Newspaper article The Canadian Press

Stella-Jones Boosts Dividend on Record 2012 Results; Q4 Misses Analyst Forecasts

Newspaper article The Canadian Press

Stella-Jones Boosts Dividend on Record 2012 Results; Q4 Misses Analyst Forecasts

Article excerpt

Stella-Jones ups dividend on strong earnings

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MONTREAL - Stella-Jones slightly missed analyst expectations in the fourth quarter but the Quebec-based wood products manufacturer is increasing its dividend 25 per cent following record annual sales and profits last year and the prospects of benefiting from a North American recovery in 2013.

"In the year ahead, we believe Stella-Jones will continue to experience solid demand for its core products and that revenues should continue to grow," president and CEO Brian McManus said Friday during a conference call.

"The recovery of the North American economy appears to be gaining momentum. We therefore anticipate increased opportunities to build shareholder value."

The company, which makes railway ties, utility poles and other pressure-treated wood products, said Friday that it will boost its quarterly dividend by four cents to 20 cents per share, effective with the April 30 payout.

The shares (TSX:SJ) were down 47 cents at $80.25 near midday Friday on the Toronto Stock Exchange.

Based on recent market prices, the dividend would yield just under one per cent annually. The stock has traded between $41.80 and $82.01 over the past year.

For the fourth quarter, Stella-Jones said net earnings were $16.5 million or $1 per diluted share on sales of $159.3 million. That was up from $13.4 million or 83 cents per diluted share of net income on sales of $147.5 million in the final three months of 2011.

The earnings in the last quarter of 2012 included tax benefits associated with land donated to local development authorities and costs related to the McFarland Cascade acquisition.

Meanwhile, for 2012 as a whole, the company says net profit was $73.1 million or $4.53 per diluted share on sales of $717.5 million. That was up from a net profit of $55.7 million or $3.48 per diluted share on sales of $640.1 million in 2011.

Last year marked the company's 12th consecutive year growing profits, driven by constant efforts to enhance operating efficiency and "a methodical execution of our continental expansion strategy," McManus said.

He said demand for its core products should remain strong as North American railway operators upgrade and expand their infrastructure while demand is expected to hold in the utility pole market. …

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