(Windsor, Ontario – December 1, 2022) – Reko International Group Inc. (TSX-V: REKO) today announced results for its first quarter ended October 31, 2022.
Consolidated sales for the quarter ended October 31, 2022, were $13.8 million, compared to $12.1 million in the prior year, an increase of $1.7 million or 14.0%. The increase in sales was largely related to persistent efforts by the sales and estimating teams which resulted in a steady flow of work. Increased pricing to help relieve some supply chain costs helped, as did an increase in the average foreign exchange rate.
Gross profit for the quarter ended October 31, 2022 was $2.2 million compared to a gross profit of $1.8 million in the prior year. Gross profit as a percentage of sales increased to 16.1%, compared to 15.2% for the same period last fiscal year. The regular attention by all levels within the organization to project performance has contributed greatly to improvement in overall efficiency, by allowing team members to react quickly to any operational inefficiencies. Navigating a very tough cost environment continues to be a daily challenge.
Selling and administrative expenses for the quarter ended October 31, 2022 were $1.6 million compared to $1.2 million in the prior year. An increase in recruiting costs to fill some positions contributed to the increase in SG&A. Retaining skilled labour is also crucial, particularly during these times when finding skilled labour can be challenging. The company invested in its workforce by offering wage increases and the opportunity to earn a performance bonus.
Net income for the quarter ended October 31, 2022 was $0.7 million or $0.12 per share, compared to $0.5 million, or $0.08 per share in the prior year.
During the quarter, the company repurchased and cancelled 54,437 shares under the normal course issuer bid. Under the current normal course issuer bid which commenced December 31, 2021, the Company was permitted to purchase up to a total of 300,837 common shares. All shares available under this current bid have now been repurchased and cancelled at a net cost of $1.48 million.
Reko is please to announce the upcoming payment of a special cash dividend of $0.25 per share to all shareholders of record on December 15, 2022, with a payment date of January 13, 2023. Shareholders are asked to ensure that TSX Trust Company has their up-to-date contact information, including mailing address, in order to expediate the payment of the dividend.
“Our bottom-line improvement for the quarter, year over year, reflects the dedicated and innovative efforts of many people on the Reko team”, stated Diane Reko, CEO. “Even with the continued supply chain challenges in both pricing and delivery of components, and with continued scarcity of skilled labour, we managed to increase our year over year sales and net income. We continue to seek innovative solutions to these new realities and are demonstrating that our team is up to the challenge.”