VANCOUVER, British Columbia, March 17, 2010 (GLOBE NEWSWIRE) -- Coastal
Contacts Inc. ("Coastal") (TSX:COA) (Stockholm:COA) today announced its
financial results for the three months ended January 31,
2010.
Coastal noted the following financial highlights for the first fiscal
quarter 2010:
-- Total order volume exceeded 347,000 orders.
-- Sales increased 15% to $36 million as compared to $31 million in the
first fiscal quarter of 2009. Sales increased 19% excluding the impact
of foreign currency exchange rate fluctuations.
-- Sales of eyeglasses grew more than 180% to $3.8 million.
-- Advertising expense declined to 11% of sales from 13% of sales as
compared to the first quarter of the previous year.
-- Cash balances increased 19% to $13.7 million from $11.5 million during
the quarter.
-- Cash generated from operations was $2.6 million during the quarter.
-- Sales in each of Canada and the United States grew by approximately 50%
when compared to the first quarter of 2009 and excluding the impact of
foreign currency exchange rate fluctuations.
Sales increased 15% to a first fiscal quarter record of $36 million
compared with $31 million in the same period in 2009. Excluding the
impact of foreign currency exchange rate fluctuations, sales grew 19%
during the first fiscal quarter as compared with the same period in
2009. Adjusted EBITDA for the first fiscal quarter of 2010 was $1.7
million compared with $1.8 million for the same period in 2009. Net
income for the first fiscal quarter of 2010 was $0.8 million or $0.01
per share.
Coastal also announced that eyeglasses sales exceeded $3.8 million for
the first fiscal quarter of 2010, a 180% increase over the same period
in 2009. The majority of the eyeglasses sales were derived from the
North American market.
Mr. Roger Hardy, Coastal's President and CEO, commented, "We are
encouraged by the record results Coastal has achieved in the first
quarter. Our vision care business continues to experience significant
growth. Key markets such as Canada and the United States experienced
sales increases of approximately 50% when measured in their domestic
currencies.
We are particularly pleased with the progress of our eyeglasses
category which is gaining traction in multiple markets. We are
expanding our manufacturing capacity in order to meet current and
anticipated consumer demand for eyeglasses. The customer feedback we
receive is overwhelmingly positive and supports our plans to invest in
this rapidly growing category."
Coastal will host a conference call to review the financial and
operating results on Wednesday, March 17, 2010 at 9:00am PDT.
Participating in the call will be Roger Hardy, Chairman and CEO and
Glen Kayll, CFO.
To attend the call, participants may dial:
North American Toll Free 1-888-892-3255
Stockholm 46 8 52 503 436
A replay of the call will be available for 7 days. To access the replay
listeners may dial:
North American Toll Free 1-800-937-6305
Passcode 304721
The following selected financial information is qualified in its
entirety by, and should be read in conjunction with our unaudited
consolidated financial statements for the first fiscal quarter ended
January 31, 2010 and accompanying notes and Management's Discussion and
Analysis which may be viewed on SEDAR at www.sedar.com.
Coastal's risks and uncertainties are discussed in detail in Coastal's
Annual Information Form dated January 29, 2010, which is also available
on SEDAR.
Adjusted EBITDA as referenced in this news release is a Non-GAAP
measure and is defined as earnings before interest, taxes, depreciation
and amortization, foreign exchange gains or losses, share based
compensation and restructuring charges. See "Supplemental Non-GAAP
Measures" herein.
COASTAL CONTACTS INC.
