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What changed in JEWETT CAMERON TRADING CO LTD's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of JEWETT CAMERON TRADING CO LTD's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+254 added−206 removedSource: 10-K (2024-11-20) vs 10-K (2023-11-28)

Top changes in JEWETT CAMERON TRADING CO LTD's 2024 10-K

254 paragraphs added · 206 removed · 101 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

33 edited+67 added−19 removed4 unchanged
Biggest changeManagement believes the ownership of these patents and trademarks is an important competitive advantage for these and certain other products. During fiscal 2023, in addition to the additional trademark rights for Adjust-A-Gate®, the Company applied for 2 patents (fiscal 2022 – one) and received 0 patents (2022 – Nil).
Biggest changeWe 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.
Corporate Development Incorporated in 1953, JC USA operated as a small lumber wholesaler based in Portland, Oregon. In September 1984, the original stockholders sold their interest in the corporation to a new group of investors. Two members of that group remained active in the Company.
Corporate Development Incorporated in 1953, JC USA initially operated as a small lumber wholesaler based in Portland, Oregon. In September 1984, the original stockholders sold their interest in the corporation to a new group of investors. Two members of that group remained active in the Company.
Reports are also filed under Canadian regulatory requirements on SEDAR, and these reports may be accessed at www.sedar.com . The contact person for the Company is Chad Summers, President and CEO. The Company’s authorized capital includes 21,567,564 common shares without par value; and 10,000,000 preferred shares without par value.
Reports are also filed under Canadian regulatory requirements on SEDAR, and these reports may be accessed at www.sedar.com . The contact person for the Company is Chad Summers, President and CEO. 1 Our authorized capital includes 21,567,564 common shares without par value; and 10,000,000 preferred shares without par value.
These individuals are Donald Boone, who passed away in May, 2019, and who was the previous Chairman and Director and the former President, Chief Executive Officer, Treasurer, and Principal Financial Officer, transitioning to strictly the Board Chair in 2017; and Michael Nasser, who retired from day-to-day involvement in the business as of December 2022 but remained engaged as a Director.
These individuals are Donald Boone, who passed away in May 2019, and who was the previous Chairman and the former President, Chief Executive Officer, Treasurer, and Principal Financial Officer, transitioning to strictly the Board Chair in 2017; and Michael Nasser, who retired from day-to-day involvement in the business in December 2022, but remained engaged as a director until October 2023.
The primary market in which Greenwood competes has decreased in economic sensitivity as users are incorporating products into the municipal and mass transit transportations sectors. However, these markets sustained some contractions due to COVID-19 as work shifted from offices to homes, and many individuals utilized transit less due to concerns over exposure.
The primary market in which Greenwood competes has decreased in economic sensitivity as users are incorporating products into the municipal and mass transit transportation sectors. However, these markets sustained some contractions in recent years due to COVID-19 as work shifted from offices to homes, and many individuals utilized public transit less due to concerns over exposure.
JCSC processed and distributed agricultural seed. Most of this segment’s sales were derived from selling seed to distributors with a lesser amount of sales derived from cleaning seed. During the fiscal year ended August 31, 2023, the Company decided to close its JCSC seed subsidiary effective August 31, 2023.
Most of this segment’s sales were derived from selling seed to distributors with a lesser amount of sales derived from cleaning seed. During the fiscal year ended August 31, 2023, the Company decided to close its JCSC seed subsidiary effective August 31, 2023.
JC USA has the following wholly owned subsidiaries. Jewett-Cameron Seed Company, (“JCSC”), incorporated in October 2000, Greenwood Products, Inc. (“Greenwood”), incorporated in February 2002, and Jewett-Cameron Company (“JCC”) incorporated in September 2013. Jewett-Cameron Trading Company, Ltd. and its subsidiaries have no significant assets in Canada.
JC USA has the following wholly owned subsidiaries incorporated under the laws of the State of Oregon: Jewett-Cameron Seed Company, (“JCSC”), incorporated in October 2000, Greenwood Products, Inc. (“Greenwood”), incorporated in February 2002, and Jewett-Cameron Company (“JCC”) incorporated in September 2013. Jewett-Cameron Trading Company, Ltd. and its subsidiaries have no significant assets in Canada.
However, the metal products that JCC manufactures and distributes may be somewhat differentiated from similar products available from other suppliers. The company has been successful garnering key patents and trademarks on multiple products that assist their ability to continue to differentiate based on design and functionality.
However, the metal products that JCC manufactures and distributes may be somewhat differentiated from similar products available from other suppliers. We have been successful in garnering key patents and trademarks on multiple products that assist their ability to continue to differentiate based on design and functionality.
In addition, this segment is prone to disruption of supply chain support which can impact other commodities outside of those specific to the disruption. Inventory is maintained at non-owned warehouse and wood treating facilities throughout the United States and is primarily shipped to customers on a just-in-time basis.
In addition, this segment is prone to disruption of supply chain support which can impact other commodities outside of those specific to the disruption. Greenwood utilizes contract manufacturers to supply its products. Inventory is maintained at non-owned warehouses and wood treating facilities throughout the United States and is primarily shipped to customers on a just-in-time basis.
Some of the products that JCC distributes flow through the Company’s distribution center located in North Plains, Oregon, and some are shipped direct to the customer from the manufacturer. Primary customers are home centers, eCommerce providers, other retailers, and direct sales to consumers. The seed processing and sales segment reflects the business of Jewett-Cameron Seed Company (“JCSC”).
Some of the products that JCC distributes flow through our distribution center located in North Plains, Oregon, and some are shipped direct to the customer from the manufacturer. Primary customers are home centers, eCommerce providers, other retailers, and direct sales to consumers.
Regular operations at JCSC ended effective August 31, 2023, but seed storage operations are expected to continue through approximately December 31, 2023 in order to provide customers time to obtain alterative storage. The entire seed inventory was sold in early October, and the remaining equipment is in the process of being sold.
Regular operations at JCSC ended effective August 31, 2023, but some seed storage operations continued through July 2024 in order to provide customers time to obtain alternative storage arrangements. The entire seed inventory was sold in early October 2023, and the remaining equipment is in the process of being sold.
ITEM 1. BUSINESS Forward-Looking Statements This Annual Report on Form 10-K contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995.
ITEM 1. BUSINESS Forward-Looking Statements This Annual Report on Form 10-K for the fiscal year ended August 31, 2024 (“Annual Report”) contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995.
Most of this segment’s sales come from selling seed to distributors with a lesser amount of sales derived from cleaning seed. Sales of seed has seasonality, but it is most affected by weather patterns in multiple parts of the United States that utilize cyclical planting. The annual weather plays an important part in year-to-year sales volatility and specific crop demand.
JCSC processed and distributed agricultural seed. Most of this segment’s sales came from selling seed to distributors with a lesser amount of sales derived from cleaning seed. Sales of seed has seasonality, but it is most affected by weather patterns in multiple parts of the United States that utilize cyclical planting.
The tariffs began at 10%, and subsequently were increased to 25% as of May 10, 2019. A number of the Company’s products manufactured in China remain subject to duties of 25% when imported into the United States.
These new tariffs are a response to what the USTR considers to be certain unfair trade practices by China. The tariffs began at 10%, and subsequently were increased to 25% as of May 10, 2019. A number of our products manufactured in China remain subject to duties of 25% when imported into the United States.
The Company’s phone number is (503) 647-0110, and the fax number is (503) 647-2272. The Company files reports and other information with the Securities and Exchange Commission located at 100 F Street NE, Washington, D.C. 20549. Copies of these filings may be accessed through their website at www.sec.gov .
Our phone number is (503) 647-0110. The contents of our website or any other website are not incorporated by reference into this Annual Report. We file reports and other information with the Securities and Exchange Commission located at 100 F Street NE, Washington, D.C. 20549. Copies of these filings may be accessed through their website at www.sec.gov .
JCSC has been receiving lower quantities of seed for processing, and the demand for its marketing and sales services have declined as costs have been rising. JCSC’s facilities and equipment are near the end of the expected useful life and would require significant capital investment to remain operating.
In April 2023, as a result of lower quantities of seed for processing, and the demand for its marketing and sales services declining against rising costs, the Board of Directors decided to close the JCSC seed division. JCSC’s facilities and equipment were near the end of the expected useful life and would have required significant capital investment to remain operating.
These factors include, but are not limited to the fact that the Company is in a highly competitive business and may seek additional financing to expand its business, and are set forth in more detail elsewhere in this Annual Report, including in the sections, ITEM 1A, “Risk Factors”, and ITEM 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations”.
These factors include, but are not limited to, the fact that our business is highly competitive, we are continually seeking ways to expand our business, we may seek additional financing or other ways to expand operations and improve margins, as well as the other risk factors that are set forth in more detail elsewhere in this Annual Report, including in the sections, ITEM 1A, “Risk Factors”, and ITEM 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations.” Introduction Jewett-Cameron Trading Company Ltd. is organized under the laws of British Columbia, Canada.
Inventory is generally not purchased on a speculative basis in anticipation of price changes. Greenwood has no significant backlog of orders. Seed Processing and Sales - JCSC JCSC operates out of an approximately 12 acre owned facility located adjacent to North Plains, Oregon. JCSC processes and distributes agricultural seed.
Inventory is generally not purchased on a speculative basis in anticipation of price changes as we order the products from the manufacturers and warehouses once a customer places an order with us. Greenwood has no significant backlog of orders. Seed Processing and Sales - JCSC JCSC operated out of a Company-owned 11.6 acre facility located adjacent to North Plains, Oregon.
As of August 31, 2023 and November 27, 2023, there were 3,498,899 common shares outstanding. The Company's common shares are listed on the NASDAQ Capital Market in the United States with the symbol “JCTCF”. The Company's fiscal year ends on August 31st.
As of August 31, 2024 and November 19, 2024, there were 3,504,802 common shares outstanding. Our common shares are listed on the NASDAQ Capital Market in the United States with the symbol “JCTC”. The common shares formerly traded under the symbol “JCTCF” until October 9, 2024. Our fiscal year ends on August 31 st .
