Richards Packaging Income Fund announced today results for the quarter ended March 31, 2015.
First quarter performance was on track with our 2014 outlook as total revenue was up 10.5% on organic revenue growth of 3.4% and a U.S./Cdn.10¢ weakening of the dollar. Gross profit and EBITDA1 as a percent of sales were 16.1% and 11.5% respectively, slightly ahead of levels in 2014. EBITDA was up $0.8 million, or 13.3%, due to higher organic revenue and the translation impact of Richards US. Net income was up $0.5 million, or 4.7¢ per Unit, mainly due to a higher profit from operations.
The $1.1 million of free cash flow2 generated in the first quarter together with $0.9 million of cash on hand at Dec. 31st was utilized to pay $0.8 million for 2014 bonuses and to fund expansion and working capital requirements for revenue growth. Income tax payable of $2.4 million will be paid in the second quarter with free cash flow and by temporary borrowings. As we have taken advantage of the changing economic climate to grow revenue, the associated $3 million working capital investment which typically unwinds will need to be financed at the expense of debt repayment for 2015.
The Fund paid monthly distributions of 7.35¢ per Unit, which represented an annualized yield of 5.6% on the March 31st closing price of $15.72 per Unit. The payout ratio3 for the first quarter was 71% up 3 percentage points from the same period in 2014 reflecting the increase in last year's distribution.
Details of the Fund's results are currently available on Richards Packaging's website at www.richardspackaging.com and on SEDAR at www.sedar.com.
About Richards Packaging Income Fund
The Fund owns Richards Packaging Inc. ("Richards Packaging"), the leading packaging distributor in Canada, and third largest in North America. Richards Packaging is a full-service packaging distributor targeting small- and medium-sized North American businesses. Richards Packaging has operated since 1912 and currently serves over 12,500 regional food, wine and spirits, cosmetic, specialty chemical, pharmaceutical and other companies from 18 locations throughout North America.