JEWETT CAMERON TRADING CO LTD
For the period ended May 31, 2026. Filed Jul 14, 2026.
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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.
May 31, 2026 · Filed Jul 14, 2026
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 2026-02-28; filed 2026-04-13.
0001553350-26-000067
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-05-31; filed 2026-07-14.
0001553350-26-000097
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 101 previous paragraphs and 103 current paragraphs.
50 unchanged; 35 reworded; 18 added; 16 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 16 previous and 13 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 (18)
Current report
Pet, Fencing and Other
Current report
Corporate and Administrative Services
Current report
Industrial Wood Products
Current report
During the period ended May 31, 2026, we applied for the refund of invalidated tariffs we paid under the IEEPA. In June 2026, we received approval and payment for our outstanding tariff claims and interest totaling $1,008,810. Of the amount received, $286,274 was recorded as a receivable during Q3 2026. Of the remaining $722,536 received, $601,396 is the remaining accepted IEEPA related claims, $80,092 are post-summary corrections unrelated to the invalided IEEPA claims, and $41,048 is interest. An additional $16,686 of our claim was rejected, and we intend to appeal this rejection once an appeal process is in place. However, the total amount of potential refunds we have requested is only a small portion of the overall tariffs we have paid over the prior 12 months, as most were not applied under IEEPA.
Current report
During the third quarter, our operations continued to be hampered by high import tariffs and new inflationary pressures caused by the current conflict in the Middle East. This has negatively affected consumer sentiment and reduced discretionary purchasing. Nevertheless, we have progressed in our goals to focus on our core products and reduce our costs going forward.
Current report
Our sales for the third quarter decreased by $2,753,006, or 22% compared to the third quarter of fiscal 2025. In the current nine month period, our sales declined by $1,884,280, or 6%, compared to our sales over the same period of fiscal 2025. The largest contributor to the decline in our sales was from the loss of our cedar fencing supply agreement with a major customer during the current period. Due to the loss of the cedar supply agreement, we sold our excess cedar fencing inventory and, combined with the liquidation of certain pet inventory, our sales were increased by approximately $200,000 in the third quarter and a total of $3.1 million during the current nine-month period, which will not be repeated in future periods.
Current report
Our net loss for the third quarter was ($814,330), or ($0.23) per share, and our net loss for the nine months was ($6,007,397), or ($1.71) per share. Several one-time items affected our results in the current third quarter. We received a tariff refund which reduced our cost of goods sold by $286,274. We also adjusted our reserve for obsolete inventory downward by $250,000 and wrote-off an additional $400,000 in lumber inventory. Our nine-month results were also negatively affected by an inventory write-down of $2,208,813 which we took in the first quarter related to the liquidation sales of the excess fencing and certain pet inventory.
Current report
Import tariffs remain a substantial negative impact on our costs and revenues. Since the implementation of the additional tariffs beginning in February 2025, our tariff costs have increased substantially. A ruling by the United States Supreme Court in February 2026 invalidated certain tariffs that were imposed under the International Emergency Economic Powers Act (IEEPA). A process for the refund of those tariffs as administered by US Customs and Border Protection (“CBP”) was established in April 2026, and we applied for the refund of invalidated tariffs we paid under the IEEPA. In June 2026, we received approval and payment for our outstanding tariff claims and interest totaling $1,008,810. Of the amount received, $887,670 is for accepted IEEPA related claims, $80,092 are post-summary corrections unrelated to the invalided IEEPA claims, and $41,048 is interest. An additional $16,686 of our claim was rejected, and we intend to appeal this rejection once an appeal process is in place. However, the amount of tariffs we previously paid which are eligible for potential refunds is a small percentage of the overall tariffs we have paid, and continue to pay, under the current tariff rates.
Current report
Most of the tariffs levied on our imported goods are unaffected by the Supreme Court ruling and remain in effect, including the 50% Section 232 steel and aluminum tariffs. In February 2026, a new temporary 10% global import duty was enacted, and in April 2026 the Section 232 steel and aluminum tariffs were adjusted. The Section 232 tariffs now range from 25 to 50%, instead of the prior fixed 50% rate, but now the rate is calculated on the full value of the imported products instead of just the metal content. In some cases this adjustment has increased the amount of tariff due. Although the revised rates have reclassified some of our other imported products to lower rate categories, the overall tariffs applicable to our product imports have increased slightly compared to our pre-February 2026 costs.
Current report
The cedar fencing supply agreement had historically represented a significant portion of the Company's consolidated revenue. Although the program operated at comparatively lower profit margins than the Company's other product categories, it did make a positive contribution to operating income. The sale of our excess fencing inventory unlocked a significant amount of stranded capital which we have deployed to the acquisition of inventory of our core products. Management believes that the elimination of the working capital requirements related to the need to maintain the fencing inventory for this customer is expected to improve the Company's liquidity position to provide cash resources for other uses going forward. It will also lessen the need for us to borrow additional amounts under our line of credit.
Current report
Sales of our pet products continues to struggle, as consumers restrain their discretionary spending and focus their pet spending away from non-consumables, such as our metal crates and kennels. Our pet product sales remain down about 40% year over year. During the third quarter, we continued to liquidate excess pet inventory to recapture some of our product costs and reduce our ongoing warehousing costs. However, a portion of these sales were made below our product costs which depressed our overall margins.
Current report
For the three months ended May 31, 2026, sales totaled $9,852,338 compared to sales of $12,605,344 for the three months ended May 31, 2025, which is a decrease of $2,753,006, or 22%. The decline was primarily due to the loss of the cedar fencing supply agreement.
Current report
Sales at JCC were $8,737,065 compared to sales of $11,900,284 for the quarter ended May 31, 2025, a decrease of $3,163,219, or 27%. The primary difference in revenue was due to the loss of the cedar fencing supply agreement, which contributed $3.06 million more in sales in the year-ago third quarter compared to the current quarter. Demand for our pet products continues to be weak, but revenue in our LTP and Adjust-a-Gate lines increased, driven by the continued expansion of our in-store displayer program. Operating loss for JCC for the quarter ended May 31, 2026 was ($435,091) compared to a loss of ($861,105) for the quarter ended May 31, 2025.