We undertake no obligation to publicly update or review any forward-looking information, whether as a result of new information, future developments or otherwise.
Any forward-looking statements speak only as of the date on which they are made and we undertake no obligation to publicly update or review any forward-looking information, whether as a result of new information, future developments or otherwise, except as required by law.
Jewett-Cameron Trading Company Ltd. has no direct employees, and the CEO of the Company is employed by JC USA.
As of November 19, the number of our full-time employees is 53. None of our employees are represented by unions. Jewett-Cameron Trading Company Ltd. has no direct employees, and our CEO and CFO are employed by JC USA.
Management believes this market is less sensitive to downturns in the U.S. economy than is the market for new home construction as its products serve both new and existing home and pet owners. The wood products that JCC distributes are not unique and are available from multiple suppliers.
Management believes this market is less sensitive to downturns in the U.S. economy than the market for new home construction as its products serve both new and existing home and pet owners. However, the home improvement business is seasonal, with higher levels of sales occurring between February and August.
The Company’s operations are classified into three reportable operating segments and the parent corporate and administrative segment, which were determined based on the nature of the products offered along with the markets being served.
In this Annual Report, the “Company”, “Jewett-Cameron”, “we”, “our” and “us” refer to Jewett-Cameron Trading Company Ltd. and its subsidiaries. Our operations are classified into three reportable operating segments and the parent corporate and administrative segment, which were determined based on the nature of the products we offer along with the markets being served.
Customer Concentration The top ten customers were responsible for 88% and 84% of total Company sales for the years ended August 31, 2023 and August 31, 2022, respectively. Also, the Company’s single largest customer was responsible for 35% and 28% of total Company sales for the years ended August 31, 2023 and August 31, 2022 respectively.
Also, the Company’s single largest customer was responsible for 36% and 35% of total Company sales for the years ended August 31, 2024 and August 31, 2023 respectively. Employees As of August 31, 2024 we had 62 full-time employees (August 31, 2023 – 68 full-time employees).
Employees As of August 31, 2023 the Company had 68 full-time employees (August 31, 2022 – 75 full-time employees). By segment these employees were located as follows: Greenwood 1, JCC 40, JCSC 8, and JC USA 19.
By segment these employees were located as follows: JCC – 40 (2023 – 40) Greenwood – 2 (2023 – 1), JCSC – 0 (2023 – 8), and JC USA – 20 (2023 -19). At the end of fiscal 2023, we ceased regular operations at JCSC.
The Office of the United States Trade Representative (“USTR”) instituted new tariffs on the importation of a number of products into the United States from China effective September 24, 2018. These new tariffs are a response to what the USTR considers to be certain unfair trade practices by China.
Tariffs Our metal and other products have historically been mostly manufactured in China and are imported into the United States. The Office of the United States Trade Representative (“USTR”) instituted new tariffs on the importation of a number of products into the United States from China effective September 24, 2018.
Inventory buildup occurs until the start of the season in February and then gradually declines to seasonal low levels at the end of the summer. JCC has concentrated on building a customer base for lawn, garden, and pet related products.
Inventory buildup occurs until the start of the season in February and then gradually declines to seasonal low levels at the end of the summer. Our wood products, distributed through JCC, are not unique and are available from multiple suppliers and retail outlets.
JCC owns 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. The Company completed its purchase of the full trademark rights for Adjust-A-Gate® and filed its registration with the US Patent and Trademark Office in February 2023.
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 2024, the Company owns 7 US Patents and 1 patent application pending in the US, CA, and MX pertaining to its fencing products.
Pet, Fencing and Other – JCC The pet, fencing and other segments reflect the business of Jewett-Cameron Company (JCC), which is a manufacturer and distributor of specialty products and a wholesaler of products formerly conducted by JCLC. JCC operates out of a 5.6 acre owned facility located in North Plains, Oregon that includes offices, a warehouse, and a paved yard.
Many are patent protected and all are well crafted for their quality, performance, and ease to work with. The Fencing, Pet and Sustainable Product businesses are conducted by JCC, which operates out of a 5.6 acre owned facility located in North Plains, Oregon that includes offices, a warehouse, and a paved yard. JCC uses contract manufacturers to make all products.
Sales, income before taxes, assets, depreciation and amortization, capital expenditures, and interest expense by segment are shown in the financial statements under Note 12 “Segment Information”.
Sales, income before taxes, assets, depreciation and amortization, capital expenditures, and interest expense by segment are shown in the financial statements under Note 11 “Segment Information.” Our principal office is located at 32275 NW Hillcrest Street, North Plains, Oregon; and our website address is www.jewettcameron.com . Our primary mailing address is P.O. Box 1010, North Plains, OR 97133.
JCSC has sold all of its seed inventory and is presently working to sell the segment’s remaining equipment in preparation for being wound-up.
JCSC has sold all of its seed inventory and is in the process of selling the segment’s remaining equipment. Company Strategy Management continues to focus on multiple strategies to lower costs, increase sales and improve profitability.
Backlog orders are a factor in this business as customers may place firm priced orders for products for shipments to take place three to four months in the future. Industrial Wood Products - Greenwood Greenwood is a wholesale distributor of a variety of specialty wood products. Operations are co-located in the building utilized by JCC.
Backlog orders have typically not been a factor in this business as customers may place firm priced orders for products for shipments to take place three to four months in the future which gives us time to order, manufacture and receive the goods at our warehouse in time to fulfil the customer’s order.
However, profitability around and after the month of August may be higher based on a seasonal surge in cleaning sales, which are more profitable than product sales. The Company ended regular operations at JCSC effective August 31, 2023. The Company has now sold all of its remaining seed inventory and is working to sell the remaining JCSC equipment.
The annual weather plays an important part in year-to-year sales volatility and specific crop demand. We ended regular operations at JCSC effective August 31, 2023 and have sold all of our remaining seed inventory and are working to sell the remaining JCSC equipment. Seed storage operations continued through July, 2024.
Removed
Introduction Jewett-Cameron Trading Company Ltd. is organized under the laws of British Columbia, Canada. In this Annual Report, the “Company”, “we”, “our” and “us” refer to Jewett-Cameron Trading Company Ltd. and its subsidiaries.
Added
Consistent with our operational structure, our Chief Executive Officer (CEO), as the chief operating decision maker, manages our business based on segment financial information for purposes of evaluating performance, allocating resources, setting incentive compensation targets, as well as internal forecasting of future period financial results.
Removed
The segments are as follows: · Industrial wood products · Pet, Fencing and Other · Seed processing and sales · Corporate and administration Effective September 1, 2013, the Company reorganized certain of its subsidiaries. Jewett-Cameron Lumber Corporation (“JCLC”) was changed to JC USA Inc. (“JC USA”), which has the following three wholly-owned subsidiaries.
Added
Our segments are as follows: · Pet, Fencing and Other · Industrial wood products · Seed processing and sales · Corporate and administrative services Total Company sales were $47.1 million and $54.3 million during fiscal years ended August 31, 2024 and 2023, respectively.
Removed
The industrial wood products segment reflects the business conducted by Greenwood Products, Inc. (“Greenwood”). Greenwood is a processor and distributor of industrial wood products. A major product category is treated plywood that is sold to the transportation industry. The pet, fencing and other segments reflect the business of the Jewett-Cameron Company (“JCC”).
Added
In 1987, we acquired JC USA and began to diversify into products beyond lumber trading. Lucky Dog® was acquired in 1995, and Adjust-A-Gate® was acquired in 2003. In 2000, we acquired the operations and property that became our JCSC seed division.
Removed
JCC is a wholesaler of products based in these categories. Pet products range from enclosures/kennels of varying types and construction primarily out of metal, to items that support the pet “home” such as beds, bowls and compostable dog waste bags.
Added
In 2002, Greenwood acquired the business and certain assets of Greenwood Forest Products Inc., a company involved in the processing and distribution of specialty wood products.
Removed
Fencing and containment products include such products as proprietary gate and fencing components, including trademarked and patented post systems, wood and other fencing infill products, as well as kitted security fencing solutions. Other products include garden, landscaping and miscellaneous products for the home. JCC uses contract manufacturers to make all products.
Added
Some of the JCSC personnel were moved to different positions within the Company as management has prioritized career development and retention whenever possible. In September 2024, we announced the successful conclusion of an 18-month search and evaluation process to identify and evaluate potential new suppliers.
Removed
JCSC is continuing to store some seed for its customers while they arrange alternate storage, but the facility is expected to be fully closed by December 31, 2023. 1 JC USA provides professional and administrative services, including accounting and credit services, to each of its wholly-owned subsidiary companies.
Added
We have historically sourced the majority of our metal products from a single factory in China. Under our new strategic sourcing program, we now have suppliers located in Canada, Bangladesh, Vietnam, Malaysia, and Taiwan in addition to our original sources in China.
Removed
Total Company sales were approximately $54.3 million and $62.9 million during fiscal years ended August 31, 2023 and 2022, respectively. The Company's principal office is located at 32275 NW Hillcrest Street, North Plains, Oregon; and the Company’s website address is www.jewettcameron.com . The Company’s primary mailing address is P.O. Box 1010, North Plains, OR 97133.
Added
The products from our new suppliers meet our high-quality standards with competitive pricing, but also mitigate the current 25% tariff rates from China placed on various Chinese made steel products imported into the United States. We expect this program will help us to maintain competitive pricing while enhancing our margins.
Removed
In October 2023, Mr. Nasser voluntarily resigned from the Board of Directors but is available as an advisor to the Board. In July 1987, the Company acquired JC USA in what was not an arms-length transaction. 2 In February 2002, Greenwood was incorporated in anticipation of JC USA acquiring the business and certain assets of Greenwood Forest Products Inc.
Added
Narrative Description of Business We are committed to improving the lives of professionals and do-it-yourselfers with innovative products that enrich outdoor spaces in their quality, performance, and ease to work with.
Removed
Greenwood is involved in the processing and distribution of specialty wood products. In June 2012, the Company acquired land and fixed assets located in Manning, Oregon for $250,000 cash. The property was sold in an arms-length transaction in the second quarter of fiscal 2019 for $325,000 cash. In May 2019 Chairman and Co-Founder of the Company Donald M.
