TWC Enterprises Limited Announces Third Quarter 2022 Results and Eligible Dividend

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    Travel 6 Megapixl Imdan TWC Enterprises Limited Announces Third Quarter 2022 Results and Eligible Dividend

    KING CITY, Ontario, Oct. 31, 2022 (GLOBE NEWSWIRE) —



    Consolidated Financial Highlights (unaudited)


    (in thousands of dollars except per share



    amounts)
    Three months ended
    Nine months ended

    September 30,



    2022
    September 30,



    2021
    September 30,



    2022
    September 30,



    2021
    Net earnings
    11,920
         		22,757
    14,421
         		27,684
    Basic and diluted earnings per share
    0.49
         		0.93
    0.59
         		1.12



    Operating Data


    Three months ended
    Nine months ended

    September 30,



    2022
    September 30,



    2021
    September 30,



    2022
    September 30,



    2021
    Canadian Full Privilege Golf Members
    16,014
         		15,714
    Championship rounds – Canada
    583,000
         		631,000
    1,027,000
         		993,000
    18-hole equivalent championship golf courses – Canada
    37.5
         		39.5
    18-hole equivalent managed championship golf courses – Canada
    2.0
         		2.0
    Championship rounds – U.S.
    32,000
         		37,000
    199,000
         		193,000
    18-hole equivalent championship golf courses – U.S.
    8.0
         		8.0

    The following is an analysis of net earnings:

    For the three months ended

    (thousands of Canadian dollars)
    September 30, 2022
         		September 30, 2021
    Operating revenue
    $
    65,009
         		$ 63,245
    Direct operating expenses

    (1)
    42,687
         		36,292
    Net operating income

    (1)
    22,322
         		26,953
    Amortization of membership fees
    1,329
         		1,324
    Depreciation and amortization
    (4,493
    )
         		(4,712 )
    Interest, net and investment income
    (1,510
    )
         		(263 )
    Other items
    (1,517
    )
         		5,109
    Income taxes
    (4,211
    )
         		(5,654 )
    Net earnings
    $
    11,920
         		$ 22,757

    For the nine months ended

    (thousands of Canadian dollars)
    September 30, 2022
         		September 30, 2021
    Operating revenue
    $
    155,677
         		$ 111,413
    Direct operating expenses

    (1)
    115,210
         		77,681
    Net operating income

    (1)
    40,467
         		33,732
    Amortization of membership fees
    3,349
         		3,319
    Depreciation and amortization
    (13,375
    )
         		(14,255 )
    Interest, net and investment income
    (812
    )
         		(1,083 )
    Other items
    (7,669
    )
         		10,446
    Income taxes
    (7,539
    )
         		(4,475 )
    Net earnings
    $
    14,421
         		$ 27,684

    The following is a breakdown of net operating income (loss) by segment:

    For the three months ended

    (thousands of Canadian dollars)
    September 30, 2022
         		September 30, 2021
    Net operating income (loss) by segment
    Canadian golf club operations
    $
    23,626
         		$ 28,016
    US golf club operations
    (2022 – US loss $375,000; 2021 – US loss $294,000)
    (493
    )
         		(370 )
    Corporate and other
    (811
    )
         		(693 )
    Net operating income

    (1)
    $
    22,322
         		$ 26,953

    For the nine months ended

    (thousands of Canadian dollars)
    September 30, 2022
         		September 30, 2021
    Net operating income (loss) by segment
    Canadian golf club operations
    $
    40,209
         		$ 34,194
    US golf club operations
    (2022 – US $2,482,000; 2021 – US $1,422,000)
    3,120
         		1,786
    Corporate and other
    (2,862
    )
         		(2,248 )
    Net operating income

    (1)
    $
    40,467
         		$ 33,732

    Operating revenue is calculated as follows:

