Colabor Group Reports Results for the First Quarter 2025

/EIN News/ -- SAINT-BRUNO-DE-MONTARVILLE, Quebec, May 01, 2025 (GLOBE NEWSWIRE) -- Colabor Group Inc. (TSX: GCL) (“Colabor” or the “Company”) reports its results for the first quarter ended March 22, 2025.

First Quarter 2025 Financial Highlights:

• Sales increased by 0.4% to $131.7 million, compared to $131.2 million for the corresponding period of 2024;
• Net loss from continuing operations was $4.0 million compared to $1.8 million for the corresponding period of 2024;
• Adjusted EBITDA⁽¹⁾ decreased to $2.3 million from $4.9 million for the corresponding period of 2024 with an adjusted EBITDA⁽¹⁾ margin to 1.7% of sales compared to 3.7% of sales during the corresponding period of 2024;
• Cash flow from operating activities decreased to $6.2 million compared to $11.7 million for the first quarter of 2024;
• Net debt⁽²⁾ decreased to $47.1 million, compared to $47.8 million as at December 28, 2024; and
• On February 19, announcement of the signature of an agreement to acquire the assets related to the food distribution activities of Alimplus Inc. and all of the shares of its subsidiary Tout-Prêt Inc. for an amount of $51.5 million. The acquisition is subject to the satisfaction of all required closing conditions.

Table of First Quarter 2025 Financial Highlights:

Financial highlights	12 weeks
(in thousands of dollars, except percentages, per share data and financial leverage ratio)	2025		2024
	$		$
Sales from continuing operations	131,702		131,200
Adjusted EBITDA(1)	2,278		4,882
Adjusted EBITDA(1) margin (%)	1.7		3.7
Net loss from continuing operations	(4,022	)	(1,776	)
Net loss	(4,022	)	(1,776	)
Per share - basic and diluted ($)	(0.04	)	(0.02	)
Cash flow from operating activities	6,161		11,745
Financial position	As at		As at
	March 22,		December 28,
	2025		2024
Net debt(2)	47,093		47,802
Financial leverage ratio(3)	2.8	x	2.4	x

⁽¹⁾ Non-IFRS measure. Refer to the table Reconciliation of Net Loss to adjusted EBITDA in MD&A section 5 "Non-IFRS Performance Measures". Adjusted EBITDA corresponds to net operating (loss) earnings before costs not related to current operations, depreciation and amortization and expenses for stock-based compensation plan.
⁽²⁾ Non-IFRS measure. Refer to MD&A section 5 "Non-IFRS Performance Measures". Net debt corresponds to bank indebtedness, current portion of long-term debt and long-term debt, net of cash.
⁽³⁾ Financial leverage ratio is an indicator of the Company's ability to service its long-term debt. It is defined as net debt / adjusted EBITDA less lease liability payments and interests on lease obligations for the last four quarters. Refer to MD&A section 5 "Non-IFRS Performance Measures".

“The growth in purchasing volume with our distribution clients allows us to continue to gain market share and mitigate the slowdown in the restaurant industry as well as the anticipated impact of the renewal of the supply agreement with an institutional client at lower margins than 2024,” said Louis Frenette, President and Chief Executive Officer of Colabor. “In order to mitigate the impact of this renewed agreement, we were able to reduce our operating expenses and prioritize debt repayment, which once again demonstrates the prudent approach of the management team.”

Results for the First Quarter of 2025

Consolidated sales for the first quarter were $131.7 million, an increase of 0.4% compared to $131.2 million during the corresponding quarter of 2024. The increase in distribution activities sales by 3.0% is primarily as a result of a volume increase and the acquisition of Beaudry & Cadrin's assets in March 2024. This growth was mitigated by the renewal of a supply agreement with an institutional customer at economic conditions significantly lower to the margins in effect in 2024, as well as the current economic uncertainties affecting the restaurant industry. Wholesale activities sales have decreased by 3.8 %, mainly as a result of the restaurant industry slowdown during the first quarter of 2025.

Adjusted EBITDA⁽¹⁾ from continuing activities was $2.3 million or 1.7% of sales from continuing activities compared to $4.9 million or 3.7% during 2024. The variation is mainly explained by the decrease in gross margin related to the supply agreement renewed in December 2024, as explained above.

Net loss from continuing operations and net loss were $4.0 million, up from $1.8 million for the corresponding quarter of the previous year, resulting essentially from a decrease of the adjusted EBITDA⁽¹⁾ and an increase in costs not related to current operations, mitigated by higher income taxes recovery.

Cash Flow and Financial Position

Cash flows from operating activities were $6.2 million for the first quarter compared to $11.7 million for the corresponding period of 2024. This decrease is mainly due to higher utilization of working capital⁽⁴⁾, combined with the decreased adjusted EBITDA⁽¹⁾. The higher utilization of working capital⁽⁴⁾ is explained by investments in inventories for the purpose of preparing for the high summer season.

