Exco Technologies Limited - Results for Third Quarter Ended June 30, 2013
TORONTO, July 24, 2013 /PRNewswire/ - Exco Technologies Limited (TSX: XTC) today announced results for its third quarter ended June 30, 2013. In addition, the Company announced the quarterly dividend of $0.045 per common share which will be paid on September 27, 2013 to shareholders of record on September 13, 2013. The dividend is an "eligible dividend" in accordance with the Income Tax Act of Canada.
Three Months ended
Nine Months ended
|($000s, except per share amounts)|
Net income before withholding tax charge on
repatriation of surplus from subsidiary
|Basic earnings before withholding tax per share||$0.17||$0.14||$0.45||$0.42|
|Diluted earnings before withholding tax per share||$0.17||$0.14||$0.45||$0.42|
|Basic earnings per share||$0.14||$0.14||$0.42||$0.42|
|Diluted earnings per share||$0.14||$0.14||$0.41||$0.42|
|Common shares outstanding||40,697,195||40,663,811||40,697,195||40,663,811|
Consolidated sales for the third quarter ended June 30, 2013 were $62.4 million - an increase of $3.2 million or 5% compared to the same quarter last year and an increase of $2.8 million or 5% over the second quarter.
The Casting and Extrusion segment reported sales of $38.9 million for the third quarter - an increase of $2.9 million or 8% from the same quarter last year. Sales at the large mould group increased in the current quarter by just over 10%. This group experienced strong sales as its product mix between higher priced new dies and lower priced rebuilds/repairs was more favorable. Sales at Castool increased in the quarter by approximately 9%. Castool's products are experiencing strong market acceptance in both their traditional North and South American markets as well as in newer Asian markets. In the Extrusion Tooling group, sales were also up approximately 10% from last year as Extrusion Texas, which was acquired in January of this year, is contributing to sales and Extrusion Colombia, which started operating in January 2012, continued to grow its sales in the third quarter over the prior quarter and the same quarter last year. Sales in the Automotive Solutions segment in the third quarter were $23.5 million - an increase of $282 thousand or 1% from the same quarter last year. Sales at Polytech and Neocon continued at high levels - sustained by strong unit vehicle sales in North American market. Polydesign sales have held up well given the difficult market conditions in Europe and the delayed launch of several Ford Europe programs.
Consolidated net income for the third quarter was materially impacted by a withholding tax charge of $1.5 million or $0.04 per share occasioned by the repatriation of surplus from subsidiary. This tax charge has increased the consolidated income tax rate for this quarter to 42.9% compared to 30.1% last year. Before this withholding tax charge, consolidated net income for the quarter was $7.1 million or $0.17 per share compared to $5.5 million or $0.14 per share in the same quarter last year. Year-to-date consolidated net income before this withholding tax charge was $18.4 million or $0.45 per share compared to $17.3 million or $0.42 per share last year. After this withholding tax charge, consolidated net income for the third quarter was $5.6 million or $0.14 per share compared to consolidated net income of $5.5 million or $0.14 per share in the same quarter last year. Year-to-date consolidated net income was $16.9 million or $0.42 per share (diluted $0.41 per share) compared to $17.3 million or $0.42 per share (diluted $0.42 per share).
The Company continues to push ahead with its previously announced capital investment plans investing $6.7 million in the quarter and $17.5 million year-to-date compared to $3.0 million and $6.3 million last year. Included in the current year were $1.5 million for the acquisition of Extrusion Texas, $4.1 million on the Extrusion Brazil greenfield and $1.3 million on the Castool Thailand greenfield. Despite significant capital expenditures in the current quarter and year-to-date, the Company's cash position on June 30, 2013 was $25.1 million compared to $31.2 million at the beginning of the year.
Gross margin and EBITDA has achieved levels not seen since 2004 when the Canadian dollar was approximately 40% weaker than it is today. Gross margin in the third quarter was up at 30.5% and year-to-date at 29.6%. EBITDA for the quarter was 18.8% and year-to-date was 17.7%. Gross margin in the third quarter and year-to-date in both Automotive and Casting and Extrusion segments remained strong despite some operational disruptions and non-recurring costs.
The overall outlook for Exco over the next several quarters remains consistently strong. The two major trends of strong light vehicle production volumes in North America and steady introduction of new or refreshed vehicles and powertrain systems by virtually all OEMs remain intact. These trends continue to benefit our automotive solutions segment, Castool and our large mould businesses and the growth in the geographic footprint of the Extrusion group should continue to grow its sales as well. Design and technological innovations at Exco have been successful in materially advancing our prospects as evidenced by significant silifont die booked business and considerable increase in our cooperation with OEM's product development for interior trim components in premium vehicles. The emphasis in the Casting and Extrusion segment will be to manage several disruptive factors without eroding our margins and earnings. These factors include continuing our machinery and equipment upgrade and replacement program and efficiently rolling out our greenfield projects (Thailand and Brazil) while continuing to meet delivery dates in an environment of increasing and fluid backlog.
In Europe the market situation, although difficult, is not as problematic for Polydesign as thought to be at the start of the fiscal year. The recent and smooth launch of the new sun visor program for Range Rover is now at full volumes. Several delayed Ford programs are scheduled to launch over the next two quarters and other new programs scheduled to launch in 2014 should not only insulate Polydesign from the worst of European market conditions but also ensure that its sales and earnings continue to hold up and improve next year.
Management continues to also look for accretive 'tuck-under' acquisition opportunities - particularly in the automotive interior trim cut and sew space in Europe where the prospects for such opportunities are more abundant and promising.
(For further information and prior year comparison please refer to the Company's Third Quarter Interim Financial Statements in the Investor Relations section posted at www.excocorp.com. Alternatively, please refer to www.sedar.com)
Exco Technologies Limited is a global supplier of innovative technologies servicing the die-cast, extrusion and automotive industries. Through our 11 strategic locations, we employ 2,207 people and service a diverse and broad customer base.
To access the live audio webcast, please log on to www.excocorp.com or directly to the web cast at http://www.newswire.ca/en/webcast/detail/1185023/1298759 a few minutes before 10:00 AM on July 25, 2013. For those unable to listen on July 25, 2013, 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 businesses (particularly our start-up business units in Brazil, Thailand, Texas and Colombia) and Polydesign, managing our order backlog in the Castool and large mould businesses, impact of our machinery and equipment investments, input costs and our operating efficiencies. 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, among other things, the number of automobile vehicles produced in North America and Europe, the rate of economic growth in North America and Europe and BRIC countries, investment by OEMs in drivetrain architecture and structural parts and currency fluctuations (particularly with respect to the US dollar, Euro and Mexican Peso). 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 2012 Annual Report, in our 2012 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