Jewett-Cameron Trading Company
Annual Report 2021

Plain-text annual report

Annual Report 2021 September 2020 to August 2021 Jewett Cameron Co. Table of Contents 3 5 7 9 Message From the CEO & President Financial Performance 11 Sustainability 19 Corporate Structure 13 Social Media & Influencer Recap New Product Category Recap 20 Greenwood Products & Jewett Cameron Seed Co FY2021 Sales 15 17 Employee Milestones & Demographics 21 Office Remodel Project Brand Development Crafted. Stewardship. Legacy. Board of Directors Senior Management Geoff Guilfoy B U S I N E S S C O N S U LTA N T Sarah Johnson S U P P LY C H A I N O P E R AT I O N S P R O F E S S I O N A L Chris Karlin B O A R D M E M B E R Charlie Hopewell C EO Chad Summers P R E S I D E N T Mike Ulwelling C H I E F R E V E N U E O F F I C E R Mike Nasser J C C O F F I C E R Charlie Hopewell C EO Michelle Rule Walker V P G L O B A L B R A N D M K T N G . & EC O M M Marty Ramirez C H I E F O P E R AT I N G O F F I C E R Mitch Van Domelen D I R EC TO R O F F I N A N C E 1 2 ANNUAL REPORT 2021 ANNUAL REPORT 2021 Message From the CEO & President To our entire team… this is your story! Be proud of what you’ve helped build, be diligent in both challenging yourself as well as our organization, and continue to help us all continue the trails that allowed us all to be a part of this story. We are extremely pleased to provide you with a more graphic and in-depth view of our company, our divisions, products, and most of all, our performance and future. We hope that this review will encourage you to more closely follow our progress forward, ask questions, and of course… purchase some of our products or recommend them to friends and family. Approximately two-and-a-half years ago, we consciously focused on our brand; what it truly means to the organization and hopefully, our shareholders. We are tremendously proud of the work our teams have done to integrate this branding not just into products, but into the organization as well. Aligned with this, we also took an inventory of what cultural elements we strive to support, achieve and reach for. The combination of these has literally manifested in perception and reality. Our workplace is different. Our products are different. Our approach and follow through continues to drive towards our three pillars of Crafted, Stewardship and Legacy. As we state in our vision of who we are: we are our past as much as our future. We hope you will see witness of this in the pages that follow. We have invested heavily these past few years and this has paid rich dividends to our future. We have driven the organization to fully embrace our omni-channel experience FOR our customers… seeing us consistently whether on a store shelf, or on-line. This proved incredibly successful when COVID hit all of us and people made the transition from traditional in-store purchasing, to on-line or “hybrid shopping” where they research on line, but still purchase locally. These past few years have been challenging to say the least, but our team continues to grow, we continue to see rewards for our efforts, and we hope that you too will see continual advancement in our value, our products, and our culture. It is indeed our pleasure to start “a new tradition” of better engagement with our stakeholders and shareholders by presenting the information in these pages. We remain a growth oriented company seeking the talent and resources that will compliment our culture while helping us into our future. Thank you all stakeholders for your contributions. Charlie Hopewell C EO The values that form the foundation of Jewett Cameron and guide every aspect of our business are crafted, stewardship, and legacy. These have helped get us to where we are today and will continue to propel us into the future. These core values directly influence the people, the partners, the products, and the processes that make up our organization. People. We are committed to our people who design, manufacture, package, sell, ship, and support the products and customers with which we have the privilege of working with. It is our desire to be a workplace that engages employees to enjoy the