• $408.3 million in sales, up 3.7% organically
• EBITDA margin at 4.7%; Adjusted EBITDA margin reaches 7.6%, up from 6.5%
• EPS at $0.58; Adjusted EPS reaches $0.94, up a strong 21.1% (up
• 38.1% once expressed in Canadian dollars)
• Corporation now debt-free after debt repayment of $277.5 million

Unless otherwise indicated in this press release, all amounts are expressed in US dollars.

Boucherville (Québec), July 30, 2015 − Uni-Select Inc. (TSX: UNS), a leading distributor of automotive products in Canada and paint and related products in the United States, today reported solid financial results with increased adjusted earnings for the second quarter ended June 30, 2015.

Over the course of the second quarter, the Corporation completed the sale of substantially all the net assets of Uni-Select USA, Inc. and Beck/Arnley Worldparts, Inc. to affiliates of Icahn Enterprises L.P. for net cash proceeds of $324 million. The proceeds of the transaction were used by Uni-Select to repay its outstanding debt and to settle related transaction costs. Accordingly, the second quarter and six-month period results include respectively two and five months of operations from the net assets sold.

"I am very pleased by our solid performance in the second quarter and delighted by the balanced contribution of both our automotive products and paint and related products segments to our results. I am particularly delighted that we are starting to see Uni-Select emerge as a substantially more profitable operation featuring a very strong balance sheet, said Richard G. Roy, President and Chief Executive Officer of Uni-Select. "As I prepare to leave for retirement, I could not be prouder of what we have achieved as a team and I am confident that an exciting future awaits Uni-Select under the leadership of Henry Buckley as President and Chief Executive Officer effective August 1, 2015."

SECOND QUARTER RESULTS

(All percentage increases and decreases represent year-over-year changes for the second quarter of 2015 compared to the second quarter of 2014, unless otherwise noted. The 2015 second quarter results include two months of operations from the net assets sold.)

The sales decrease of 14.7% in the second quarter, compared to last year, is due to the sale of net assets of Uni‐Select USA, Inc. and Beck/Arnley Worldparts, Inc. and by the declining Canadian dollar, while partly compensated by additional sales from recent acquisitions. On an organic basis, consolidated sales grew 3.7%, namely driven by the recruitment of new customers in the paint and related products segment combined with the implementation of a customer centric strategy in the automotive products segment.

The Corporation generated $19.0 million of EBITDA (after impairment and transaction charges related to the sale of net assets of $13.5 million and a net reversal of restructuring and other charges of $1.7 million), compared to $29.7 million last year. Adjusted EBITDA reached $31.1 million, resulting in an adjusted EBITDA margin of 7.6%, up from 6.5% last year.

Net earnings declined to $12.4 million, from $15.5 million last year, mainly as a result of impairment and transaction charges related to the sale of net assets. Adjusted earnings grew 21.1% from $16.5 million last year ($0.77 on a per share basis) to $20.0 million ($0.94 on a per share basis), favourably impacted by improved EBITDA from remaining operations, financing costs for debt reimbursement as well as by the lower depreciation and amortization on net assets sold.

As indicated above, the Corporation’s results are presented in US dollars. Once converted to Canadian dollars, adjusted earnings per share reached C$1.16 for the second quarter of 2015, up 38.1% compared to C$0.84 in 2014.

Segmented Results

Prior to their disposal, the net assets sold over the course of the second quarter were included until May 31, 2015, in the automotive products group for segmented reporting. Accordingly, sales of the automotive products segment declined to $252.9 million from $331.7 million in the prior year, mainly as a result of this disposition and the declining Canadian dollar. Segment organic sales grew 3.0% in the second quarter, driven by a successful ongoing regional strategy to better cater to customer needs through an enhanced product offering and pricing optimization adjustments. EBITDA for the automotive products segment decreased to $4.0 million in the second quarter, a decline mainly attributable to the impairment and transaction charges. Adjusted EBITDA decreased to $14.0 million, a performance attributable to the inclusion of only two months of operation of the US activities sold in Q2, as well as to lower productivity of these operations.

The paint and related products segment recorded sales of $155.4 million, up 5.7% from 2014, or 4.4% organically. Segment EBITDA reached $19.2 million, up 24.1% from $15.5 million last year. This performance is namely attributable to adjustments on sales programs, enhanced gross margins resulting from optimal inventory management, accretive business acquisitions that were partially offset by an unfavourable customer mix. The segment adjusted EBITDA margin reached 12.6%, compared to 10.5% last year.

