Emperor Metals Inc. — Interim / Quarterly Report 2021

Jul 16, 2021

Jewett-Cameron Announces 3[rd] Quarter Financial Results

North Plains, Oregon, July 15, 2021 – Jewett-Cameron Trading Company Ltd. (NASDAQ: JCTCF) today reported financial results for the third quarter and nine month periods of fiscal 2021 ended May 31, 2021.

Sales for the third quarter of fiscal 2021 totaled approximately $21.6 million compared to sales of $16.2 million for the third quarter of fiscal 2020. Income from operations was $2,638,010 compared to $1,913,582 for the third quarter ended May 31, 2020. Net income after other items and income taxes for the current quarter was $2,414,477, or $0.69 per share, compared to net income of $1,396,973, or $0.40 per share, in the same quarter of 2020.

For the nine months ended May 31, 2021, Jewett-Cameron reported sales of $42.4 million compared to sales of $30.9 million for the nine months ended May 31, 2020. Net income was $2,849,839, or $0.82 per share, compared to net income of $1,216,089, or $0.33 per share, in the first nine months of fiscal 2020.

Net income for both the three and nine month periods ended May 31, 2021 were positively affected by a one-time gain of $687,387 related to the forgiveness of the Company’s PPP loans.

“We are pleased with the higher level of sales and net income in the current periods, which continues to reflect the success of our ongoing corporate strategy”, said CEO Charlie Hopewell. “All of our sales channels showed sales increases, with many customers boosting both the volume of individual products and the number of different products in their orders. However, the worldwide supply chain disorder is having a negative effect on our operations and margins, which may continue for the remainder of fiscal 2021 and into fiscal 2022.”

As of May 31, 2021, the Company’s cash position was approximately $2.2 million. Due to higher customer demand and logistical issues, the Company tapped its line of credit in the third quarter. The borrowing totaled $996,010 as of May 31, 2021. In June 2021, the Company’s line of credit was increased from $3.0 million to $5.0 million.

About Jewett-Cameron Trading Company Ltd.

Jewett-Cameron Trading Company is a holding company that, through its subsidiaries (Jewett-Cameron Companies), operate out of facilities located in North Plains, Oregon. Those businesses consist of the manufacturing and distribution of patented and patent pending specialty metal products, wholesale distribution of wood products, and seed processing and sales. Examples of the Company’s brands include Lucky Dog®, Animal House® and AKC (used under license from the American Kennel Club) for pet enclosures and kennels; Adjust-A-Gate, Fit-Right™, LIFETIME POST™and Perimeter Patrol® for gates and fencing; Early Start, Spring Gardener™, and Weatherguard for greenhouses; and TrueShade® for patio umbrellas, furniture covers and canopies.

Forward-looking Statements

The information in this release contains certain forward-looking statements that anticipate future trends and events. These statements are based on certain assumptions that may prove to be erroneous and are subject to certain risks, including but not limited to, the uncertainties of the Company’s new product introductions, the risks of increased competition and technological change in the Company’s industry, and other factors detailed in the Company’s SEC filings. Accordingly, actual results may differ, possibly materially, from predictions contained herein.

JEWETT-CAMERON TRADING COMPANY LTD. CONSOLIDATED BALANCE SHEETS

(Expressed in U.S. Dollars) (Prepared by Management) (Unaudited)

ASSETSCurrent assetsCash and cash equivalentsAccounts receivable, net of allowanceof $Nil (August 31, 2020 - $Nil)Inventory, net of allowanceof $250,000 (August 31, 2020 - $65,000) (note 3)Prepaid expensesTotal current assetsProperty, plant and equipment, net(note 4)Intangible assets, net(note 5)Total assets	May 31,2021August 31,2020
	$ 2,170,046$ 3,801,03711,051,0616,274,4267,767,6409,198,1462,580,8561,036,128
	23,569,60320,309,7373,799,4022,967,56512,910659
	$ 27,381,915$ 23,277,961
LIABILITIES AND STOCKHOLDERS’ EQUITYCurrent liabilitiesAccounts payableBank indebtednessCurrent portion of notes payableIncome taxes payableAccrued liabilitiesTotal current liabilitiesLong-term liabilitiesNotes payableDeferred tax liabilityTotal liabilitiesStockholders’ equityCapital stockAuthorized21,567,564 common shares, without par value10,000,000 preferred shares, without par valueIssued3,489,161 common shares (August 31, 2020 – 3,481,162)Additional paid-in capitalRetained earningsTotal stockholders’ equityTotal liabilities and stockholders’ equity	$ 1,557,721$ 1,095,061996,010--342,326230,19040,5962,290,2352,016,300
	5,074,1563,494,283-338,38139,18496,952
	5,113,3403,929,616823,171821,284687,211618,70720,758,19317,908,354
	22,268,57519,348,345
	$ 27,381,915$ 23,277,961