As at March 22, 2025, the Company's working capital⁽⁴⁾ was $45.8 million, down from $50.3 million at the end of the fiscal year 2024. This decrease is the result of the seasonality effect.  

As at March 22, 2025, the Company's net debt⁽²⁾ was down to $47.1 million, compared to $47.8 million at the end of the fiscal year 2024, resulting from the credit facility repayment of $5.8 million, mitigated by a decrease in cash.

Outlook

“We continue to focus on sound financial management of our finances, working to gain market share in Western Quebec while improving our product and customer mix. This will help us to gradually mitigate the impact of the renewal of the important contract at lower margin,” concluded Mr. Frenette.

Non-IFRS Performance Measures

The information provided in this release includes non-IFRS performance measures, notably adjusted earnings before financial expenses, depreciation and amortization and income taxes ("Adjusted EBITDA")⁽¹⁾. As these concepts are not defined by IFRS, they may not be comparable to those of other companies. Refer to Section 5 "Non-IFRS Performance Measures" in the Management's Discussion and Analysis.

Reconciliation of Net Loss to Adjusted EBITDA(1)	12 weeks
(in thousands of dollars)	2025		2024
	$		$
Net loss from continuing operations	(4,022	)	(1,776	)
Income taxes recovery	(1,428	)	(616	)
Financial expenses	2,649		2,589
Operating (loss) earnings	(2,801	)	197
Expenses for stock-based compensation plan	22		15
Costs not related to current operations	325		99
Depreciation and amortization	4,732		4,571
Adjusted EBITDA(1)	2,278		4,882

Additional Information

The Management's Discussion and Analysis and the consolidated financial statements of the Company are available on SEDAR+ (www.sedarplus.ca). Additional information, including the annual information form, about Colabor Group Inc. can also be found on SEDAR+ and on the Company’s website at www.colabor.com.

Forward-Looking Statements

This press release contains certain forward-looking statements as defined under applicable securities law. Forward-looking information may relate to Colabor's future outlook and anticipated events, business, operations, financial performance, financial condition or results and, in some cases, can be identified by terminology such as "may"; "will"; "should"; "expect"; "plan"; "anticipate"; "believe"; "intend"; "estimate"; "predict"; "potential"; "continue"; "foresee"; "ensure" or other similar expressions concerning matters that are not historical facts. Particularly, statements regarding the Company’s financial guidelines, future operating results and economic performance, objectives and strategies are forward-looking statements. These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects and opportunities, which Colabor believes are reasonable as of the current date. Refer in particular to section 2.2 "Development Strategies and Outlook" of the Company's MD&A. While Management considers these assumptions to be reasonable based on information currently available to the Company, they may prove to be incorrect. Forward-looking information is also subject to certain factors, including risks and uncertainties that could cause actual results to differ materially from what Colabor currently expects. For more exhaustive information on these risks and uncertainties, the reader should refer to section 6 "Risks and Uncertainties" of the Company's MD&A. These factors are not intended to represent a complete list of the factors that could affect Colabor and future events and results may vary significantly from what Management currently foresees. The reader should not place undue importance on forward-looking information contained in this press release, information representing Colabor's expectations as of the date of this press release (or as of the date they are otherwise stated to be made), which are subject to change after such date. While Management may elect to do so, the Company is under no obligation (and expressly disclaims any such obligation) and does not undertake to update or alter this information at any particular time, whether as a result of new information, future events or otherwise, except as required by law.

Conference Call

Colabor will hold a conference call to discuss these results on Friday, May 2, 2025, beginning at 9:30 a.m. Eastern time. Interested parties can join the call by dialing 1-800-990-4777 (from anywhere in North America) or 1-289-819-1299 (Toronto) or 1-514-400-3794 (Montreal). If you are unable to participate, you can listen to a recording by dialing 1-888-660-6345 or 1-289-819-1450 and entering the code 41794# on your telephone keypad. The recording will be available from 1:30 p.m. on Friday, May 2, 2025, until 11:59 p.m. on May 9, 2025. Note that the recording will be available offline on our website at the following address:
https://colabor.com/en/investisseurs-en/evenements-et-presentations/

You can also use the QuickConnect link: https://emportal.ink/3G404we. This new link allows any participant to access the conference call by clicking on the URL link and enter their name and phone number.

About Colabor

Colabor is a distributor and wholesaler of food and related products serving the hotel, restaurant and institutional markets or "HRI" in Quebec and in the Atlantic provinces, as well as the retail market. Within its two operating activities, Colabor offers specialty food products such as meat, fish and seafood, as well as food and related products through its Broadline activities.

Further information:

Pierre Blanchette Senior Vice President and Chief Financial Officer Colabor Group Inc Tel.: 450-449-4911 extension 1308 investors@colabor.com

Danielle Ste-Marie Ste-Marie Strategy and Communications Inc. Investor Relations Tel.: 450-449-0026 extension 1180