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Burnaby, British Columbia--(Newsfile Corp. - May 10, 2024) - Canlan Ice Sports Corp. (TSX: ICE) (the "Company" or "Canlan Sports") today reported its financial results for the first quarter ended March 31, 2024.
Overview of Q1 2024
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Total operating revenue of $26.2 million (the Company's highest Q1 revenue) increased by $1.7 million or 7.0% compared to a year ago due to pricing and higher volumes;
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Total operating earnings were $7.6 million compared to $7.4 million in 2023; and
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Net earnings of $4.2 million or $0.32 per share compared to $3.4 million or $0.26 per share in 2023.
First Quarter Results
| | | For the 3 months ended March 31 |
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| (in thousands) | | 2024 | | | 2023 |
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| Ice rink & recreational facilities revenue | $ | 26,186 | | $ | 24,477 | |
| Operating expenses | | 16,336 | | | 15,018 |
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| | | 9,850 | | | 9,459 | |
| G&A expenses | | 2,220 | | | 2,031 |
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| Operating earnings 1 | $ | 7,630 | | $ | 7,428 | |
| Operating earnings per share | $ | 0.57 | | $ | 0.56 |
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| Depreciation | | 1,858 | | | 1,930 | |
| Interest | | 635 | | | 449 | |
| Interest rate swap (gain) loss | | (514 | ) | | 580 | |
| Foreign exchange gain | | (2 | ) | | - | |
| Gain on sale of assets | | - | | | (10 | ) |
| Income tax expense | | 1,415 | | | 1,034 |
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| Net earnings | $ | 4,238 | | $ | 3,445 | |
| Net earnings per share | $ | 0.32 | | $ | 0.26 |
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| Key Balance Sheet Figures (in thousands): | | March 31, | | | December 31, | |
| Assets | |
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| Cash and cash equivalents | $ | 18,312 | | $ | 19,029 | |
| Property plant and equipment | | 93,023 | | | 93,328 | |
| Other assets | | 10,869 | | | 9,642 |
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| Total assets | $ | 122,204 | | $ | 121,999 |
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| Liabilities and Equity | |
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| Debt | $ | 42,501 | | $ | 42,948 | |
| Lease liabilities | | 6,077 | | | 6,327 | |
| Accounts payable and accrued liabilities | | 12,087 | | | 11,742 | |
| Deferred revenue | | 9,961 | | | 14,425 | |
| Other liabilities | | 2,256 | | | 1,901 |
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| Total liabilities | | 72,882 | | | 77,343 |
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| Share capital and contributed surplus | | 63,652 | | | 63,652 | |
| Foreign currency translation reserve |
| 3,660 |
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| 2,832 |
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| Deficit | | (17,990 | ) | | (21,828 | ) |
| Total shareholders' equity | | 49,322 | | | 44,656 |
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| Total liabilities and equity | $ | 122,204 | | $ | 121,999 |
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First Quarter Results
(three months ended March 31, 2024 compared with three months ended March 31, 2023)
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Total operating revenue of $26.2 million increased by $1.7 million or 7.0% compared to 2023 mainly due to higher sales from soccer leagues, third-party surface rentals and food and beverage operations;
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Facility operating expenses of $16.3 million increased by $1.3 million or 8.8% mainly due to increased roof refurbishment costs, annual wage increments as planned and increased customer service and marketing expenses to service increased traffic flow;
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The Company's roof remediation program will continue as scheduled in 2024 to proactively improve the weather resistance of building envelopes of specific sports complexes in its portfolio;
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Total G&A expenses of $2.2 million increased by $0.2 million or 9.3% mainly due to increased wages and IT costs. To strengthen operations support and KPI reporting, the Company recruited additional team members and implemented technology at the central office during the second half of fiscal 2023. In addition, the Company recorded compensation expense in Q1 2024 (no expense required in Q1 2023) related to a new long-term incentive compensation plan that commenced during fiscal 2023;
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After G&A expenses, operating earnings was $7.6 million compared to $7.4 million in 2023; and
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After recording depreciation expense of $1.9 million, finance costs of $0.1 million, and income tax expense of $1.4 million, net earnings for the period were $4.2 million or $0.32 earnings per share compared to $3.4 million or $0.26 per share in 2023.