SEDAR Filing
July 05, 2011
2010 Data
Check list:
1.Major Business.
A BC based company which operates 22 ice sport center with 64 ice surfaces mainly for hockey and skating program. 18 in Canad, 4 in US. Company entered ice sports at 1986. IPO at 1990.
around 70% revenue is from ice sports. include ASHL league: 35% of revenue. Third party contract around 20%. Food and Beverage around 20%.
Ontario 50%. BC: 25%.
Q1 and Q4 20% higher than Q2 and Q3.
2.Balance sheet.
Recent Price: $1.90, Tangible book value: $3.49:, Share outstanding:13,3m, Market Cap: $25m.
Current asset:$14.5m Current liability:$19.8m, Debt: $44.4m, Inventory: $1m, Cash: $8.9m.
Current ratio <1.
3.Credit facility.
(1) $30m 6.79% loan mature at 2018. 20 years term. $27 outstanding. $1.5m payment of principle per year from Sept to Dec.
(2) $20m prime + 1.5% mature at 2014. $17m outstanding. Seems $1.2m payment of principle per year.
Interest expense around $3.5m at 2010.
4.Financial data by years.
| 2010 | 2009 | 2008 | 2007 | 2006 | 2005 | 2004 | 2003 | 2002 | 2001 | |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 69.8 | 67.2 | 64.7 | 62.5 | 55.2 | 48.8 | 46.1 | 45.0 | 42.3 | 39.8 |
| OP Income | 5.4 | 8.0 | 8.5 | 6.0 | 8.7 | 4.7 | 4.1 | 4.1 | 3.2 | 0 |
| Income/s | 0.05 | 0.20 | 0.29 | 0.05 | 0.10 | 0.07 | 0.15 | (0.11) | (0.11) | (0.33) |
| FCF | 3.2 | 6.2 | 6.2 | 4.0 | (2.8)* | 3.2 | 3.4 | 2.5 | 2.2 | (1.2) |
| Cash | 8.9 | 9.2 | 7.6 | 4.6 | 4.8 | 1.2 | 1.2 | 4.1 | 4.0 | 2.5 |
| Debt | 44.4 | 46.6 | 49.1 | 50.3 | 53.2 | 49.1 | 47.2 | 50.8 | 53.9 | 55.5 |
Revenue is 3 times of market cap.
* 2006 has $12.7m in capital expenditure.
5.Cost structure
Leasing obligations. Flexible cost structure or fixed cost structure? Cost controls.
6.Insider holding, options, Insider trading info, share buy back.
Bartrac Investment: 75% of share. 10m shares.
Frank D. Barker and Geoffrey J. Barker seems the owner of it.
7.Management compensation.
St. Aubin: CEO less than $300k a year.
8.Employee numbers. Revenue/Employee. Compensation/Employee.
963 at 2010. 4 facilities use unionized worker.
9.Industry comparison.
Major competitors in the same industry. Whether the business is competitive?
10.Auditor
KPMG LLP
11.Major events.
(1) Grant Ballantyne retire at end of 2008 as CEO.
12.Comments.
(1) Current ratio is quite low. However, there is $11m among current liability which is differed income and customer deposit. So it is not likely to be a problem.
(2) FCF seems good since 2004. Average income still a little bit low.
(3) It seems quite leveraged with quite a lot of debt. However, with its real estate value and positive cash flow. It doesn't seems be a problem.
(4)Trading volume seems really low. Maybe hard to buy and sell.
