BURNABY, BC, November 5, 2021 – Taiga Building Products Ltd. (“Taiga” or the “Company”) today reported its financial results for the three and nine months ended September 30, 2021.
Third Quarter Ended September 30, 2021 Earnings Results
Sales for the quarter ended September 30, 2021 were $484.6 million compared to $500.7 million over the same period last year. The decrease in sales by $16.1 million or 3% was largely due to decreased selling prices for commodity products.
Gross margin for the quarter ended September 30, 2021 decreased to $7.6 million from $91.5 million over the same period last year. Gross margin percentage was 1.6% for the three months ended September 30, 2021 compared to 18.3% in the same period last year. These decreases were due to commodity prices falling dramatically during the quarter. Furthermore, the Company booked a $13.4 million inventory reserve due to the impact falling commodity prices had on its treated inventory values.
Net earnings (loss) for the quarter ended September 30, 2021 decreased to a loss of ($5.2) million from $33.4 million over the same period last year primarily due to decreased gross margin.
EBITDA for the quarter ended September 30, 2021 was ($1.8) million compared to $50.5 million for the same period last year. EBITDA decreased primarily due to lower margin earned during the quarter.
Nine Months Ended September 30, 2021 Earnings Results
Sales for the nine months ended September 30, 2021 were $1,807.2 million compared to $1,177.8 million over the same period last year. The increase in sales by $629.4 million or 53% was largely due to the Company experiencing higher selling prices for its commodity products at the beginning of the period before prices fell dramatically partway through the third quarter.
Gross margin for the nine months ended September 30, 2021 increased to $245.9 million from $164.8 million over the same period last year. Gross margin percentage decreased to 13.6% for the nine months ended September 30, 2021 compared to the same period last year at 14.0%. The increase in margin is primarily due to rising commodity prices at the beginning of the period before prices fell dramatically partway through the third quarter. .
Net earnings for the nine month period ended September 30, 2021 were $82.4 million compared to $53.2 million for the same period last year.
EBITDA for the nine months ended September 30, 2021 was $127.8 million compared to $87.5 million for the same period last year. EBITDA increased primarily due to higher margin earned during the current period.
Management Update on the COVID-19 Pandemic
The outbreak of the coronavirus, also known as “COVID-19”, has spread across the globe and is impacting worldwide economic activity. Conditions surrounding the coronavirus continue to rapidly evolve and government authorities have implemented emergency measures to mitigate the spread of the virus. As at the financial statement approval date, the pandemic has had a positive impact on Taiga’s business and financial performance in fiscal 2020 and the first half of fiscal 2021. This is a direct result of the increased demand for detached housing, record high commodity prices and low borrowing rates experienced during the pandemic. However, commodity prices did fall dramatically during the Company’s third quarter which had a material impact on its results. The extent to which these events may continue to impact the Company’s business activities in the same manner in future periods will depend on a number of factors, such as the ultimate geographic spread of the disease, the duration of the outbreak, travel restrictions, the rate at which vaccines are administered, the effectiveness of vaccines against the coronavirus and its mutations, subsequent outbreaks, business disruptions, and the effectiveness of actions taken in Canada, the United States and other countries to contain and treat the disease, the demand for detached housing in North America, future commodity prices, interest rates and the strength of the general economy. These events are highly uncertain and as such, the Company cannot predict with any certainty how the progression of the coronavirus pandemic and these events will ultimately impact the Company’s financial performance in 2021.
See attached PDF for complete press release and statement of earnings.
For further information:
Mark Schneidereit-Hsu, CFO and VP, Finance & Administration