Added
The Company’s operations are classified into four segments: Pet, Fencing and Other; Industrial wood products; Seed processing and sales; and corporate and administrative services. 2 Pet, Fencing and Other Operating Segment We have concentrated on building a customer base for lawn, garden, and pet related products.
Removed
Boone passed away. Mr. Boone served as President and CEO from 1984 until 2017 when he voluntarily retired from his officer positions and oversaw the addition and successful integration of new management and directors. In April 2023, the Board of Directors decided to close the Company’s JCSC seed division.
Added
Industrial Wood Products - Greenwood Greenwood is a wholesale distributor of a variety of specialty wood products. Current products are focused on the transportation industry. Greenwood’s total sales for fiscal 2024 and 2023 were 8% and 5%, respectively, of total Company sales.
Removed
JCSC operates as a seed storage, processing and sales business and was incorporated by the Company in October 2000 in anticipation of JC USA acquiring the business and certain assets of a firm called Agrobiotech Inc.
Added
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.
Removed
The Company has prioritized career development and retention, and some of the JCSC personnel are being moved to different positions within the Company. Narrative Description of Business The Company’s operations are classified into four segments: Industrial wood products; Pet, Fencing and Other; Seed processing and sales; and corporate and administration.
Added
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. We are exploring the potential to re-zone the property, or revise the existing code, to expand the list of permitted uses. The listed sale price of the property is $9,000,000.
Removed
This business is a wholesaler, and a manufacturer and distributor of products that include an array of pet enclosures, kennels, and pet welfare and comfort products, proprietary gate support systems, perimeter fencing, greenhouses, and fencing in-fill products made of wood, metal and composites.
Added
This is the current asking price, and there is no guarantee the property will sell for this amount.
Removed
Examples of the Company’s brands include Lucky Dog®, for pet products; Adjust-A-Gate®, Fit-Right®, Perimeter Patrol®, and Lifetime Post™ for gates and fencing; Early Start, Spring Gardner™, Greenline®, and Weatherguard for greenhouses. JCC has also recently become the exclusive distributor of MyEcoWorld® sustainable bag products in the US and Canada. JCC uses contract manufacturers to manufacture its products.
Added
If we are able to complete a sale, the net proceeds will be reduced by brokers’ commissions, expenses related to the sale, and taxes. 3 Corporate and Administrative Services – JC USA JC USA is the parent company for Greenwood, JCC and JCSC as described above.
Removed
Some of the products that JCC distributes flow through the Company’s facility in North Plains, Oregon, and some are shipped direct to the customer from the manufacturer. Primary customers are home centers, eCommerce partners, on-line direct consumers as well as other retailers. 3 The home improvement business is seasonal, with higher levels of sales occurring between February and August.
Added
JC USA operates out of our offices in North Plains, Oregon and provides professional and administrative services, including warehousing, accounting and credit services, to JCTC’s subsidiary companies. Company Products 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.
Removed
Historically, a major product category was treated plywood that was sold into the marine industry. It migrated from that segment and focused more into the transportation industry. Greenwood’s total sales for fiscal 2023 and 2022 were 5% and 4% respectively of total Company sales.
Added
The Industrial Wood Products segment is conducted by Greenwood, a processor and distributor that operates out of the same facilities in North Plains, Oregon. Greenwood contracts with custom manufacturers for its products. Inventory is maintained at non-owned warehouses and wood treating facilities throughout the United States and is primarily shipped to customers on a just-in-time basis.
Removed
Seed storage operations are expected to continue through approximately December 31, 2023 in order to provide customers time to obtain alternative storage. Administrative Services – JC USA JC USA is the parent company for the Company’s wholly-owned subsidiaries as described above. JC USA operates out of the Company’s offices in North Plains, Oregon.
Added
Fencing Products Our fencing business crafts durable, functional fencing solutions that bolster security, privacy, and beauty. Our primary products include: · The Adjust-A-Gate® family of products are straightforward, lifelong solutions that eliminates measurement issues. Complete steel frame gate kits to perfectly fit openings for wood fences and never sag.
Removed
It provides professional and administrative services, including warehousing, accounting and credit services, to its subsidiary companies. 4 Tariffs The Company’s metal and other products are largely manufactured in China and are imported into the United States.
Added
Easy enough for homeowners, but with superior quality that meets the demands of the professional contractor. · Fit-Right® is a fully adjustable gate system for chain link gates. This custom solution is perfect for when a special sized chain link gate opening is needed.
Removed
Subsequent to the end of the fiscal year, the Company ceased regular operations at JCSC. 4 of the JCSC employees are being transferred to JCC, and the remainder were terminated and offered transition assistance. None of these employees are represented by unions at the Company.
Added
Equipped with all the necessary parts, building a gate on-site eliminates measurement issues for the right fit the first time and every time. · Lifetime Steel Post® offers unmatched strength and versatility in fencing.
Added
This post offers versatile support for a range of fence designs and styles, allowing flexibility to showcase the posts or keep them discreetly hidden. · Euro Fence offers the beauty of wood without the upkeep, featuring durable wood/plastic composite materials.
Added
With locking tongue & groove composite and aluminum boards, it provides UV protection, never needs paint or stain, and installs easily in-ground or mounted. · Perimeter Patrol® Portable Security Panels create an enclosed space or linear fence for outdoor areas.
Added
Perfect for crowd control, job site security, outdoor events, enclosed storage areas and more. · Cedar fencing is a premium softwood known for its unique blend of beauty and durability. Its natural resistance to decay enhances its longevity, while its ease of cutting, sawing, and nailing with standard tools makes it a preferred choice for versatile applications.
Added
Pet Products Our Lucky Dog® brand is dedicated to keeping pets safe and happy with exceptional quality, long-lasting products that put your pet first. Our primary pet products are: · Lucky Dog® STAY Series Studio Kennels built with long-lasting steel frames and powder coated finish.
Added
The waterproof polyester cover offers UPF 50+ protection and is designed for ultimate comfort. · Lucky Dog® Outdoor Kennel Covers provide durable, waterproof protection with UPF 50+ sun defense.
Added
Designed for year-round comfort, they fit securely over Lucky Dog® Kennels. · Lucky Dog® Dwell Series® Crates offers peace of mind with secure latches, rust-resistant E-coating along with a patented sliding side door and patented corner stabilizers.
Added
With a top handle for easy transport and a divider panel for flexible space, they offer durability and convenience. · Lucky Dog® Exercise Pens provide a secure space for pets with sturdy, rust-resistant wire construction.
Added
Featuring a step-thru door, tool-free setup, and fold-flat design for easy storage, these pens are perfect for both indoor and outdoor use. 4 Sustainable Products Our newest product category is Sustainable and Post-Consumer Recycled (“PCR”) bag products.
Added
Sold under the MyEcoWorld® brand, it is making a tangible, positive difference to the planet by working to reduce conventional single-use plastic in our daily lives. We offer two types of bag products. The Compostable bags are made with 30% corn.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

18 edited+18 added−2 removed8 unchanged
Biggest changeThere is a great deal of risk involved in the business of the company, and any of the following risks could affect our business, its financial condition, its potential profits or, and could result in you losing your entire investment if our business became insolvent. The risks and uncertainties described below are not the only ones we face.
Biggest changeITEM 1A. RISK FACTORS Investors should carefully consider the following risk factors and all other information contained in this Annual Report. There is a great deal of risk involved in our business, and any of the following risks could affect our business, its financial condition, its potential profits or could result in you losing your entire investment.
Future stock distributions could be structured in such a way as to be 1) diluting to our current shareholders or 2) could cause a change in control to new investors. If we raise additional funds by selling more of our stock, the new stock may have rights, preferences or privileges senior to those of the rights of our existing stock.
Future stock distributions could be structured in such a way as to be 1) diluting to our current shareholders or 2) could cause a change in control to new investors. If we raise additional funds by selling more of our stock, the new shares may have rights, preferences or privileges senior to those of the rights of our existing shares.
These consequences include: · The inability of our third-party manufacturers in China and elsewhere to manufacture or deliver products to us in a timely manner, if it all. · Isolation requirements may prevent our employees from being able to report to work or being required to work from home or other off-site location which may prevent us from accomplishing certain functions, including receiving products from our suppliers and fulfilling orders for our customers, which may result in an inability to meet our obligations. · Our new products may be delayed or require unexpected changes to be made to our new or existing products. · The effect of the outbreak on the economy may be severe, including an economic downturn and decrease in employment levels which could result in a decrease in consumer demand for our products.
These consequences include: · The inability of our third-party manufacturers to manufacture or deliver products to us in a timely manner, if it all. · Isolation requirements may prevent our employees from being able to report to work or being required to work from home or other off-site location which may prevent us from accomplishing certain functions, including receiving products from our suppliers and fulfilling orders for our customers, which may result in an inability to meet our obligations. · Our new product launches may be delayed or require unexpected changes to be made to our new or existing products. · The effect of the outbreak on the economy may be severe, including an economic downturn and decrease in employment levels which could result in a decrease in consumer demand for our products.
We could experience a decrease in the demand for our products resulting in lower sales volumes. In the past we have at times experienced decreasing products sales with certain customers. The reasons for this can be generally attributed to: increased competition; general economic conditions; demand for products; and consumer interest rates.
Risks Related to Our Business We could experience a decrease in the demand for our products resulting in lower sales volumes. In the past we have at times experienced decreasing products sales with certain customers. The reasons for this can be generally attributed to: increased competition; general economic conditions; demand for products; and consumer interest rates.
Risks Related to Our Business A contagious disease outbreak, such as the recent COVID-19 pandemic emergency, could have an adverse effect on our operations and financial condition Our business could be negatively affected by an outbreak of an infectious disease due to the consequences of the actions taken by companies and governments to contain and control the virus.
A contagious disease outbreak, such as the recent COVID-19 pandemic emergency, could have an adverse effect on our operations and financial condition Our business could be negatively affected by an outbreak of an infectious disease due to the consequences of the actions taken by companies and governments to contain and control such an outbreak.
