In the opinion of management, all adjustments consisting of normal recurring adjustments, considered necessary for a fair presentation of the Company's financial position, results of operations and cash flows have been included. Operating results for the interim period presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the full fiscal year ending April 30, 2009.
2. Adoption of New Accounting Standards
Effective January 1, 2008 the Company adopted the following new accounting standards issued by the Canadian Institute of Chartered Accountants.
Capital Management
Section 1535, Capital disclosures, requires the Company to disclose information about the Company's objectives, policies and procedures for the management of its capital.
Financial Instruments - Disclosures and Presentation
Section 3862, Financial Instruments - Disclosures, and Section 3863, Financial Instruments - Presentation replace section 3861, Financial Instruments - Disclosure and Presentation. These sections require the disclosure of information with regards to the significance of financial instruments for the Company's financial position and performance and the nature and extent of risks arising from financial instruments to which the Company is exposed during the period and at the balance sheet date, and how the Company manages those risks.
Financial instrument classification is as follows:
Cash and marketable securities Held-for-trading Accounts receivable Loans and receivables Derivative assets and liabilities Held-for-trading Accounts payable and accrued liabilities Held-for-trading Income taxes payable Held-for-trading Long-term liabilities Other liabilitiesAs a result of adoption of the above policies, there was no material impact on the Statement of Operations.
3. Shareholders' equity and other comprehensive income
The following are the changes in shareholders' equity for the six months ended October 31, 2008:
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Common Common Contri- Retained Accumu Total
Shares shares buted earnings lated ($)
(number) $ surplus ($) other
($) compre-
hensive
income
($)
--------------------------------------------------------------------------
Balance at
April 30, 2008 10,719,807 $100,403 $2,997 $19,297 ($318) $122,379
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Net income (2,067) (2,067)
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Dividends (5,228) (5,228)
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Employee Stock
Option Program 14,250 218 (93) 125
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Employee Share
Purchase Program 2,122 42 12 54
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Stock-based
compensation (718) 333 (385)
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Normal course
issuer bid (559,148) (5,200) (3,215) (8,415)
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Unrealized
derivative gains
on cash flow
hedges - net (798) (798)
--------------------------------------------------------------------------
Balance at
October 31,
2008 10,177,031 $94,745 $3,249 $8,787 ($1,116) $105,665
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4. Earnings per Share
The following is a reconciliation of the numerator and denominator of the
basic and diluted per share computations:
Quarter Ended Six Months Ended
October 31, October 31,
2008 2007 2008 2007
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(Loss) income before
discontinued
operations ($3,996) $4,498 ($2,804) $8,233
Discontinued
operations (net of
tax) 569 236 737 6,036
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Net (loss) income ($3,427) $4,734 ($2,067) $14,269
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Weighted average
number of common
shares outstanding 10,242,692 11,125,425 10,465,510 11,118,138
Net effect of stock
options 18,845 - 28,832 371,637
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Weighted average
diluted number of
common shares
outstanding 10,261,537 11,125,423 10,494,342 11,489,775
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Earnings per share
Basic - before
discontinued
operations ($0.39) $0.40 ($0.27) $0.74
Diluted - before
Discontinued
operations ($0.39) $0.40 ($0.27) $0.72
Basic - net income ($0.33) $0.43 ($0.20) $1.28
Diluted - net income ($0.33) $0.43 ($0.20) $1.24
For the quarters ended October 31, 2008 and October 31, 2007, 269,606 and 289,456 options, respectively, were excluded from the calculation of diluted earnings per share, as the exercise price of these options exceeded the average market price of the Company's common stock during this period and were therefore anti-dilutive.
