JEWETT CAMERON TRADING CO LTD
For the period ended Feb 28, 2025. Filed Apr 14, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Feb 28, 2025 · Filed Apr 14, 2025
JCTC$2.85-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-11-30; filed 2025-01-14.
0001079973-25-000072
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-02-28; filed 2025-04-14.
0001079973-25-000625
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 134 previous paragraphs and 150 current paragraphs.
83 unchanged; 31 reworded; 34 added; 20 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 22 previous and 21 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (34)
Current report
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Current report
Corporate and administration
Current report
Corporate and Administration – JC USA
Current report
During the second quarter, we continued our focus on our core products while progressing in our efforts to lower our costs through multi-sourcing of our products and rationalizing our personnel assignments to improve operational efficiencies.
Current report
Sales increased by 10% in the current fiscal second quarter compared to the second quarter of fiscal 2024. Strength in fencing, primarily in Lifetime Steel Posts® (“LTP”), offset declines in Industrial Wood due to difficult year over year comparisons, and lingering weakness in consumer spending on pet products. Margins were lower in the current quarter due to specific product mix and the costs involved with the LTP program, including the initial one-time costs of deploying new displayer units in additional stores. We have now taken steps to pare down the costs of these new displayer units which we expect will result in higher margins for LTP going forward.
Current report
Fence products are our largest category, and we continue to focus on growing our sales in this segment. The ongoing rollout of our in-store displayers for our LTP product accelerated during the second quarter. By the end of February, our new in-store displayers were in 334 Home Depot and Lowe’s stores. This exceeded our original goal of 300 installations by the end of the second quarter ahead of the traditional fence installation season during the Spring and Summer months. These in-aisle display units are positioned adjacent to the lumber bays, which may result in additional sales of complementary wood products.
Current report
The durability, strength, and easier installation of LTP makes it popular with both DIY consumers and professionals Traditional wood fence posts are prone to rot, decay, and fail over time. Lifetime Steel Posts® are engineered to last a lifetime, providing a maintenance-free, corrosion-resistant alternative for wood fence post construction. Installation is faster and less expensive than similar wood posts, which requires smaller diameter post holes and less concrete. In many areas of the country LTP can be driven directly into the ground using hydraulic post drivers in a matter of seconds with no concrete needed which saves both time and cost. We anticipate the need for replenishment orders for these displayers during the second half of fiscal 2025 as the initial supply is sold through.
Current report
We have also added to our fencing gate line with the launch of our new Adjust-A-Gate® Unlimited in December. This product is a fully adjustable complete gate kit. It features a low profile, corner bracket solution that allows for fully adjustable gate designs customizable for each unique project yet is easy to install by both professionals and DIYers of all skill levels. The Adjust-A-Gate® Unlimited is sold as an all-in-one complete integrated system at a competitive price point compared to other gate kits that require purchasing additional parts such as latches, hinges and other components to complete a gate project. Our original full frame Adjust-A-Gate®kits have been featured in thousands of stores in their own in-aisle display units. Last summer we expanded into over 1,500 additional stores with these displayers and we continue to add stores for the upcoming fencing season.
Current report
The availability of cedar fencing can be constrained by factors such as shortages in log material as well as labor challenges from time to time. This can tighten supply and result in increased costs of sourcing. In recent years we have mitigated some of the Western Red Cedar constraints by offering Japanese Cedar, or Sugi Cedar, as a high-quality alternative. Sugi fencing sells for a lower price than Western Red Cedar which can negatively affect our margins, but we are looking for ways to improve our margins on this product. As Sugi Cedar continues to be more available and consumers become more familiar with its similarities to Western Red Cedar for fence applications, we believe demand for this product at competitive pricing may shift consumer sentiment more towards it as a quality alternative. We are evaluating options to optimize our importing of Sugi Cedar from Asia to offer our customers competitive pricing and improve our margins where possible. We will continue to monitor the potential impact of new tariffs and any possible exemptions of product classes that may be applied to our wood fence imports.
Current report
Sales of our pet products remain limited by continuing weak consumer demand in the sector which have restrained new orders from retailers continuing to be burdened by large product inventories. We continue to pursue new sales relationships in this sector, and our direct sales to consumers through our own online store have picked up. We have made significant progress in reducing our overall pet product inventory, which is down 17% year-over-year from February 2024 and nearly 60% from February 2023. With the significant increases in import tariffs, particularly in steel products, our inventory on hand in our US warehouse may become further price competitive against new imported products going forward.
Current report
MyEcoWorld® secured its first grocery store placement with the launch of Pet Waste Bags into 59 Tops Friendly Markets across the Northeast beginning in late February. Our MyEcoWorld® sustainable and Post-Consumer Recycled (PCR) bags continue to gain traction in the marketplace as consumers continue to look quality sustainable as alternatives to disposable traditional single-use plastics.
Current report
At Greenwood, sales for the current six-month period were down compared to the year-ago period. However, sales in the prior six months were buoyed by transit operators buying components to catch up on fleet maintenance they deferred during the pandemic. The continued push for workers to return to the office suggests that demand from the transit sector will continue to stabilize. Although the new tariffs on Canadian wood products could raise prices for our raw materials in future periods, Greenwood's materials currently appear to be exempt on the applicable schedule at this time. We have recently hired two new traders who are focusing both on growing our customer base in our primary transit sector and developing new markets for our industrial wood products.
Current report
The current prevailing issue for industry and consumers alike is the recently announced higher US import tariffs. The diversification of our suppliers to additional countries beyond China is successfully allowing us to mitigate some of the recent tariff increases. China sourced products were already subject to a 25% tariff implemented in 2019, with additional tariffs added in February and March 2025, and further tariffs announced in April 2025. Our new supply agreements with factories in Bangladesh, Vietnam, Malaysia and Taiwan mitigate the higher China specific tariffs, but are variously affected by other new tariffs. Steel and aluminum products from all countries outside the US are subject to the 25% global tariff rate, while all imports not included on the exemption list from all countries were assigned a baseline 10% tariff in April 2025. Steel and aluminum imports which are assigned the 25% tariff are presently exempt from the 10% baseline and any reciprocal tariffs on top of the 25% rate.
Current report
The new tariffs are a fluid and complicated situation that will become more clear over time due to ongoing negotiations as well as interpretations to exemptions being applied to various product categories. Initially, it appears the steel and aluminum products we import from Vietnam and Bangladesh will be subject to a lower tariff rates than those same products manufactured in China. Even with increased cost to produce our products in other countries and different freight costs, the landed costs are expected to be less than the costs associated with China-sourced products. Management began pursuing multiple suppliers in 2023 and as a result we are able to reduce to a certain extent the tariff impact to our customers. In fiscal 2024, more than 80% of our imported inventory purchases were from China-based suppliers. Our purchases for fiscal 2025 are currently expected to be less than 40% from China and likely to be significantly less in fiscal 2026.
