Welcome!

Microsoft Cloud Authors: Liz McMillan, John Basso, Pat Romanski, Glenn Rossman, Elizabeth White

News Feed Item

easyhome Ltd. Reports 2012 Third Quarter Results

Revenue Growth of 5.8%, Net Income Growth of 39%

MISSISSAUGA, ONTARIO -- (Marketwire) -- 11/12/12 -- easyhome Ltd. (TSX:EH) (the "Company" or "easyhome"), Canada's largest merchandise leasing company and a growing provider of financial services, today announced its results for the third quarter ended September 30, 2012.

easyhome delivered strong revenue growth during the third quarter of 2012. Revenue for the quarter increased 5.8% to $49.3 million, driven primarily by the expansion of the easyfinancial Services business and the related growth of its consumer loans receivable portfolio. Net income for the quarter was $2.6 million, up from $1.9 million reported in the third quarter of 2011. Reported earnings per share for the quarter was 22 cents compared to 16 cents for the third quarter of 2011.

During the third quarter of 2012 and as previously announced, the Company entered into a new $20 million credit facility to support the growth of easyfinancial Services. In conjunction with this financing, the Company amended the terms and extended the maturity date of its revolving operating facility with a syndicate of banks. These actions, when taken together, will provide the Company with the capital necessary to achieve its growth objectives as it continues to build upon positive momentum in its easyfinancial Services business.

Other highlights for the third quarter of 2012 include:

easyhome Leasing


--  Stabilization of the operating income, arresting the year over year
    decline experienced in prior quarters 
--  Same store revenue growth excluding easyfinancial Services of 3.1%
    Delivery growth for same stores of 6.8% compared to the third quarter of
    2011 
--  Successful integration of second quarter store closures and the
    migration of the leasing portfolios from closed stores to nearby
    locations 
--  Excluding the impact of changes to the store network, the lease
    portfolio as measured by potential monthly lease revenue increased by
    $0.3 million year over year 

easyfinancial Services


--  The consumer loans receivable portfolio closed at $59.6 million,
    representing a year- over-year increase of 40% 
--  Revenue for the third quarter of 2012 increased 52% compared to the
    third quarter of 2011 
--  Operating margin of 33.8% 
--  Successful implementation of, and migration to the new loan management
    system supporting easyfinancial Services 

easyhome Franchising


--  Franchise system wide revenue increased 35% compared to the third
    quarter of 2011 
--  Shortly after the end of the third quarter of 2012, the last of the
    three original Be-A- Contender franchise locations that were funded by
    easyhome obtained independent financing and now all three original Be-A-
    Contender franchise locations have repaid their debts to easyhome 

Overall


--  Same store revenue growth of 9.8% 
--  Excluding the impact of variable compensation plan expenses, corporate
    expenses for the third quarter of 2012 are consistent with corporate
    expenses for the third quarter of 2011 
--  Operating income increased 28% from the third quarter of 2011 
--  Operating margin of 8.7% and EBITDA margin of 11.0% 
--  Cash flow from operating activities of $16.3 million 

"We are pleased with our financial performance and with the completion of several strategic initiatives during the quarter," said David Ingram, easyhome's President and Chief Executive Officer. "The restructuring of our easyhome leasing operations that occurred in the second quarter of this year delivered the expected results. Our easyfinancial Services business continued to produce higher earnings and margin expansion. This was achieved while migrating to our new loan management system without negatively impacting customers. Finally, we secured additional financing which will allow us to grow unencumbered throughout 2013."

Third Quarter Results

For the third quarter ended September 30, 2012, easyhome generated revenues of $49.3 million, an increase from $46.6 million in the third quarter of 2011. At the store level, including easyfinancial, same store revenue growth for the quarter was a strong 9.8%, up from 5.1% in the third quarter of 2011.

On a segmented basis, easyfinancial Services revenues increased 52% to $9.8 million from $6.4 million for the same period last year. The improvement is a result of the increase in the consumer loans receivable portfolio from $42.7 million to $59.6 million. The Company's leasing operations recorded revenues of $39.1 million, down from $39.8 for the same period last year and franchising operations recorded revenues of $0.3 million, relatively unchanged from the same period last year.

