2014

Avcorp announces 2011 Third Quarter Results

VANCOUVER, Nov. 10, 2011 /PRNewswire/ - Avcorp (TSX: AVP) today announced its financial results for the quarter ended September 30, 2011.

During the quarter ended September 30, 2011, the Company recorded net income of $39,000 on $20,383,000 revenue, as compared to a net loss of $185,000 on $21,808,000 revenue for the same quarter preceding year.

Earnings before interest, taxes, depreciation and amortization (EBITDA) was positive $1,455,000 for the quarter ended September 30, 2011 compared to an EBITDA of positive $1,129,000 for the quarter ended September 30, 2010.

Cash flows from operating activities, before consideration of changes in non-cash working capital provided $843,000 of cash for the quarter ended September 30, 2011 compared to providing $203,000 of cash for the same quarter last year.  The primary factor underlying the increase in cash provided by operating activities during 2011 was positive production gross margins.

Non-cash operating assets and liabilities utilized $1,723,000 of cash during the current quarter primarily as a result of the growth in accounts receivable and inventory related to new business; compared to utilizing $2,536,000 of cash during the same quarter in 2010 which occurred as a result of increased accounts receivable stemming from resurgent customer demand.

About Avcorp

Avcorp designs and builds major airframe structures for some of the world's leading aircraft companies, including Boeing, Bombardier, and Cessna.  With more than 50 years of experience, over 500 skilled employees and 354,000 square feet of facilities, Avcorp offers integrated composite and metallic aircraft structures to aircraft manufacturers, a distinct advantage in the pursuit of contracts for new aircraft designs, which require lower-cost, light-weight, strong, reliable structures.  Avcorp is a Canadian public company traded on the Toronto Stock Exchange (TSX:AVP).

(signed)
MARK VAN ROOIJ
PRESIDENT and CHIEF EXECUTIVE OFFICER

Forward-Looking Statements

This management discussion and analysis should be read in conjunction with the Company's audited financial statements.  Certain statements in this report and other oral and written statements made by the Company from time to time are forward-looking statements, including those that discuss strategies, goals, outlook or other non-historical matters; or projected revenues, income, returns or other financial measures.  These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in the statements, including the following:  (a) the ability of the Company to renegotiate its debt agreements under which it is in default; (b) the extent to which the Company is able to achieve savings from its restructuring plans; (c) uncertainty in estimating the amount and timing of restructuring charges and related costs; (d) changes in worldwide economic and political conditions that impact interest and foreign exchange rates; (e) the occurrence of work stoppages and strikes at key facilities of the Company or the Company's customers or suppliers; (f) government funding and program approvals affecting products being developed or sold under government programs; (g) cost and delivery performance under various program and development contracts; (h) the adequacy of cost estimates for various customer care programs including servicing warranties; (i) the ability to control costs and successful implementation of various cost reduction programs; (j) the timing of certifications of new aircraft products; (k) the occurrence of further downturns in customer markets to which the Company products are sold or supplied or where the Company offers financing; (l) changes in aircraft delivery schedules or cancellation of orders; (m) the Company's ability to offset, through cost reductions, raw material price increases and pricing pressure brought by original equipment manufacturer customers; (n) the availability and cost of insurance; (o) the Company's ability to maintain portfolio credit quality; (p) the Company's access to debt financing at competitive rates; and (q) uncertainty in estimating contingent liabilities and establishing reserves tailored to address such contingencies.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(unaudited, prepared in accordance with IFRS, expressed in thousands of Canadian dollars)

  September 30, 2011 December 31, 2010
ASSETS    
Current assets    
Accounts receivable $   15,109 $   8,869
Inventories 18,706 14,886
Prepayments 1,404 1,922
Other assets 31 28
  35,250 25,705
Non-current assets    
Development costs 5,861 5,181
Property, plant and equipment 12,955 14,794
Total assets 54,066 45,680
     
LIABILITIES AND EQUITY    
Current liabilities    
Bank indebtedness 643 8,158
Accounts payable and accrued liabilities 11,660 10,634
Current portion of long-term debt 1,634 5,420
  13,937 24,212
Non-current liabilities    
Deferred gain 323 358
Lease inducement 691 764
Deferred tooling revenues 18,585 6,804
Long-term debt 12,555 3,275
Warranty provisions 136 167
  46,227 35,580
Equity    
Attributable to shareholders of the Company:    
Capital stock 73,251 72,927
Equity component of convertible loan 453 453
Preferred shares 7,622 7,622
Contributed surplus 2,821 2,662
Deficit (76,308) (73,564)
  7,839 10,100
Total liabilities and equity 54,066 45,680