JEWETT-CAMERON TRADING COMPANY LTD. CONSOLIDATED STATEMENTS OF OPERATIONS

(Expressed in U.S. Dollars) (Prepared by Management) (Unaudited)

SALESCOST OF SALESGROSS PROFITOPERATING EXPENSESSelling, general and administrative expensesDepreciation and amortizationWages and employee benefitsIncome from operationsOTHER ITEMSGain on sale of property, plant andequipmentGain on extinguishment of debtInterest and other incomeIncome before income taxesIncome tax expenseNet incomeBasic earnings per common shareDiluted earnings per common shareWeighted average number of commonshares outstanding:BasicDiluted	Three MonthPeriod EndedMay 31,20212020	Three MonthPeriod EndedMay 31,20212020	Nine MonthPeriod EndedMay 31,20212020
	$ 21,619,95216,037,702	$ 16,241,23911,931,746	$ 42,396,591$ 30,918,34531,239,86622,555,253
	5,582,250966,29969,3531,908,588	4,309,493706,07954,7811,635,051	11,156,7258,363,0922,556,9022,118,999175,171160,9925,226,0214,343,412
	2,944,2402,638,010-687,387(6,282)	2,395,9111,913,5822,2003,217	7,958,0946,623,4033,198,6311,739,689-2,600687,387(283)21,414
	681,1053,319,115(904,638)	5,4171,918,999(522,026)	687,10424,0143,885,7351,763,703(1,035,896)(547,614)
	$ 2,414,477	$ 1,396,973	$ 2,849,839$ 1,216,089
	$ 0.69$ 0.693,489,1613,489,161	$ 0.40$ 0.403,481,1623,481,162	$ 0.82$ 0.33$ 0.82$ 0.333,485,5253,672,8583,485,5253,672,858

JEWETT-CAMERON TRADING COMPANY LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS (Expressed in U.S. Dollars) (Prepared by Management) (Unaudited)

CASH FLOWS FROM OPERATING ACTIVITIESNet incomeItems not involving an outlay of cash:Depreciation and amortizationStock-based compensation expense(Gain) on sale of property, plant and equipmentGain on extinguishment of debtDeferred income tax expenseChanges in non-cash working capital items:(Increase) in accounts receivableDecrease (increase) in inventory(Increase) in notes receivable(Increase) in prepaid expensesDecrease in prepaid income taxesIncrease in accounts payable and accrued liabilitiesIncrease in income taxes payableNet cash (used in) provided by operating activitiesCASH FLOWS FROM INVESTING ACTIVITIESPurchase of property, plant and equipmentProceeds from sale of property, plant andequipmentNet cash provided by (used in) investing activitiesCASH FLOWS FROM FINANCING ACTIVITIESProceeds from bank indebtednessIncrease in notes payableRedemption of common stockNet cash provided by (used in) financing activitiesNet (decrease) in cashCash, beginning of periodCash, end of period	Nine MonthPeriod EndedMay 31,20212020
	$ 2,849,839$ 1,216,089175,171160,99270,391--(2,600)(680,707)-(57,768)39,571(4,776,635)(4,044,507)1,430,506(408,282)-(561,813)(1,544,728)(942,541)-101,686736,5951,448,292189,594-
	(1,607,742)(2,993,113)(1,019,259)(207,469)-3,900
	(1,019,259)(203,569)996,010--680,707-(3,867,046)
	996,010(3,186,339)(1,630,991)(6,383,021)3,801,0379,652,310
	$ 2,170,046$ 3,269,289

Contact: Charlie Hopewell, Chief Executive Officer, (503) 647-0110

Source: Jewett-Cameron Trading Company Ltd.