Current report
The higher tariffs, including the significantly higher tariffs on the products we continue to source from China, is requiring us to raise our prices to our customers to compensate. In March 2025, we sent a letter to all of our customers notifying them of an upcoming price increase to address these new costs. We are currently working with customers on the final pricing and the expected start date for the new prices. Although consumers will eventually adjust their buying to accept higher prices over time, it is likely to dampen demand in the short-term until consumers become more accepting of the higher prices. These increased costs will also likely negatively affect our margins in the short term and we are able to successfully mitigate some of the higher tariff costs through various pricing and other strategies. However, these tariffs do not just affect our products, but will impact all imported goods into the US, including many of those of our competitors as well.
Current report
We continue to look for operational efficiencies and cost savings in all aspects of our business. We have realigned our employees as part of our strategic plans to increase sales in our core products while developing both new and improved products. We have added employees to Greenwood to support our growth initiatives in Industrial Wood, and hired new employees in other key areas, including sales, marketing, and product innovation. At the end of the second quarter, our full-time employee count was 11% lower than at the end of the second quarter of fiscal 2024.
Current report
Our current inventory level and product mix has improved over prior periods, as we have continued to reduce the inventory of our pet products and increased the inventory of our core products, including LTP and Adjust-a-Gate. This enhanced product mix will allow us to more quickly and efficiently meet the anticipated restocking of the new in-store display units during the busy fencing season in the second half of our fiscal year.
Current report
Consumer sentiment and economic conditions continue to be challenging due to the impact of inflation, high interest rates, and disruptions and uncertainty over higher import tariffs and trade policy. These circumstances are affecting the entire industry and are largely outside of any company’s control, but we are taking actions to limit their effect on our business and minimize disruptions to our operations and customers. The new higher tariff rates are increasing our costs for most of our products, both directly and indirectly. This will require us to increase our prices to our customers. Similar to what we experienced with the historically high inflation rates over the last several years, the higher prices caused by the new tariffs may result in lower short-term demand for our products from consumers until they become more accepting of higher prices across the entire economy. DIYers are particularly price sensitive in the short-term, but less so for Professionals. Further developing our engagement with Professionals, particularly in the fencing segment, will help us diversify and increase our end users. These professionals may also serve as Brand Ambassadors and influencer for our products, as well as providing important product input that helps us develop new product innovations that meet their needs.
Current report
Although the current economic climate and tariff uncertainty provides significant short-term issues, our focus remains on designing quality, affordable, functional solutions than enrich outdoor spaces. Jewett-Cameron has withstood many economic challenges in our over 70 years in business by successfully adjusting to unpredictable markets. We will continue to lead with innovation to dependably provide quality products that improve the lives both professionals and DIYers at affordable prices.
Current report
Sales for the three months ended February 28, 2025 were $9,054,951 compared to sales of $8,229,192 for the three months ended February 29, 2024, which was an increase of $825,759, or 10%. Sales in the current quarter were increased by the rollout of the LTP in-store displayers and higher sales at Greenwood.
Current report
Sales at JCC were $7,943,319 in the three months ended February 28, 2025 compared to sales of $7,383,965 for the three months ended February 29, 2024. This represents an increase of $559,354, or 8%. The higher revenue was due to the stocking of the LTP in-store displayers, while pet sales remained weak. Operating loss for the current quarter was ($834,127) compared to an operating loss of ($934,557) for the quarter ended February 29, 2024. The operating results of JCC are historically seasonal with the first two quarters of the fiscal year being slower than the final two quarters of the fiscal year.
Current report
Sales at Greenwood were $1,111,632 compared to sales of $824,073 for the three months ended February 29, 2024, which is an increase of $287,559, or 35%. We have added additional traders which have contributed to the increase in sales. For the three months ended February 28, 2025, Greenwood had an operating loss of ($24,035) compared to an operating loss of ($20,234) for the three months ended February 29, 2024.
Current report
Operating expenses decreased by $205,008 to $2,586,195 compared to expenses of $2,791,203 for the three months ended February 29, 2024. The decline was primarily due to lower Wages and Employee Benefits, which fell to $1,564,799 from $1,732,738 which was related to a lower employee headcount in the current quarter. Selling, General and Administrative expenses declined to $940,168 from $967,426, and Depreciation and Amortization decreased to $81,228 from $91,039 Interest income was $9,096 compared to $19,819 for the quarter ended February 29, 2024. Other income in the current quarter was $306, and there was a Loss on the sale of assets of ($568) in the year-ago quarter.
Current report
Six Months Ended February 28, 2025 and February 29, 2024
Current report
Sales were $18,321,951 for the six months ended February 28, 2025 compared to sales $18,035,033 for the six months ended February 29, 2024, which is an increase of $286,918, or 2%.
Current report
Sales at JCC rose to $16,368,287 for the six months ended February 28, 2025 from sales of $16,006,938 for the six months ended February 29, 2024, which was an increase of $361,349, or 2%. Current sales were positively affected by the roll-out of the new LTP in-store display units, which has grown to over 300 store installations by the close of the quarter. Operating loss at JCC for the six months ended February 28, 2025 was ($1,754,365) compared to operating loss of ($1,998,898) for the six months ended February 29, 2024. Overall, the operating results of JCC are seasonal with the first two quarters of the fiscal year being slower than the final two quarters of the fiscal year.
Current report
JCSC operations were permanently closed as of December 31, 2023, and storage activity ended in July 2024. Therefore, there was no revenue or income from JCSC in the current six-month period compared to revenue of $69,672 and an operating profit of $38,392 for the six months ended February 29, 2024.
Current report
JC USA, the holding company that provides professional and administrative services for the wholly-owned operating subsidiaries had operating income of $205,798 for the six months ended February 28, 2025 compared to operating income of $505,263 for the six months ended February 29, 2024. The results of JC USA are eliminated on consolidation.
Current report
Operating expenses for the six months ended February 28, 2025 declined by 7% to $5,138,242 from $5,536,508. Selling, General and Administrative Expenses fell to $1,749,380 from $1,915,907. Wages and Employee Benefits fell to $3,226,567 from $3,431,658 due to a lower employee headcount in the current period. Depreciation and Amortization decreased to $162,295from $188,943 for the six months ended February 29, 2024.
