BOUCHERVILLE, QUEBEC — Uni-Select Inc. recorded an increase in net profits of 20.8 percent this year to attain U.S. $4.14 million or $0.23 per share compared to $3.43 million or $0.19 per share for the corresponding period a last year. Sales improved to $175.8 million in the first quarter of 2004, an increase of 6.2 percent versus sales of $165.6 million in the first quarter of 2003.
Automotive Group Canada saw its sales increase by 10.3 percent during the course of the first quarter of 2004 to reach $121.8 million, compared to $110.4 million in the first quarter of 2003. This growth is chiefly organic and results, amongst others, from sales in the first quarter to a major client which the corporation did not previously supply in 2003. Furthermore, the first quarter of 2004 included an additional billing day compared to the first quarter of 2003, which also contributed to the increase. Automotive Group Canada maintained its operating margin at 4.6 percent as in the first quarter of 2003.
Automotive Group USA’s sales decreased by 11.8 percent in the first quarter to attain $38.4 million compared to $43.5 million in the same quarter of 2003. This decrease is entirely due to the impact of the less favourable exchange rate by 12.9 percent when compared to the exchange rate during the course of the first quarter of 2003. On a comparative basis, excluding the additional billing day and the unfavorable fluctuation of the exchange rate, sales of the Automotive Group USA remained stable despite the closing of sales locations and the reorganization of operations purchased at the beginning of 2003 by the Northwest division. Organic sales of the North Central and South Central divisions increased by 3.4 percent during the course of the first quarter. The group’s operating margin increased to 5.8 percent in the first quarter of 2004 compared to 4.8 percent in 2003.
The heavy duty group increased its sales by 34.1 percent in the first quarter of 2004 to reach $15.6 million compared to $11.7 million in 2003. This increase results from an acquisition in the Montreal region which has contributed for 22.5 percent of the increase. Taking this acquisition into account and the additional billing day, sales of the heavy duty group increased by 8.7 percent on an organic level. The operating margin of the group went from -0.5 percent in 2003 to -0.4 percent in 2004. Had the initial costs inherent to the above-mentioned transaction not been incurred, the heavy duty group’s operations would have been profitable.
Jacques Landreville, president and CEO of Uni-Select stated, “These results cast a positive outlook for 2004. Although the first quarter has the least impact on our corporation, we are confident that the programs put into place in 2003, the agreement with Midas and with others will sustain our growth in 2004. We are pursuing our expansion efforts both through organic growth and through corporate development. We are also concentrating our efforts mostly in the U.S. as it is a market with great potential and the aftermarket replacement parts business is showing healthy signs of growth. Our developmental efforts do not, however, distract us from our low-cost, low-asset-base strategy. Furthermore, we continue to focus our energies on providing service to our independent merchant members.”
Finally, the board of directors of Uni-Select declared a quarterly dividend of $0.0735 per common share payable on July 21, 2004 to shareholders of record as at April 30, 2004.
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