work they do and who they do it with. This effort helps ensure we retain our best talent, train team members to advance as we grow, and attract new talent. Partners. Jewett Cameron is selective with whom we do business. We put a lot of time and resources into our supply partners. They need to produce consistent quality products in a timely fashion, meet manufacturing and workforce standards, and truly partner with us as we innovate and grow. We place a great deal of value on our business partners that provide us with professional services (such as banking, accounting, legal, etc.) to help us run our business as efficiently and effectively as possible. We also consider our customers as valued partners and strategically pursue and maintain those we are uniquely equipped to serve best. Products. All of our products are designed with the end user in mind. We also take pride in designing our Chad Summers P R E S I D E N T products to best accommodate the sales channels and partners we work with to accelerate the velocity of movement off their shelves, be it virtual or physical, into the hands of end users. We continue to incorporate a greater degree of recyclability and sustainability in the materials we use for our designs. Jewett Cameron products are quality designed and built, thoughtful, and functional with special attention towards elegance and innovation. Watch for continued expansion of new innovative products within our good, better, and best category options. Process. It is important our end users, customers, and supply partners experience us as reliable and dependable. We continue to invest in our infrastructure to streamline processes with automation and make Jewett Cameron easy to work with. Our commitment to becoming omni- channel and having our products available wherever our customers prefer to purchase has proven invaluable. Whether it’s receiving orders via EDI or through our Business to Business (B2B) portal to make it simple to place orders with us, or providing a subscription service to receive Lucky Dog poop bags every 3 months so you never run out, we are committed to improving our processes that compliment customer satisfaction and experience. These efforts also enable us to scale and accommodate our continued growth trajectory. I am personally grateful to all the leaders and team members that contributed to building Jewett Cameron over the last nearly 7 decades. We are excited to build upon the quality product mix, the amazing supply partners, and the incredible customer base. I couldn’t be more excited and honored to take the reins and help drive Jewett Cameron forward. 3 4 ANNUAL REPORT 2021 ANNUAL REPORT 2021 Corporate Structure Jewett-Cameron Trading Company Ltd. JC USA Inc. 5 6 ANNUAL REPORT 2021 ANNUAL REPORT 2021 Delivering quality, innovative products, right where you want them Industrial wood panels designed for Original Equipment Manufacturers (OEMs) in transportation sector and structural, engineered panels for construction High quality seeds for your custom needs Clean, store, and broker grass, clover, and grains in our turnkey facility 7 8 ANNUAL REPORT 2021 ANNUAL REPORT 2021 FY2021 Sales Growth of E-commerce vs Non-E-commerce E-commerce $10,463,872 E-commerce $13,414,004 E-commerce $10,239,281 E-commerce $13,055,392 26% of Sales 27% of Sales 25% of Sales 31% of Sales E-commerce $16,482,931 30% of Sales Top Sellers Gates Kennels Poop Bags Crates Infinity Euro Perimeter Patrol Other Lifetime Steel Post Cots Greehouses Outdoor Living 38% 33% 7% 5% 4% 4% 3% 2% 2% 2% 1% Desktop 56.6% Mobile 40.5% Tablet 3.0% Device Category User Demographics 2017 2018 2019 2020 2021 Online New vs Returning Users Non-E-commerce $30,287,304 Non-E-commerce $36,433,143 Non-E-commerce $29,980,467 Non-E-commerce $28,869,252 Non-E-commerce $38,250,131 TOTAL TOTAL $40,751,176 $49,847,147 TOTAL $40,219,748 TOTAL $41,924,644 TOTAL $54,733,062 Lucky Dog New 83,487 Returning Total 26,382 109,869 Lifetime Fence 54,540 Spring Gardener 12,686 16,929 3,835 71,469 16,521 Jewett Cameron Seed Co. & Greenwood Products financial data not included. TOTAL 150,713 47,146 197,859 2k 4k 6k Top Channels for Lucky Dog and