Current report
Net loss for the six months ended February 28, 2025 was ($1,231,811), or ($0.35) per basic and diluted share, compared to net income for the six months ended February 29, 2024 of $757,395, or $0.22 per share which was positively affected by a one-time gain related to the arbitration settlement in October 2023.
Current report
Asset held for sale was unchanged at $566,022. This asset is the 11.6 acres of land and 109,500 square feet of buildings which formerly housed JCSC operations. The property and buildings are listed for sale at a price of $9,000,000, though there is no guarantee the property will sell for this amount.
Current report
During the six months ended February 28, 2025, the Company issued 13,317 common shares to officers, directors and employees under the Restricted Share Plan. The value of these shares was $59,926.
Current report
Beginning in January 2025, the new administration in the United States began to increase tariff rates on numerous products from a range of nations. Imported steel and aluminum products from all countries globally were assigned a new tariff rate of 25% on top of any country or product specific rates. In early April 2025, the US imposed a universal baseline 10% tariff rate on imports globally along with a list of product exemptions. The current schedules exempt steel and aluminum products which are subject to the 25% global steel and aluminum tariff from the 10% universal baseline tariff and from any reciprocal tariffs. Therefore, our steel products imported from countries other than China are subject to only the 25% rate. China, however, has been assigned special rates. Tariff rates on steel products imported from China were at 70% as of the end of March 2025, consisting of the 2019 tariff of 25%, February 2025 tariff of 10%, March 2025 tariff of 10%, with the additional 25% steel and aluminum tariff. Additional China specific tariffs announced in April 2025 could increase these rates even higher.
Current report
We are continuing our shift to suppliers outside of China which have lower tariff rates. We also face uncertainty in the interpretation of new tariffs and their applicability, including with respect to customs valuation, product classification and country-of-origin determinations. Although we and our suppliers seek to comply with applicable customs laws and regulations, the application of rules regarding new tariffs can be subject to varying interpretations or future re-interpretations. It is possible that US or other relevant authorities could, upon review or audit, disagree with the valuation, rules of origin or classification methods applied to certain products. Any such disagreement could result in the retroactive assessment of additional duties with interest, the imposition of penalties, or other enforcement actions without the ability to mitigate such penalties, thereby adversely affecting our operations or financial results. Furthermore, certain of our competitors may be better positioned than us to withstand or react to border taxes, tariffs or other restrictions on global trade and as a result, we may lose market share to such competitors. Due to broad uncertainty regarding the timing, content and extent of any regulatory changes in the U.S. or abroad, we cannot predict with certainty the impact, if any, that these changes could have to our business, financial condition and results of operations.
Removed paragraphs (20)
Previous report
Corporate and administrative services
Previous report
Corporate and Administrative Services – JC USA
Previous report
The incoming US Presidential administration has stated its intention to impose new or increased tariff rates on imported goods from a number of countries, including China and Canada. The details of these tariffs, including which countries, which products would be included, the new rates, and the potential timing, are currently unknown.
Previous report
During the first quarter, we continued the implementation of our strategic plan to increase our sales, improve operational efficiency to lower our costs, and monetize our surplus assets, with the goal to improve our profitability.
Previous report
The rollout of our new in-store displays for our Lifetime Steel Posts® (“LTP”) and the expansion of our existing Adjust-A-Gate® display units continues on schedule. At the end of August, our LTP displays were in 100 stores. During the first quarter, we ramped up the roll out and nearly doubled our in-store LTP display units to almost 200 installations as of the end of November 2024. This expansion of display units drove a 19% increase in our metal fence product sales in this quarter compared to the first quarter of fiscal 2024. These in-aisle display units are positioned adjacent to the lumber bays, which may result in additional sales of complementary wood products. Our wood product sales rose 4% in this quarter vs. the comparable quarter of the prior year. These efforts to expand our fence product displayers in stores aligns with the seasonally high fence installations during the Spring and Summer months, and is expected to have a positive impact on our sales for in the second half of fiscal 2025.
Previous report
To help us expand and maintain these display units, we engaged Continental Sales & Marketing, Inc. (“CSM”) in October 2024. CSM is a nationally recognized, multifaceted, strategic business partner with over 49 years of experience with national and regional home improvement retailers. In addition to capitalizing on their deep distribution relationships with retailers across the United States, CSM will also help us manage the installed units and the expected product reorders to ensure the in-store displays are well-stocked and inventory is available for consumers. Each Lifetime Steel Post® display contains 96 posts and each Adjust-A-Gate® display contains 20 units and 4 drop rods kits. A typical fence project may contain 1 or 2 gates and upwards of 24 or more posts. Each display unit will require replenishment throughout the year, which is expected to provide increased reorder demand for each product. CSM will also work to increase the online presence of our other products through our retail partners, including key national and regional home improvement retailers, which will provide additional visibility and sales opportunities to expand distribution of our various product lines.
Previous report
The development of new products and upgrading and improving our existing products is an important component of our strategic plan. In December 2024, we launched our innovative new Adjust-A-Gate® Unlimited. The Unlimited is a complete gate kit that features a low profile, corner bracket solution that allows for fully adjustable gate designs that provides both professionals and DIYers with greater control to create gates tailored to their specific needs. The kit supports both horizontal and vertical gate designs and accommodates sizes up to 72 inches high and 84 inches wide with patented anti-sag technology that ensures gates stay straight and secure over time. The Adjust-A-Gate® Unlimited is sold as an all-in-one complete integrated system at a competitive price point and does not require the consumer to buy any additional parts such as latches, hinges, or other components. Adjust-A-Gate® Unlimited is the first of five new and enhanced products set to launch over the next 12 months. We are committed to continuing to innovate by improving and expanding our existing product lines in addition to adding new products that solve problems, meet unmet needs, and enrich outdoor spaces.
Previous report
Demand for high performing sustainable products is growing as consumers desire high quality alternatives to disposable single-use plastics combined with bans of traditional plastics being legislated throughout the United States. Our MyEcoWorld® sustainable and Post-Consumer Recycled (PCR) bags continue to gain traction in the marketplace. MyEcoWorld® compostable bin liners and pet waste bags are building sales online and being scheduled for in-store placement at multiple grocery chains during calendar 2025. Our recently launched lower-cost PCR pet waste bags have had initial successful sales internationally.
Previous report
The diversification of our suppliers has been a primary focus of management for several years. The addition of new suppliers with factories in Bangladesh, Vietnam, Malaysia, and Taiwan, along with our other suppliers in Canada and China for our fence, dog containment, and MyEcoWorld® products not only reduces our dependence and systematic risk of dependence upon a single supplier in China, it also mitigates the current 25% tariff on Chinese metal goods imported in the US. We are currently receiving products from these new suppliers in addition to our original supplier in China which we also continue to use. We are working through our current inventory of the higher cost tariffed products on many of our lines, but as those products are replaced by the non-tariffed products our margins will improve and will help us to maintain competitive pricing.
