HOT HOUSE GROWERS
The Hot House Growers Income Fund reported sharply higher profits and revenues in its latest quarter and resumed paying distributions to unitholders as its financial health improved. The Vancouver- based vegetable grower said yesterday it earned $ 3.4 million, or 49 cents aunit, for the three months ended Sept. 30. That compared with meagre earnings of $ 360,000, or 5cents a unit, for the same 2004 period.
Quarterly revenues rose 39 per cent to $ 25.1 million from $ 18 million, primarily because of an expansion in the growing area at the company’s Delta, B. C. greenhouse and a return to more typical product prices this year. The fund’s board also resumed cash distributions for November, at 3 cents a month per unit, or 36 cents a year. Distributions of 3 cents a unit will be paid in November and December. The fund had suspended payments last year when its finances deteriorated in the wake of slumping tomato prices, caused by a market glut. “With an increased growing area, higher average product prices through 2005’ s peak selling season, and improved operational efficiencies, we have recorded significant year-overyear improvements in revenue, ( earnings before interest, taxes and other deductions), net income and distributable cash,” said Stephen Fane, president and CEO of Hot House said yesterday.
“ As a result, we have been able to reduce our operating line of credit, and can now restart cash distributions to our unitholders. As exchange rates continue to be a concern, and as we are coming to the end of our crop year, cash distributions will begin at a very conservative level.” The fund’s results are based on the results of Hot House Growers Inc., a leading North American greenhouse producer of tomatoes, cucumbers and sweet bell peppers for grocery retailers in Canada and the United States. Hot House was formed from the combination of Canagro Produce and Century Pacific Greenhouses Ltd. at the time of the fund’s IPO in December 2003. The Hot House fund owns 75 per cent of Hot House Growers Inc., which operates seven greenhouses in the Fraser Valley of southwestern British Columbia. Hot House units closed on the Toronto Stock Exchange yesterday at $ 7.30, up 5 cents.