Lifetime Fence Top Selling Regions By Brand West 32,717 South 32,136 Midwest 22,804 West 23,132 South 17,424 Midwest 17,372 West 5,524 South 3,447 Midwest 3,360 Northeast 16,167 Northeast 10,817 Northeast 2,603 9 1 0 Male 52.5% Female 47.5% Users by Age 65+ 55-64 45-54 35-44 25-34 18-24 ANNUAL REPORT 2021 ANNUAL REPORT 2021 Financial Performance 2016 - 2021 Gross Profit Income Statement 2019 2020 2021 Sales Cost of Goods Sold $ 45,446,362 $ 44,945,263 $ 57,501,543 $ 35,481,931 $ 32,472,080 $ 43,354,897 Gross Profit $ 9,964,431 $ 12,473,183 $ 14,146,646 Expenses Selling, General and Administrative $ 2,127,296 $ 2,502,989 $ 3,204,945 Depreciation and Amortization $ 191,819 $ 217,712 $ 244,279 Wages and Employee Benefits $ 4,907,766 $ 5,894,346 $ 6,957,730 Total Expenses $ 7,226,881 $ 8,615,047 $ 10,406,954 Income From Operations $ 2,737,550 $ 3,858,136 $ 3,739,692 Other Income Interest Income (expense) Gain/(Loss) on Sales of Assets Net Profit Before Taxes Income Tax Expense Net Profit $ 16,780 $ 28,448 $ 105,366 $ 12,005 $ 12,415 $ 6,600 $ 687,387 $ -2,871 0 $ 2,888,144 $ 3,889,156 $ 4,424,208 $ 787,692 $ 1,104,631 $ 969,255 $ 2,100,452 $ 2,784,525 $ 3,454,953 Earnings Per Share 0.50 0.77 0.99 Earnings per share growth 98% in 2 years 45% increase in six years 3 8 2 , 9 7 0 , 1 1 $ 7 1 0 2 4 1 8 , 7 9 5 , 1 1 $ 8 1 0 2 1 3 4 , 4 6 9 , 9 $ 9 1 0 2 3 9 5 , 6 3 7 , 9 $ 6 1 0 2 6 4 6 , 6 4 1 , 4 1 $ 3 8 1 , 3 7 4 , 2 1 $ 0 2 0 2 1 2 0 2 Total Assets 2021 2020 2019 1 1 $ 29,138,399 2018 $ 23,627,563 $ 23,277,961 $ 22,214,677 2017 2016 $ 22,181,035 $ 19,869,772 For a complete FY2021 Financial Performance Report, please visit www.jewettcameron.com/financial-reports. Financial data represented on this spread includes all JCC subsidiaries. 1 2 ANNUAL REPORT 2021 ANNUAL REPORT 2021 Social Media & Influencer Recap Partnership with @mapleandmortycorgis (350k followers) for Earth Day. Earth Day Giveaway National Love Your Pet Giveaway Partnered with Stewart Pet and @Ella. husky. Over 500 entries. Prize included Lucky Dog Poop Bags, Elevated Dog Bed, and Stewart Pet Treats. Partnership with Dad, How Do I? (3.6 Million subscribers on Youtube) Giving Back to the Community Lorem ipsum dolor sit amet, consectetur adipiscing elit. In ornare pulvinar arcu sollicitudin pharetra. Nam ornare metus nisi, eu pulvinar neque congue vel. Donec risus enim, dictum eget consectetur in, lacinia non libero. Over 25k likes, 252k impressions, and over 300 followers gained from this post. Over 500 entries and 3 pups won 200 rolls of Poop Bags (2,400 bags total!) Over 500 entries prize was Lucky Dog poop bags, elevated dog bed and Stewart Pet treats. Top Posts in FY2021 Make a Wish Oregon and Rick’s Custom Fencing & Decking partnered up to make a simple wish come true for 5 year old boy. Earth Day 76 likes, 800 impressions After spending time outside, nothing feels better than throwing away your dog's droppings in a way that creates change for our environment. Sliding Door Crate with Dalmation 100 likes, 900 impressions German Shepard Christmas 102 likes, 1,073 impressions Sponsored Adjust-A-Gate video Over 26k views, 2.2k likes Partnership with Brent- BYOT (205k subscribers on Youtube) When you wake up and realize it’s Friday! Have a great weekend furfriends! The countdown begins, one week away from the big day!! Who else still has some last minute shopping to do? Total of 40 non-influencer and brand ambassador campaigns Lucky Dog Follower Growth 2020 - 5,400 total followers 2021- 7,000 total followers 30% increase 2020 - 17,200 total followers 2021 - 18,500 total followers 8% increase Lifetime Fence Follower Growth 2020 - 511 total followers 2021 - 860 total followers 68% increase @lifetimefence @luckydogdirect @luckydogdirect Total number of posts tagged with #luckydogdirect in FY21: 435 posts @thelifetimefence 2020- 258 total followers 2021- 624 total followers 141% increase Sponsored Adjust-A-Gate video Over 12k views, 411 likes 1 3 1 4 ANNUAL REPORT 2021 ANNUAL REPORT 2021 Employee Milestones & Demographics 2021 New Hires Anniversary Milestones 0 19% Employees 10+ years 8 Employees 31% Employees here 2-9 years 3 Employees 4 Employees 