Previous report
During the first quarter, we shifted a number of our existing employees to support our strategic plans, including adding personnel at Greenwood, where we feel there is significant potential to add new customers outside of transit operators. We have also recently hired several new employees in key areas, including sales, marketing, and product innovation. These strategic additions and realignments are an important component of our focus on increasing sales in our core products and creation of both new products and new innovations and improvements to our existing products.
Previous report
As of November 30 th, our current ratio (current assets divided by current liabilities) is 8.79, and our cash position was $3.04 million. To date, we have not drawn against our line of credit, although we may need to draw against our line during our second fiscal quarter to fund our customary inventory build prior to our historically busiest outdoor selling season beginning in Spring. Our overall inventory level as of November 30 is appropriate for the end of the quarter with the exception of our pet products, where demand continues to be weak. For our slower moving pet products, we continue to explore opportunities to accelerate sales in those items.
Previous report
Ocean shipping issues which began in the fourth quarter of fiscal 2024 persisted into the current quarter. These issues delayed the arrival of some shipments containing a number of our metal products. The costs for these shipments were also significantly higher during the last two quarters beginning in May 2024. These higher costs have compressed our margins, and although the ocean shipping prices have fallen from the peaks achieved during our most recent quarter, they remain more than 50% higher than the prevailing prices during the same periods of a year ago.
Previous report
We are also increasing awareness of Jewett-Cameron and of our individual brands among customers, consumers, and investors. We recently rebranded Jewett-Cameron as “a company committed to innovative products that enrich outdoor spaces”. During the first quarter, we chose Lytham Partners for our new strategic investor relations and shareholder communication program. This program kicked off with our presentation at the Lytham Fall 2024 Investor Conference in October. We also changed our NASDAQ trading symbol from “JCTCF” to “JCTC” effective October 9 th. We believe this change helps investors to gain a better understanding of Jewett-Cameron as a US-based company.
Previous report
The economic climate in the United States remains challenging, including the potential threat of new tariffs on imported goods. We remain focused on executing on our strategic plan to grow sales and provide innovative new products while sharpening our operational efficiency.
Previous report
Sales at JCC were $8,424,968 compared to sales of $8,622,972 for the three months ended November 30, 2023, which was a decrease of $198,004, or 2%. Sales of metal fencing products increased by 19% compared to the quarter ended November 30, 2023, which was driven by our new Lifetime Post in-store displayers. Our wood fencing product sales increased by 4% compared to the same period. Demand for our pet products continues to be weak, as sales in the current quarter declined by 31% compared to the first quarter of fiscal 2024. Sales of our compostable products were also down in this quarter as a customer made a large initial purchase in the prior year’s quarter which was not repeated in the current quarter. Operating loss for JCC was ($920,237) compared to an operating loss of ($1,064,341) for the quarter ended November 30, 2023. Overall, the operating results of JCC are seasonal with the first two quarters of the fiscal year historically being slower than the final two quarters of the fiscal year.
Previous report
Gross margin for the three month period ended November 30, 2024 was 18.3% compared to 19.9% for the three months ended November 30, 2023. Higher shipping and logistic costs, particularly in sharply higher ocean shipping container rates, negatively affected our margins in the current quarter. The costs of additional in-store display units deployed during the current quarter also increased our costs compared to the first quarter of fiscal 2024.
Previous report
Operating expenses declined to $2,552,048 from $2,745,305 recorded in the three months ended November 30, 2024. Selling, General and Administrative Expenses fell to $809,213 from $948,481. Wages and employee benefits dropped slightly to $1,661,768 from $1,698,920 due to a decline in employee headcount which was largely offset by higher wage rates and benefit costs due to inflation. Depreciation and Amortization decreased to $81,067 from $97,903.
Previous report
Loss from operations for the current quarter was ($858,145) compared to a loss of ($789,224) for the quarter ended November 30, 2023.
Previous report
Prior to June 2024, we had a line of credit of $5,000,000 with U.S. Bank, which was reduced from $10,000,000 in February 2024. The line was secured by an assignment of accounts receivable and inventory. Calculation of the interest rate was based on the one-month Secured Overnight Financing Rate (SOFR) plus 157 basis points, which as of August 31, 2023 was 6.88% (5.31% + 1.57%). All amounts borrowed under this line of credit were repaid in full during fiscal 2024.
Previous report
During the quarter, the Company issued no common shares.
Reworded paragraphs (31)
Previous wording
These unaudited financial statements are those of the Company and its wholly owned subsidiaries. In the opinion of management, the accompanying consolidated financial statements of Jewett-Cameron Trading Company Ltd., contain all adjustments, consisting only of normal recurring adjustments, necessary to fairly state its financial position as of November 30, 2024 and August 31, 2024 and its results of operations and cash flows for the three month periods ended November 30, 2024 and 2023 in accordance with U.S. GAAP. Operating results for the three month period ended November 30, 2024 are not necessarily indicative of the results that may be experienced for the fiscal year ending August 31, 2025. Overall, the operating results of JCC are seasonal with the first two quarters of the fiscal year historically being slower than the final two quarters of the fiscal year.
Current wording
These unaudited financial statements are those of the Company and its wholly owned subsidiaries. In the opinion of management, the accompanying consolidated financial statements of Jewett-Cameron Trading Company Ltd., contain all adjustments, consisting only of normal recurring adjustments, necessary to fairly state its financial position as of February 28, 2025 and August 31, 2024 and its results of operations and cash flows for the three and six month periods ended February 28, 2025 and February 29, 2024 in accordance with U.S. GAAP. Operating results for the three and six month periods ended February 28, 2025 are not necessarily indicative of the results that may be experienced for the fiscal year ending August 31, 2024. Overall, the operating results of JCC are seasonal with the first two quarters of the fiscal year historically being slower than the final two quarters of the fiscal year.
Previous wording
Our wood products, distributed through JCC, are not unique and are available from multiple suppliers and retail outlets. However, the metal products that JCC manufactures and distributes may be somewhat differentiated from similar products available from other suppliers. We have been successful in garnering key patents and trademarks on multiple products that assist their ability to continue to differentiate based on design and functionality.
Current wording
Our wood products, distributed through JCC, are primarily cedar fencing and are not unique. However, Western Red Cedar, which historically has constituted the bulk of our wood fencing, can only be supplied in large volume from a limited number of suppliers and can experience supply shortages on occasion. Other cedar fencing, which serves as a substitute for Western Red Cedar, is more widely available from multiple suppliers. The metal products that JCC manufactures and distributes may be somewhat differentiated from similar products available from other suppliers. We have been successful in garnering key patents and trademarks on multiple products that assist their ability to continue to differentiate based on design and functionality.