If common stock is issued in return for additional funds, the price per share could be lower than that paid by our current stockholders. The result of this would be a lessening of each present stockholder’s relative percentage interest in our company. 5 The Company’s common shares currently trade within the NASDAQ Capital Market in the United States.
If common shares are issued in return for additional funds, the price per share could be lower than that paid by our current stockholders. The result of this would be a lessening of each present stockholder’s relative percentage interest in our company. The Company’s common shares currently trade within the NASDAQ Capital Market in the United States.
If economic conditions deteriorate or if consumer preferences change, we could experience a significant decrease in profitability. If our top customers were lost, we could experience lower sales volumes. For the fiscal year ended August 31, 2023 our top ten customers represented 88% of our total sales, and our single largest customer was responsible for 35% of our total sales.
If economic conditions deteriorate or if consumer preferences change, we could experience a significant decrease in profitability. If our top customers were lost, we could experience lower sales volumes. For the fiscal year ended August 31, 2024 our top ten customers represented 88% of our total sales, and our single largest customer was responsible for 36% of our total sales.
If we acquire an asset or enter into a business combination, this could include exchanging a large amount of our common stock, which could dilute the ownership interest of present stockholders.
If we acquire an asset or enter into a business combination, this could include exchanging a large amount of our common shares, which could dilute the ownership interest of present shareholders.
We have completed a management assessment of internal controls as prescribed by Section 404 of the Sarbanes-Oxley Act, which we were required to do in connection with our year ended August 31, 2023. Based on this process we did not identify any material weaknesses.
We have completed a management assessment of internal controls as prescribed by Section 404 of the Sarbanes-Oxley Act, which we were required to do in connection with our audit of our financial statements for the year ended August 31, 2024. Based on this process we did not identify any material weaknesses or significant deficiencies.
Additional risks and uncertainties, including those not presently known to us or that we currently deem immaterial, also may result in decreased revenues, increased expenses or other events which could result in a decline in the price of our common stock.
The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties, including those not presently known to us or that we currently deem immaterial, also may result in decreased revenues, increased expenses or other events which could result in a decline in our financial condition and the price of our common shares.
The average daily trading volume of our common stock was approximately 5,000 shares on NASDAQ for the fiscal year ended August 31, 2023. With this limited trading volume, investors could find it difficult to purchase or sell our common stock.
The average daily trading volume of our common stock was approximately 4,700 shares on NASDAQ for the fiscal year ended August 31, 2024. With this limited trading volume, investors could find it difficult to purchase or sell our common stock or experience significant volatility in the price of our common stock.
Although we believe our internal controls are operating effectively, we cannot guarantee that in the future we will not identify any material weaknesses in connection with this ongoing process. ITEM 1B. UNRESOLVED STAFF COMMENTS --- No Disclosure Necessary ---
Although we believe our internal controls are operating effectively, we cannot guarantee that in the future we will not identify any material weaknesses or significant deficiencies in connection with this ongoing process.
However, we cannot control the duration or depth of such actions which may increase our product costs which would in turn reduce our margins and potentially decrease the competitiveness of our products.
We cannot control the duration or depth of such actions which may increase our product costs which would in turn reduce our margins and potentially decrease the competitiveness of our products. These actions could have a negative effect on our business, results of operations, or financial condition.
Risks Related to Our Common Stock We may decide to acquire assets or enter into business combinations, which could be paid for, either wholly or partially with our common stock and if we decide to do this our current shareholders would experience dilution in their percentage of ownership.
The costs associated with any outbreak may have an adverse impact on our operations and financial condition and not be fully recoverable or adequately covered by insurance. 10 Risks Related to Our Common Shares We may decide to acquire assets or enter into business combinations, which could be paid for, either wholly or partially with our common shares and if we decide to do this our current shareholders would experience dilution in their percentage of ownership.
The financial impact of such an outbreak are outside our control and are not reasonable to estimate but may be significant. The costs associated with any outbreak may have an adverse impact on our operations and financial condition and not be fully recoverable or adequately covered by insurance.
The financial impact of such an outbreak are outside our control and are not reasonable to estimate but may be significant.
The continuing tariffs by the United States on certain Chinese goods include some of our products that we purchase from suppliers in China. The company has multiple options to assist in mitigating the cost impacts of these government actions.
The continuing tariffs by the United States on certain Chinese goods include some of our products that we purchase from suppliers in China. The possibility of new tariffs being levied on manufactured goods imported into the United States from other countries in addition to China also currently exists.
We could experience delays in the delivery of our products to our customers causing us to lose business. We purchase our products from other vendors and a delay in shipment from these vendors to us could cause significant delays in our delivery to our customers.
If we are unable to effectively compete with these other products and companies, we would likely lose market share which would result in a decrease in revenue and profitability. We could experience delays in the delivery of our products to our customers causing us to lose business.
We are currently in compliance with the requirements of our existing line of credit. If we lost access to this line of credit it could negatively affect our ability to pay some of our creditors on a timely basis.
The maximum draw amount is currently available, and the line will expire on June 30, 2025. If we lost access to credit, or the borrowing costs exceed the likely benefits of our use of such capital, it could negatively affect our ability to acquire inventory to fulfil our customers’ orders and pay our obligations on a timely basis.
Removed
ITEM 1A. RISK FACTORS Investors should carefully consider the following risk factors and all other information contained in this Annual Report.
Added
We are dependent upon third-party manufacturers and suppliers for substantially all our of products We do not have any manufacturing capabilities and rely on a limited number of contract manufacturers located outside the United States for the majority of our products.
Removed
These actions could have a negative effect on our business, results of operations, or financial condition. 6 We could lose our credit agreement and could result in our not being able to pay our creditors. We have a line of credit with U.S. Bank in the amount of $10 million, of which the entire amount is available.
Added
Our reliance on contract manufacturers involves certain risks, including: · Production disruptions or delays at the factory as a result of political instability, labor unrest, mechanical issues, natural disasters, or pandemic outbreaks; · Capacity constraints; · Inability to control the quality of the finished products; · Inability to control manufacturing and delivery schedules; If our products are delayed or cannot be supplied in a timely manner, we risk losing revenue and customers.
Added
Developing alternate sources of supply for our products that meet our requirements may be time-consuming, difficult, and costly, and we may not be able to source our products on terms that are acceptable to us, or at all, which will have a negative effect on our revenue and financial condition. 8 We face significant competition, which could reduce the demand for our products.
Added
Our revenue depends in part on maintaining and growing the sales of our current products in both existing and new markets, but also by improving existing products and developing new products. There is substantial competition among companies in each of our market sectors, and a number of companies market products that compete directly with our products.
Added
Current and potential customers may consider these products from our competitors to be superior to or less expensive than our products. Some of these competitors may also have greater financial, manufacturing, and sales and market resources than us.
Added
We purchase our products from other vendors and a delay in shipment from these vendors to us could cause significant delays in our delivery to our customers. Such disruptions may include adjustments to ocean shipping schedules, labor strikes or other job-related actions by workers within the supply chain, geopolitical unrest, longshoreman or rail strikes, geopolitical unrest, or government actions.
Added
Inflation could adversely affect our business Inflation has many impacts on our business, including increasing our direct costs for raw materials, manufacturing, shipping and logistics, labor, and energy. Our ability to pass on these higher costs to our customers is limited.
Added
When we are able to increase our selling prices, it may be delayed several months after we first incur the higher costs and we may not be able to fully recoup the difference. In addition, high rates of inflation can reduce consumer’s discretionary spending and reduce demand for our products.
Added
These actions could have a negative effect on our business, results of operations, or financial condition. Outdoor product sales are highly seasonal and subject to adverse weather. Our fencing and outdoor products are primarily bought by consumers during the spring and summer.
Added
The majority of our revenues and income from these products occur during our 3 rd and 4 th quarters of our fiscal year. Demand for these products is highly affected by the weather.
Added
Adverse weather, including abnormally wet conditions or unseasonably hot or cold temperatures, can negatively affect demand for our products and cause our customers to delay, or reduce, their orders. This would have a negative effect on our business, results of operations, or financial condition.
Added
Competitors may infringe on our intellectual property which would negatively affect our business and financial condition We rely on our intellectual property rights, including patents, patent applications, and trademarks, to provide us with competitive advantages and protect us from theft of our intellectual property. We believe that our patents are valid, enforceable, and valuable.
Added
If third parties infringe on our intellectual property, we may be forced to pursue litigation which would consume significant amounts of our management and financial resources. There is no guarantee that we will have the financial resources necessary to engage in litigation, or that any litigation we do pursue will result in a favorable outcome.
Added
Such infringements or unfavorable outcomes of litigation would have a negative effect on our business, results of operations, or financial condition. 9 Our products may have issues that could lead to product liability claims The products we manufacture and distribute exposes us to potential product liability risks.
Added
Although we seek to insure against such risks, there can be no assurance that such insurance coverage will be sufficient to cover any claims or adverse legal judgements, and our costs to defend any litigation could be significant.
Added
A successful product liability claim in excess of our insurance coverage could have a material negative effect on our business and financial condition. In addition, it could significantly increase our costs of this insurance on commercially reasonable terms or make it unavailable to us altogether.
Added
We could lose our credit agreement and could result in our not being able to pay our creditors.
Added
We have a line of credit with Northrim where short-term operating capital will be provided by purchasing our accounts receivable invoices for up to $6,000,000, or as a loan against our inventory for up to $4,000,000, with the maximum amount we can draw under the line of $6,000,000.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe property associated with JCSC, which is owned, consists of 11.7 acres of land, 105,000 square feet of buildings, rolling stock, and equipment. It is currently used for seed processing and storage. It is located at 31345 NW Beach Road, Hillsboro, OR 97124, which is adjacent to North Plains, OR.
Biggest changeIt was used for seed processing and storage. It is located at 31345 NW Beach Road, Hillsboro, Oregon, which is adjacent to North Plains, Oregon. With the closure of JCSC’s business, the property is considered surplus to our needs and is currently listed for sale or lease.
ITEM 2. PROPERTIES The Company’s executive offices are located at 32275 NW Hillcrest Street, North Plains, OR 97133. The 5.6 acre facility, which is owned, consists of 55,250 square feet of covered space (10,000 office and 47,250 warehouse), a little over three acres of paved yard space, and was originally completed in October 1995.
