The Westaim Corporation Reports 2012 Fourth Quarter Results

TORONTO, Feb. 28, 2013 /CNW/ - The Westaim Corporation ("Westaim") today announced it has recorded a net loss of $1.0 million or $0.00 per share for the quarter ended December 31, 2012, compared to a net income of $11.6 million or $0.02 per share for the quarter ended December 31, 2011.  For the year ended December 31, 2012, Westaim recorded net income of $103.0 million or $0.15 per share compared to net income of $39.8 million or $0.06 per share for the year ended December 31, 2011.  On September 28, 2012, Westaim paid $521.4 million or $0.75 per share to Westaim's common shareholders as a return of capital.  At December 31, 2012, Westaim's consolidated shareholders' equity was $34.6 million or $0.05 per share compared to $417.3 million or $0.65 per share at December 31, 2011.

On May 2, 2012 Westaim announced that it had entered into an agreement to sell all the issued and outstanding shares in the capital of Jevco for $530.0 million in cash. Shareholder approval of the sale and related matters was received at a special meeting held on June 28, 2012.  All regulatory approvals were received and other conditions for the sale were met during the third quarter and the sale of Jevco closed on September 4, 2012.  The profit on the sale of Jevco is reflected in Westaim's statements of financial position, comprehensive income, equity and cash flow for the year ended December 31, 2012.  For the year ended December 31, 2012, a post-tax gain on sale of Jevco of $106.7 million was realized.

"Westaim's book value per share appreciated by 23% during the first nine months of 2012 from $0.65 at December 31, 2011 to $0.80 at September 28, 2012 prior to the payment of the $0.75 per share return of capital.  Subsequent to the return of capital on September 28, 2012 and as at December 31, 2012, Westaim's book value per share was $0.05.  Management is continuing to pursue Westaim's business strategy, by searching for and investigating potential investments to grow shareholder value over the long term." said Cameron MacDonald, President and Chief Executive Officer of Westaim.

Westaim is a publicly traded Canadian-based financial services company that invests directly and indirectly through acquisitions, joint ventures and other arrangements, with the objective of providing its shareholders with capital appreciation and real wealth preservation. Westaim's strategy is to pursue investment opportunities to grow shareholder value (as measured by book value per share) over the long term.  Westaim's common shares are listed on the TSX Venture Exchange under the trading symbol WED.

Certain portions of this press release as well as other public statements by Westaim contain forward-looking statements. Such forward-looking statements include but are not limited to statements concerning: strategies, alternatives and objectives to maximize value for shareholders; expectations and assumptions relating to Westaim's business plan; the effect of adverse changes in equity markets or Westaim's operations; expectations regarding Westaim's assets and liabilities; Westaim's ability to retain key employees, management's belief that its estimates for determining the valuation of Westaim's assets and liabilities are appropriate; Westaim's views regarding potential future remediation costs; the effect of changes to interpretations of tax legislation on income tax provisions in future periods; and Westaim's determination that the adoption of new accounting standards will not have a material impact on its consolidated financial statements. These statements are based on current expectations that are subject to risks, uncertainties and assumptions and Westaim can give no assurance that these expectations are correct. Westaim's actual results could differ materially from those anticipated by forward-looking statements for various reasons generally beyond Westaim's control, including but not limited to: (i) difficult economic conditions or a prolonged economic downturn may adversely affect Westaim's business; (ii) Westaim may not be able to realize its investment objectives or its liquid assets may prove to be insufficient to meet future obligations; (iii) Westaim may have undisclosed liabilities; (iv) Westaim may require significant additional funding;; and (v) other risk factors set forth in Westaim's Annual Report, Quarterly Reports or Annual Information Form. Westaim disclaims any intention or obligation to revise forward-looking statements whether as a result of new information, future developments or otherwise except as required by law. All forward-looking statements are expressly qualified in their entirety by this cautionary statement.

The Westaim Corporation
Financial Highlights
(thousands of Canadian dollars except share and per share data)
(unaudited)
           
      Three Months Ended December 31     Year Ended December 31
      2012   2011     2012   2011
                     
Loss from continuing operations                    
  Revenue of continuing operations   $ 114 $ 35   $ 305 $ 2,881
  Expenses of continuing operations     1,093   4,276     33,644   12,402
Loss from continuing operations     (979)   (4,241)     (33,339)   (9,521)
                     
Profit on sale of discontinued operations                    
  Proceeds on sale of subsidiary     -   -     530,000   -
  Carrying value of subisdiary     -   -     (414,289)   -
  Transaction costs     -   -     (7,498)   -
  Income tax expense     -   -     (1,530)   -
Post-tax gain on sale of discontinued operations     -   -     106,683   -
Post-tax profit of discontinued operations     -   15,796     29,667   49,337
Profit from discontinued operations     -   15,796     136,350   49,337
                     
Profit or loss and other comprehensive income   $ (979) $ 11,555   $ 103,011 $ 39,816
                     
                     
Earnings per share                    
  Loss from continuing operations - basic and diluted   $ (0.001) $ (0.006)   $ (0.050) $ (0.014)
  Profit or loss and other comprehensive income - basic and diluted   $ (0.001) $ 0.017   $ 0.154 $ 0.061
                     
                     
Weighted average number of common and                    
Series 1 Class A preferred shares outstanding (in thousands)                    
  Basic     658,016   650,412     660,500   646,774
  Diluted     679,664   661,679     670,374   656,893

             
      December 31     December 31
Financial position     2012     2011
             
Cash and cash equivalents   $ 39,164   $ 24,347
Other     202     1,271,786
Total assets   $ 39,366   $ 1,296,133
             
Total liabilities   $ 4,754   $ 878,870
Shareholders' equity     34,612     417,263
Total liabilities and shareholders' equity   $ 39,366   $ 1,296,133
             
             
             
      2012     2011
             
Book value per share at December 31   $ 0.050   $ 0.648
Return of capital per share to shareholders on September 28, 2012   $ 0.750      

 

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE: Westaim Corporation

For further information:

Jeff Sarfin, Chief Financial Officer
The Westaim Corporation
info@westaim.com
416-203-2253