Previous wording
We own the patents and manufacturing rights connected with the Adjust-A-Gate® and Fit-Right® products, which are the gate support systems for wood, vinyl, chain link, and composite fences, in addition to our trade secret industry practices and well-known trademarked brands. We believe the ownership of these patents and trademarks is an important competitive advantage for these and certain other products. We completed our purchase of the full global trademark rights for Adjust-A-Gate® and filed its registration with the US Patent and Trademark Office in February 2023. As of the close of fiscal 2024, the Company owns 7 US Patents and 1 patent application pending in the US, CA, and MX pertaining to its fencing products.
Current wording
We own the patents and manufacturing rights connected with the Adjust-A-Gate® and Fit-Right® products, which are the gate support systems for wood, vinyl, chain link, and composite fences, in addition to our trade secret industry practices and well-known trademarked brands. We believe the ownership of these patents and trademarks is an important competitive advantage for these and certain other products. We completed our purchase of the full global trademark rights for Adjust-A-Gate® and filed its registration with the US Patent and Trademark Office in February 2023. As of the close of fiscal 2024, the Company owns 7 US Patents and 1 patent application pending in the US, Canada, and Mexico relating to its fencing products.
Previous wording
Backlog orders have typically not been a factor in this business as customers may place firm priced orders for products for shipments to take place three to four months in the future which gives us time to order, manufacture and receive the goods at our warehouse in time to fulfil the customer’s order.
Current wording
Backlog orders have typically not been a factor in this business as customers may place firm priced orders for products for shipments to take place three to four months in the future which gives us time to order, manufacture and receive the goods at our warehouse in time to fulfill the customer’s order.
Previous wording
JCSC operated out of a Company-owned 11.6 acre facility located adjacent to North Plains, Oregon. JCSC processed and distributed agricultural seed. Most of this segment’s sales came from selling seed to distributors with a lesser amount of sales derived from cleaning seed. Sales of seed has seasonality, but it is most affected by weather patterns in multiple parts of the United States that utilize cyclical planting. The annual weather plays an important part in year-to-year sales volatility and specific crop demand.
Current wording
JCSC operated out of a Company-owned 11.6 acre facility located adjacent to North Plains, Oregon. JCSC processed and distributed agricultural seed. Most of this segment’s sales came from selling seed to distributors with a lesser amount of sales derived from cleaning seed.
Previous wording
JC USA is the parent company for Greenwood, JCC and JCSC as described above. JC USA operates out of our offices in North Plains, Oregon and provides professional and administrative services, including warehousing, accounting and credit services, to JCTC’s subsidiary companies.
Current wording
JC USA is the parent company for Greenwood, JCC and JCSC as described in Note 1 to Notes to Consolidated Financial Statements. JC USA operates out of our offices in North Plains, Oregon and provides professional and administrative services, including warehousing, accounting and credit services, to JCTC’s subsidiary companies.
Previous wording
The Fencing, Pet and Other businesses are conducted by JCC, which operates out of a 5.6 acre owned facility located in North Plains, Oregon that includes offices, a warehouse, and a paved yard. JCC uses contract manufacturers to make all products. Some of the products that JCC distributes flow through our distribution center located in North Plains, Oregon, and some are shipped direct to the customer from the manufacturer. Primary customers are home centers, eCommerce providers, other retailers, and direct sales to consumers.
Current wording
The Fencing, Pet and Other businesses are conducted by JCC, which operates out of a 5.6 acre owned facility located in North Plains, Oregon that includes offices, a warehouse, and a paved yard. JCC uses contract manufacturers to make all products. Some of the products that JCC distributes flow through our distribution center located in North Plains, Oregon, and some are shipped direct to the customer from the manufacturer. Primary customers are home centers, eCommerce providers, other retailers, distributors, and direct sales to consumers.
Previous wording
Active operations at JCSC ended as of December 31, 2023, and the final seed storage ended in July 2024. With the final closure of the segment, the 11.6 acres of land and 105,000 square feet of buildings were listed for sale at a price of $9,000,000, which is a competitive price based on comparable properties in the area. This is the current asking price, and there is no guarantee the property will sell for this amount. The land is strategically situated on a corner lot at a major interchange immediately adjacent to US Highway 26, which is one of the region’s busiest roadways. The land is currently zoned with a rural industrial classification, but the Company is exploring the potential to expand the list of permitted uses for the property, including a possible re-zoning by the governing authority. A reclassification would provide interested parties with greater flexibility of development options. There is also a high level of interest from the cities immediately adjacent to the property in the potential expansion of their urban growth boundaries, and this property would potentially be included within the expanded area. Should such an expansion be approved and/or a rezoning occur, it would likely increase the land’s value and potentially maximize any return we receive for the sale of this surplus asset.
Current wording
The surplus Jewett-Cameron Seed property of 11.6 acres of land and 109,500 square feet of buildings is listed for sale at a price of $9,000,000, which we believe continues to be a competitive price based on comparable properties in the area. This is the current asking price and there is no guarantee the property will sell for this amount. A number of parties have reviewed the listing and the property, but no serious offers have been received to date. The land is currently zoned with a rural industrial classification but is well situated on a corner lot at a major interchange immediately adjacent to US Highway 26, which is one of the region’s busiest roadways. The Company is exploring the potential to expand the list of permitted uses for the property, including a possible re-zoning by the governing authority. A reclassification would provide interested parties with greater flexibility of development options.
Previous wording
Active operations at JCSC ended as of December 31, 2023, and all storage activity ended in July 2024. There was no revenue or expenses from JCSC in the current quarter compared to sales of $48,518 and operating income of $1,210 in the quarter ended November 30, 2023.
Current wording
Active operations at JCSC ended as of December 31, 2023, and all storage activity ended in July 2024. There was no revenue or expenses from JCSC in the current quarter compared to revenue of $21,153 for the quarter ended February 29, 2024
Previous wording
JC USA is the holding company for the wholly-owned operating subsidiaries. For the quarter ended November 30, 2024, JC USA had operating income of $108,720 compared to operating income of $212,290 for the quarter ended November 30, 2023. The results of JC USA are eliminated on consolidation.
Current wording
JC USA is a holding company for the wholly-owned operating subsidiaries, and thus the overall results of JC USA are eliminated on consolidation. For the quarter ended February 28, 2025, JC USA had an operating profit of $97,078 compared to an operating profit of $242,046 for the quarter ended February 29, 2024.