ITEM 2. PROPERTIES Our executive offices are located at 32275 NW Hillcrest Street, North Plains, Oregon. The 5.6 acre facility, which is owned, consists of 55,250 square feet of covered space (10,000 office and 47,250 warehouse), a little over three acres of paved yard space, and was originally completed in October 1995.
A 12,000 square foot warehouse expansion was completed in fiscal 2017 which the Company is using for several new product lines. In fiscal 2021, the Company completed the conversion of 2,000 square feet of older warehouse space into 4,000 square feet of office and meeting space on two levels.
A 12,000 square foot warehouse expansion was completed in fiscal 2017 which we are using for several new product lines. In fiscal 2021, we completed the conversion of 2,000 square feet of older warehouse space into 4,000 square feet of office and meeting space on two levels.
The facility provides office space for JC USA, including all of the Company’s executive offices, and is used as a distribution center to service the Company’s customer base for JCC and Greenwood. During fiscal 2022, the Company leased an additional 4,700 square feet of warehouse space located in North Plains.
The facility provides office space for JC USA, including all of our executive offices, and is used as a distribution center to service the customer base for JCC and Greenwood. During fiscal 2022, we leased an additional 4,700 square feet of warehouse space located in North Plains, Oregon.
With the closure of the seed business, the ultimate disposition of JCSC’s property has not been determined and will be evaluated by the Board. During fiscal 2010, the Company purchased a 2,000 square foot building adjacent to the Company’s main facilities that previously housed a seed testing lab located at 31895 NW Hillcrest Street, North Plains, OR 97133.
During fiscal 2010, we purchased a 2,000 square foot building adjacent to our main facilities that previously housed a seed testing lab located at 31895 NW Hillcrest Street, North Plains, Oregon. We formerly leased the property for $729 per month until the expiration of the lease on January 4, 2010.
Removed
The Company formerly leased the property for $729 per month until the expiration of the lease on January 4, 2010. At that time, the Company exercised its option to buy the land and building for a total cost of $150,946.
Added
At that time, the Company exercised its option to buy the land and building for a total cost of $150,946. In fiscal 2020, we renovated this building into an innovation center which focuses on new product development. The property associated with JCSC, which is owned, consists of 11.6 acres of land, 105,000 square feet of buildings, rolling stock, and equipment.
Removed
In fiscal 2020, the Company began a renovation of this building into its new innovation center which will focus on new product development for the Company’s subsidiaries. The renovation was completed during fiscal 2021. 7

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe liability arbitration hearing was held in December 2022. In February 2023, the arbitrator issued its decision and ruled in favor of the Company on the majority of all of its claims. A damages hearing was held in August 2023. In September 2023, the Company settled its arbitration for a cash payment of $2,450,000 which was received in October 2023.
Biggest changeIn February 2023, the arbitrator issued its decision and ruled in our favor on the majority of all of our claims. A damages hearing was held in August 2023. In September 2023, we settled this arbitration for a cash payment of $2,450,000 which was received in October 2023. ITEM 4.
ITEM 4. MINE SAFETY DISCLOSURES --- No Disclosure Necessary --- 8 PART II
MINE SAFETY DISCLOSURES --- No Disclosure Necessary --- 12 PART II
Removed
ITEM 3. LEGAL PROCEEDINGS A consortium of California District Attorneys contacted the Company in regard to possible liabilities related to environmental labeling of its plant-based Lucky Dog Poop Bags previously sold in the State of California.
Added
ITEM 3. LEGAL PROCEEDINGS From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. We are currently unaware of any material pending legal proceedings to which we are party or of which our property is the subject.
Removed
The Company has since modified its product marketing statements in response to their concerns, and during the period ended May 31, 2022, accrued $300,000 in anticipation of a settlement.
Added
However, we may at times in the future become involved in litigation in the ordinary course of business, which may include actions related to or based on our intellectual property and its use, customer claims, employment practices and employee complaints and other events arising out of our operations.
Removed
In June 2022, a settlement was finalized which required the Company to pay the previously accrued $300,000 as a cash fine over a four-month period with no admission of guilt by the Company. The Company was one of three named defendants in a Civil Action in Pennsylvania.
Added
When appropriate in management’s estimation, we will record adequate reserves in our financial statements for pending litigation. Litigation is subject to inherent uncertainties, and an adverse result in any such matters could adversely impact our reputation, operations, and our financial operating results or overall financial condition.
Removed
The matter arises out of a dog allegedly escaping from a Jewett-Cameron kennel product and causing personal injuries to three individuals. The Company’s applicable liability insurer provided the defense covering the Company’s legal fees and costs.
Added
Additionally, any litigation to which we may become subject could also require significant involvement of our senior management and may divert management’s attention from our business and operations. In fiscal 2021, we initiated arbitration against a former distributor asserting a breach of the distribution agreement and seeking damages.
Removed
During the fiscal year ended August 31, 2022, the case was settled within the Company’s insurance policy limits with no admission of guilt by the Company, and there were no additional costs incurred. In fiscal 2021, the Company initiated arbitration against a former distributor asserting a breach of the distribution agreement and seeking damages.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeTable No. 1 NASDAQ Capital Market Common Shares Trading Activity (US Dollars) Period Ended Volume High Low Closing Monthly 9/30/23 64,900 $ 4.84 $ 4.50 $ 4.65 Quarterly 8/31/23 471,700 $ 5.62 $ 3.70 $ 4.52 5/31/23 206,500 $ 5.90 $ 4.67 $ 4.65 2/28/23 296,200 $ 5.98 $ 4.95 $ 5.50 11/30/22 274,800 $ 6.54 $ 4.85 $ 5.08 8/31/22 162,600 $ 7.09 $ 6.19 $ 6.36 5/31/22 271,500 $ 8.25 $ 5.50 $ 6.72 2/28/22 153,800 $ 9.84 $ 7.15 $ 7.98 11/30/21 254,100 $ 13.74 $ 9.02 $ 9.15 Annually 8/31/23 1,249,200 $ 6.54 $ 3.70 $ 4.52 8/31/22 842,000 $ 13.74 $ 5.50 $ 6.36 8/31/21 1,305,400 $ 12.00 $ 7.23 $ 10.60 8/31/20 455,600 $ 8.78 $ 5.00 $ 7.55 8/31/19 1,318,200 $ 10.00 $ 6.23 $ 8.04 Holders Computershare Investor Services Inc. which is located in Vancouver, British Columbia, Canada is the registrar and transfer agent for the common shares.
Biggest changeTable No. 1 NASDAQ Capital Market Common Shares Trading Activity (US Dollars) Period Ended Volume High Low Closing Monthly September 2024 140,000 $ 5.00 $ 4.35 $ 4.98 August 2024 70,300 4.72 3.86 4.61 July 2024 151,200 5.24 4.01 4.10 June 2024 98,300 5.69 4.70 4.85 May 2024 161,100 5.50 5.16 5.36 April 2024 100,000 5.69 4.58 5.23 Quarterly Three months ended August 31, 2024 319,800 $ 5.69 $ 3.86 $ 4.61 Three months ended May 31, 2024 289,000 5.71 4.58 5.36 Three months ended February 29, 2024 301,000 6.35 4.89 5.27 Three months ended November 30, 2023 261,100 4.99 4.50 4.86 Three months ended August 31, 2023 471,700 $ 5.62 $ 3.70 $ 4.52 Three months ended May 31, 2023 206,500 5.90 4.67 4.65 Three months ended February 28, 2023 296,200 5.98 4.95 5.50 Three months ended November 30, 2022 274,800 6.54 4.85 5.08 Annually Fiscal year ended August 31, 2024 1,170,900 $ 6.35 $ 3.86 $ 4.61 Fiscal year ended August 31, 2023 1,249,200 6.54 3.70 4.52 Fiscal year ended August 31, 2022 842,000 13.74 5.50 6.36 Fiscal year ended August 31, 2021 1,305,400 12.00 7.23 10.60 Fiscal year ended August 31, 2020 455,600 8.78 5.00 7.55 Holders Computershare Investor Services Inc. which is located in Vancouver, British Columbia, Canada is the registrar and transfer agent for our common shares.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common shares trade on the NASDAQ Capital Market (formerly the NASDAQ Small Cap Market) in the United States. The trading symbol for the common stock is “JCTCF” and the CUSIP number for the stock is 47733C-20-7.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common shares trade on the NASDAQ Capital Market (formerly the NASDAQ Small Cap Market) in the United States. The trading symbol for our common shares is “JCTC” and the CUSIP number for the stock is 47733C-20-7.
Purchases of equity securities by the issuer and affiliated purchasers The Company has not repurchased any common shares during the years ended August 31, 2023 or August 31, 2022. ITEM 6. [RESERVED]
Purchases of equity securities by the issuer and affiliated purchasers We have not repurchased any common shares during the years ended August 31, 2024 or August 31, 2023. ITEM 6. [RESERVED]
The common stock began trading on the NASDAQ Small Cap Market in April 1996. Table No. 1 lists the volume of trading along with the high, low, and closing sales prices on the NASDAQ Capital Market for the Company's common shares.
The common shares formerly traded under the symbol “JCTCF” until October 9, 2024. Our common shares began trading on the NASDAQ Small Cap Market in April 1996. Table No. 1 lists the volume of trading along with the high, low, and closing sales prices on the NASDAQ Capital Market for our common shares.
Any dividends paid by the Company to U.S. shareholders would be subject to Canadian withholding tax. 9 Recent Sales of Securities: Use of Proceeds from Securities The Company has sold no securities in the last 3 fiscal years.
There are no current restrictions that limit our ability to pay dividends on common equity or that are likely to do so in the future. Any dividends paid by us to U.S. shareholders would be subject to Canadian withholding tax. Recent Sales of Securities: Use of Proceeds from Securities We have not sold securities in the last three fiscal years.
On October 13, 2023 there were 26 registered shareholders and 3,498,899 shares of the Company’s common shares outstanding. Dividends The Company has not declared any dividends since incorporation and does not anticipate that it will do so in the foreseeable future.
