Why Invest
Monthly Cash Distributions
The Fund has paid a monthly cash distribution every month since its inception in June 2005. The distribution amount is set monthly by the Board of Trustees and is entirely dependent on the business performance of Coast Wholesale Appliances LP (Coast). Currently, the Fund pays a monthly cash distribution of $0.0416 per unit ($0.50 per annum) to its public unitholders and to the 35% non-controlling interest retained by the previous ownership.
Solid Industry Fundamentals
Major household appliances represent a $3.3 billion market opportunity in Canada. While new housing starts are currently down from the record levels of recent years, the growth in home renovation, as well as product innovation, an increasing focus on home décor and energy efficiency, and favourable demographics continue to generate demand.
Proven and Sustainable Business Model
Coast has operated successfully since 1978. Coast delivers complete appliance solutions with an unusually wide selection of products and brands, and a superior service offering. It benefits from established supplier relationships and a loyal, diversified customer base.
Leading Market Position
Coast has an estimated 25% share of the developer and builder market in Western Canada, as well as a significant and growing share of the retail market.
Track Record of Stable, Growing Cash Flow
In 2008, despite an extremely challenging business environment, sales increased by 2.6% over 2007 to a record $146.7 and EBITDA of 12.7 million represented an EBITDA margin of 8.7%.
In 2007, sales increased by 13.6% over 2006 to $143.0 million and EBITDA of $14.1 million represented an EBITDA margin of 9.8%.
In 2006, sales increased by 8.1% over 2005 to $126.0 million and EBITDA of $14.2 million represented an EBITDA margin of 11.3%.
Growth Potential
A significant opportunity exists for Coast to increase sales from existing branches by capitalizing on growing recognition of the Coast name and tailoring product offerings to meet regional preferences. Geographic expansion also offers growth potential, particularly in Ontario where Coast established a strong foothold in early 2009 with the acquisition of a well-located appliance dealership in the Greater Toronto Area, Canada’s largest market.
Experienced, Proven Management
Coast’s management team has a demonstrated ability to successfully execute on business strategy. Management’s interests are aligned with those of unitholders through a long-term incentive plan.