Operating income, which is income before interest expense and income taxes, increased 27% to $4.3 million from $3.3 million in the third quarter of 2011. As a percentage of revenue, operating income was 8.7% compared to 7.2% in the third quarter of 2011.

Net income increased to $2.6 million or 22 cents per share for the third quarter of 2012, compared with net income of $1.9 million or 16 cents per share for the third quarter of 2011.

Nine Months Results

For the nine months of the year, easyhome recorded revenues of $148.0 million, up 6.4% compared with $139.0 million in the first nine months of 2011. Operating income for the period was $10.5 million compared with $10.0 million in the first nine months of 2011. Adjusted operating earnings for the nine months of 2012, excluding the restructuring and other charges, was $12.4 million, an increase of 11.6% over the first nine months of 2011. Diluted earnings per share increased from 59 cents to 61 cents. Adjusted net income, adjusted for unusual items, was $7.6 million compared with $7.0 million for the same period last year. On a per share basis and excluding unusual items, diluted earnings per share was 63 cents compared with 59 cents a year ago.

Cash flow provided by operating activities for the nine months ended September 30, 2012 was $42.5 million. Included in these cash flows was a net investment in the easyfinancial Services consumer loans receivable portfolio of $17.9 million. If this net investment in the loan portfolio was treated as cash flow from investing activities, cash flow from operating activities would be $60.4 million. This cash flow from operating activities enabled the Company to invest in the portfolios to drive future revenue growth of all business units and maintain its total dividend payments for the quarter.

Outlook

"We believe that our business is well positioned for continued success," commented David Ingram. "easyhome leasing took the difficult but necessary steps in the second quarter of this year to restructure its operations and return the focus of field staff from administrative processes to leasing, collecting and customer relationships. Over the past 24 months, easyfinancial has tripled the size of its consumer loans receivable portfolio and has a Canadian leadership position as an alternative provider of term financing to consumers. We have completed the build out of our corporate infrastructure to support the growth plans of all of our business units. Finally, we have secured the financing that is necessary for the Company to achieve its growth objectives."

easyhome has established the following targets for 2013:


--  easyhome leasing does not plan to open any new corporate stores but we
    expect to open 3-4 new Be-A-Contender franchise stores that are
    consolidated for financial reporting purposes 
--  open 3-5 new franchise stores 
--  open 25-35 new easyfinancial locations with most of these being stand-
    alone locations 
--  easyfinancial consumer loans receivable portfolio growing to $90-$100
    million 

Based on these assumptions, we are targeting total revenue growth of 8-12%. The achievement of these targets by the Company, however, is predicated on a number of factors, including the pace of expansion of easyfinancial.

Donald K. Johnson, Chairman of the Board, commented, "The Company has seen significant change over the past two years, especially as easyfinancial has grown into a significant and sustainable business. The Board is pleased with the progress and the results for the first nine months of 2012 and looks forward to continued growth in the future."

The Board of Directors has approved a quarterly dividend payment of $0.085 per share payable on January 9, 2013 to the holders of common shares of record as at the close of business on December 1, 2012.

About easyhome

As of November 12th, easyhome Ltd. operated 206 easyhome leasing stores (including 8 consolidated franchise locations), 101 easyfinancial locations and had 46 franchise locations.

easyhome Ltd. is Canada's largest merchandise leasing Company and the third largest in North America, offering top quality, brand-name household furnishings, appliances and home electronic products to consumers under weekly or monthly leasing agreements through both corporate and franchise stores. In addition, the Company offers a variety of financial services, including loans and prepaid cards, through its easyfinancial Services business. easyhome Ltd. is listed on the TSX under the symbol 'EH'. For more information, visit www.easyhome.ca.

The above analysis refers to certain financial measures, including same store revenue growth, gross consumer loans receivable, adjusted earnings, adjusted operating earnings and adjusted EBITDA, which are not determined in accordance with International Financial Reporting Standards ("IFRS"). These measures do not have standardized meanings and may not be comparable to similar measures presented by other companies. These measures are defined in our Management's Discussion and Analysis for the period which is available on SEDAR or on the Company's website at www.easyhome.ca or can be determined by reference to our financial statements. We discuss these measures because we believe that they facilitate the understanding of the results of our operations and financial position.