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(unaudited, prepared in accordance with IFRS, expressed in thousands of Canadian dollars, except number of shares and per share amounts)

  Three months ended Nine months ended
FOR THE PERIOD ENDED SEPTEMBER 30 2011 2010 2011 2010
Revenues $   20,383 $   21,808 $   61,791 $   57,894
Cost of sales 17,686 18,873 54,526 52,930
Gross profit 2,697 2,935 7,265 4,964
Administrative and general expenses 2,729 2,413 8,237 8,130
Office equipment depreciation 160 257 495 792
Other (gains) and losses - net (6) (2) (12) (3)
Operating Income (loss) (186) 267 (1,455) (3,955)
Foreign exchange (gain) loss (706) 104 (571) (223)
Finance costs 481 348 1,294 912
Income (loss) before income tax 39 (185) (2,178) (4,644)
Income taxes recovery (expense) - - - -
Future income tax recovery (expense) - - - -
Income (loss) and total comprehensive income (loss) for the period 39 (185) (2,178) (4,644)
Earnings (loss) per share:        
Basic and diluted earnings loss per common share 0.00 (0.00) (0.01) (0.02)
Basic weighted average number of shares outstanding (000's) 198,750 195,505 196,599 191,664
Diluted weighted average number of shares outstanding (000's) 198,750 195,505 200,305 192,379

CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, prepared in accordance with IFRS, expressed in thousands of Canadian dollars)

  Three months ended Nine months ended
FOR THE PERIOD ENDED SEPTEMBER 30 2011 2010 2011 2010
Cash flows from operating activities        
Profit (loss) before tax $   39 $   (185) $   (2,178) $   (4,644)
   Adjustment for items not affecting cash:        
     Accretion on convertible loan 21 - 63 -
     Accrued interest and government royalties 352 166 635 432
     Amortization and depreciation 844 899 2,530 2,653
     Deferred tooling revenue amortization (214) (229) (640) (628)
     Development cost amortization 91 67 281 167
     Provision for loss-making contracts (300) (476) (591) (197)
     Provision for obsolete inventory (123) 41 (173) (386)
     Stock based compensation 25 - 115 -
     Warranty provisions (6) 7 (18) 882
     Other items 114 (87) 18 (134)
  843 203 42 (1,855)
Changes in non-cash working capital        
   Accounts receivable (1,396) (2,957) (3,136) (2,992)
   Inventories (1,065) 555 (3,056) 2,922
   Prepayments - (877) 518 (1,337)
    Accounts payable and accrued liabilities 815 790 448 2,782
   Other items (77) (47) (47) (217)

Net cash from operating activities

(880) (2,333) (5,231) (697)
         

Cash flows from investing activities

       
Purchase of equipment (364) (290) (691) (808)
Payments relating to development costs and tooling (99) (876) (961) (1,402)

Net cash from investing activities

(463) (1,166) (1,652) (2,210)
         
Cash flows from financing activities        
(Decrease) increase in bank indebtedness (8,054) 2,103 (7,515) (1,701)
Proceeds from customer funding of program non-recurring expenditures 3,837 1,658 9,317 2,739
Proceeds from current and long-term debt 6,000 - 6,000 1,771
Repayment of current and long-term debt (440) (262) (919) (875)
Issue of common shares - - - 977
Share issue expense - - - (4)

Net cash from financing activities

1,343 3,499 6,883 2,907
Net increase (decrease) in cash and cash equivalents - - - -
Cash and cash equivalents - Beginning of period - - - -
Cash and cash equivalents - End of period - - - -

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(unaudited, prepared in accordance with IFRS, expressed in thousands of Canadian dollars, except number of shares)

  Share capital Equity
component
convertible
loan
Preferred
shares
Contributed
surplus
Deficit Total
equity
  Shares Amount
Balance January 1, 2010 177,732,112 $ 71,954 $    - $  7,622 $  2,647 $ (66,162) $ 16,061
Issue of common shares 17,773,211 973 - - - - 973
Loss for the period - - - - - (4,644) (4,644)
Dividends on preferred shares - - - - - (566) (566)
Balance September 30, 2010 195,505,323 72,927 - 7,622 2,647 (71,372) 11,824
Balance December 31, 2010 195,505,323 72,927 453 7,622 2,662 (73,564) 10,100
Issue of common shares 6,488,790 324 - - - - 324
Stock based compensation expense - - - - 115 - 115
Fair value of warrants expense - - - - 44 - 44
Loss for the period - - - - - (2,178) (2,178)
Dividends on preferred shares - - - - - (566) (566)
Balance September 30, 2011 201,994,113 73,251 453 7,622 2,821 (76,308) 7,839

SOURCE Avcorp Industries Inc.



More by this Source


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.