Boyd Group 2Q Sales Up 48 Percent

Sales for Boyd Group Income Fund, parent company to Glass America, Gerber Collision & Glass and others, has increased by 48.2 percent to $202.8 million for the second quarter, compared with sales of $136.9 million for the same period last year. Sales were up thanks to the glass business, recent acquisitions and a rise in same-store sales, according to officials.

More specifically, the $65.9 million increase was due largely to contributions of $37.8 million from acquisitions, incremental sales of $12.8 million from the glass business compared to $10.3 million contributed in the same period last year, and same-store sales increases, excluding foreign exchange, of $9.1 million, the company’s management reported.

“The second quarter of 2014 was a continuation of the positive results we achieved in the first quarter,” says Brock Bulbuck, president and CEO of Boyd Group. “This was the result of contributions from new acquisitions, the start of the strong selling season for glass, combined with the carryover from the positive effects of the severe weather conditions we experienced at the beginning of the year.

“For the second half of the year, we anticipate market conditions to return to historical norms,” he adds.

Sales in Canada were $20.0 million, an increase of $0.4 million over the second quarter of 2013.

Sales in the U.S. were $182.8 million, an increase of $65.6 million or 55.9 percent, over the same period in 2013. The increase resulted from contributions of $7.1 million from 17 new single locations, $29.8 million from Hansen, Collision Revision and Collex, $12.8 million incremental sales from the glass business, as well as a $9.3 million, or 8.8 percent, increase in same-store sales, excluding foreign exchange.

Applying foreign exchange, same-store sales increased by $7.5 million due to higher U.S. dollar exchange rates. Sales decreased by $1.0 million due to closures of underperforming repair facilities.

The net loss for the second quarter of 2014 was $11.2 million or $0.749 per unit (fully diluted) compared to net loss of $2.6 million or $0.205 per unit (fully diluted) for the same period last year, officials reported. The loss was attributable to fair value adjustments to financial instruments of $17.5 million primarily due to the increase in unit price during the quarter, along with acquisition, transaction and process improvement costs of $1.8 million. Excluding the impact of these adjustments as well as the amortization of brand names, adjusted net earnings would have increased to $8.5 million, or $0.567 per unit. This compares to adjusted net earnings of $3.8 million, or $0.302 per unit for the same period in 2013. The increase in adjusted net earnings is the result of new acquisition contributions, new location growth and increases in same-store sales.

For the six-month period,sales increased by 44.5 percent, or $118.9 million, to $386.5 million, compared to the same period last year. The increase was due largely to sales generated from 23 new single locations, 25 Hansen locations, 25 Collision Revision locations and 16 Collex locations, which combined contributed $60.6 million of incremental sales.

The glass business contributed incremental sales of $24.3 million. Same-store sales increased by 7.3 percent, adding another $17.9 million, excluding foreign exchange and increased a further $18.0 million due to the translation of same-store sales at a higher U.S. dollar exchange rate. Sales were affected by the closure of under-performing facilities which decreased sales by $1.9 million.

Sales in Canada were $40.5 million, an increase of $1.5 million or 3.9 percent, over the same period in 2013.

Sales in the U.S. were $345.9 million, an increase of $117.4 million or 51.4 percent compared with the same period in 2013. Increased sales resulted primarily from $16.5 million generated from 22 new locations, $42.0 million incremental sales from Hansen, Collision Revision and Collex, as well as $24.3 million incremental sales from the glass business. Sales also benefited from same-store increases of $17.8 million or 8.6 percent, excluding foreign exchange, and increased another $18.0 million due to translation of same-store sales at a higher U.S. dollar exchange rate.

Sales were affected by the closure of underperforming facilities resulting in a sales decrease of $1.2 million.

The net loss of $12.9 million or $0.861 per unit (fully diluted) compared to the net loss of $2.5 million or $0.202 for the same period last year. This decrease was the result of fair value adjustments to financial instruments of $24.9 million primarily due to the increase in unit price during the quarter, along with acquisition, transaction and process improvement costs of $3.1 million. Net earnings adjusted for these items as well as the amortization of brand names increased to $15.7 million, or $1.052 per unit, compared with adjusted earnings of $7.4 million, or $0.594 per unit, for the same period in 2013.

As of June 30, 2014, the company had total debt outstanding, net of cash, of $109.9 million, compared to $44.8 million at March 31, 2014 and $48.4 million at December 31, 2013. The increase in debt was due to additional seller loans and draws on the revolving bank debt facility related to the acquisitions of Collision Revision and Collex.

Looking ahead, Bulbuck says, “During 2014 we have executed on our growth strategy by acquiring 41 locations through multi-shop acquisitions. We remain disciplined in our approach to acquiring quality multi-shop operations to achieve accretive growth. Additionally we added seven single-store locations as we continue to model 6 percent to 10 percent growth in single location additions for a total of 16 to 26 in 2014. Our second-quarter same-store sales growth of 7.3 percent system wide, with 8.8 percent growth in the U.S., is a testament to our ability to make accretive acquisitions that consistently contribute over time.”

“Looking to the rest of the year, we will continue to focus on our three-pronged growth strategy to continue to add single store locations … acquire multi-shop operations and achieve same-store sales growth,” he concludes.

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