BMTC Q4 sales up 3.9%

MONTREAL – BMTC Group, the largest full-line furniture retailer in Quebec saw revenue climb for both the fourth quarter and the full 2015 year although earning fell after completing a number of strategically important tasks including the expansion of its EconoMax banner, the rationalisation of its share structure and the rebuilding of its IT systems.

For the three months ending December 31, 2015, revenue was $190.2 million, a 3.9% advance over the $183.1 million for the same period of 2014.

Net earnings were $16.2 million or 41 cents per share, down 8.9% compared to $17.8 million or 40 cents per share.

For the year that also ended December 31, 2015, revenue was $717.3 million, 2.3% higher than the $701.5 for the 2014 year. Net income was $41.5 million or 99 cents per share, compared with $48.6 million or $1.08 per share – down 8.3% on a per share basis.

In May 2015, BMTC received permission to eliminate its then-existing dual class share structure. Under the new single class share structure, the company had slightly more than 44.9 million common shares issued and outstanding. In July, BMTC repurchased some 6.98 million shares from companies controlled by two of the company’s directors, Gilles Crépeau and Pierre Ouimet, for an estimated $108 million.

This reduced the number of common shares to 37.9 million.

During the year, BMTC began rebuilding all of its web sites. The first phase, implementing a distinct e-commerce platform for its Brault & Martineau banner, was completed and made operational in November. The company said the second phase of this $10 million project is now well underway.

The company is also considering spending $15 million – spread over 2016 and 2017 – to refit all of the furniture and electronics departments in all 10 of its Brault & Martineau stores. “The objective of this improvement is to offer our clients a unique shopping experience which will help differentiate us from online shopping,” long-time chairman and chief executive Yves Des Groseillers said in his note to shareholders.

Its EconoMax banner opened a new store in Drummondville, Quebec in October, bringing the store count for this promotional banner to 11. Most are concentrated in and around the Greater Montreal Area, which Des Groseillers said gives “the banner visibility needs for proper development.”

BMTC also intends to open a new 220,000 square foot Ameublements Tanguay outlet in Trois-Rivières in the fall of 2016. The existing store will be converted into a liquidation centre.

“In spite of a difficult economic context, the Québec economy has seen a slight growth in 2015,” Des Groseillers said. “The loss of thousands of jobs in Québec as well as government austerity measures caused a slowdown in consumer spending. In fact, 2015 was the worst year since 2010 for bankruptcy filings in the retail industry.”

While offering little insight on performance for 2016, Des Groseillers said BMTC’s operational efficiencies and strong financial position give it a competitive advantage in a difficult market. “It permits the company to continue its aggressive marketing campaigns, allowing it to remain a leading participant in its market,” he noted.

According to the latest preliminary data from Statistics Canada, furniture store sales in Quebec totalled $2.51 billion in 2015. This would give BMTC a 28.5% market share in the only Canadian province in which it operates and is essentially unchanged from 2014.

BMTC operates some 36 stores and two distribution centres throughout Quebec under four different banners: Ameublements Tanguay; Brault & Martineau; Brault & Martineau Sleep Gallery stores; and, EconoMax.