by Leon's franchises, total revenues for the year were C$589.8 million, up 1.9% over last year's C$578.9 million. In 2002, Leon's franchises generated C$129.2 million in sales.
"We are pleased to report that our continued vigilance towards improving efficiencies at all levels of our operations, together with a decrease in effective corporate tax rates, generated an increase in profitability in spite of somewhat lower revenues in the fourth quarter," said Terry Leon, president and CEO of the family managed retailer.
"During the first few weeks of 2004, we have seen the benefits of our more aggressive marketing campaigns," he said. "In spite of harsh weather conditions, we have managed to increase sales."
Leon's will complete this year the renovations of stores in Burlington, Ontario, and Ottawa, and will begin similar projects at stores in Windsor, Ontario, Halifax, Nova Scotia, and Kitchener, Ontario.
New warehouse showrooms will be opened this year in South Edmonton, Alberta, Hamilton, Ontario, and Quebec City, and land has been secured for a new store in Saskatoon, Saskatchewan.
"In addition, we continue to seek high-quality locations in the Toronto and Montreal areas," Leon said.
In recent years, Leon's has funded renovations and expansions from its own resources and carries no debt. As of Dec. 31, the company held cash, cash equivalents and market securities valued at just under C$103 million, up from about C$86 million at the end of 2002.
Leon's rolled out three franchised stores in 2003, in Lethbridge, Alberta, Woodstock, Ontario, and Gander, Newfoundland. Three franchises are set to open this year, one each in Ontario, New Brunswick and Quebec.
| Leon's(a) | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are loses or declines. | |||
| Quarter ended 12/31 | 2003 | 2002 | Change |
| (a) In Canadian dollars. | |||
| Sales | C$137,154,000 | C$138,347,000 | (0.9%) |
| Operating income | 27,281,000 | 25,085,000 | 8.8% |
| Net income | 16,284,000 | 14,213,000 | 14.6% |
| Earnings per share | 0.83 | 0.71 | 16.9% |
| Year ended 12/31 | 2003 | 2002 | Change |
| Sales | C$456,352,000 | C$449,693,000 | 1.5% |
| Operating income | 67,493,000 | 69,633,000 | (3.1%) |
| Net income | 38,852,000 | 38,520,000 | 0.9% |
| Earnings per share | 1.94 | 1.93 | 0.5% |