On November 14, 2024 there were 29 registered shareholders and 3,504,802 shares of our common shares outstanding. 13 Dividends We have not declared any dividends since incorporation and we do not anticipate that we will do so in the foreseeable future. Our present policy is to retain earnings for use in our operations and expansion of our business.
Removed
The present policy of the Company is to retain earnings for use in its operations, expansion of its business, and the possible repurchase of Company shares. There are no restrictions that limit the ability of the Company to pay dividends on common equity or that are likely to do so in the future.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

34 edited+63 added−76 removed3 unchanged
Biggest changeFor the Year Ended August 31, 2023 First Second Third Fourth Full Quarter Quarter Quarter Quarter Year Sales $ 12,578 $ 8,143 $ 18,946 $ 14,622 $ 54,289 Gross profit 2,860 1,921 4,413 3,053 12,247 Net income (loss) (74 ) (972 ) 735 290 (21 ) Basic earnings per share $ (0.02 ) $ (0.28 ) $ 0.21 $ 0.08 $ (0.01 ) Diluted earnings per share $ (0.02 ) $ (0.28 ) $ 0.21 $ 0.08 $ (0.01 ) For the Year Ended August 31, 2022 First Second Third Fourth Full Quarter Quarter Quarter Quarter Year* Sales $ 12,918 $ 14,061 $ 20,922 $ 15,001 $ 62,902 Gross profit 2,465 3,424 5,353 2,551 13,793 Net income (loss) (391 ) 270 1,494 (209 ) 1,164 Basic earnings (loss) per share $ (0.11 ) $ 0.08 $ 0.43 $ (0.06 ) $ 0.33 Diluted earnings (loss) per share $ (0.11 ) $ 0.08 $ 0.43 $ (0.06 ) $ 0.33 * Fiscal 2023 quarterly per share earnings were calculated using weighted average number of common shares outstanding as of August 31, 2023 of 3,498,899 (2022 – 3,493,807).
Biggest changeFor the Year Ended August 31, 2024 First Second Third Fourth Full Quarter Quarter Quarter Quarter Year Sales $ 9,806 $ 8,229 $ 15,896 $ 13,214 $ 47,145 Gross profit 1,956 2,065 2,951 1,912 8,884 Net income (loss) 1,292 (534 ) 155 (191 ) 722 Basic earnings per share $ 0.37 $ (0.15 ) $ 0.04 $ (0.05 ) $ 0.21 Diluted earnings per share $ 0.37 $ (0.15 ) $ 0.04 $ (0.05 ) $ 0.21 For the Year Ended August 31, 2023 First Second Third Fourth Full Quarter Quarter Quarter Quarter Year Sales $ 12,578 $ 8,143 $ 18,946 $ 14,622 $ 54,289 Gross profit 2,860 1,921 4,413 3,053 12,247 Net income (loss) (74 ) (972 ) 735 290 (21 ) Basic earnings per share $ (0.02 ) $ (0.28 ) $ 0.21 $ 0.08 $ (0.01 ) Diluted earnings per share $ (0.02 ) $ (0.28 ) $ 0.21 $ 0.08 $ (0.01 ) * Fiscal 2024 quarterly per share earnings were calculated using weighted average number of common shares outstanding as of August 31, 2024 of 3,504,802 (2023 – 3,498,899).
Management has discussed with the Audit Committee the development, selection and disclosure of accounting estimates used in the preparation of the consolidated financial statements. Recent Accounting Pronouncements Management has reviewed the new accounting guidance and determined that there is not a material impact on our financial statements.
Management has discussed with the Audit Committee the development, selection and disclosure of accounting estimates used in the preparation of the consolidated financial statements. Recent Accounting Pronouncements Management has reviewed the new accounting guidance and determined that there is not a material impact on our financial statements. 20
Actual results may differ from these estimates under different assumptions or conditions. The Company has not adopted any new accounting policies that would have a material impact on the consolidated financial statements, nor did it make changes to accounting policies.
Actual results may differ from these estimates under different assumptions or conditions. We have not adopted any new accounting policies that would have a material impact on the consolidated financial statements, nor did we make changes to accounting policies.
The sum of the quarterly earnings per share may not equal the full year earnings per share due to the use of the full year’s weighted average share figure and rounding. RESULTS OF OPERATIONS Fiscal 2023 was a difficult year in our markets.
The sum of the quarterly earnings per share may not equal the full year earnings per share due to the use of the full year’s weighted average share figure and rounding. 14 RESULTS OF OPERATIONS Fiscal 2024 was a year of transition for the Company.
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 2022 and 2023 has also had a negative effect on the Company’s interest expense paid for its borrowing under its line of credit.
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 2024 has also had a negative effect on our interest expense charged on any borrowing on our lines of credit.
The Company has ensured that each of its suppliers is in full compliance with the law and none of its products fall under the prohibited goods clause. 16 Critical Accounting Policies Management is required to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements, the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
Critical Accounting Policies Management is required to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements, the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
Since the ability of the Company to pass through all of the current increase in its product costs to its customers are somewhat limited and occur after such costs are first incurred, management expects that its gross margins will remain under pressure in fiscal 2023.
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 2025.
We support educational programs that build the future workforce through active participation in regional and statewide organizations, including the CTE/STEM Employer Coalition and assisting teachers to connect traditional school subjects to practical job site applications. The Company also actively participates in the local community, supported by a Corporate Charitable Giving Charter.
We regularly provide employees with a corporate engagement survey to benchmark their engagement, satisfaction, and ideas for change. We support educational programs that build the future workforce through active participation in regional and statewide organizations, including the CTE/STEM Employer Coalition and assisting teachers to connect traditional school subjects to practical job site applications.
The Company’s revenues and cash flow continue to be seasonal and highly variable, with the 3 rd and 4 th quarters of the fiscal year being much busier than the 1 st and 2 nd quarters due to the Company’s current product offerings.
Wet and unseasonably cold weather across much of the US also shortened our traditional Spring and Summer selling season which reduced our expected sales in our important outdoor product lines.The Company’s revenues and cash flow continue to be seasonal and highly variable, with the 3 rd and 4 th quarters of the fiscal year being much busier than the 1 st and 2 nd quarters due to the Company’s current product offerings.
A portion of this payment was used to repay some of the amount borrowed under the Line of Credit, with the remainder held as working capital.
Current Working Capital Requirements In October 2023, we received the cash payment under the arbitration settlement agreement from our former distributor. A portion of this payment was used to repay some of the amount borrowed under the former line of credit, with the remainder held as working capital.
Accounts payable rose to $2,181,194 from $1,566,047 which is related to the timing of payments due to suppliers. Accrued liabilities increased by $257,154 to $2,113,193 from $1,856,039. Bank indebtedness, which is from the Company’s line of credit and has primarily been used to acquire inventory, was $1,259,259 as of August 31, 2023 compared to $7,000,000 as of August 31, 2022.
Accounts payable fell by $943,206 to $1,237,988 from $2,181,194 which is related to the timing of payments due to suppliers. Accrued liabilities declined by $711,812 to $1,401,382 from $2,113,194. Bank indebtedness, which is from our prior line of credit and has primarily been used to acquire inventory, was $1,259,259 as of August 31, 2023.
JCSC had an operating loss of ($251,261) in fiscal 2023 compared to an operating loss of ($517,453) in fiscal 2022. 14 Corporate – JC USA JC USA, the holding company that provides professional and administrative services for the wholly-owned operating subsidiaries had operating income of $962,459 in fiscal 2023 compared to income of $819,139 in fiscal 2022.
Corporate – JC USA JC USA, the holding company that provides professional and administrative services for the wholly-owned operating subsidiaries had operating income of $894,325 in fiscal 2024 compared to operating income of $962,459 in fiscal 2023. The results of JC USA are inter-company transactions and are eliminated on consolidation.
Governance As a public company, our processes are outlined and governed by multiple regulations, including Sarbanes-Oxley. Our financial controls are mapped, executed, self-audited as well as regularly audited by outside experts as part of our annual process. We have established risk mitigations that allows for condensed reviews of risks and impacts with our systems in place.
We also actively participate in the local community, supported by a Corporate Charitable Giving Charter. Governance As a public company, our processes are outlined and governed by multiple regulations, including the Sarbanes-Oxley Act of 2002. Our financial controls are mapped, executed, self-audited as well as regularly audited by outside experts as part of our annual process.
Based on the Company’s current working capital position, the anticipated reduction in cash needs due to the closure of JCSC, and the unused borrowing capacity under its current line of credit, the Company expects to have sufficient liquidity available to meet its working capital requirements for fiscal 2024. 15 OTHER MATTERS Contractual Obligations and Commercial Commitments The Company currently has no material contractual obligations or commercial commitments other than to suppliers of products or services.
Based on our current working capital position, the anticipated reduction in cash needs due to the closure of JCSC, and the unused borrowing capacity under our current line of credit, we expect to have sufficient liquidity available to meet our working capital requirements for the next twelve months.
Customs unless the importer is able to prove that these goods have not been made with forced labor.
Customs unless the importer is able to prove that these goods have not been made with forced labor. We ensure that each of our suppliers is in full compliance with the law and none of our products fall under the prohibited goods clause.
The results of JC USA are inter-company transactions and are eliminated on consolidation. LIQUIDITY AND CAPITAL RESOURCES Fiscal Year Ended August 31, 2023 As of August 31, 2023, the Company had working capital of $19,134,810 compared to working capital of $19,207,874 as of August 31, 2022.
LIQUIDITY AND CAPITAL RESOURCES Fiscal Year Ended August 31, 2024 As of August 31, 2024, we had working capital of $19,982,071 compared to working capital of $19,134,810 as of August 31, 2023.
We remain committed to maintaining our list prices on our primary pet products. There is no urgency to move this inventory as it will not degrade or spoil over time. For our slower moving pet products, we continue to explore opportunities to accelerate sales in those items.
This may lead to some shortages in the short term until the worldwide shipping situation improves. Although our pet product inventory levels remain higher than usual, we remain committed to maintaining our list prices on our primary pet products. There is no urgency to move this inventory as it will not degrade or spoil over time.
