Exco Technologies Limited - Fourth Quarter ended September 30, 2011 and Quarterly Dividend Declared
- Annual Sales increased 21%
- Annual Profits increased 46.9%
- Year-end Cash on hand $15.4 million
- No bank debt
TORONTO, Nov. 30, 2011 /PRNewswire/ - Exco Technologies Limited (TSX-XTC) today announced results for its fourth quarter ended September 30,
2011. In addition, the Company announced that its quarterly cash
dividend of $0.03 per share will be paid on December 22, 2011 to
shareholders of record on December 14, 2011. The dividend is an
"eligible dividend" in accordance with the Income Tax Act of Canada.
Three Months ended
Twelve Months ended
|($000s, except per share amounts)|
|Basic and diluted earnings per share||$0.06||$0.06||$0.36||$0.25|
|Common shares outstanding||40,961,823||40,912,823||40,961,823||40,912,823|
In the fourth quarter sales were $52.3 million - a $6.4 million or 14% increase over the prior year. Both business segments reported higher quarterly sales. The Casting and Extrusion segment recorded higher sales of $32.7 million compared to $30.1 million last year - an increase of 9%. The Automotive Solutions segment experienced a 24% increase in sales from $15.9 million last year to $19.6 million.
Consolidated annual sales totalled $199.6 million compared to $165.5 million last year - an increase of $34.1 million or 21% over last year. Annual sales for the Casting and Extrusion segment were $125.3 million - an increase of $20.3 million or 19% from the prior year. Annual sales for the Automotive Solutions segment were $74.3 million - an increase of $13.8 million or 23% from the prior year.
The Company's fourth quarter net income of $2.3 million ($0.06 per share) compared to $2.4 million ($0.06 per share) in fiscal 2010 was severely impacted by exchange rate volatility in the last months of the quarter. This caused expenses in the Corporate segment to increase by $1 million from foreign exchange losses mainly on the fair valuation of Mexican peso collars and in the Casting and Extrusion segment to increase by $839 thousand from the revaluation of the Company's Mexican peso investment in Excoeng Mexico. These exchange losses - although notional, non-cash in nature and under IFRS reporting which commences next quarter will not recur with respect to the revaluation of the Company's investment in Excoeng Mexico - reduced fourth quarter earnings per share by 3 cents per share and annually by 2 cents per share.
Fourth quarter pretax earnings increased in the Automotive Solutions segment by $2 million or 189% over the same quarter last year ($3 million compared to $1.1 million last year) on strong overall demand, efficient production and generally smooth new product launches. Partially offsetting this improvement was a decline in quarterly pretax earnings in the Casting and Extrusion segment by $881 thousand. The extrusion tooling group's earnings were impacted by the final costs of closing the AluDie business (severances $340 thousand), production inefficiencies from relocating the last of AluDie's machinery and equipment to Colombia and write down of some equipment from the Colombian acquisition ($134 thousand). The large mould businesses struggled with tight delivery dates on a growing book of business. This caused excessive overtime and excessive outsourcing of certain long lead time functions. As internal capacity is adjusted both overtime and outsourcing should abate. This group also experienced cost overruns on several first off moulds during the quarter.
The Company reported full year consolidated net income of $14.8 million or $0.36 per share compared to $10.1 million or $0.25 per share last year. Annual Casting and Extrusion earnings increased by 17% to $13.3 million from $11.4 million in the prior year. The Automotive Solutions segment recorded earnings of $12 million for the year compared to $4.4 million last year.
Gross margin in the quarter increased slightly to 23.8% compared to 23.3% last year. Full year gross margin also increased slightly to 26.5% compared to 26% last year.
During the fourth quarter the Company continued the sales and earnings momentum that has been consistently building since 2010. With both automotive tooling and component sales convincingly recovering in North America and the closure of AluDie now complete, the Company's earnings and cash position should continue to prosper. We also look forward to our two start-ups, Excoeng Mexico and Exco Colombia, beginning to contribute in the later part of the year and our large mould businesses to improve operating efficiencies by insourcing throughout the year as internal production capacity rises.
The Company continues to have a strong balance sheet with no bank debt and $15.4 million cash on hand at year end despite having funded increased account receivable and inventory of $23.5 million, capital expenditures of $8.2 million and paying $4.3 million in dividends during the year.
"While exchange rate volatility caused by unpredictable global events and some internal operating inefficiencies have taken an unexpected bite out of our fourth quarter, I am pleased with Exco's overall performance in 2011" said Brian Robbins, President and CEO of Exco, "and I am comfortable that the fundamentals of our various business units are robust and point to continued growth."
(For further information and prior year comparison please refer to the Company's Fourth Quarter Interim Financial Statements in the Investor Relations section posted at www.excocorp.com. Alternatively, please refer to www.sedar.com after November 30, 2011.)
Exco Technologies Limited is a global supplier of innovative technologies servicing the die-cast, extrusion and automotive industries. Through our 10 strategic locations, we employ 2,019 people and service a diverse and broad customer base.
Management will hold a conference call to discuss the fourth quarter results on Thursday December 1, 2011 at 10:00 am (Toronto Time). The local dial in number for the call is (647) 427-7450 or toll free 1-888-231-8191. To access the live audio webcast, please log on to www.excocorp.com or http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=3748140 a few minutes before the event. Real Player is required for access. For those unable to participate on December 1, 2011, an archived version will be available on the Exco website.
This news release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws. We use words such as "anticipate", "plan", "may", "will", "should", "expect", "believe", "estimate" and similar expressions to identify forward-looking information and statements especially with respect to growth and financial performance of the Company's business units, contribution of our two start-up business units and improvement in operating efficiencies in the large mould businesses. Such forward-looking information and statements are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe to be relevant and appropriate in the circumstances. These assumptions include the number of automobile vehicles produced, investment by OEMs in drivetrain architecture, weakening raw material prices, continuing economic recovery and currency fluctuations. Readers are cautioned not to place undue reliance on forward-looking information and statements, as there can be no assurance that the assumptions, plans, intentions or expectations upon which such statements are based will occur. Forward-looking information and statements are subject to known and unknown risks, uncertainties, assumptions and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed, implied or anticipated by such information and statements. These risks, uncertainties and assumptions are described in the Company's Management's Discussion and Analysis included in our 2011 Annual Report, in our 2011 Annual Information Form and, from time to time, in other reports and filings made by the Company with securities regulatory authorities.
While the Company believes that the expectations expressed by such forward-looking information and statements are reasonable, there can be no assurance that such expectations and assumptions will prove to be correct. In evaluating forward-looking information and statements, readers should carefully consider the various factors which could cause actual results or events to differ materially from those indicated in the forward-looking information and statements. Readers are cautioned that the foregoing list of important factors is not exhaustive. Furthermore, the Company will update its disclosure upon publication of each fiscal quarter's financial results and otherwise disclaims any obligations to update publicly or otherwise revise any such factors or any of the forward-looking information or statements contained herein to reflect subsequent information, events or developments, changes in risk factors or otherwise.
SOURCE Exco Technologies Limited
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