Forward-Looking Statements

This news release includes forward-looking statements about easyhome Ltd., including its business operations, strategy and expected financial performance and condition. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as 'expects', 'anticipates', 'intends', 'plans', 'believes' or negative versions thereof and similar expressions. In addition, any statement that may be made concerning future financial performance (including revenue, earnings or growth rates), ongoing business strategies or prospects about future events is also a forward-looking statement. Forward- looking statements are based on certain factors and assumptions, including expected growth, results of operations and business prospects and are inherently subject to, among other things, risks, uncertainties and assumptions about our operations, economic factors and the industry generally. They are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied by forward-looking statements made by us, due to, but not limited to important factors such as our ability to enter into new lease and/or financing agreements, collect on existing lease and/or financing agreements, open new locations on favourable terms, secure new franchised locations, purchase products which appeal to our customers at a competitive rate, cope with changes in legislation, react to uncertainties related to regulatory actions, raise capital under favourable terms, manage the impact of litigation (including shareholder litigation), control costs at all levels of the organization and maintain and enhance our system of internal controls. We caution that the foregoing list is not exhaustive. The reader is cautioned to consider these and other factors carefully and not place undue reliance on forward-looking statements, which may not be appropriate for other purposes. We are under no obligation (and expressly disclaim any such obligation) to update or alter the forward-looking statements whether as a result of new information, future events or otherwise, unless otherwise required by law.

(tables follow)

easyhome Ltd.

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(Unaudited)

(expressed in thousands of Canadian dollars)


                                                        As at         As at 
                                                September 30,  December 31, 
                                                         2012          2011 
----------------------------------------------------------------------------
                                                                            
ASSETS                                                                      
Current assets                                                              
Cash                                                    1,041         1,019 
Amounts receivable                                      3,726         5,893 
Income taxes recoverable                                    -           600 
Consumer loans receivable (note 4)                     35,548        32,619 
Prepaid expenses                                        1,159         1,316 
----------------------------------------------------------------------------
Total current assets                                   41,474        41,447 
----------------------------------------------------------------------------
Amounts receivable                                        805         1,365 
Consumer loans receivable (note 4)                     20,560        12,319 
Lease assets                                           63,681        66,996 
Property and equipment (note 5)                        13,268        12,612 
Deferred tax assets (note 10)                           5,578         2,933 
Intangible assets                                       5,475         4,126 
Goodwill                                               17,325        17,325 
----------------------------------------------------------------------------
TOTAL ASSETS                                          168,166       159,123 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
LIABILITIES AND SHAREHOLDERS' EQUITY                                        
Current liabilities                                                         
Bank revolving credit facility (note 6)                32,212        33,123 
Accounts payable and accrued liabilities               19,484        19,504 
Income taxes payable                                    6,483             - 
Dividends payable (note 7)                              1,012         1,007 
Deferred lease inducement                                 541           598 
Unearned revenue                                        3,910         4,562 
Provisions (note 9)                                       325            24 
----------------------------------------------------------------------------
Total current liabilities                              63,967        58,818 
----------------------------------------------------------------------------
Accounts payable and accrued liabilities                  552           727 
Deferred lease inducements                              1,682         1,959 
Provisions (note 9)                                       246            77 
----------------------------------------------------------------------------
Total liabilities                                      66,447        61,581 
----------------------------------------------------------------------------
                                                                            
Contingencies (note 13)                                                     
                                                                            
Shareholders' equity                                                        
Share capital (note 7)                                 60,667        60,207 
Contributed surplus                                     3,014         3,171 
Accumulated other comprehensive loss                     (441)          (52)
Retained earnings                                      38,479        34,216 
----------------------------------------------------------------------------
Total shareholders' equity                            101,719        97,542 
----------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY            168,166       159,123 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

See accompanying notes to the interim condensed consolidated financial statements

easyhome Ltd.