Current report
Gross margin for the three months ended May 31, 2026 was 18.0% compared to 15.0% for the three months ended May 31, 2025. Current margins improved due to a higher percentage of metal fencing product sales compared to lower-margin wood fencing in the current quarter.
Current report
Nine Months Ended May 31, 2026 and May 31, 2025
Current report
For the nine months ended May 31, 2026, sales totaled $29,043,015 compared to sales of $30,927,295 for the nine months ended May 31, 2025, which is a decrease of $1,884,280, or 6%. The decline was primarily due to the loss of our cedar fencing supply agreement, although revenues were supported by the one-time sales of our excess fencing inventory and liquidation of certain slow-moving pet inventory, and higher sales at Greenwood.
Current report
Sales at JCC were $25,252,256 compared to sales of $28,268,572 for the nine months ended May 31, 2025, which is a decrease of $3,016,316, or 11%. Much of the decline was due to the loss of the cedar fencing supply agreement and continued weakness in demand for our pet products. Consumer resistance to higher prices for our products caused by the tariff costs and higher logistics and raw material prices also contributed to weaker demand during the period, as well as the decline in discretionary spending due to inflationary pressures, largely due to sharply higher energy prices. For the current nine-month period, JCC had an operating loss of ($5,142,332) compared to an operating loss of ($2,615,470) for the nine months ended May 31, 2025.
Current report
Other items recorded in the current nine-month period include a gain on the sale of assets of $200 and interest expense of ($341,759) which is primarily related to interest on our line of credit. In the comparable nine months of fiscal 2025, we had other income of $306, a gain on sale of assets of $800, and interest expense of ($43,053).
Removed paragraphs (16)
Previous report
During the second quarter, we made important progress toward our goals to refocus on our operational strengths while reducing costs. We successfully sold the majority of our excess lumber inventory and continued to grow our Lifetime Steel Post sales through both our existing accounts and through the addition of new customers.
Previous report
Our sales for the second quarter increased by $1,482,259, or 16% over Q2 2025. Our current six-month sales rose by $868,726, or 5%, over the first six months of fiscal 2025. However, approximately $2.5 million of these sales were from the liquidation of certain pet inventory and the sale of our excess cedar fencing inventory, and those sales will not be repeated in future periods. Our net loss for the second quarter was ($1,248,928), or ($0.35) per share, and our net loss for the six months was ($5,193,067), or ($1.48) per share. Our six-month results were negatively affected by an inventory write-down of $2,208,813 we took in the first quarter related to the liquidation sales.
Previous report
In November 2025, we received notice from one of our largest fencing customers that they would be terminating our cedar fencing supply agreement in calendar 2026. We originally entered into a consignment agreement with this customer in 2023 after they lost their primary source of Western Red Cedar fencing. This program provided them with a ready source of cedar fencing and provided us with a steadier flow of orders that stabilized the year-over-year lumber sale fluctuations that we commonly experienced as a secondary supplier to multiple big box retailers. However, under the agreement, we were required to maintain a higher level of fencing inventory on hand than we had previously in order to quickly meet all the potential demand under the customer’s sales forecasts. During the Spring of 2025, we failed to acquire an adequate supply of fencing to meet our actual demand and were unable to fulfill all our customers’ orders during the third quarter. To ensure we could meet their needs for the remainder of the busy summer season, we quickly moved to secure additional Western Red Cedar from our supply partners to meet their forecasted level of sales for the remainder of the summer season. Unfortunately, this customer’s actual level of fencing sales for the remainder of the season fell short of their forecasts. Volatility in lumber markets during this period resulted in higher prices which led to consumers restraining their elective purchases. As a result, we ended the 2025 fencing season with excess cedar fencing inventory on hand.
Previous report
Although the consignment program provided us with meaningful revenue, it eroded the margin, profitability, and pricing flexibility we were accustomed toin our cedar sales prior to this consignment arrangement. This consignment sales agreement accounted for the majority of our lumber fencing sales, but we are continuing to offer cedar fencing as we have other current customers for these products.
Previous report
Import tariffs remain a significant issue for our operations. Since the implementation of the additional tariffs beginning in February 2025, our tariff costs have increased substantially. Since 2023, we have successfully migrated much of our production from China to other lower-tariffed countries. This has helped us successfully mitigate some of the 2025 tariffs, particularly the China-specific levies, that otherwise would have resulted in greater import costs.
Previous report
In February 2026, the United States Supreme Court ruled that tariffs that were imposed under the International Emergency Economic Powers Act (IEEPA) were not legal. This ruling invalidated certain of the current tariffs levied since February 2025. We may be eligible to receive refunds of certain IEEPA related tariffs, but if so, any refunded amounts will be a small fraction of the overall amounts we have paid in tariffs over the last year. Most of the tariffs levied on our imported goods are unaffected by the Supreme Court ruling and remain in effect, including the 50% Section 232 steel and aluminum tariffs. As set forth above, we are currently evaluating the new Section 232 tariffs and how it will apply to our imported products. However, this change is unlikely to relieve much, if any, of the overall tariff rate on our imported metal products, and may in some cases increase the tariffs we are required to pay.
Previous report
The implementation of the new tariffs also placed a strain on our capital position beginning in March 2025. The new tariffs became effective almost immediately after they were first announced. That gave us very little time to adjust to the higher costs, and we were required to pay these tariffs immediately upon effectiveness. This increased our cash outlays which we were not able to immediately recoup in the form of higher sales prices for the affected goods. Our customers must consent to any price increases, and although we negotiate with our customers to accept higher prices, they may not immediately accept these increases, and any changes may only be accepted after 30 to 90 days, or longer, if at all. Many of our customers did not immediately accept higher prices for our products, but by September 2025, those remaining customers agreed to accept shipments with the higher prices which began during the following weeks. However, the volume of these shipments was significantly lower than in prior years, and that trend continued in the second quarter. Due to the uncertainty around tariff changes, some of our customers have resisted placing long-term purchases at contracted prices which has further negatively affected our revenue. Although our customers have slowly begun to accept higher product prices, consumers have not yet fully adjusted their expectations. Consumer confidence has declined, and they continue to resist paying the higher product prices which restrains their elective purchases. It is highly probable these increased tariff related costs and their effects will continue to negatively affect our margins and demand for our products for the remainder of fiscal 2026.