Previous wording
For the three months ended November 30, 2024, sales were $9,267,001 compared to sales of $9,805,841 for the three months ended November 30, 2023. This is a decrease of $538,840, or 5%. Inflationary pressures and lowered consumer confidence continue to restrain discretionary spending by American consumers, particularly in the home improvement and pet sectors. Our results for the current quarter were also negatively affected by higher logistics and ocean shipping costs and our investment in the new in-store fencing product display units.
Current wording
Gross margin for the three months ended February 28, 2025 was 20.1% compared to 25.1% as of February 29, 2024. The decrease was due to a less favorable mix of products sold during the quarter. Our margin for the current quarter was also negatively affected by higher logistics and ocean shipping costs and our investment in the new in-store fencing product display units.
Previous wording
The net loss for the quarter ended November 30, 2024 was ($658,717), or ($0.19) per share, compared to net income of $1,291,541, or $0.37 per share, for the quarter ended November 30, 2023.
Current wording
Net loss for the quarter ended February 28, 2025 was ($573,094), or ($0.16) per basic and diluted share, compared to a net loss of ($534,145), or ($0.15) per basic and diluted share, for the quarter ended February 29, 2024.
Previous wording
Sales at Greenwood for the three months ended November 30, 2024 were $842,033 compared to sales of $1,134,351 for the three months ended November 30, 2023, which was a decrease of $292,318, or 26%. Sales in the prior year’s period were boosted by higher demand by municipalities and transit operators catching up on deferred vehicle maintenance post-pandemic. We believe there is significant potential to grow sales at Greenwood by opening new sales channels and broadening our customer base, particularly for users outside of transit such as in housing and construction. During the current quarter, we realigned a number of our personnel and several were added to Greenwood to advance these sales efforts. In addition, in December 2024 we hired a new lumber trader with experience in the other non-transit sectors. For the quarter, Greenwood had an operating loss of ($23,830) compared to operating income of $61,617 for the three months ended November 30, 2023, as the additional personnel shifted to Greenwood during the quarter increased its costs.
Current wording
Sales at Greenwood were relatively flat at $1,953,665 in the current six months compared to sales of $1,958,424 for the six months ended February 29, 2024. We hired additional traders and reassigned some employees to Greenwood in the current six months to support our efforts to increase sales by opening new sales channels and adding new customers, both within the transit sector and in new sectors such as construction. Sales in the prior year’s period were boosted by higher demand by municipalities and transit operators catching up on deferred vehicle maintenance post-pandemic. For the six months ended February 28, 2025, Greenwood had an operating loss of ($47,865) compared to operating income of $41,383 for the six months ended February 29, 2024.
Previous wording
Other items in the current quarter included a gain on sale of property, plant and equipment of $800 and interest income on our cash balances of $21,998. In the year-ago period, the Company recorded income from other items of $2,532,800, which included the one-time cash payment of $2,450,000 from the positive settlement of its arbitration case against one of our former distributors. Other items for the quarter ended November 30, 2023 included a gain on sale of assets of $89,655, which was largely due to the sale of JCS equipment, and net interest expense of ($6,855).
Current wording
Other items in the current six-month period included Other income of $306, Interest income of $31,094 and gain on sale of assets of $800. In the prior six-month period ended February 29, 2024, the Company settled its arbitration case against one of its former distributors for a cash payment of $2,450,000. This one-time gain was included in other income. Other items included a gain on sale of assets of $89,087 which was largely due to the sale of JCSC equipment, and net interest income of $12,964.
Previous wording
Loss before income taxes was for the quarter ended November 30, 2024 was ($835,347). Income before income taxes for the quarter ended November 30, 2023 was $1,743,576, which was boosted by the receipt of the arbitration case settlement payment. Income tax recovery in the current quarter was $176,630 compared to income tax expense of ($452,035) in the prior year’s quarter. The Company estimates income tax expense for the quarter based on combined federal and state rates that are currently in effect.
Current wording
Income tax recovery for the six months ended February 28, 2025 was $364,621 compared to income tax expense of ($278,745) for the six months ended February 29, 2024. The Company estimates income tax expense for the period based on combined federal and state rates that are currently in effect.
Previous wording
As of November 30, 2024, the Company had working capital of $19,726,137 compared to working capital of $20,548,093 as of August 31, 2024, a decrease of $821,956.
Current wording
As of February 28, 2025, the Company had working capital of $19,086,483 compared to working capital of $20,548,093 as of August 31, 2024, a decrease of $1,461,610.
Previous wording
Cash and cash equivalents totaled $3,039,391, a decrease of $1,813,976 from cash of $4,853,367. The decrease was due to the timing of collection of accounts receivable, which rose to $4,183,710 from $3,668,815, and prepaid expenses, which are largely related to down payments for future inventory purchases, which increased to $978,302 from $891,690. Inventory increased slightly by $334,304 to $13,491,547 from $13,157,243. Prepaid income taxes declined to $19,950 from $50,326.
Current wording
Cash and cash equivalents totaled $435,635, a decrease of $4,417,732 from cash of $4,853,367. The decrease was due to the purchase of inventory for the busier Spring and Summer seasons, which rose to $14,881,766 from $13,157,243, the timing of collection of accounts receivable, which rose to $5,636,877 from $3,668,815, and prepaid expenses, which are largely related to down payments for future inventory purchases, which increased to $1,485,244 from $891,690. Prepaid income taxes fell to $27,075 from $50,326.
Previous wording
Current liabilities decreased to $2,552,785 from $2,639,370. Accounts payable declined to $1,102,166 from $1,237,988, and accrued liabilities increased to $1,450,619 from $1,401,382.
Current wording
Current liabilities increased to $3,946,136 from $2,639,370. Accounts payable increased to $2,305,136 from $1,237,988, and accrued liabilities increased to $1,641,000 from $1,401,382.
Previous wording
As of November 30, 2024, accounts receivable and inventory represented 79% of current assets and 66% of total assets compared to 73% of current assets and 61% of total assets as of August 31, 2024.
Current wording
As of February 28, 2025, accounts receivable and inventory represented 89% of current assets and 74% of total assets compared to 73% of current assets and 61% of total assets as of August 31, 2024.
Previous wording
For the three months ended November 30, 2024, the accounts receivable collection period, or DSO, was 41 days compared to 31 days for the three months ended November 30, 2023. Inventory turnover to the three months ended November 30, 2024 was 160 days compared to 206 days for the three months ended November 30, 2023.