Our customers continue to pay on-time, with almost all of our outstanding receivables classified as current. For the fiscal year ended August 31, 2023, the accounts receivable collection period or DSO was 38 days compared to 42 days for the year ended August 31, 2022.
For the fiscal year ended August 31, 2024, the accounts receivable collection period or DSO was 28 days compared to 38 days for the year ended August 31, 2023.
Our facilities have replaced high energy consumption infrastructure with energy efficient HVAC and lighting during our recent remodel. Active products and designs utilize either recycled or non-petroleum-based plastics to enhance recycling and composting. This includes the recently introduced compostable dog waste bag, a plant-based product, that is less reliant on fossil fuels used in traditional plastic bags.
Packaging is designed to maximize recyclability and re-use and minimize non-recycled materials, and all waste materials in our own facilities are segregated to maximize recycling. Our facilities have replaced high energy consumption infrastructure with energy efficient HVAC and lighting during our most recent remodel. Active products and designs utilize either recycled or non-petroleum-based plastics to enhance recycling and composting.
An IT Governance Committee aligns execution and security both for ourselves and also for parties with whom we communicate and do business. Uyghur Forced Labor Prevention Act The Uyghur Forced Labor Prevention Act (“UFLPA”) is a US Federal Law signed by President Biden in December 2021 which became effective on June 21, 2022. As enforced by U.S.
Uyghur Forced Labor Prevention Act The Uyghur Forced Labor Prevention Act (“UFLPA”) is a US Federal Law which became effective on June 21, 2022. As enforced by U.S.
Interest is now calculated based on the one-month SOFR plus 157 basis points, which as of August 31, 2023 was 6.88% (5.31% + 1.57%). The line of credit has certain financial covenants. The Company is in compliance with these covenants.
Calculation of the interest rate was based on the one-month Secured Overnight Financing Rate (SOFR) plus 157 basis points, which as of August 31, 2023 was 6.88% (5.31% + 1.57%). Indebtedness under the line as of August 31, 2023 was $1,259,259. All amounts borrowed under this line of credit were repaid in full during fiscal 2024.
Inflation Historically, inflation has not been a significant issue for the Company. However, beginning in fiscal 2021, a number of product costs increased substantially, including raw materials, energy, and transportation/logistical related costs. These higher costs have negatively affected the Company’s gross margins.
OTHER MATTERS Contractual Obligations and Commercial Commitments We currently have no material contractual obligations or commercial commitments other than to suppliers of products or services in the ordinary course of business. Inflation 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.
For fiscal 2023, Greenwood had an operating loss of ($46,307) compared to operating income of $21,865 for fiscal 2022. Seed Processing and Sales - JCSC During fiscal 2023, the Board of Directors made the difficult decision to permanently close JCSC effective August 31, 2023. Sales for JCSC in fiscal 2023 were $2,464,153 compared to sales of $2,359,794 in fiscal 2022.
For fiscal 2023, Greenwood had operating income of $19,563 compared to a loss of ($46,307) for fiscal 2023 which is consistent with the higher level of revenue. Seed Processing and Sales - JCSC During fiscal 2023, we decided to close JCSC effective August 31, 2023.
Even though the costs in this case were material, we believe it is critical to defend our valuable intellectual property and will take action against any future infringements of our patents, trademarks and contractual agreements. The Board of Directors approved the adoption of an Advance Notice Policy for the nominations of directors by the Company’s shareholders.
Although the costs of such litigation may be significant, we believe it is critical to defend our valuable intellectual property and will take action against any future infringements of our patents, trademarks and contractual agreements. We have no current borrowing against our line of credit.
We strive to operate and grow in a way that honors our environment and relationships for the long term. This also aligns with one of our three value pillars: stewardship. Environmental For our products, the goal is that 90% of materials can be recycled.
This also aligns with one of our three value pillars: stewardship. 19 Environmental For our products, the goal is that 90% of materials can be recycled. Our suppliers are audited to strict commercial and fair practice standards, including our own supplier qualifications regarding facilities, capacity, labor practices, and environmental awareness.
We also dedicate a percentage of sales to support environmental cleanup efforts. Social Our social responsibilities include cultural standards of operations and values which we establish in conjunction with our employees. We regularly provide employees with a corporate engagement survey to benchmark their engagement, satisfaction, and ideas for change.
This includes the recently introduced compostable dog waste bag, a plant-based product, that is less reliant on fossil fuels used in traditional plastic bags. We also dedicate a percentage of sales to support environmental cleanup efforts. Social Our social responsibilities include cultural standards of operations and values which we establish in conjunction with our employees.
The Company calculates income tax expense based on combined federal and state rates that are currently in effect. Net loss in fiscal 2023 was ($20,626), or ($0.01) per share, compared to net income of $1,164,123, or $0.33 per common share, in fiscal 2022. The weighted number of shares outstanding were 3,495,342 in fiscal 2023 and 3,493,807 in fiscal 2022.
Income tax expense for fiscal 2024 was $82,070 compared to income tax expense of $63,097 in fiscal 2023. The Company calculates income tax expense based on combined federal and state rates that are currently in effect.
The segments are as follows: · Industrial wood products · Pet, Fencing and Other · Seed processing and sales · Corporate and administration Quarterly Results The following table summarizes quarterly financial results in fiscal 2023 and fiscal 2022. (Figures are thousands of dollars except per share amounts).
The segments are as follows: · Pet, Fencing and Other · Industrial wood products · Seed processing and sales · Corporate and administrative services Sales, income before taxes, assets, depreciation and amortization, capital expenditures, and interest expense by segment are shown in the financial statements under Note 12 “Segment Information.” Quarterly Results The following table summarizes quarterly financial results in fiscal 2024 and fiscal 2023.
Deferred tax assets rose to $319,875 from $Nil. As of August 31, 2023, accounts receivable and inventory represented 97% of current assets and 80% of total assets. As of August 31, 2022, accounts receivable and inventory represented 94% of current assets and 81% of total assets.
As of August 31, 2023, accounts receivable and inventory represented 97% of current assets and 80% of total assets. Our customers continue to pay on-time, with almost all of our outstanding receivables classified as current.
Inventory turnover for the year ended August 31, 2023 was 169 days compared to 130 days for the year ended August 31, 2022. Short-term and Long-term Debt External sources of liquidity include a line of credit from U.S. Bank of $10 million, of which approximately $8.74 million was available as of August 31, 2023.
Inventory turnover for the year ended August 31, 2024 was 151 days compared to 169 days for the year ended August 31, 2023. 18 Short-term and Long-term Debt During fiscal 2024, we established a new line of credit agreement with Northrim Funding Services (“Northrim”).
The interest rate paid by the Company has increased from 1.83% as of November 30, 2021 to 6.88% as of August 31, 2023. Environmental, Social and Corporate Governance (ESG) Jewett-Cameron endeavors to be a good steward and provide sustainable products with a positive impact.
Environmental, Social and Corporate Governance (ESG) Jewett-Cameron endeavors to be a good steward and provide sustainable products with a positive impact. We strive to operate and grow in a way that honors our environment and relationships for the long term.
These items include interest expense on the bank line of credit of $458,463 in 2023 compared to $163,045 in fiscal 2022, with the increase due to a higher level of borrowing and a significantly higher interest rate in fiscal 2023. Gain on sale of property, plant and equipment was $70,250 in fiscal 2023 and $4,526 in fiscal 2022.
For the year ended August 31, 2023, gain on sale of assets was $70,250, and interest expense totaled ($458,463) which was related to amounts borrowed against a bank line of credit. Including other items, income before income taxes was $803,823 compared to income before income taxes of $42,471 in fiscal 2023.
As we sell this high-cost inventory, our costs of goods sold declines. The high inflation rate which has prevailed over the last 24 months has also depressed our margins. Inflation affects our costs of goods more quickly than our ability to raise our selling prices.
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.
We are pleased to have settled the case and that we will no longer have to expend time and money pursuing this case. Our costs to pursue this action have been sizeable, particularly during fiscal 2023, which were included in our selling, general and administrative costs and reduced our income from operations accordingly.
This payment covered our substantial legal fees and some of our losses due to the breach. We are pleased to have settled the case and that we will no longer have to expend time and resources pursuing this case.
Removed
Our operations confronted a number of challenges, including poor weather, negative economic trends and inflationary pressures, and changing consumer spending habits. The primary selling season for our outdoor products in the spring and summer months was greatly shortened by the historically wet and unseasonably cold winter weather which extended across much of the United States well into April.
Added
(Figures are thousands of dollars except per share amounts).
Removed
This delayed, and ultimately significantly reduced, our orders from many of our customers, particularly retail hardware and Big Box stores. They maintained their winter inventory longer than usual which reduced their selling period for warm weather products.
Added
Although our business continued to be negatively affected by stubbornly high inflation and negative consumer sentiment, we successfully completed several important projects to optimize our operations and focus on our core products, broaden our customer base, and improve our financial position. The overall business climate remains challenging.
Removed
As a result, they ordered less product from our outdoor lines this year than in ordinary weather years. 10 The post-COVID shift of consumer spending habits, which has been compounded by persistently high levels of inflation, had a negative effect on our sales for the year.
Added
Inflation has pushed our costs higher, particularly in raw materials and shipping, while simultaneously squeezing consumers who have cut back on discretionary spending. These issues are particularly acute in the home improvement and pet product sectors.
Removed
These forces were particularly prominent within our home improvement and pet product lines, as consumers reduced their spending on these types of discretionary products from the elevated levels experienced during the pandemic. Our fiscal 2023 sales of $54.2 million is 21% higher than our sales of $44.9 in the last pre-pandemic year of 2020.
Added
Our margins and financial results in fiscal 2024 were also hurt by the clearance of some older higher cost lumber, and a one-time inventory write-down of $110,293 for the liquidation of all of our remaining pet inventory located in Europe. We also increased our obsolete inventory reserve by $459,464.
Removed
Although inflation has raised our selling price of our products since 2020, this 21% increase in the dollar amount of sales is still greater than the cumulative inflation rate in the US during the same period. Fencing sales were largely steady year-over-year, with several product lines exceeding expectations.