Previous report
The pet market has been particularly hard hit by the weakness in consumer purchases. Pet adoptions declined drastically post-pandemic as workers returned to the office, which reduced demand for our non-consumable product offerings such as metal crates and kennels. This trend has continued as consumers continue to restrain their discretionary spending which has further depressed the overall pet market. As a result, we have been burdened with excess pet inventory above our forecasted sales, which we have been liquidating during the current six-month period. Although these sales recapture some of our inventory costs and will reduce our ongoing warehousing costs, these sales have been made at below cost which have depressed our overall margins. Although we believed we had made adequate inventory allowances in the previous fiscal year to reflect market conditions, we recorded an additional $550,000 inventory allowance in the current period to reflect the difference between our costs and the revenue from these sales. Overall, our pet sales are down about 40% year over year as retailers have sufficient inventory on hand and are currently limiting their inventory purchases.
Previous report
There has been no further incidents related to the cybersecurity intrusion we experienced in October 2025. A threat actor gained unauthorized access to portions of the Company’s information technology (“IT”) environment. We immediately activated our cyber incident response process to contain the intrusion, assess and investigate the incident, and implemented remedial measures, including retaining external cybersecurity experts and notifying law enforcement. We believe the unauthorized activity was contained and our IT systems and individual computer devices were brought back online, and we implemented additional cybersecurity measures. The incident caused disruptions and limitation of access to portions of our business applications, which affected our ability to process and ship orders for several weeks. We believe that our direct costs associated with these activities are not material as the costs related to the services provided by experts and the disruption to our business have largely been covered by the Company’s insurance policies.
Previous report
We are continuing the implementation of our strategic plan to concentrate our resources on our successful fencing and pet product lines while monetizing non-core assets, including the disposal of excess inventory. Our focus remains on reinforcing our operational strengths while reducing costs where possible in our efforts to increase our sales and margins and return to profitability. Management and the Board have engaged consultants that augment our efforts to return the Company to profitability. These outside professionals have been very constructive in helping us navigate our recent challenges and refining our strategic plan. We expect we will continue to engage such services for the remainder of the fiscal year as we proceed with implementation of our plan.
Previous report
Sales for the three months ended February 28, 2026 were $10,537,210 compared to sales of $9,054,951 for the three months ended February 28, 2025, which was an increase of $1,482,259, or 16%. Sales in the current quarter were increased by the higher LTP sales, higher sales at Greenwood, and the liquidation of certain pet and fencing inventory.
Previous report
Sales at JCC were $9,086,177 in the three months ended February 28, 2026, compared to sales of $7,943,319 in the three months ended February 28, 2025. This represents an increase of $1,142,858, or 14%. The increase in revenue was due to higher LTP sales and higher sales at Greenwood. We also liquidated certain slow-moving pet inventory and our excess cedar fencing which was acquired prior to the termination of our consignment sales agreement with a major retailer, and those sales will not be repeated in future periods. Operating loss for the current quarter was ($814,083) compared to an operating loss of ($834,127) for the quarter ended February 28, 2025. 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.
Previous report
Gross margin for the three months ended February 28, 2026 was 15.7% compared to 20.1% as of February 28, 2025. The decrease was primarily due to the liquidation of certain pet inventory and surplus cedar fencing at prices below cost. We also sold higher volumes of lower margin products in the current period. Our costs have also continued to rise, due to higher raw material costs, higher shipping and logistic costs, and the new import tariffs which began in March 2025.
Previous report
Six Months Ended February 28, 2026 and February 28, 2025
Previous report
Sales were $19,190,677 for the six months ended February 28, 2026 compared to sales of $18,321,951 for the six months ended February 28, 2025, which is an increase of $868,726, or 5%.
Previous report
Sales at JCC rose slightly to $16,515,191 from sales of $16,368,287 for the six months ended February 28, 2025. Some of our customers have not yet fully accepted the higher prices for our products caused by inflation and tariffs, which reduced our sales in the period. Our sales were also negatively affected by the cybersecurity event in October, which hampered our ability to ship products for several weeks. Current sales were assisted by the one-time liquidation of certain pet inventory and the sale of excess cedar fencing. Operating loss at JCC for the six months ended February 28, 2026 was ($4,707,241) compared to an operating loss of ($1,754,365) in the prior six months ended February 28, 2025. Higher raw material, shipping and tariff costs hurt our margins in the current period, which were also negatively affected by the liquidation of the certain pet inventory and excess fencing. 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.
Reworded paragraphs (35)
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 February 28, 2026 and August 31, 2025 and its results of operations and cash flows for the three and six month periods ended February 28, 2026 and 2025 in accordance with U.S. GAAP. Operating results for the three and six month periods ended February 28, 2026 are not necessarily indicative of the results that may be experienced for the fiscal year ending August 31, 2026. 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 May 31, 2026 and August 31, 2025 and its results of operations and cash flows for the three and nine month periods ended May 31, 2026 and 2025 in accordance with U.S. GAAP. Operating results for the three and nine month periods ended May 31, 2026 are not necessarily indicative of the results that may be experienced for the fiscal year ending August 31, 2026. 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
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 2025, the Company owns 7 US Patents and 1 patent application pending in the United States, Canada and Mexico 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. As of August 31, 2025, the Company owns 7 US Patents and 1 patent application pending in the United States, Canada and Mexico pertaining to its fencing products.
Previous wording
The Company formerly operated agricultural seed processing and sales operations through its Jewett-Cameron Seed Company (“JCSC”) subsidiary. JCSC operated out of a Company-owned 11.6 acre facility located adjacent to North Plains, Oregon. We ended regular operations at JCSC effective August 31, 2023. In July 2024, we listed the JCSC property for sale or lease. The combined size of the buildings is approximately 109,500 square feet. One of the buildings is specialized for the seed industry, while most are metal warehouse buildings with power, allowing a wide array of possible uses. The property is currently zoned “Rural Industrial” (RIND), which allows for use of the existing property, or development of the site, as approved by Washington County. The current listing price for the property is $7.223 million. This is the current asking price, and there is no guarantee the property will sell for this amount, if at all. If we are able to complete a sale, the net proceeds will be reduced by brokers’ commissions, expenses related to the sale, and taxes.