2 Employees 100 50% Employees here less than 2 years 5 years or more 10 years or more 15 years or more More than 20 years Department Breakdown Warehouse Sales Team Digital Marketing Direct-to-Consumer Sales Supply Chain Product Mktg & Supply Seed Company Logistics/Import Accounting Customer Service Corporate/Admin/IT 13 7 4 5 3 4 10 6 5 6 9 Total 72 This total includes regular, full-time employees only. 16 22 25 Having been with Jewett-Cameron for over 15 years, I have seen many changes. What has remained the same, is the quality of Team members, and products we deliver to the Markets we serve. What is even more exciting, during these challenging times, is the energy and commitment everyone is bringing to the Mission, each and every day. I look forward to being able to spend more time in person, collaborating and creating new solutions for our customers and consumers, in the near future. -Steve, Sales Department I’ve worked at Jewett Cameron long enough to develop great confidence in my colleagues as we have navigated through extreme market fluctuations. Our growing, diverse, and agile team consistently plan for the long term. Looking down the road, I’m most excited about our recent endeavors which have produced a world class product development process, coupled with recent talent acquisitions giving us a lead in OMNI-channel commerce. This is a great place to think and invent. -Ken, Business Development Employee Demographics Male 62% Female 38% Proud to be awarded 1 6 15 New Positions 7 Age Breakdown 20's & Younger 30's 40's 50's 60's & Older 1 5 3 6 ANNUAL REPORT 2021 ANNUAL REPORT 2021 Brand Development 1 2 Jewett Cameron recently unveiled three brands. As the parent company of Lucky Dog®, Lifetime Fence™ and Spring Gardener™, Jewett Cameron is committed to the innovative development of products that are made from premium materials and built to last a lifetime. Through these three brands, strategic marketing and product initiatives have been developed to allow us to be an omni-channel leader in the various market categories, while delivering the very best products to our customers. 3 Lucky Dog Rugged. Sustainable. Timeless. A legacy of crafting quality pet products inspired by the Pacific Northwest since 1990. Lifetime Fence Designed by Pros. Built by You. Creating premium perimeter solutions for professionals and homeowners since 1953. Spring Gardener Growing Better Together. Enhancing outdoor spaces with durable designs since 2000. 1 7 1. 2. 3. 4. 5. Spring Gardener™ Landscape Edging and installation tools. Lucky Dog® Poop Bags featuring influencer @copper.and.ember Lucky Dog® Crate featuring influencer @ kaleighraephoto's dogs Charlie and Ellis. The popular AG36-3, featuring a UL301 Drop Rod Kit. Spring Gardener™ Landscape Edging installed. 4 5 1 8 ANNUAL REPORT 2021 ANNUAL REPORT 2021 Created From Recycled Plastic Sustainability Jewett Cameron Company is guided by our defining principles of crafted, stewardship and legacy.  As such, we apply the same care in developing our products as we do investing in our people, our partnerships, our environment, and in the communities where we live, work and play. Jewett Cameron strives to develop products that are built to last. Many of our products can be fully recycled at the end of the product's lifespan, such as our crates and steel fence products, further contributing toward our goal of being good stewards of our environment. LANDSCAPE EDGING 1. Creation Phase No wasteful inner core. Most other dog waste bags use a plastic or cardboard core we don’t feel is necessary. POOP BAGS 2. Production Phase In 2021, we produced over 100K dog waste bags made with plant ingredients and renewable materials instead of oil-based polyethylene used in traditional single use plastic bags. 3. End Phase The resin used to produce Lucky Dog poop bags is biodegradable and meets domestic and international compostability standards. 