Second Cup posts $26.3 million Q3 loss, outlines 3-yr plan for turnaround
Posted Nov 3, 2014 09:02:41 AM.
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TORONTO – Second Cup Ltd. (TSX:SCU) had a $26.2 million loss in the third quarter, as the troubled specialty coffee company it booked provisions for cafe closures and the impairment of its asset values.
The loss amounted to $2.65 per share, mostly due to a $25.7-million item that reflects the reduced value of Second Cup’s trademarks.
On an adjusted basis, Second Cup’s operations had a reduced profit of four cents per share — down about 64 per cent from last year’s third quarter when adjusted earnings were 11 cents per share..
Second Cup also announced Monday that it plans to raise up to $5 million this month through a private placement of its stock, as part of a three-year plan to revitalize the Canadian specialty retailer’s network of cafes and brand.
At the end of the third quarter there were 349 Second Cup cafes, two less than a year earlier and eight fewer than at the beginning of the quarter.
Second Cup has been faced with increased competition in recent years from high-end coffe retailers such as Seattle-based Starbucks and major restaurant chains such as Tim Hortons (TSX:THI) and McDonald’s.