Current wording
The Company formerly operated agricultural seed processing and sales operations through its Jewett-Cameron Seed Company (“JCSC”) subsidiary. JCSC operated out of a Company-owned 11.6 acre facility located adjacent to North Plains, Oregon. We ended regular operations at JCSC effective August 31, 2023. In July 2024, we listed the JCSC property for sale or lease. The combined size of the buildings is approximately 109,500 square feet. One of the buildings is specialized for the seed industry, while most are metal warehouse buildings with power, allowing a wide array of possible uses. The property is currently zoned “Rural Industrial” (RIND), which allows for use of the existing property, or development of the site, as approved by Washington County. The current listing price of the property to $6.221 million. This is the current asking price, and there is no guarantee the property will sell for this amount, if at all. If we are able to complete a sale, the net proceeds will be reduced by brokers’ commissions, expenses related to the sale, and taxes. The carrying value of this property as reflected in the Company’s financial statements is $566,022 as of May 31, 2026.
Previous wording
The Company’s mission is to improve the lives of professionals and do-it-yourselfers with innovative products that enrich outdoor spaces. We design, source, commercialize and distribute our products. Many are patent protected and all are well crafted for their quality, performance, and ease to work with.
Current wording
The Company’s mission is to improve the lives of professionals and do-it-yourselfers with innovative products that enrich outdoor spaces. We design, source, commercialize and distribute our products. Some of our products are patent protected and all are well crafted for their quality, performance, and ease to work with.
Previous wording
In February 2026, the Supreme Court of the United States ruled the President did not have the authority to impose tariffs under the International Emergency Economic Powers Act (IEEPA). This ruling invalidated certain of the current tariffs levied since February 2025, including the additional country-specific tariffs and the fentanyl related levy. However, the tariffs on imported steel and aluminum products were not affected by the ruling, as those tariffs were levied under a different section of the Trade Act which was not subject to the Court’s determination. We may be eligible to receive refunds of certain tariffs we paid that were levied under the IEEPA. If it is determined that we are eligible for refunds, the availability, amount and timing of such refunds is uncertain and subject to further developments. However, a majority of the tariffs we have paid since the new tariffs were first announced in February 2025 have been levied under Section 232, including the steel and aluminum tariff and other historic tariffs which are unaffected by this court decision. Therefore, any potential refund will only be a small percentage of the overall tariffs we have paid over the prior 12 months.
Current wording
In February 2026, the Supreme Court of the United States ruled the President did not have the authority to impose tariffs under the International Emergency Economic Powers Act (IEEPA). This ruling invalidated certain of the current tariffs levied since February 2025, including the additional country-specific tariffs and the fentanyl related levy. However, the tariffs on imported steel and aluminum products were not affected by the ruling, as those tariffs were levied under a different section of the Trade Act which was not subject to the Court’s determination. However, a majority of the tariffs we have paid since the new tariffs were first announced in February 2025 have been levied under Section 232, including the steel and aluminum tariff and other historic tariffs which are unaffected by this court decision.
Previous wording
Since the Supreme Court ruling, the Presidential Administration has announced its intent to levy new sets of tariffs imposed under a different section of the Trade Act which would not fall under the IEEPA. On February 24 th, a new temporary 10% global import duty took effect for 150 days. However, imports covered under Section 232 tariffs, which include the steel and aluminum products, are excluded from this additional 10% rate. On April 2, 2026, the Section 232 steel and aluminum tariffs were adjusted. Under the new rule, the Section 232 steel and aluminum tariffs were adjusted. Previously, a 50% tariff was levied on the original value of the foreign metal in the imported product. Under the new rule, the tariff rates on most imported steel and aluminum products will range from 25 to 50%, but will now be calculated on the full value of the imported products, which in some cases may potentially increase the amount of tariff due. We are currently evaluating the new tariff proclamation and how it will apply to our imported products.
Current wording
Since the Supreme Court ruling, the Presidential Administration has announced its intent to levy new sets of tariffs imposed under a different section of the Trade Act which would not fall under the IEEPA. On February 24 th, a new temporary 10% global import duty took effect for 150 days. However, imports covered under Section 232 tariffs, which include the steel and aluminum products, are excluded from this additional 10% rate. On April 2, 2026, the Section 232 steel and aluminum tariffs were adjusted. Previously, a 50% tariff was levied on the original value of the foreign metal in the imported product. Under the new rule, the tariff rates on most imported steel and aluminum products now range from 25 to 50%, but are calculated on the full value of the imported products, which in some cases has increased the amount of tariff due. Some of our other imported products have been reclassified, and tariff rates on those products have been reduced. As a result of the recent changes in tariffs product classifications, the overall tariffs applicable to our product imports has increased slightly compared to our pre-February 2026 costs.
Previous wording
These tariffs have tremendously disrupted our markets and consumer buying habits. In addition to increasing our direct costs, the shift in manufacturing away from China has caused increases to logistical and shipping costs as the supply chains from these alternative countries are less developed than from China. These higher costs resulted in a double-digit reduction in overall gross margins across the majority of our product lines.
Current wording
These tariffs have tremendously disrupted our markets and negatively affected consumer buying habits. Since 2023, we have successfully migrated much of our production from China to other lower-tariffed countries. Although this shift to new suppliers has helped us successfully mitigate some of the tariffs, particularly the China-specific levies, it has increased some our direct costs. It also caused increases to logistical and shipping costs as the supply chains from these alternative countries are currently less developed than from China. These higher costs resulted in a double-digit reduction in overall gross margins across the majority of our product lines, but the reduction to our margins is less than if we retained that production in China that is subject to the higher China specific tariffs.
Previous wording
With the customer’s notice they were terminating the consignment agreement, this excess inventory became surplus to our needs. This inventory was not only incurring storage costs and represented a significant drain on our available capital, it also was subject to the potential of weathering or other deterioration which would further erode its value over time. During the first quarter, we took a write-down on its value to reflect our estimates of its current value. During the second quarter we successfully negotiated with the consignment customer for them to purchase the portion of the inventory already present in their distribution facilities at the originally contracted prices. We then sold the remaining excess inventory to a lumber wholesaler. The inventory we sold to the consignment customer at the contracted prices resulted in a small profit, but the other excess inventory was sold below our cost. However, the sale of this inventory unlocked a significant amount of stranded capital which we are utilizing to acquire other inventory for our traditionally busier Spring and Summer season while reducing the need for us to borrow additional amounts under our line of credit.