1 9 Give Back Program 1% of Lucky Dog Poop Bags donated to organizations dedicated to environmental improvement In 2021 Jewett Cameron Co. donated over $23K to The Wave NW Recyclable Made of materials that can be used again after processing Biodegradable Has the ability to break down and decompose into nature Compostable Disintegrate into non-toxic, natural elements similar to organic materials Membership Pet Sustainability Coalition (PSC) United States Composting Council (USCC) Our Lucky Dog poop bag complies with: Australian Standard AS 5810 “Biodegradable plastics suitable for home composting”, certified by the Australasian Bioplastics Association (ABA), Australia French Standard NF T 51-800 “Plastics — Specifications for plastics suitable for home composting”, certified by Din Certco, Germany European Standard EN13432-2000 “Requirements for packaging recoverable through composting and biodegradation”, certified by Din Certco, Germany USA Standard ASTM D6400 – “Standard Specification for Compostable Plastics”, certified by Biodegradable Products Institute (BPI), USA Australian Standard AS 4736 – “Biodegradable Plastics suitable for composting and other microbial treatment”, certified by Australasian Bioplastics Association (ABA), Australia It is not safe to home compost dog waste 2 0 ANNUAL REPORT 2021 ANNUAL REPORT 2021 New Product Category Recap Office Remodel Project STAY Series™ Kennel August 2021 AG PRO August 2021 2021 saw the first update to Lucky Dog Kennels in over a decade. New covers in a UV protective and waterproof fabric add elegance and also eliminate the need for external bungee cords. This streamlined design, easy install, and a 2-year warranty make this first-to-market product an innovative addition to the market. New branding was also added to all kennel gates with high end dome labels, ensuring Lucky Dog brand recognition moving forward. For the pros who want the best DIY gate framing kit on the market that still allows them to use their own custom hardware. •Made from durable 1.5" steel tubing for a no sag premium gate framing experience. •Our AG PRO line's durable construction assures there will be no manufacturer defects and we stand behind our product with a limited lifetime warranty on the parts included. Spring Gardener 20’ Landscape Edging July 2021 Spring Gardener wanted to bring a flexible, sustainable, eco-friendly to market. Something easy to install, that looks great and is not harmful to the environment. •Easy to install •Recycled material that lasts for years •7 metal stakes included •Green Line Technology let's consumer know exactly how deep to bury their edging. With the continued expansion of our various teams, our aging facility needed attention in order to accommodate this growth. We launched a rebuild/remodel program in 2020 that is scheduled to be complete in December 2021. We couldn’t be more excited about the transformation and upgrade for our associates, visitors as well as increased functionality and accommodation for future growth. One of our buildings, which used to be a seed testing facility used many years ago by our Seed Company, has been transformed into a team collaboration area, complete with a state-of-the-art photo studio. Our main facility has a new entrance that compliments a totally remodeled and re-configured main office, as well as a new two-story remodel of previous warehouse space. The first story of the two-story section is a large open space for gathering. The second story (as shown in the top left image above) now houses our accounting, computer and records teams with a view out west to our surrounding farm land. Central to all of this is how members of our team wove in our new Jewett Cameron brand both in colors as well as physical fixtures. Natural woods, energy efficient HVAC and LED lighting that compliments the colors and feel of our new space. Our goal is to be consistent with our brand, create an environment in which people can both work, yet also be social and comfortable. And to top it off, our aging roof has now been replaced with state-of-the-art roofing insuring our employees AND our products will be safe from the elements for many years to come. 2 1 2 2 ANNUAL REPORT 2021 ANNUAL REPORT 2021 jewettcameron.com Proud to be listed on NASDAQ for 25 years Times Square display in March 2021 celebrating our 25th anniversary. 

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