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(expressed in thousands of Canadian dollars except earnings per share)


                                   Three months ended     Nine months ended 
                                --------------------------------------------
                                 September  September  September  September 
                                       30,        30,        30,        30, 
                                      2012       2011       2012       2011 
----------------------------------------------------------------------------
                                                                            
REVENUE                                                                     
Lease revenue                       38,014     39,040    116,925    119,198 
Interest income                      6,503      4,369     17,533     10,681 
Other                                4,772      3,157     13,521      9,154 
----------------------------------------------------------------------------
                                    49,289     46,566    147,979    139,033 
----------------------------------------------------------------------------
                                                                            
EXPENSES BEFORE DEPRECIATION AND                                            
 AMORTIZATION                                                               
Salaries and benefits (note 8)      16,378     15,304     48,403     45,129 
Advertising and promotion            1,702      1,748      5,858      5,214 
Bad debts                            2,434      1,729      6,760      4,243 
Occupancy                            6,320      6,145     19,367     18,819 
Distribution and travel              1,821      1,993      5,535      5,932 
Other                                3,376      3,904     10,055     10,492 
Restructuring and other items                                               
 (note 9)                                -          -        436          - 
----------------------------------------------------------------------------
                                    32,031     30,823     96,414     89,829 
----------------------------------------------------------------------------
                                                                            
DEPRECIATION AND AMORTIZATION                                               
Depreciation of lease assets        11,847     11,563     36,045     35,375 
Depreciation of property and                                                
 equipment                           1,007        914      2,978      2,538 
Amortization of intangible                                                  
 assets                                119        120        348        397 
Impairment (net) (note 5)               (7)      (202)       275       (173)
----------------------------------------------------------------------------
                                    12,966     12,395     39,646     38,137 
----------------------------------------------------------------------------
                                                                            
Total operating expenses            44,997     43,218    136,060    127,966 
----------------------------------------------------------------------------
                                                                            
Operating income                     4,292      3,348     11,919     11,067 
                                                                            
Interest expense                       481        423      1,428      1,056 
----------------------------------------------------------------------------
                                                                            
Income before income taxes           3,811      2,925     10,491     10,011 
                                                                            
Income tax expense (recovery)                                               
 (note 10)                                                                  
 Current                             1,394        611      5,845        162 
 Deferred                             (221)       414     (2,645)     2,853 
----------------------------------------------------------------------------
                                     1,173      1,025      3,200      3,015 
----------------------------------------------------------------------------
                                                                            
Net income                           2,638      1,900      7,291      6,996 
----------------------------------------------------------------------------
                                                                            
Basic earnings per share (note                                              
 11)                                  0.22       0.16       0.61       0.59 
Diluted earnings per share (note                                            
 11)                                  0.22       0.16       0.61       0.59 
----------------------------------------------------------------------------
----------------------------------------------------------------------------

See accompanying notes to the interim condensed consolidated financial statements

Contacts:
easyhome Ltd.
David Ingram
President & Chief Executive Officer
(905) 272-2788

easyhome Ltd.
Steve Goertz
Senior Vice President and Chief Financial Officer
(905) 272-2788