Current wording
Our lumber sales in the current nine month period was down 18% compared to the nine months ended May 31, 2025. The decline was due to the termination of our cedar fencing supply agreement by one of our largest fencing customers. We were notified by this customer in November 2025 that they would be terminating the supply agreement in calendar 2026. During the summer of 2025, we obtained additional fencing inventory based on this customer’s forecasted level of sales to ensure we could meet their needs for the remainder of the busy summer season. Unfortunately, this customer’s actual level of fencing sales from that point forward fell short of their forecasts. As a result, we had excess cedar fencing inventory on hand when the customer terminated the agreement. This inventory was not only incurring storage costs and represented a significant drain on our available capital, it also was subject to the potential of weathering or other deterioration which would further erode its value over time. During the first quarter, we took a write-down on its value to reflect our estimates of its current value. During the second quarter we successfully negotiated with the customer for them to purchase the portion of the inventory already present in their distribution facilities at the originally contracted prices. We then sold the remaining excess inventory to a lumber wholesaler. The inventory we sold to the customer at the contracted prices resulted in a small profit, but the other excess inventory was sold below our cost.
Previous wording
Sales in our metal fencing were down year-over-year which is largely attributable to difficult market conditions from the tariff situation. Higher sales of our Lifetime Steel Post® (LTP) were offset by lower sales for our Adjust-A-Gate and other fencing products. Our in-store displayers continue to drive consumer engagement. We have added new customers to the display program, including orders for new in-store display units from other retailers which are shipping in the third quarter. Significant growth opportunities remain in the fencing sector, both through the expansion of our existing products into more stores and through new sales channels. We are developing improvements and enhancements to our existing products, and evaluating outside products from third parties that complement our current product lines and to expand our product offerings.
Current wording
Sales in our metal fencing were up slightly year-over-year. However, market conditions remain difficult due to the higher consumer prices resulting from the metal tariffs and higher logistic costs, which have also reduced our margins. Increased sales of our Lifetime Steel Post® (LTP) were offset by lower sales for our Adjust-A-Gate, Eurofence, and other fencing products. Our in-store displayer program has successfully driven consumer engagement and higher sales for LTP. We continue to deploy new display units with both existing and new customers. We believe significant growth opportunities remain in the fencing sector, both through the expansion of our existing products into more stores and through new sales channels. We are developing improvements and enhancements to our existing products, and evaluating outside products from third parties that complement our current product lines and to expand our product offerings.
Previous wording
Greenwood revenues increased by 37% compared to the first six months of fiscal 2025. Demand for transit related products continues to recover from the post-pandemic lows, and the seat shortage that slowed transit construction in fiscal 2025 has been resolved. Our sales have also risen due to a recently added non-transit industrial customer and new product pricing. We will continue to focus on acquiring new customers and expanding our offerings, particularly in non-transit markets. However, as we intend to concentrate our operations on the fence and outdoor segment, we are evaluating strategic alternatives for Greenwood and its industrial wood operations.
Current wording
Greenwood revenues increased by 43% compared to the first nine months of fiscal 2025. Demand for transit related products continues to recover from the post-pandemic lows, and the seat shortage that slowed transit construction in fiscal 2025 has been resolved. Our sales have also risen due to a recently added non-transit industrial customer and new product pricing. We will continue to focus on acquiring new customers and expanding our offerings, particularly in non-transit markets. However, as we intend to concentrate our operations on the fence and outdoor segment, we are evaluating strategic alternatives for Greenwood and its industrial wood operations.
Previous wording
In December 2025 we successfully negotiated a revised borrowing agreement with Northrim Funding Services (“Northrim”). Under the new terms, the maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 90% of the maximum eligible accounts and is not to exceed $8,000,000, which was increased from the prior 80% of the net eligible accounts and a $6,000,000 limit. Borrowing against the Company’s inventory was increased to an amount equal to 50% of all eligible inventory from the prior 25%, and the maximum amount the Company may borrow was increased to $6,500,000 from $4,000,000. Amounts provided by Northrim will be secured by certain of the Company’s real estate assets. Proceeds from the sale of any such assets will be used to pay down the credit line and thereafter the funding arrangement will revert to the original conditions and limits set forth prior to the recent amendments. The increase in our line provides us with additional flexibility to provide funds to help our operational realignment and the purchase of inventory ahead of our traditionally busier Spring and Summer seasons. In addition to the revised credit line with Northrim, we are currently evaluating other strategies to strengthen our liquidity position. These strategies may include, but are not limited to, disposition of certain non-core assets and unused real property and seeking additional financing from both the public and private markets through the issuance of equity or debt securities. There can be no assurance that we will be successful in achieving these strategies.
Current wording
In June 2026, we revised and renewed our borrowing agreement with Northrim Funding Services (“Northrim”). With the end of our cedar fencing agreement, we have substantially reduced our need to purchase and maintain significant amounts of lumber inventory. Therefore, we have reduced the maximum draw available under the new line accordingly. Under the new terms, the maximum amounts of Accounts Receivable invoices Northrim will purchase at one time is limited to an amount equal to 85% of the maximum eligible accounts and is not to exceed $6,000,000. Borrowing against the Company’s inventory remains at an amount equal to 50% of all eligible inventory, but the maximum amount the Company may borrow was decreased to $3,000,000 from $6,500,000. The revised maximum more closely aligns with our forecasted inventory going forward. Amounts provided by Northrim continue to be secured by certain of the Company’s real estate assets. Proceeds from the sale of any such assets will be used to pay down the credit line. The line with Northrim will now expire on June 30, 2027. In addition to the revised credit line with Northrim, we are currently evaluating other strategies to strengthen our liquidity position. These strategies may include, but are not limited to, disposition of certain non-core assets and unused real property and seeking additional financing from both the public and private markets through the issuance of equity or debt securities. There can be no assurance that we will be successful in achieving any of these strategies.
Previous wording
We are continuing our efforts to reduce our operating and administrative costs to match our anticipated future revenue levels. Due to our work force reduction in fiscal 2025, our wages and employee expenses were 23% lower in the current six-month period compared to the first six months of fiscal 2025 while not compromising our levels of quality or service. We also continue our efforts to sell surplus assets, including our surplus Jewett-Cameron Seed property and our innovation studio property, both of which remain on the market for sale at listing prices of $7.223 million and $795,000, respectively. For both properties, these are the current asking prices and there is no guarantee the properties will sell for this amount, if at all.
