Inscape Announces Fourth Quarter and Annual Results

- Annual sales increased by 15% year over year - 3 more West Elm Workspace with Inscape showrooms open this quarter - 5 more Platinum Dealers added during the fourth quarter

ID: 1443446
recent pressrelease next pressrelease

(businesspress24) - HOLLAND LANDING, ONTARIO -- (Marketwired) -- 06/23/16 -- Inscape (TSX: INQ) today announced its fourth quarter and annual financial results ended April 30, 2016.

During fiscal 2016, Management continued to focus and build on its four key strategic objectives which are the foundation of the Company''s strategic growth and development: (1) Enhance and expand the Company''s products to provide a full range of products for end users; (2) Generate a dedicated distribution network; (3) Create a customer interface platform that leverages leading edge technology, simplifies fulfillment process, meet customer needs more quickly; (4) Re-invent the industrial system. These key strategic initiatives are creating a strong foundation for growth of the Company.

"We are seeing the results of our focus on our key strategic objectives," said Jim Stelter, CEO. "Inscape made significant strides in the improvement of our dealer network this year, including participation in the most robust training program in our company''s history. We have seen increased utilization of our F.I.R.E. software, a key differentiator linking visualization, specification, order acknowledgement and shipment of our products to market. In addition, we are committed to delivering not only superior service, but also innovative products that meet the needs of today''s workspaces. We will build on the success seen at NeoCon this year, with our two Best of NeoCon awards."

Financial Results

Sales in the fourth quarter was 62% higher than the same quarter of last year. All business segments achieved an increase in sales volume and the addition of West Elm Workspace with Inscape and seating solutions also contributed to the growth in the current quarter''s sales. With the exclusion of U.S. currency impacts, sales in the fourth quarter was 33.7% higher than the same quarter of last year.

The current quarter had a net income of $5.4 million, compared with a net loss of $3.4 million in the same quarter of last year. During the fourth quarter of the year, the Company reorganized its administrative and overhead support functions that will reduce expenses in future years. A restructuring cost of $0.4 million was accrued in the quarter. $0.3 million of the costs was included in the overhead component of the costs of goods sold. The current quarter income also included an unrealized gain of $7.5 million relating to the change in the fair market value of the outstanding U.S. currency hedge contracts, whereas the same quarter of last year had an unrealized gain of $5.9 million. With the exclusion of these unrealized derivative gains, the current quarter had an adjusted loss of $1.3 million compared with the same quarter of last year''s adjusted loss of $4.9 million. The improvement of $3.6 million was mainly a result of higher sales volume and lower production costs that benefited from economy of scale.

On an annual basis, sales increased $10.5 million (15%) compared to 2015, which resulted from volume increase in all product segments, favorable US exchange rates, new products under the brand name of West Elm Workspace with Inscape, and the addition of seating solutions. With the exclusion of the U.S. exchange rate, year-over-year sales increase was 2.1%.

Fiscal year 2016 had a net loss of $1.3 million or 9 cents per share, compared to a net loss of $13.1 million, or 91 cents per share a year ago. The current year''s loss included a derivative gain of $4.7 million and unrealized exchange gain of $0.3 million due to the revaluation of FX hedges and exchange respectively. With the exclusion of the currency adjustments, the restructuring cost and certain one-time items to be discussed below, fiscal year 2016 would have an adjusted loss of $5.0 million compared to last year''s adjusted loss of $6.4 million before taxes.

The fourth quarter gross profit as a percentage of sales was 15.9 percentage points higher than the same quarter of last year due to higher volume, favourable USD exchange rates, and lower production costs benefited from economy of scale; partially offset by the restructuring cost of $0.3 million, or 1.6% of the quarter''s sales.

On an annual basis, gross profit as a percentage of sales increased 3.5 percentage point from last year''s 21.3% to current year''s 24.8%. This increase was due to favourable overhead absorption with higher sales volume, lower variable and fixed cost of sales, which was offset by unfavourable realized selling prices.

Selling, General & Administrative Expenses ("SG&A") for the quarter was 33.5% of sales, compared with last year''s 50.3%. The current quarter''s expense of $6.9 million was $0.5 million or 7.9% higher than the same quarter of last year, of which $0.3 million was variable SGA relating to higher sales volume. The remaining $0.2 million increase in SGA consists mainly of higher fixed selling expenses and depreciation of F.I.R.E. SG&A for the year was 32.8% of sales versus 32.2% of last year.

The fiscal year''s SGA of $26.2 million was $3.9 million or 17.1% higher than last year. $0.4 million of the increase was variable SGA for higher sales. The remaining $3.5 million mainly consists of one-time settlement loss on the wind-up one of the Company''s defined benefit pension plans, investment in West Elm Workspace with Inscape start-up and operating costs, and investment in sales initiatives, new products and higher health care expenses in Canada and the US.

At the end of the fiscal year 2016, the company was debt-free with cash and cash equivalents of $6.0 million and short-term investments of $4.5 million.

Financial Statements

Fourth Quarter Call Details

Inscape will host a conference call at 8:30 AM EST on Friday, June 24, 2016 to discuss the company''s quarterly and annual results. To participate, please call 1-888-227-5826 five minutes before the start time. A replay of the conference call will also be available from June 24, 2016 after 10:30 AM EST until 10:30 AM EST on July 1, 2016. To access the rebroadcast, please dial 1-800-558-5253 (Reservation Number 21813150).

Forward-looking Statements

Certain of the above statements are forward-looking statements that involve risks and uncertainties. Actual results could differ materially as a result of many factors including, but not limited to, further changes in market conditions and changes or delays in anticipated product demand. In addition, future results may also differ materially as a result of many factors, including: fluctuations in the company''s operating results due to product demand arising from competitive and general economic and business conditions in North America; length of sales cycles; significant fluctuations in international exchange rates, particularly the U.S. dollar exchange rate; restrictions in access to the U.S. market; changes in the company''s markets, including technology changes and competitive new product introductions; pricing pressures; dependence on key personnel; and other factors set forth in the company''s Ontario Securities Commission reports and filings.


Inscape, an award-winning designer and manufacturer of office furniture, has been initiating change in workspace design for over 125 years. With an emphasis on quality, innovation, technical design and unparalleled delivery and service, Inscape has been consistently awarded for its design.

Inscape collaborates with leading European partners and manufactures their designs in North American facilities. Our systems, storage, seating and wall solutions delight users, foster agility and empower technology in the workplace. Flexible and designed for sustainability, Inscape products enable easy customization and readily adapt to keep pace with changing needs in the workplace.

For more information, visit .


Matthew Posno
Chief Financial Officer
905 836 7676
905 836 5037 (FAX)

More information:

Keywords (optional):


Company information / Profile:

PressRelease by


PressContact / Agency:

published by: Marketwired
print pressrelease  send to a friend  

Date: 06/23/2016 - 14:55
Language: English
News-ID 1443446
Character count: 3026
Firma: Inscape Corporation
Ansprechpartner: Feedback to about Pressrelease-id:


Number of hits: 373


Direct Link to this PressRelease:

We would appreciate a link in your News-, Press- or Partner-Site.

Comments on this PressRelease

All members: 9 437
Register today: 0
Register yesterday: 0
Members online: 0
Guests online: 113

Don't have an account yet? You can create one. As registered user you have some advantages like theme manager, comments configuration and post comments with your name.