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...
Large scale deployments present unique planning challenges, system commissioning hurdles between IT and OT and demand careful system hand-off orchestration. In his session at @ThingsExpo, Jeff Smith, Senior Director and a founding member of Incenergy, will discuss some of the key tactics to ensure delivery success based on his experience of the last two years deploying Industrial IoT systems across four continents.
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develo...
SYS-CON Events announced today that MangoApps will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device.
IoT is rapidly changing the way enterprises are using data to improve business decision-making. In order to derive business value, organizations must unlock insights from the data gathered and then act on these. In their session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, and Peter Shashkin, Head of Development Department at EastBanc Technologies, discussed how one organization leveraged IoT, cloud technology and data analysis to improve customer experiences and effi...
The IETF draft standard for M2M certificates is a security solution specifically designed for the demanding needs of IoT/M2M applications. In his session at @ThingsExpo, Brian Romansky, VP of Strategic Technology at TrustPoint Innovation, explained how M2M certificates can efficiently enable confidentiality, integrity, and authenticity on highly constrained devices.
In today's uber-connected, consumer-centric, cloud-enabled, insights-driven, multi-device, global world, the focus of solutions has shifted from the product that is sold to the person who is buying the product or service. Enterprises have rebranded their business around the consumers of their products. The buyer is the person and the focus is not on the offering. The person is connected through multiple devices, wearables, at home, on the road, and in multiple locations, sometimes simultaneously...
“delaPlex Software provides software outsourcing services. We have a hybrid model where we have onshore developers and project managers that we can place anywhere in the U.S. or in Europe,” explained Manish Sachdeva, CEO at delaPlex Software, in this SYS-CON.tv interview at @ThingsExpo, held June 7-9, 2016, at the Javits Center in New York City, NY.
"We've discovered that after shows 80% if leads that people get, 80% of the conversations end up on the show floor, meaning people forget about it, people forget who they talk to, people forget that there are actual business opportunities to be had here so we try to help out and keep the conversations going," explained Jeff Mesnik, Founder and President of ContentMX, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo Silicon Valley Call for Papers is now open.
The IoT is changing the way enterprises conduct business. In his session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, discussed how businesses can gain an edge over competitors by empowering consumers to take control through IoT. He cited examples such as a Washington, D.C.-based sports club that leveraged IoT and the cloud to develop a comprehensive booking system. He also highlighted how IoT can revitalize and restore outdated business models, making them profitable ...
"delaPlex is a software development company. We do team-based outsourcing development," explained Mark Rivers, COO and Co-founder of delaPlex Software, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
We all know the latest numbers: Gartner, Inc. forecasts that 6.4 billion connected things will be in use worldwide in 2016, up 30 percent from last year, and will reach 20.8 billion by 2020. We're rapidly approaching a data production of 40 zettabytes a day – more than we can every physically store, and exabytes and yottabytes are just around the corner. For many that’s a good sign, as data has been proven to equal money – IF it’s ingested, integrated, and analyzed fast enough. Without real-ti...
I wanted to gather all of my Internet of Things (IOT) blogs into a single blog (that I could later use with my University of San Francisco (USF) Big Data “MBA” course). However as I started to pull these blogs together, I realized that my IOT discussion lacked a vision; it lacked an end point towards which an organization could drive their IOT envisioning, proof of value, app dev, data engineering and data science efforts. And I think that the IOT end point is really quite simple…
"There's a growing demand from users for things to be faster. When you think about all the transactions or interactions users will have with your product and everything that is between those transactions and interactions - what drives us at Catchpoint Systems is the idea to measure that and to analyze it," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York Ci...
Big Data, cloud, analytics, contextual information, wearable tech, sensors, mobility, and WebRTC: together, these advances have created a perfect storm of technologies that are disrupting and transforming classic communications models and ecosystems. In his session at @ThingsExpo, Erik Perotti, Senior Manager of New Ventures on Plantronics’ Innovation team, provided an overview of this technological shift, including associated business and consumer communications impacts, and opportunities it ...
A critical component of any IoT project is what to do with all the data being generated. This data needs to be captured, processed, structured, and stored in a way to facilitate different kinds of queries. Traditional data warehouse and analytical systems are mature technologies that can be used to handle certain kinds of queries, but they are not always well suited to many problems, particularly when there is a need for real-time insights.
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data. In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...
Is your aging software platform suffering from technical debt while the market changes and demands new solutions at a faster clip? It’s a bold move, but you might consider walking away from your core platform and starting fresh. ReadyTalk did exactly that. In his General Session at 19th Cloud Expo, Michael Chambliss, Head of Engineering at ReadyTalk, will discuss why and how ReadyTalk diverted from healthy revenue and over a decade of audio conferencing product development to start an innovati...
Extracting business value from Internet of Things (IoT) data doesn’t happen overnight. There are several requirements that must be satisfied, including IoT device enablement, data analysis, real-time detection of complex events and automated orchestration of actions. Unfortunately, too many companies fall short in achieving their business goals by implementing incomplete solutions or not focusing on tangible use cases. In his general session at @ThingsExpo, Dave McCarthy, Director of Products...