Current wording
An important component of our operating plan is reducing our operating and administrative costs, which includes disposing of our surplus assets to focus on our core product lines. Our wages and employee expenses were 22% lower in the current nine-month period compared to the prior nine-month period as we reduced our employee headcount to concentrate on our core product lines. We also continue our efforts to sell surplus assets, including our surplus seed property and our innovation studio property. Both of these surplus properties are on the market for sale at revised listing prices of $6.221 million and $743,000, respectively. For both properties, these are the current asking prices and there is no guarantee the properties will sell for this amount, if at all. Our selling, general and administrative expenses are higher in the current nine-month period as management and the Board have engaged independent consultants that augment our efforts to return the Company to profitability. These outside professionals have been very constructive in helping us navigate our recent challenges and implementing our strategic plan. We expect we will continue to engage such services for the remainder of fiscal 2026.
Previous wording
Due to the continued uncertainty and higher costs stemming from the high global tariff levels and the conflict in the Middle East, we expect fiscal 2026 to remain challenging. Fuel prices have risen dramatically worldwide since the outbreak of miliary action in the Persian Gulf in March 2026. We are now beginning to incur higher shipping and logistic costs as our providers are raising their rates and implementing immediate fuel surcharges to cover their higher costs, but our ability to quickly pass on these costs to our customers is limited. We expect this will further compress our margins for the remainder of the fiscal year. In addition, periods of high fuel prices, particularly gasoline, have historically led to significant decreases in discretionary spending by American consumers which may negatively affect demand for our products during our traditionally busier Spring and Summer seasons.
Current wording
We are continuing the implementation of our strategic plan to concentrate our resources on our successful fencing and pet product line. Our focus remains on reinforcing our operational strengths while reducing costs where possible in our efforts to increase our sales and margins and return to profitability. However, we anticipate continued challenges to our business in the fourth quarter and into fiscal 2027 due to the high global tariffs, increasing costs, and restrained consumer discretionary spending. Fuel prices have risen dramatically worldwide since the outbreak of miliary action in the Middle East in March 2026, and we are incurring higher shipping and logistic costs as our providers raise their rates and implement fuel surcharges to cover their higher costs. Our ability to quickly pass on these costs to our customers is limited. We expect these rising costs will restrain our margins. In addition, periods of high fuel prices, particularly gasoline, have historically led to significant decreases in discretionary spending by American consumers which may negatively affect demand for our products during this period.
Previous wording
Three Months Ended February 28, 2026 and Three Months Ended February 28, 2025
Current wording
Three Months Ended May 31, 2026 and May 31, 2025
Previous wording
Sales at Greenwood were $1,451,034 compared to sales of $1,111,632 for the three months ended February 28, 2025, which is an increase of $339,402, or 31%. Demand from transit customers continue to recover from workers returning to offices. We are also receiving higher sales from non-transit customers. For the three months ended February 28, 2026, Greenwood had an operating profit of $167,242 compared to an operating loss of ($24,035) for the three months ended February 28, 2025.
Current wording
Sales at Greenwood for the quarter were $1,115,273 compared to sales of $705,059 for the three months ended May 31, 2025, which was an increase of $410,214 or 58%. Demand from transit customers continues to recover from the pandemic lows, and we also are receiving higher sales from non-transit customers. For the three months ended May 31, 2026, Greenwood had an operating profit of $133,684 compared to an operating loss of ($20,283) for the three months ended May 31, 2025.
Previous 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, 2026, JC USA had an operating loss of ($602,446) compared to an operating profit of $97,078 for the quarter ended February 28, 2025.
Current wording
JC USA is the holding company for the wholly-owned operating subsidiaries. For the quarter ended May 31, 2026, JC USA had a loss before income taxes of ($541,827) compared to income before income taxes of $119,460 for the quarter ended May 31, 2025. The results of JC USA are eliminated on consolidation.
Previous wording
Operating expenses increased by $174,898 to $2,761,093 compared to expenses of $2,586,195 for the three months ended February 28, 2025. Selling, General and Administrative expenses rose to $1,435,093 from $940,168, which was primarily due to higher professional fees related to the engagement of outside consultants in the period. Wages and Employee Benefits declined to $1,263,765 from $1,564,799 due to a lower headcount during the current quarter. Depreciation and Amortization decreased to $62,235 from $81,228. Interest expense, which was largely due to interest on the line of credit, was ($137,459) compared to interest income of $9,096 in the year-ago quarter. Other income in the current quarter was $Nil compared to income of $306 in the quarter ended February 28, 2025.
Current wording
Operating expenses for the three months ended May 31, 2026 were $2,542,491, which was relatively flat compared to expenses of $2,576,788 in the three months ended May 31, 2025. Wages and employee benefits declined to $1,179,687 from $1,488,446 as we adjusted our employee headcount to better align our costs with our anticipated revenues. Selling, General and Administrative expenses rose to $1,302,396 from $1,008,334 which was primarily due to higher professional fees related to the engagement of outside consultants in the period. Depreciation declined to $60,408 from $80,008. Gain on the sale of assets in the current quarter was $200 compared to $Nil in the period ended May 31, 2025. Interest expense related to borrowing against our line of credit was ($75,151) in the current third quarter compared to expense of ($74,147) in the year-ago quarter.
Previous wording
Income tax recovery for the three-month period ended February 28, 2026 was $359 compared to recovery of $187,991 in the three months ended February 28, 2025. 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 three months ended May 31, 2026 was $28,902 compared to recovery of $112,294 for the three-month period ended May 31, 2025. The Company estimates income tax expense for the quarter based on combined federal and state rates that are currently in effect.
Previous wording
Net loss for the quarter ended February 28, 2026 was ($1,248,928), or ($0.35) per basic and diluted share, compared to a net loss of ($573,094), or ($0.16) per basic and diluted share, for the quarter ended February 28, 2025.
Current wording
Net loss for the quarter ended May 31, 2026 was ($814,330), or ($0.23) per basic and diluted share, compared to a net loss of ($649,634), or ($0.18) per basic and diluted share, for the quarter ended May 31, 2025.