Current wording
For the three months ended February 28, 2025, the accounts receivable collection period, or DSO, was 55 compared to 52 for the three months ended February 29, 2024. For the six-month period ended February 28, 2025, the DSO was 55 compared to 47 for the six months ended February 29, 2024. Inventory turnover for the three months ended February 28, 2025 was 175 days compared to 258 days for the three months ended February 29, 2024. For the six months ended February 28, 2025, inventory turnover was 172 days compared to 232 days for the six months ended February 29, 2024.
Previous wording
External sources of liquidity include an asset-based line of credit agreement with Northrim Funding Services (“Northrim”) which we established in fiscal 2024. Under the terms of the agreement, Northrim will provide short-term operating capital by either purchasing the Company’s accounts receivable invoices (“AR invoices”) or as a loan against our inventory position. The maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 80% of the net eligible accounts but is not to exceed $6,000,000. Borrowing against our inventory is computed as an amount equal to 25% of all eligible inventory but is not to exceed $4,000,000. The maximum total draw the Company may borrow under the line is $6,000,000. Interest is computed at the prime rate plus 4.75% with floor of 11%, and is secured by certain or our assets. The line expires on June 30, 2025. There has been no borrowing to date under this line of credit, although we may need to draw against the line during our second fiscal quarter to help fund our usual inventory build prior to our busiest selling season beginning in Spring.
Current wording
External sources of liquidity include an asset-based line of credit agreement with Northrim Funding Services (“Northrim”) which we established in fiscal 2024. Under the terms of the agreement, Northrim will provide short-term operating capital by either purchasing the Company’s accounts receivable invoices (“AR invoices”) or as a loan against our inventory position. The maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 80% of the net eligible accounts but is not to exceed $6,000,000. Borrowing against our inventory is computed as an amount equal to 25% of all eligible inventory but is not to exceed $4,000,000. The maximum total draw the Company may borrow under the line is $6,000,000. Interest is computed at the prime rate plus 4.75% with floor of 11%, and is secured by certain or our assets. The line expires on June 30, 2025. There was no borrowing under this line as of February 28, 2025. Subsequent to the end of the six-month period, in March 2025 the Company drew its initial borrowings against this line. We have drawn approximately $3,000,000 to fund inventory purchases to meet expected demand ahead of our historically busy sales season of Spring and Summer. We have also begun discussions with the lender to renew the line, which is currently set to expire on June 30, 2025.
Previous wording
Based on the Company’s current working capital position, combined with the expected timing of accounts receivable and the capital available under our Line of Credit, the Company is expected to have sufficient liquidity available to meet the Company’s working capital requirements for the remainder of fiscal 2025.
Current wording
Based on the Company’s current working capital position, combined with the expected timing of accounts receivable and the capital available under our Line of Credit, the Company is expected to have sufficient liquidity available to meet the Company’s working capital requirements for the next twelve months.
Previous wording
Our metal and other products have historically been mostly manufactured in China and are imported into the United States. The Office of the United States Trade Representative (“USTR”) instituted new tariffs on the importation of a number of products into the United States from China effective September 24, 2018. These new tariffs are a response to what the USTR considers to be certain unfair trade practices by China. The tariffs began at 10%, and subsequently were increased to 25% as of May 10, 2019. A number of our products manufactured in China remain subject to duties of 25% when imported into the United States.
Current wording
Our metal and other products have historically been mostly manufactured in China and are imported into the United States. Beginning in 2018, the Office of the United States Trade Representative (“USTR”) instituted new tariffs on the importation of a number of products into the United States from China. These initial tariffs were a response to what the USTR considers to be certain unfair trade practices by China. The tariffs began at 10%, and subsequently were increased to 25% as of May 2019.
Previous wording
During fiscal 2024, we engaged suppliers in countries outside of China, including Bangladesh, Vietnam, Malaysia, Taiwan, and Canada. Products manufactured in and imported from these countries are not subject to the China-specific tariffs, but may be subject to other duties and fees that are typically much lower than the current 25% tariff on Chinese manufactured metal products.
Current wording
Prior to fiscal 2024, our metal products were primarily manufactured in China and subject to the full 25% tariff rate. During fiscal 2024, we engaged suppliers in countries outside of China, including Bangladesh, Vietnam, Malaysia, Taiwan, and Canada. Products manufactured in and imported from these countries were not subject to the China-specific tariffs, but were subject to other duties and fees that are typically much lower than the then 25% tariff on Chinese manufactured metal products.
Previous wording
The increases in interest rates as a result of the higher level of inflation in the US economy experienced beginning in calendar 2021 and continuing through 2024 has also had a negative effect on our interest expense charged on any borrowing on our lines of credit. The interest rate on our current line of credit is computed using the Prime Interest Rate, which has risen from 3.25% in January 2022 to approximately 7.50% in December 2024. There are no amounts outstanding under this line of credit.
Current wording
The increases in interest rates as a result of the higher level of inflation in the US economy experienced beginning in calendar 2021 and continuing through 2024 has also had a negative effect on our interest expense charged on any borrowing on our lines of credit. The interest rate on our current line of credit is computed using the Prime Interest Rate, which has risen from 3.25% in January 2022 to approximately 7.50% in February 2025. There were no amounts outstanding under this line of credit as of February 28, 2025. However, beginning on March 7, 2025, the Company began drawing against its asset-based line of credit to fund its usual seasonal build of inventory to meet its anticipated needs for the busy Spring and Summer seasons. The Company has drawn approximately $3,000,000 at a current interest rate of 12.25%.
Previous wording
For the fiscal quarter ended November 30, 2024 our top ten customers represented 98% of our total sales, and our single largest customer was responsible for 40% of our total sales. We would experience a significant decrease in sales and profitability and would have to cut back our operations, if these customers were lost and could not be replaced. Our top ten customers are located in North America and are primarily in the retail home improvement and pet industries.
Current wording
For the six months ended February 28, 2025, our top ten customers represented 96% of our total sales, and our single largest customer was responsible for 36% of our total sales. We would experience a significant decrease in sales and profitability and would have to cut back our operations, if these customers were lost and could not be replaced. Our top ten customers are located in North America and are primarily in the retail home improvement and pet industries.
Previous wording
Since the bulk of our products are supplied from other countries, political actions by either our trading country or our own domestic policy could impact both availability and cost of our products. Currently, we see this in regard to tariffs being levied on foreign sourced products entering into the United States, including from China. The continuing tariffs by the United States on certain Chinese goods include some of our products that we purchase from suppliers in China. The possibility of new tariffs being levied on manufactured goods imported into the United States from other countries in addition to China also currently exists. We cannot control the duration or depth of such actions which may increase our product costs which would in turn reduce our margins and potentially decrease the competitiveness of our products. These actions could have a negative effect on our business, results of operations, or financial condition.