    For the three months ended

    (thousands of Canadian dollars)
    September 30, 2022
         		September 30, 2021
    Annual dues
    $
    16,967
         		$ 19,598
    Golf
    17,965
         		21,161
    Corporate events
    4,855
         		2,347
    Food and beverage
    16,035
         		12,134
    Merchandise
    5,760
         		4,799
    Rooms and other
    3,427
         		3,206
    Operating revenue
    $
    65,009
         		$ 63,245

    For the nine months ended

    (thousands of Canadian dollars)
    September 30, 2022
         		September 30, 2021
    Annual dues
    $
    51,055
         		$ 41,532
    Golf
    37,645
         		37,650
    Corporate events
    7,452
         		2,844
    Food and beverage
    27,360
         		16,284
    Merchandise
    11,281
         		8,807
    Real estate
    15,811
         		–
    Rooms and other
    5,073
         		4,296
    Operating revenue
    $
    155,677
         		$ 111,413

    Direct operating expenses are calculated as follows:

    For the three months ended

    (thousands of Canadian dollars)
    September 30, 2022
         		September 30, 2021
    Operating cost of sales
    $
    8,868
         		$ 7,242
    Labour and employee benefits
    22,092
         		18,881
    Utilities
    2,506
         		2,059
    Selling, general and administrative expenses
    1,382
         		1,092
    Property taxes
    441
         		206
    Repairs and maintenance
    924
         		768
    Insurance
    1,252
         		1,116
    Turf operating expenses
    1,159
         		1,178
    Fuel and oil
    681
         		511
    Other operating expenses
    3,382
         		3,239
    Direct Operating Expenses

    (1)
    $
    42,687
         		$ 36,292

    For the nine months ended

    (thousands of Canadian dollars)
    September 30, 2022
         		September 30, 2021
    Operating cost of sales
    $
    16,170
         		$ 11,545
    Real estate cost of sales
    16,394
         		–
    Labour and employee benefits
    49,590
         		38,273
    Utilities
    6,146
         		5,230
    Selling, general and administrative expenses
    4,266
         		3,494
    Property taxes
    2,776
         		2,858
    Repairs and maintenance
    2,705
         		2,370
    Insurance
    3,878
         		3,090
    Turf operating expenses
    3,517
         		3,158
    Fuel and oil
    1,416
         		929
    Other operating expenses
    8,352
         		6,734
    Direct Operating Expenses

    (1)
    $
    115,210
         		$ 77,681


    (1)

    Please see Non-IFRS Measures


    Third Quarter 2022 Consolidated Operating Highlights

    As required by IFRS, ClubLink recognizes its annual dues revenue on a straight-line basis throughout the year based on when its properties are allowed to open and services are provided. As a result of COVID-19 lockdowns in 2021, annual dues revenue was not recognized during certain periods. There were no COVID-19 lockdowns in the third quarter of 2021. There have been no COVID-19 lockdowns to date in 2022. Canadian annual dues revenue decreased 15.5% to $15,317,000 for the three month period ended September 30, 2022 from $18,133,000 in 2021. Due to this policy, the deferral of 2021 annual dues from lockdowns during the first six months were recognized into revenue throughout the third and fourth quarter on a straight-line basis.

    Operating revenue increased 2.8% to $65,009,000 for the three month period ended September 30, 2022 from $63,245,000 in 2021 due to less COVID-19 operating restrictions in 2022, allowing the Company to operate on a more normal pace. This was offset by the decline in annual dues revenue as described above and the fact that ClubLink has not operated the Bond Head property in 2022.

    Direct operating expenses increased 17.6% to $42,687,000 for the three month period ended September 30, 2022 from $36,292,000 in 2021 due to the fact that certain activities were reduced in 2021 due to lockdowns and restrictions. High inflation is also impacting most expense categories.

    Net operating income for the Canadian golf club operations segment decreased to $23,626,000 for the three month period ended September 30, 2022 from $28,016,000 in 2021 due to the change in annual dues revenue described above.