SIX-MONTH PERIOD RESULTS

(All percentage increases and decreases represent year-over-year changes for the six-month period of 2015 compared to the six-month period of 2014, unless otherwise noted. The 2015 six‐month period results include five months of operations from the net assets sold.)

For the first six-month period of 2015, overall sales decreased by 8.0% to $820.0 million, a performance explained by the same factors as for the second quarter. On an organic basis, sales grew 3.0% or $15.6 million in the first half of the year.

The Corporation recorded a negative EBITDA of $103.2 million for the first six months of 2015, compared to an EBITDA of $48.3 million last year. This is explained by impairment and transaction charges of $150.8 million in connection with the sale of the net assets of the US automotive products distribution business activities and restructuring charges to rightsize the corporate operations recorded over the course of the first semester. Adjusted EBITDA for the first half of the year decreased by 3.1% while the adjusted EBITDA margin increased from 5.8% to 6.2%.

The Corporation recorded a net loss of $69.9 million in the first half of the year while adjusted earnings grew 14.5% to $30.0 million ($1.41 on a per share basis) from $26.2 million ($1.23 on a per share basis) for the corresponding period last year.

As indicated above, the Corporation’s results are presented in US dollars, once converted to Canadian dollars, adjusted earnings per share for the six-month period amount to C$1.74 compared to C$1.35 in 2014, up 28.9%.

Segmented Results

Prior to their disposal, the net assets sold over the course of the first half of the year were included in the automotive products group for segmented reporting. Accordingly, sales of the automotive products segment were down 15.2% for the first six-month period of 2015 to $516.8 million, or down 8.6% excluding the impact of closed or sold locations, mainly related to the impact of the declining Canadian dollar and partially offset by the sales of recent accretive acquisitions. On an organic basis, sales were similar in the first half of the year. A negative segment EBITDA of $126.1 million was recorded in the first half of the year, down from $23.6 million last year, a decline explained by the impairment and transaction charges. Adjusted EBITDA decreased to $20.7 million, a performance mainly attributable to the inclusion of only five months of operation of the US activities sold in Q2, as well as to lower productivity of these operations.

The paint and related products segment recorded sales of $303.2 million in the first six-month period of the year, up 7.3%. Sales grew 5.5% organically or $15.4 million, driven mainly by the recruitment of new customers. Segment EBITDA reached $35.3 million, up 20.7% from 2014, while adjusted EBITDA reached $35.6 million, up 21.9%, mainly attributable to organic growth and accretive business acquisitions. Segment adjusted EBITDA margin was 11.8%, up from 10.3% for the corresponding period last year.

DEBT REIMBURSEMENT AND GROWTH STRATEGY

Over the course of the second quarter, the Corporation repaid in its entirety the $277.5 million outstanding debt. On June 30, 2015,
the Corporation had $78.5 million in cash and $405 million in available credit facility, providing Uni-Select with the wherewithal to actively focus on its organic and acquisition growth-driven strategy.

DIVIDEND

The Uni-Select’s Board of Directors declared a dividend of C$0.16 per share payable on October 20, 2015 to shareholders of record on September 30, 2015. This dividend is an eligible dividend for tax purposes.

CONFERENCE CALL

Uni-Select will host a conference call to discuss its second quarter results for 2015 on July 30, 2015 at 2 PM (EDT). To join the conference, dial 1 866 696-5910 followed by 2686549.

A replay of the conference call will be available from 5 PM (EDT) until 11:59 PM on August 10, 2015. To access the replay, dial 1 800 408-3053 followed by 1561870.

ABOUT UNI-SELECT

Leader in the Canadian distribution of automotive products, Uni-Select is also a leading independent automotive paint distributor in the United States with FinishMaster. Over 2,400 employees spread across 13 distribution centres and 189 corporate stores are dedicated to offering advanced solutions and first-rate service to customers in order for them to benefit from a positively experience. Uni-Select's strong network and proficient programs contribute to the success of countless auto service shops and collision centres as well as more than 1,155 independent wholesalers in North America. Its Canadian banner programs made up of Auto Parts Plus®, Auto-Plus®, Bumper to Bumper®, Auto Select™, Uni-Pro®, SAX and Carrossier ProColor® regroup over 3,900 shops and stores. Uni-Select is headquartered in Boucherville and its shares are traded on the Toronto Stock Exchange (TSX) under the symbol UNS.