Current wording
Since the bulk of our products are supplied from other countries, political actions by either our trading country or our own domestic policy could impact both availability and cost of our products. Currently, we see this in regard to tariffs being levied on foreign sourced products entering into the United States, including from China. Beginning in January 2025, the new administration in the United States began to increase tariff rates on numerous products from a range of nations. Imported steel and aluminum products from all countries globally were assigned a new tariff rate of 25% on top of any country or product specific rates. In early April 2025, the U.S. imposed a universal baseline tariff rate of 10% on all imports globally, although steel and aluminum products tariffed at the 25% rate are exempted from the additional baseline 10% tariff. China, however, has been assigned special additional rates. For steel and aluminum products imported from China, the rates were at 70% at the end of March 2025, but additional China specific tariffs announced in April 2025 could result in even higher tariff rates for those products. We also face uncertainty in the interpretation of new tariffs and their applicability, including with respect to customs valuation, product classification and country-of-origin determinations. Although we and our suppliers seek to comply with applicable customs laws and regulations, the application of rules regarding new tariffs can be subject to varying interpretations or future re-interpretations. It is possible that U.S. or other relevant authorities could, upon review or audit, disagree with the valuation, rules of origin or classification methods applied to certain products. Any such disagreement could result in the retroactive assessment of additional duties with interest, the imposition of penalties, or other enforcement actions without the ability to mitigate such penalties, thereby adversely affecting our operations or financial results. Furthermore, certain of our competitors may be better positioned than us to withstand or react to border taxes, tariffs or other restrictions on global trade and as a result, we may lose market share to such competitors. We cannot control the duration or depth of such actions which may increase our product costs which would in turn reduce our margins and potentially decrease the competitiveness of our products. These actions could have a negative effect on our business, results of operations, or financial condition.
Previous wording
Inflation has many impacts on our business, including increasing our direct costs for raw materials, manufacturing, shipping and logistics, labor, and energy. Our ability to pass on these higher costs to our customers is limited. When we are able to increase our selling prices, it may be delayed several months after we first incur the higher costs and we may not be able to fully recoup the difference. In addition, high rates of inflation can reduce consumer’s discretionary spending and reduce demand for our products. These actions could have a negative effect on our business, results of operations, or financial condition.
Current wording
Inflation has many impacts on our business, including increasing our direct costs for raw materials, manufacturing, shipping and logistics, labor, and energy. Our ability to pass on these higher costs to our customers is limited. When we are able to increase our selling prices, it may be delayed several months after we first incur the higher costs and we may not be able to fully recoup the difference. In addition, high rates of inflation can reduce consumer’s discretionary spending and reduce demand for our products. These actions could have a negative effect on our business, results of operations, or financial condition. The increases in interest rates as a result of the higher level of inflation in the US economy experienced beginning in calendar 2021 and continuing through 2024 has also had a negative effect on our interest expense charged on any borrowing on our lines of credit. The interest rate on our current line of credit is computed using the Prime Interest Rate, which has risen from 3.25% in January 2022 to approximately 7.50% in February 2025. Beginning on March 7, 2025, the Company began drawing against its asset-based line of credit to fund its usual seasonal build of inventory to meet its anticipated needs for the busy Spring and Summer seasons. The Company has drawn approximately $3,000,000 at a current interest rate of 12.25%.
Previous wording
Our fencing and outdoor products are primarily bought by consumers during the spring and summer. The majority of our revenues and income from these products occur during our 3 rd and 4 th quarters of our fiscal year. Demand for these products is highly affected by the weather. Adverse weather, including abnormally wet conditions or unseasonably hot or cold temperatures, can negatively affect demand for our products and cause our customers to delay, or reduce, their orders. This would have a negative effect on our business, results of operations, or financial condition.
Current wording
Our fencing and outdoor products are primarily bought by consumers during the spring and summer. The majority of our revenues and income from these products occur during our third and fourth quarters of our fiscal year. Demand for these products is highly affected by the weather. Adverse weather, including abnormally wet conditions or unseasonably hot or cold temperatures, can negatively affect demand for our products and cause our customers to delay, or reduce, their orders. This would have a negative effect on our business, results of operations, or financial condition.
Previous wording
We have a line of credit with Northrim where short-term operating capital will be provided by purchasing our accounts receivable invoices for up to $6,000,000, or as a loan against our inventory for up to $4,000,000, with the maximum amount we can draw under the line of $6,000,000. The maximum draw amount is currently available, and the line will expire on June 30, 2025. If we lost access to credit, or the borrowing costs exceed the likely benefits of our use of such capital, it could negatively affect our ability to acquire inventory to fulfil our customers’ orders and pay our obligations on a timely basis.
Current wording
We have a line of credit with Northrim where short-term operating capital will be provided by purchasing our accounts receivable invoices for up to $6,000,000, or as a loan against our inventory for up to $4,000,000, with the maximum amount we can draw under the line of $6,000,000. The maximum draw amount is currently available, and the line will expire on June 30, 2025. If we lost access to credit, or the borrowing costs exceed the likely benefits of our use of such capital, it could negatively affect our ability to acquire inventory to fulfil our customers’ orders and pay our obligations on a timely basis. Although we are in discussions with our current lender to renew the line of credit, there can be no assurance that we will be able to successfully extend or replace this line of credit.
Previous wording
The Company’s common shares currently trade within the NASDAQ Capital Market in the United States. The average daily trading volume of our common stock was approximately 4,700 shares on NASDAQ for the fiscal year ended August 31, 2024 and 7,500 shares for the fiscal quarter ended November 30, 2024. With this limited trading volume, investors could find it difficult to purchase or sell our common stock or experience significant volatility in the price of our common stock.
Current wording
The Company’s common shares currently trade within the NASDAQ Capital Market in the United States. The average daily trading volume of our common stock was approximately 4,700 shares on NASDAQ for the fiscal year ended August 31, 2024 and 7,900 shares for the six months ended February 28, 2025. With this limited trading volume, investors could find it difficult to purchase or sell our common stock or experience significant volatility in the price of our common stock. In addition, if any of the risk factors set forth above are realized, it can have a negative impact on the trading price of our common stock.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Income tax recovery for the three-month period ended February 28, 2025 was $187,991 compared to a recovery of $173,291 in the three months ended February 29, 2024. The Company estimates income tax expense for the quarter based on combined federal and state rates that are currently in effect.
Current report — wording carried from elsewhere
Gross margin for the six-month period ended February 28, 2025 was 19.2% compared to 22.3% for the six months ended February 29, 2024. Our costs for the current quarter were negatively affected by higher logistics and ocean shipping costs and our investment in the new in-store fencing product display units.