Previous wording
Sales at Greenwood increased to $2,675,486 from $1,953,665 for the six months ended February 28, 2025. Demand by municipalities and transit operators has continued to recover from the post-pandemic lows as more workers return to offices. We also added new non-transit industrial customers during the current six months. For the six months ended February 28, 2026, Greenwood had an operating profit of $292,523 compared to an operating loss of ($47,865) for the six months ended February 28, 2025.
Current wording
Sales at Greenwood were $3,790,759 in the current nine-month period compared to sales of $2,658,723 for the nine months ended May 31, 2025. This represents an increase of $1,132,036, or 43%. Demand by municipalities and transit operators has continued to recover from the post-pandemic lows as more workers return to offices. We also added new non-transit industrial customers during the current period. Sales in the prior year’s nine-month period were negatively impacted by a vehicle seat shortage which reduced new bus construction. For the nine months ended May 31, 2026, Greenwood had an operating profit of $426,208 compared to an operating loss of ($68,148) for the nine months ended May 31, 2025.
Previous wording
JC USA, the holding company that provides professional and administrative services for the wholly-owned operating subsidiaries had operating loss of ($748,333) compared to operating income of $205,798 for the six months ended February 28, 2025. The results of JC USA are eliminated on consolidation.
Current wording
JC USA, the holding company that provides professional and administrative services for the wholly-owned operating subsidiaries had an operating loss of ($1,290,260) for the nine months ended May 31, 2026 compared to operating income of $325,258 for the nine months ended May 31. The results of JC USA are eliminated on consolidation.
Previous wording
Gross margin for the six-month period ended February 28, 2026 was 3.0% compared to 19.2% for the six months ended February 28, 2025. Our margins were negatively affected in the current six months due to higher product, shipping and tariff costs, and the liquidation sales of certain pet inventory and surplus cedar fencing at below cost which was supported by the $2,208,813 in additional inventory write-downs we took during the first quarter. Our sales also shifted to a higher volume of lower margin products.
Current wording
Gross margin for the nine-month period ended May 31, 2026 was 8.1% compared to 17.5% for the nine months ended May 31, 2025. Our margins were negatively affected in the current nine months due to higher product, shipping and tariff costs, and the liquidation sales of certain pet inventory and surplus cedar fencing at below cost which was supported by the $2,208,813 in additional inventory write-downs we took during the period.
Previous wording
Operating expenses for the six months ended February 28, 2026 were $5,466,776 compared to $5,138,242, which is an increase of $328,534, or 6%. The increase was due to higher Selling, General and Administrative expenses, which rose to $2,836,128 from $1,749,380 which was primarily due to higher professional fees related to the engagement of consultants to assist us with operations and strategic planning. Wages and Employee Benefits declined 23% to $2,490,803 from $3,226,567 due to a lower employee headcount during the current six months. Depreciation and Amortization decreased to $139,845 from $162,295 for the six months ended February 28, 2025.
Current wording
Operating expenses rose to $8,009,267 from $7,715,030 for the nine months ended May 31, 2025. Selling, General and Administrative expenses increased to $4,138,524 from $2,757,714 which was primarily due to higher professional fees related to the engagement of consultants to assist us with operations and strategic planning. Wages and employee benefits declined to $3,670,490 from $4,715,013 due to the lower employee headcount in the current period. Depreciation and amortization declined to $200,253 from $242,303.
Previous wording
Interest expense related to borrowing against the line of credit was ($266,608) in the current six-month period. The prior six month period ended February 28, 2025 had other income of $306, interest income of $31,094 and gain on sale of assets of $800. Income tax expense for the six months ended February 28, 2026 was ($30,015) compared to income tax recovery of $364,621 for the six months ended February 28, 2025. The Company estimates income tax expense for the period based on combined federal and state rates that are currently in effect.
Current wording
Income tax expense in the current nine-month period was ($1,113) compared to income tax recovery of $476,915 in the prior nine-month period ended May 31, 2025. The Company estimates income tax expense for the period based on combined federal and state rates that are currently in effect.
Previous wording
Net loss for the six months ended February 28, 2026 was ($5,193,067), or ($1.48) per basic and diluted share, compared to a net loss of ($1,231,811), or ($0.35) per basic and diluted share, for the six months ended February 28, 2025.
Current wording
Net loss for the nine months ended May 31, 2026 was ($6,007,397), or ($1.71) per basic and diluted share, compared to a net loss of ($1,881,445), or ($0.54) per basic and diluted share, for the nine months ended May 31, 2025.
Previous wording
As of February 28, 2026, the Company had working capital of $12,450,122 compared to working capital of $17,026,472 as of August 31, 2025, a decrease of $4,576,350.
Current wording
As of May 31, 2026, the Company had working capital of $11,696,200 compared to working capital of $17,026,472 as of August 31, 2025, a decrease of $5,330,272.
Previous wording
Cash and cash equivalents totaled $546,614, an increase of $320,401 from cash of $226,213 as of August 31, 2025. The increase was due to the timing of collection of accounts receivable, which increased to $6,518,143 from $3,863,678, and prepaid expenses, which are largely related to down payments for future inventory purchases, which increased to $1,012,351 from $1,000,439. Inventory declined by $6,289,713, or 40%, to $9,595,876 from $15,885,589 as we sold most of our excess cedar fencing and liquidated certain of our older pet inventory. Prepaid income taxes declined to $167,401 from $180,151.
Current wording
Cash and cash equivalents totaled $1,063,801, an increase of $837,588 from cash of $226,213 as of August 31, 2025. The increase was due to the timing of collection of accounts receivable, which increased to $4,232,247 from $3,863,678, and prepaid expenses, which are largely related to down payments for future inventory purchases, which increased to $1,186,176 from $1,000,439. Inventory declined by $8,432,953, or 53%, to $7,452,636 from $15,885,589 as we sold most of our excess cedar fencing and liquidated certain of our older pet inventory. Prepaid income taxes rose to $204,526 from $180,151.
Previous wording
Current liabilities rose to $6,292,074 from $4,695,620 as bank indebtedness increased to $4,275,261 from $2,101,835. Accounts payable declined to $963,050 from $1,510,173, and accrued liabilities fell slightly to $1,053,763 from $1,083,612.
