New Look Vision Group Reports Q2 Results, Provides Update on COVID-19 Response, Store Re-Openings and New Financing

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MONTREAL—New Look Vision Group Inc. (TSX: BCI), a leader in the Canadian retail optical industry with stores across Canada and stores in Florida, reported financial results Friday for the 13- and 26-week periods ended June 27, and provided updates on actions in response to COVID-19, store re-openings, and new financing arrangements. Antoine Amiel, president and CEO, stated, "The second quarter started after most of the company’s retail stores stopped operating mid-March. Gradual reopening started mid-May and was completed by June 21 when the last local retail operation restrictions were lifted. In March, the company implemented a high impact cash conservation plan which yielded minimum cash burn throughout the 90+ day physical retail shutdown. This, in addition to revenues generated online, is reflected in the strong cash position at quarter’s end, given the circumstances."

He continued, "Retail operations re-started in each market as soon as local regulatory restrictions allowed and under all-encompassing safety first internal protocols. Trade has been brisk since the re-start. Strengthened by its resilience, financial and organizational strengths throughout the COVID-19 disruption, the company has resumed its profitable growth journey, organic and external. I am, more than ever, in awe of the New Look Vision Group people’s fortitude through the ordeal and dedication to eyecare and eyewear since the re-start. They deserve the highest praise and deepest gratitude."

Among New Look's Q2 highlights, which were significantly impacted by COVID-19:

• Revenues decreased by 64.9 percent to $27.4 million, resulting principally from COVID-19 temporary store closures, as well as scheduled store closures offset by revenue from newly acquired stores.

• Adjusted EBITDA attributed to shareholders totaled $1.2 million, a decrease of $14.1 million or 92.3 percent from last year

• Net loss attributed to shareholders was $12.4 million, a decrease of 281.5 percent from last year.

• Adjusted net (loss)/earnings attributed to shareholders decreased by 231.7 percent to ($9.7) million.

• Cash flows related to operating activities reached $5.5 million, a decrease of $4.7 million or 46.3 percent from last year.
 
• During the quarter, the company successfully secured $73.9 million of additional bank and subordinated debt financing.

• The Board of Directors suspended the regular quarterly dividend and the corresponding dividend reinvestment plan until further notice, effective March 19, 2020 in order to improve liquidity during the COVID-19 period.

For the year to date, the company said it has adopted IFRS 16 Leases effective Q1 2020. The company has applied a modified retrospective approach; the operating results of previous fiscal periods have not been restated.

• Year-to-date revenues and adjusted EBITDA attributed to shareholders were $95.5 million and $16.6 million respectively, which represent decreases of 36.2 percent and 38.9 percent respectively from last year.

• The increase in the number of stores in the last twelve months reflects the acquisition of 19 stores net of five planned closures and the sale of one clinic.

• Net (loss)/earnings attributed to shareholders were ($12.7) million, compared to $8.9 million last year.

• Adjusted net (loss)/earnings attributed to shareholdersdecreased to ($8.3) million, a decrease of $19.6 million, as compared to last year.

• Cash flows related to operating activities reached $19.0 million, a decrease of 16.7 percent as compared to last year.

New Look Vision said that it has and continues to respond swiftly to the crisis along three principles: participation, protection and responsibility.

• Participation in stemming the pandemic spread by closing a large number of locations early on (stores, offices, factories and distribution centers).

• Protection for employees with a supplemental pay program for those placed on temporary leave. Protection of our financial autonomy with immediate cash burn optimization (expense freeze, CAPEX postponement, dividend suspension, executive pay reduction) and expansion of our available funding from both our lenders. As a result, the Company is confident that it has the necessary financial resource to sustain the ongoing impact of the pandemic.

• Responsibility, as eye care professionals, to keep open a minimum number of stores to serve those in urgent need of eye care and eyewear. The company launched the Guardian Angel program on March 25 giving hospital personnel the opportunity to replace broken eyewear quickly. Our central lens processing facility retooled to produce safety eyewear for use in health care facilities.

Throughout the shutdown, teams working on strategic initiatives, both internal and external, have carried on and New Look Vision said it continues to diligently control its cost structure while actively monitoring market conditions.

Gradual store reopening started on May 4 in line with local and professional regulations. Ahead of reopening stores, the company issued stringent health and safety procedures, undertook extensive training in the form of in-store rehearsals and is providing each location with prescribed personal protection equipment. By the end of the second quarter, the Company's entire store network had re-opened.

In Q2 2020, the company successfully secured an additional $73.9 million in bank and subordinated debt financing to strengthen its balance sheet and boost liquidity for both working capital and acquisition and development purposes. As at June 27, 2020, as a result, it had $47.1 million of cash on hand and undrawn credit and subordinated debt facilities of $52.7 million.

New Look Vision is a leader in the eyecare industry in Canada with a network of 391 stores operating mainly under the New Look Eyewear, Vogue Optical, Greiche & Scaff, Iris, and Edward Beiner banners (in the US) and laboratory facilities using state-of-the-art technologies.