BMTC Group, the owner and operator of Quebec’s largest full-line furniture retailer, Ameublements Tanguay, recently reported sales for the first quarter of its current fiscal year fell 23% but net earnings soared thanks to the proceeds from the sale of its distribution centre here.
For the three months ending April 30, 2023, revenue totaled $135.1 million, down 23% from the $175.7 million rung-up for the compared period last year. BMTC’s current fiscal year will end on January 31, 2024.
Net earnings for the first fiscal quarter amounted to $38.0 million or $1.15 per share, up substantially from the comparable period’s $807,000 or two cents per share.
While the company noted its ongoing share repurchase program had no impact in net earnings per share, it did record an extraordinary after-tax gain of $51.0 million or $1.54 per share after selling its Montreal distribution centre for $66.5 million during the quarter.
BMTC will continue to occupy the facility as a tenant for the next two years.
Without that one-time gain, BMTC would have declared a first quarter net loss of $13.8 million or 41 cents per share.
On May 16, 2023, publicly held BMTC announced it was discontinuing three of its banners – Brault & Martineau, EconoMax and Liquida Meubles – and converting all of its stores under the Ameublesment Tanguay banner.
Before the change, the Tanguay banner was flown by the company’s stores in and around Quebec City (BMTC acquired it in 1989). Expanding the Tanguay banner to Montreal-based Brault & Martineau banner also gave the company the opportunity to upscale its merchandise profile. Three former EconoMax stores were also converted to the Tanguay banner.
The Liquida Meubles banner as well as three other EconoMax were converted into Tanguay L’Entrepôt. There are now five Tanguay L’Entrepôt stores across Quebec offering clearance furniture as well as new entry-level products. As part of the restructuring, BMTC closed five EconoMax stores – those in Kirkland, Sainte-Thérèse, Brossard, Ste-Eustache and LaSalle.
BMTC also said it has set aside $28.0 million to bring those former Brault & Martineau and EconoMax up to the Tanguay banner standard, “in order to provide a better product and service offering and a unique customer experience in its market.”
Some $3.7 million of that budget was incurred in the first quarter of the current fiscal year. The balance will be incurred before the current fiscal year ends next January 31.
BMTC said its now has 25 stores in Quebec operating under the Ameublements Tanguay and Tanguay L’Entrepôt banners – down from 30 stores at the end of its 2023 fiscal year.
The move to a single banner is part of a process started in September 2022 when BMTC announced it was going to create a single IT system to manage and support its activities, a project that was completed last December.
“These IT changes have thus enabled the company to carry out a complete reorganization of its operational and commercial structure as well as its administrative services,” BMTC president and chief executive officer Marie-Berthe Des Groseillers said in her report to shareholders. “All these changes over the past few months have made it possible to create significant synergies, thus creating expanded and diversified teams allowing the success of this deployment. Management is confident that we can continue to improve our operational and commercial efficiency and continue to reduce our costs.”
Another move was to realign the retailer’s senior management team, including naming Jacques Tanguay, then president of the Ameublements Tanguay banner, as BMTC Group’s chief operating officer (COO) while Charles Tanguay, then the banner’s vice president, became president of all three of banners.
“This decision comes at an opportune time for the company,” Des Groseillers continued, noting BMTC faces a number of wide-ranging challenges, including the difficulty in finding and keeping qualified labour, the shift towards e-commerce and the constant evolution of retail’s competitive environment.
“We believe that these IT, organizational, structural and commercial changes will enable the company to exercise leadership in its market, significantly improve its profitability and financial structure and maintain its objectives of increasing its market share in Quebec,” she concluded.