Current wording
Current liabilities declined to $3,631,271 from $4,695,620. Bank indebtedness decreased to $1,328,270 from $2,101,835 as we used cash generated from our liquidation of excess inventory to pay down the line of credit. Accounts payable declined to $1,305,959 from $1,510,173, and accrued liabilities fell to $997,042 from $1,083,612.
Previous wording
As of February 28, 2026, accounts receivable and inventory represented 86% of current assets and 74% of total assets compared to 91% of current assets and 78% of total assets as of August 31, 2025.
Current wording
As of May 31, 2026, accounts receivable and inventory represented 78% of current assets and 63% of total assets compared to 91% of current assets and 78% of total assets as of August 31, 2025.
Previous wording
For the three months ended February 28, 2026, the accounts receivable collection period, or DSO, was 56 compared to 55 for the three months ended February 28, 2025. For the six-month period ended February 28, 2026, the DSO was 61 compared to 55 for the six months ended February 28, 2025. Inventory turnover for the three months ended February 28, 2026 was 117 days compared to 175 days for the three months ended February 28, 2025. For the six months ended February 28, 2026, inventory turnover was 124 days compared to 172 days for the six months ended February 28, 2025.
Current wording
For the three months ended May 31, 2026, the accounts receivable collection period, or DSO, was 40 compared to 50 for the three months ended May 31, 2025. For the nine-month period ended May 31, 2026, the DSO was 40 compared to 60 for the nine months ended May 31, 2025. Inventory turnover for the three months ended May 31, 2026 was 98 days compared to 129 days for the three months ended May 31, 2025. For the nine months ended May 31, 2026, inventory turnover was 120 days compared to 152 days for the nine months ended May 31, 2025.
Previous wording
External sources of liquidity include an asset-based line of credit agreement with Northrim Funding Services (“Northrim”) which we originally 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. Subsequent to the end of the quarter, we completed a revised borrowing agreement with Northrim. Under the revised agreement, the maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 90% of the maximum eligible accounts and is not to exceed $8,000,000, which was increased from the prior 80% of the net eligible accounts and a $6,000,000 limit. Borrowing against the Company’s inventory was increased to an amount equal to 50% of all eligible inventory from the prior 25%, and the maximum amount the Company may borrow was increased to $6,500,000 from $4,000,000. Amounts provided by Northrim will be secured by certain of the Company’s real estate assets. Proceeds from the sale of any such assets will be used to pay down the credit line. 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, 2026. As of February 28, 2026, we have borrowed $4,275,261 against the line at a current interest rate of 11.5%.
Current wording
External sources of liquidity include an asset-based line of credit agreement with Northrim Funding Services (“Northrim”) which we originally 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. Subsequent to period ended May 31, 2026, we extended the borrowing agreement with Northrim until June 30, 2027 under revised terms. Under the revised agreement, the maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 85% of the maximum eligible invoices and is not to exceed $6,000,000. Borrowing against the Company’s inventory is 50% of all eligible inventory, and the maximum amount the Company may borrow is $3,000,000. Amounts provided by Northrim will be secured by certain of the Company’s real estate assets. We would use the proceeds from the sale of any such assets to pay down the credit line. Interest is computed at the prime rate plus 4.75% with floor of 11%. The revised line expires on June 30, 2027. As of May 31, 2026, we have borrowed $1,328,270 against the line at a current interest rate of 11.5%.
Previous wording
During the six months ended February 28, 2026, the Company issued the Company issued 3,782 common shares to officers, directors and employees under the Restricted Share Plan. The value of these shares was $9,077. In December 2025, the Company cancelled 1,788 common shares valued at $8,301 which were previously issued but unvested under the Restricted Share Plan for an employee who left the Company.
Current wording
During the nine months ended May 31, 2026, the Company issued 3,782 common shares to officers, directors and employees under the Restricted Share Plan. The value of these shares was $9,077. In December 2025, the Company cancelled 1,788 common shares valued at $8,301 which were previously issued but unvested under the Restricted Share Plan for an employee who left the Company.
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 newly revised credit arrangement, the Company is expected to have sufficient liquidity available to meet the Company’s working capital requirements for the next 12 months.
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 credit arrangement, the Company is expected to have sufficient liquidity available to meet the Company’s working capital requirements for the next 12 months.
Previous wording
Since fiscal 2021, a number of product costs have increased substantially, including raw materials, energy, and transportation/logistical related costs. These higher costs have negatively affected our gross margins. Historically, we have passed cost increases on to the customer, but the rapid rise of prices over the last several years has resulted in consumers significantly reducing discretionary spending which has made the market much more price sensitive. This has made retailers more reluctant to accept higher prices for our goods which has limited our ability to raise our selling prices quickly enough to match the rate of increase of our costs. Our ability to pass through all of the current increase in our product costs to our customers is somewhat limited and occur after such costs are first incurred. Although management is working to mitigate such cost increases through the new sourcing agreements and modifying logistic agreements, we expect that our gross margins will remain under pressure in fiscal 2026.
Current wording
Since fiscal 2021, a number of product costs have increased substantially, including raw materials, energy, and transportation/logistical related costs. These higher costs have negatively affected our gross margins. Historically, we have passed cost increases on to the customer, but the rapid rise of prices over the last several years has resulted in consumers significantly reducing discretionary spending which has made the market much more price sensitive. This has made retailers more reluctant to accept higher prices for our goods which has limited our ability to raise our selling prices quickly enough to match the rate of increase of our costs. Our ability to pass through all of the current increase in our product costs to our customers is somewhat limited and occur after such costs are first incurred. Although management is working to mitigate such cost increases through the new sourcing agreements and modifying logistic agreements, we expect that our gross margins will remain under pressure throughout fiscal 2026 and into fiscal 2027.
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 fiscal 2025 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 August 2025. In March 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 busier Spring and Summer seasons. As of the end of the most recent fiscal period ended February 28, 2026, the Company has drawn $4,275,261 against this line of credit at a current interest rate of 11.5%.
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 fiscal 2025 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 August 2025. In March 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 busier Spring and Summer seasons. As of the end of the most recent fiscal period ended May 31, 2026, the Company has drawn $1,328,270 against this line of credit at a current interest rate of 11.5%.