FORWARD-LOOKING INFORMATION

The information provided in this press release may include some forward-looking information, which could include certain risks and uncertainties which may cause the final results to be significantly different from those listed or implied within this news release. Such risks and uncertainties may include, for example, the impact of the transaction on the business of Uni-Select and certain strategic benefits expected to result from the transaction. For additional information with respect to risks and uncertainties, refer to the Annual Report filed by Uni-Select with the Canadian securities commissions. The forward-looking information contained herein is made as of the date of this press release, and Uni-Select does not undertake to publicly update such forward-looking information to reflect new information, subsequent or otherwise, unless required by applicable securities laws.

ADDITIONAL INFORMATION

The Management Report, the unaudited interim financial statements and the accompanying notes for the Second Quarter of 2015 are available in the “Investors” section on the Corporation’s website at uniselect.com as well as on SEDAR at sedar.com. The Corporation’s Annual Report may also be found on these websites as well as other information related to Uni-Select, including its Annual Information Form.

- 30 -

Source

UNI-SELECT INC.
uniselect.com

Contact

Louis Juneau
Vice-President, Legal Affairs and Secretary
450 641-6922
investorrelations@uniselect.com

NON-IFRS FINANCIAL MEASURES

The information included in this press release contains certain measures that are consistent with IFRS. Non-IFRS financial measures do not have any standardized meaning prescribed by IFRS and are, therefore, unlikely to be comparable to similar measures presented by other entities.

Organic growth – This measure consists of quantifying the increase in pro forma consolidated sales between two given periods, excluding the impact of acquisitions, sales and disposals of stores, exchange‐rate fluctuations and when necessary, the variance in the number of billing days. Determining the rate of organic growth, based on findings that Management regards as reasonable, may differ from the actual rate of organic growth.

EBITDA – This measure represents net earnings excluding finance costs, depreciation and amortization, equity income and income taxes. This measure is a financial indicator of a corporation’s ability to service and incur debt. It should not be considered by an investor as an alternative to sales or net earnings, as an indicator of operating performance or cash flows, or as a measure of liquidity, but as additional information.

Adjusted EBITDA, adjusted earnings and adjusted earnings per share – Management uses adjusted EBITDA, adjusted earnings and adjusted earnings per share to assess EBITDA, net earnings and net earnings per share from operating activities, excluding certain adjustments, net of income taxes (for adjusted earnings and adjusted earnings per share), which may affect the comparability of the Corporation’s financial results. Management considers that these measures are more representative of the Corporation’s operational performance and more appropriate in providing additional information. These adjustments include, among other things, restructuring and other charges, impairment and transaction charges related to the sale of net assets, the non‐capitalizable costs related to the development and implementation of the ERP system and costs related to the closure and disposal of stores. The exclusion of these items does not indicate that they are non‐recurring.

Adjusted EBITDA margin – The adjusted EBITDA margin is a percentage corresponding to the ratio of adjusted EBITDA to sales.

Free cash flows – This measure corresponds to the cash flows from operating activities according to the consolidated statements of cash flows adjusted for the following items: changes in working capital items, equity income, acquisitions of property and equipment and difference between amounts paid for post‐employment benefits and current year expenses. Uni‐Select considers the free cash flows to be a good indicator of financial strength and of operating performance because it shows the amount of funds available to manage growth in working capital, pay dividends, repay debt, reinvest in the Corporation and capitalize on various market opportunities that arise. The free cash flows exclude certain variations in working capital items (such as trade and other receivables, inventory and trade and other payables) and other funds generated and used according to the statement of cash flows. Therefore, it should not be considered as an alternative to the consolidated statement of cash flows, or as a measure of liquidity, but as additional information.

Total net debt – This measure consists of long‐term debt, including the portion due within a year, net of cash.

RECONCILIATION OF NON-IFRS MEASURES

The following table presents a reconciliation of EBITDA and adjusted EBITDA.

(1) Include costs mainly related to data conversion, employee training and deployment to various sites.
(2) Consist primarily of handling and freight expenses required to relocate inventory.

The following tablepresents a reconciliation of adjusted earnings and adjusted earnings per share.

The effect of the declining Canadian dollar was $0.04 on earnings per share for the quarter compared to the same period of 2014, while the effect for the six-month period was $0.05 compared to the same period last year.