    Interest, net and investment income increased to an expense of $1,510,000 for the three month period ended September 30, 2022 from an expense of $263,000 in 2021 due to a decrease in borrowings and an increase in distributions from the Company’s investment in Automotive Properties REIT. The Company paid off certain non-revolving mortgages in advance of their due dates resulting in an expense of $2,604,000 which includes prepayment penalties and other costs.

    Other items consist of the following income (loss) items:


    For the three months ended

    September 30, 2022
    September 30, 2021
    Unrealized foreign exchange gain (loss)
    $
    (440
    )
         		$ 708
    Unrealized gain (loss) on investment in marketable securities
    (1,915
    )
         		2,067
    Insurance proceeds
    220
         		–
    Equity income (loss) from investments in joint ventures
    623
         		(340 )
    Glen Abbey redevelopment charge
    –
         		(189 )
    Impairment reversal (Heron Bay)
    –
         		2,628
    Other
    (5
    )
         		235
    Other items
    $
    (1,517
    )
         		$ 5,109

    The exchange rate used for translating US denominated assets has changed from 1.2886 at June 30, 2022 to 1.3707 at September 30, 2022. This has resulted in a foreign exchange loss of $440,000 for the three month period ended September 30, 2022 on the translation of the Company’s US denominated financial instruments.

    Net earnings decreased to $14,421,000 for the three month period ended September 30, 2022 from $22,757,000 in 2021 due to a $6,626,000 change in other items as analyzed above. Basic and diluted earnings per share decreased to 49 cents per share in 2022, compared to basic and diluted earnings per share of 93 cents in 2021.


    Non-IFRS Measures

    TWC uses non-IFRS measures as a benchmark measurement of our own operating results and as a benchmark relative to our competitors. We consider these non-IFRS measures to be a meaningful supplement to net earnings. We also believe these non-IFRS measures are commonly used by securities analysts, investors and other interested parties to evaluate our financial performance. These measures, which included direct operating expenses and net operating income do not have standardized meaning under IFRS. While these non-IFRS measures have been disclosed herein to permit a more complete comparative analysis of the Company’s operating performance and debt servicing ability relative to other companies, readers are cautioned that these non-IFRS measures as reported by TWC may not be comparable in all instances to non-IFRS measures as reported by other companies.

    The glossary of financial terms is as follows:


    Direct operating expenses

    = expenses that are directly attributable to company’s business units and are used by management in the assessment of their performance. These exclude expenses which are attributable to major corporate decisions such as impairment.


    Net operating income

    = operating revenue – direct operating expenses

    Net operating income is an important metric used by management in evaluating the Company’s operating performance as it represents the revenue and expense items that can be directly attributable to the specific business unit’s ongoing operations. It is not a measure of financial performance under IFRS and should not be considered as an alternative to measures of performance under IFRS. The most directly comparable measure specified under IFRS is net earnings.


    Eligible Dividend

    Today, TWC Enterprises Limited announced an eligible cash dividend of 5 cents per common share to be paid on December 15, 2022 to shareholders of record as at November 30, 2022.


    Corporate Profile

    TWC is engaged in golf club operations under the trademark, “ClubLink One Membership More Golf.” TWC is Canada’s largest owner, operator and manager of golf clubs with 47.5 18-hole equivalent championship and 2.5 18-hole equivalent academy courses (including two managed properties) at 36 locations in Ontario, Quebec and Florida.

    For further information please contact:

    Andrew Tamlin

    Chief Financial Officer

    15675 Dufferin Street

    King City, Ontario L7B 1K5

    Tel: 905-841-5372 Fax: 905-841-8488



    [email protected]


    Management’s discussion and analysis, financial statements and other disclosure information relating to the Company is available through SEDAR and at




    www.sed





    a




    r.com



    and on the Company website at




    www.twcenterprises.ca

    TWC Enterprises Limited Announces Third Quarter 2022 Results and Eligible Dividend

    GlobeNewswire
    October 31, 2022 – 4:42 PM PDT
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