CONSOLIDATED BALANCE
SHEETS
($000's)
January 31, October
31,
2010 2009
------------------------ ----------- -------
(Unaudited)
ASSETS
Current
Cash and cash
equivalents $13,727 $11,532
Accounts receivable 8,686 7,965
Inventory 14,454 15,701
Prepaid expenses 1,426 1,532
Future income tax 102 109
Due from related parties 378 374
------------------------ ----------- -------
38,773 37,213
------------------------ ----------- -------
Property, equipment and
leasehold improvements 2,530 2,813
Intangible assets 8,728 9,517
Goodwill 7,353 7,757
------------------------ ----------- -------
$57,384 $57,300
------------------------ ----------- -------
LIABILITIES
Current
Accounts payable and
accrued liabilities $18,714 $17,890
Income tax payable 301 615
------------------------ ----------- -------
19,015 18,505
------------------------ ----------- -------
Long-term lease
inducement 4 18
Future income tax 3,347 3,614
------------------------ ----------- -------
22,366 22,137
------------------------ ----------- -------
SHAREHOLDERS' EQUITY
Share capital
Authorized:
Unlimited common
shares without par
value
Unlimited Class A
preferred shares
without par value
Issued and outstanding:
56,901,719 common
shares [2009 --
56,901,719] 40,248 40,248
Contributed surplus 2,514 2,294
Accumulated other
comprehensive loss (4,597) (3,482)
Deficit (3,147) (3,897)
------------------------ ----------- -------
35,018 35,163
------------------------ ----------- -------
$57,384 $57,300
------------------------ ----------- -------
COASTAL CONTACTS INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)($000's, except share and per
share amounts)
Three months ended January 31 2010 2009
----------------------------- ---------- ----------
Sales $35,908 $31,342
Cost of sales 25,597 21,324
----------------------------- ---------- ----------
Gross profit 10,311 10,018
----------------------------- ---------- ----------
Advertising 3,991 4,126
Selling, general and
administration 4,642 4,069
Share-based compensation 220 148
Amortization on property,
equipment and leasehold
improvements 282 215
Amortization of intangible
assets 399 399
Foreign exchange gains (18) (202)
Interest (income) expense,
net 14 (42)
----------------------------- ---------- ----------
Earnings before income taxes 781 1,305
Income tax 31 337
----------------------------- ---------- ----------
Net earnings 750 968
Basic earnings per share $0.01 $0.02
Diluted earnings per share $0.01 $0.02
----------------------------- ---------- ----------
Weighted average number of
common shares outstanding
Basic 56,901,719 58,318,284
Diluted 58,502,318 58,318,284
----------------------------- ---------- ----------
Supplemental Non-GAAP Measures
Coastal Contacts reports its results in accordance with Canadian GAAP,
however, it presents Adjusted EBITDA because Coastal believes its
investors use these figures to make investment decisions about Coastal.
Adjusted EBITDA is a non-GAAP measure that does not have any
standardized meaning prescribed by Canadian GAAP and is therefore
unlikely to be comparable to similar measures presented by other
companies. Adjusted EBITDA should be considered in addition to, and not
as a substitute for, net earnings, cash flows and other measures of
financial performance and liquidity reported in accordance with
Canadian GAAP.
Adjusted EBITDA is a measure Coastal believes is useful in assessing
performance and highlighting trends on an overall basis. Adjusted
EBITDA differs from the most comparable GAAP measure, net earnings,
primarily because it does not include interest, income taxes,
amortization, restructuring cost and share-based compensation expense.
For the three
months ended
January 31,
---------------
($000's) 2010 2009
------------------------- ------- ------
Net earnings (loss) $750 $968
Depreciation and
amortization 681 614
Interest income, net 14 (42)
Income tax expense 31 337
Share-based compensation 220 148
Foreign exchange (gain)
loss (18) (202)
------------------------- ------- ------
Adjusted EBITDA $1,678 $1,823
------------------------- ------- ------
About Coastal Contacts:
Coastal Contacts Inc. is the world's leading online vision products
company which designs, produces and distributes a diversified offering
of contact lenses and eyeglasses. Coastal's unique combination of
branded and private label products represent quality, value and above
all, service. Coastal sells into more than 150 countries through
proprietary web properties which reflect the culture and consumer
preference of the target market. As new markets for eyeglasses and
contact lenses evolve, Coastal is positioned to become the vision
product consumer's retailer of choice owing to its compelling value
proposition combining value and service. A leader in many of its
markets, Coastal is rapidly advancing toward its goal of becoming the
"World's Optical Store."
Forward Looking Statements
All statements made in this news release, other than statements of
historical fact, are forward-looking statements. The words "may",
"would", "could", "will", "intend", "plan", "anticipate", "believe",
"estimate", "expect", "goal", "target", "should," "likely,"
"potential," "continue", "project," "forecast," "prospects," and
similar expressions typically are used to identify forward-looking
statements.
Forward looking statements are based on the then-current expectations,
beliefs, assumptions, estimates and forecasts about our business and
the industry and markets in which we operate. Forward-looking
statements are not guarantees of future performance and involve risks,
uncertainties and assumptions which are difficult to predict.
Persons reading this news release are cautioned that forward-looking
statements or information are only predictions, and that our actual
future results or performance could vary significantly due to a number
of factors. These factors include, but are not limited to: changes in
the market; Coastal's ability to implement its business strategies;
competition; limited suppliers; disruption in its distribution
facilities; mergers and acquisitions; foreign currency exchange rate
fluctuations; regulatory requirements; demand for contact lenses and
related vision care products; dependence on the internet and other
risks detailed in the section entitled "Risk Factors" contained in
Coastal's most recently filed Annual Information Form dated January 29,
2010 as filed on SEDAR. Readers should not place undue reliance on
forward-looking statements and information, which are qualified in
their entirety by this cautionary statement. These forward-looking
statements are made as of the date of this news release and Coastal
expressly disclaims any intent or obligation to update these
forward-looking statements.
CONTACT: Coastal Contacts Inc.
Terry Vanderkruyk, Vice President, Corporate Development
604.676.4498
terryv@coastalcontacts.com
Coastal Contacts Reports Record First Fiscal Quarter Sales of $36 Million
| Source: Coastal Contacts Inc
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