Added
We are continuing to sell through some of the higher cost pet inventory we purchased during the prior high-cost logistics period. Supply chain issues also worsened in the third and fourth quarters. Besides increasing our shipping costs, it also has affected our inventory availability.
Removed
This performance was especially encouraging considering the poor Spring weather across the country which reduced consumer demand for fence lumber and hardware. Our efforts to increase the visibility of our hardware products and maintain their in-stock availability with several retailers has also contributed to this year’s sales.
Added
Multiple issues, including conflict in the Red Sea and low water levels in the Panama Canal led to ship diversions and cancelations that caused significant shipping disruptions and delays and reduced container availability. A number of our supply orders beginning during the 4 th quarter of fiscal 2024 were delayed by these late and cancelled sailings from Asia.
Removed
We remain at the desired warehouse inventory levels for our key fence products and are experiencing no shipping delays to our customers. During fiscal 2023, we signed a new sales agreement with one of major lumber customers which changed how we inventory, sell and record our sales for this customer.
Added
This led to some inventory shortages and unavailability of certain products which caused some missed sales and back orders awaiting container arrivals that have extended into the first quarter of fiscal 2025. In addition to the significant delays, the costs of ocean shipping have soared since Mid-May 2024.
Removed
Our expectation that this new arrangement would provide us with more consistent and predictable fencing sales, while improving the availability of the product in their stores, has been confirmed. Although this agreement requires us to maintain higher levels of fencing inventory than we had in the past, we are pleased with how the arrangement has progressed.
Added
We notified our customers of the shipping delays and higher costs which we cannot fully absorb. Therefore, we temporarily increased certain of our product prices.
Removed
In the future, it may be possible to extend this agreement to more of this customer’s distribution centers that we continue to serve under our prior sales agreements. The pet industry overall has recently experienced a spending downturn from the surge of sales recorded in the prior two years. During the pandemic many Americans worked from home.
Added
These price increases may ultimately reduce our sales as some of our customers may be unwilling to purchase the full amount of their usual orders at these higher prices and instead may wait to see if shipping costs fall later in calendar 2024.
Removed
They acquired new pets and purchased additional supplies for all their pets. This increased spending subsided as many people returned to work outside the home. The higher levels of inflation prevailing over the last 18 months has also dampened consumer spending in the sector. Demand for our pet products have similarly been affected.
Added
These supply chain issues and the higher shipping costs negatively affected our sales and margins during the fourth quarter and are continuing into fiscal 2025. In fencing, which is our largest product category, we rolled out new in-store displays for our Lifetime Steel Posts® and continue to deploy additional in-store Adjust-A-Gate® displayers.
Removed
We relaunched one of our kennel products during 2023, and we also resolved a sales interruption with a significant on-line retailer, both of which have had positive results on sales. Our pet product inventory levels remain higher than usual.
Added
These in-aisle display units are positioned directly beside the wood racks for greater visibility of key products which increases sales of the items and improves the choices for consumers. The Lifetime Steel Posts® displayers began in just one region and expanded to 100 stores by the close of the fiscal year in August.
Removed
Many retailers have a higher than normal level of pet supply inventory on hand due to increasing their purchases during the pandemic prior to the sudden downturn in consumer demand. As a result, we expect overall demand from retailers to remain depressed into 2024 until they are able to work through their own high inventory levels.
Added
Since then, we have ramped up our roll out and displayers are now being installed in stores in multiple regions. In October 2024, we announced the engagement of Continental Sales & Marketing, Inc. (“CSM”) to help us expand these display units to more retailers across the US.
Removed
We launched our new MyEcoWorld® sustainable bag products during the 4 th quarter of fiscal 2023. Under our distribution agreement with SECOS Group of Australia, Jewett-Cameron is the exclusive distributor of their MyEcoWorld® sustainable bag products in the US and Canada.
Added
CSM will also help us manage the installed units and the expected product reorders to ensure they are well-stocked and inventory is available for consumers. We expect this program will increase our visibility and brand recognition with consumers and will be a valuable contributor to our revenue in 2025.
Removed
We expect it will take time for sales of these new and innovative premium products to gain traction with retailers and consumers. Since these products are consumables, once they are established, recurring sales will build over time. We are optimistic of the potential of this new product line to grow into a meaningful segment of our business.
Added
Although our lumber supply agreement with a major customer is performing well, supply issues are causing a significant shortage of Western Red Cedar. To ensure the supply of fence boards for this customer, we successfully shifted some of our product supply to high-quality alternatives, including Sugi Cedar, beginning in the 3 rd quarter of fiscal 2024.
Removed
Consumers are increasingly seeking more environmentally friendly alternatives to conventional hydrocarbon derived plastic products. Our success with our compostable poop bag since its launch several years ago indicates these products are less seasonal and can provide positive contributions to our historically lower revenue quarters.
Added
Sugi fencing sells for a lower price than Western Red Cedar which negatively affects our margins. Because consumers are not as familiar with Sugi Cedar, we believe demand for the product was diminished in the second half of fiscal 2024 which hurt our revenue. JCSC’s active operations ended as of December 31, 2023.
Removed
Greenwood’s primary customers are in the transit sector, which is an industry among the most affected by the COVID-19 pandemic.
Added
The seed operations were located on 11.6 acres of land and 105,000 square feet of buildings owned by the Company which is now surplus to the Company’s needs. Therefore, the land and buildings were listed for sale or lease in July 2024 at a listing price of $9,000,000, which is a competitive price based on comparable properties in the area.
Removed
Transit is beginning to recover from the severe decline in ridership and other serious issues, including shortages of vehicle components and trained drivers and mechanics, that reduced the number of vehicles on the road and the need for Greenwood’s engineered wood products.
Added
This is the current asking price, and there is no guarantee the property will sell for this amount. If we are able to complete a sale, the net proceeds will be reduced by brokers’ commissions, expenses related to the sale, and taxes.
Removed
With transit’s recovery, Greenwood’s sales have increased from the pandemic periods but were flat in 2023 compared to 2022. We continue to see a number of marketing opportunities for Greenwood’s products in both its current markets and in new sectors, such as construction.
Added
The land is on a corner lot situated at a major interchange immediately adjacent to US Highway 26, which is one of the region’s busiest roadways. The land is currently zoned with a rural industrial classification, but the Company is exploring the potential to re-zone the property, or revise the existing code, to expand the list of permitted uses.
Removed
We have been actively searching to hire new traders to pursue these new business opportunities, and a new trader was successfully hired in September 2023. 11 During fiscal 2023, management concluded a comprehensive strategic review of the seed segment. As a result of this review, the Board of Directors made the difficult decision to close JCSC effective August 31, 2023.
Added
A reclassification would provide interested parties with greater flexibility of development options. There is also a high level of interest from the cities immediately adjacent to the property in the potential expansion of their urban growth boundaries and those communities are investigating those potential options. Due to its strategic location, this property would potentially be included within the expanded area.
Removed
The review of JCSC, which last reported a full-year profit in fiscal 2020, was initiated due to the segment’s declining revenue, higher costs, and the lack of success in generating new customers over the last several years.
Added
Should such an expansion be approved and/or a rezoning occur, it would likely increase the land’s value and potentially maximize any return we receive for the sale of this surplus asset. 15 Diversifying our suppliers has been a primary focus of management for several years.
Removed
When the seed operation was first opened in 1965, and then acquired by the Company in 2000, the local area around the JCSC operations was rural and dominated by large farming operations, including grass seed farms which made up JCSC’s customers.
Added
The majority of our metal products have been sourced from a single supplier manufacturing in a single factory in China. Beginning in fiscal 2022, the Company initiated an extensive world-wide evaluation process to find suppliers who could manufacture many of our metal products that met our high-quality standards with competitive pricing.
Removed
Over the last decade, many agricultural customers in the area around JCSC are converting their acreage from growing cyclical and commoditized grass seed to more specialized higher value crops, such as berries and filberts. Consequently, JCSC has been receiving lower quantities and quality of seed for processing and experiencing less demand for its marketing and sales in recent years.
Added
After 18 months, the Company completed its search and engaged several new suppliers with factories in Canada, Bangladesh, Vietnam, Malaysia, and Taiwan. We are now receiving products from these new suppliers in addition to our original supplier in China which we also continue to use.
Removed
In addition, JCSC’s building and equipment are nearing the end of their expected operating life. Over the last several years, the higher costs of maintenance required to maintain operations have had a substantial negative effect on JCSC’s margins and has been an important factor in JCSC’s operating losses.
Added
These new supply agreements cover the Company’s fence products, dog containment products, as well as MyEcoWorld® products. In addition to reducing the systematic risk of the reliance of a single supplier from a single factory, products from these new suppliers are not subject to the current 25% tariff rate on Chinese made steel products imported into the United States.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed0 unchanged
Biggest changeForeign Currency Risk The Company operates primarily in the United States. However, a relatively small amount of business is conducted in currencies other than U.S. dollars. Also, to the extent that the Company uses contract manufacturers in China, currency exchange rates can influence the Company’s purchasing costs.
Biggest changeForeign Currency Risk We operate primarily in the United States. However, a relatively small amount of business is conducted in currencies other than U.S. dollars. Also, to the extent that we use contract manufacturers located outside the United States, including China, Canada, Bangladesh, Vietnam, Malaysia, and Taiwan, currency exchange rates can influence our purchasing costs.
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Risk The Company did not have any derivative financial instruments as of August 31, 2023, and the Company does not use derivative instruments for trading purposes. Changes in U.S. interest rates affect the interest earned on the Company’s cash as well as interest paid on debt.
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Risk We did not have any derivative financial instruments as of August 31, 2024, and we do not use derivative instruments for trading purposes. Changes in U.S. interest rates affect the interest earned on our cash as well as interest paid on debt.
The Company has a line of credit with an interest rate based on published rates that may fluctuate over time based on economic changes in the environment. The Company is subject to interest rate risk and could be subject to increased interest payments against any amounts borrowed against the line of credit if market interest rates fluctuate.
We have a line of credit with an interest rate based on published rates that may fluctuate over time based on economic changes. We are subject to interest rate risk and could be subject to increased interest payments against any amounts borrowed against the line of credit if market interest rates fluctuate.

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