Xebec Announces Net Income of $1.4 Million for Q4-2013 and $0.4 Million for Fiscal 2013

Xebec Fiscal 2013 Fourth Quarter and Year-end Financial Results

MONTREAL, April 25, 2014 /CNW Telbec/ - Xebec Adsorption Inc. (TSXV: XBC-V) ("Xebec"), a provider of biogas upgrading, natural gas, field gas and hydrogen purification and filtration solutions for the clean energy and crude-derived fuels displacement markets, announced today its 2013 fourth quarter operating results.

  • Revenues of $2.8 million in the fourth quarter 2013 compared to $5.8 million for the same period in 2012, a 51.1% decrease in the period.
  • Positive EBITDA of $1.4 million in the fourth quarter compared to $0.2 million for the same period in 2012.
  • Revenues of $11.3 million in fiscal 2013 compared to $15.2 million for the same period in 2012, a 25.5% decrease in the year.
  • Net income of $0.4 million or $0.01/share in fiscal 2013 compared to $1.9 million or $0.04/share for the same period in 2012.
  • Backlog of $9.4 million

Financial Highlights:

 
  Three months ended
December 31,
% of
Change
Twelve months ended
December 31,
% of
Change
  2013 2012   2013 2012  
(In dollars) (unaudited) (unaudited)   (audited) (audited)  
Revenues 2,812,406 5,753,220 -51.1% 11,311,443 15,179,121 -25.5%
Gross margin 287,855 1,178,498 -75.6% 1,625,107 3,146,347 -48.3%
Gross margin as a percentage of revenues 10.2% 20.5%   14.4% 20.7%  
EBITDA* 1,436,832 182,784   793,890 3,368,866  
Net income (loss) 1,376,669 (92,199)   405,019 1,938,853  
Net income (loss) per share - basic  ($/share) 0.04 (0.00)   0.01 0.04  
Net income (loss) per share - diluted ($/share) 0.04 (0.00)   0.01 0.04  
Weighted average number of shares 39,363,867 39,363,867   39,363,867 39,363,867  
As at:       December 31,
2013
December 31,
2012
 
Total assets       9,749,397 9,734,306  
Total Long term Liabilities       1,026,078 1,213,873  
Equity       1,958,988 1,737,339  
As at:       April 25,
2014
April 1,
2013
 
Back log       9,416,428 8,487,778  
* EBITDA is a non-IFRS financial measure and the Company defines it as earnings from operations excluding financial charges, taxes, foreign exchange loss (gain) and amortization.

Financial Results

Revenues

Xebec posted revenues of $2.8 million for the fourth quarter of 2013, a 51.1% decrease compared to $5.8 million in the fourth quarter of 2012. The decrease is mainly explained by the decline in the gas purification and the natural gas dryer segments, respectively by $2.8 million and $0.8 million, and partly offset by an increase of $0.7 million in the compressed gas filtration product line. Revenues were $11.3 million for the twelve-month period ended December 31, 2013, compared to $15.2 million for the corresponding period in 2012. This decrease of $3.9 million is due mainly to the $5.5 million decline in sales in the gas purification segment, which was partly offset by increased sales in natural gas dryers and in compressed gas filtration respectively of $0.2 million and $1.8 million. The compressed gas filtration product line showed a significant increase in revenues this year compared to the last fiscal year as a result of a strengthened sales team in this segment.

Order Backlog

As of April 25, 2014, total order backlog stood at $9.4 million, compared to $8.5 million as at April 1, 2013. Part of the increase in the backlog is explained by higher orders in the compressed gas filtration segment.

Gross Margin

Xebec's gross margin for the fourth quarter of 2013 amounted to $0.3 million compared to $1.2 million for the same period in 2012. The decline versus the same period last year is mostly explained by the poor operating performance of our Chinese subsidiary, an inventory write-down of $475,000 and an additional provision for loss on an Asian biogas project. For the twelve-month period ended December 31, 2013, the total gross margin amounted to $1.6 million, compared to $3.2 million for the same period in 2012. Margins were negatively affected by a $300,000 provision for an ongoing biogas project in Asia, the completion of a biogas project with a negative margin during the year and the inventory write-down of $475,000 at our Chinese subsidiary. The sales increase in the gas compression and natural gas dryer product lines mitigated the margin decrease caused by the compressed gas purification product line.

EBITDA and Net Income

The EBITDA for the fourth quarter of 2013 amounted to $1.5 million compared to $0.1 million in the fourth quarter of 2012. The improvement is mainly explained by the additional $1.7 million net proceeds received for the accomplishment of all the remaining milestones targeted in the sale agreement of the IP portfolio to Air Products. This variation of the EBITDA for the fourth quarter of 2013 is also attributable to the decrease of $1.0 million in gross margin and the reduction of $0.3 million in selling and administrative expenses.

For the twelve-month period ended December 31, 2013, the EBITDA amounted to $0.8 million compared to $3.3 million for the same period in 2012. The decline of $2.5 million in EBITDA, compared to the same period last year, reflects primarily the $6.4 million non-recurring gain on the sales of our IP portfolio to Air Products in 2012, compared to additional non-recurring proceeds of $4.5 million in 2013 related to this transaction.

The net income for the fourth quarter of 2013 totaled $1.4 million, or $0.04 per share, compared to a net loss of $0.1 million, or nil per share for the same period in 2012. This increase of $1.5 million in net income is explained by a gain of $2.7 million in Q4-2013 on the final additional proceed pursuant to the agreement with Air Product, compared to a gain of $1.0 million in Q4-2012 on an additional proceed related to this agreement, combined with decreases of $0.3 million in selling and administrative expenses and of $0.3 million in research and development expenses and net financial expenses, partly offset by a decrease in gross margin by $1.0 million.

For the twelve-month period ended December 31, 2013, net income was $0.4 million, or $0.01 per share, compared to a net income of $1.9 million, or $0.04 per share, for the same period in 2012, reflecting the additional nonrecurring gains on the disposition of the IP portfolio to Air Products of $4.5 million in 2013, compared to the non recurring proceeds of $6.4 million in 2012, and resulting from a decrease of gross margin by $1,5 million, partly offset by a decrease of $0.6 million in selling and administrative expenses, a decrease of $0.9 million in net financial expenses and an increase of $0.3 million in foreign exchange gain, compared to same period last year.

Selling and administrative expenses were $1.8 million in the fourth quarter of 2013, compared to $2.1 million for the same period last year. The decreased is mainly attributable to the reduction of expenses in salaries, commissions, professional fees and an increase of the bad debts expense.

For the twelve-month period ended December 31, 2013, the selling and administrative expenses were $5.9 million, compared to $6.5 million for the same period last year. The decrease is mainly explained by the reduction of expenses in salaries, commissions, professional fees, amortization, rent and travelling expenses and by an increase of the bad debts expense.

As of December 31, 2013, the Company had $2.8 million of cash on hand, $0.4 million of bank loan and $1.0 million of long-term debt outstanding, of which $0.3 million is due within one year.

Xebec 2013 year-end Financial Statements and Management's Discussion and Analysis include further information on the Company.

2013 Fourth Quarter Financial Statements and Management's Discussion and Analysis

The complete audited financial statements, notes to financial statements and the Management's Discussion and Analysis for the fiscal year ended December 31, 2013, are available on the Company's Website at www.xebecinc.com or on the SEDAR Website at www.sedar.com.

About Xebec Adsorption Inc.
Xebec Adsorption Inc. is a global provider of clean energy solutions to corporations and governments looking to reduce their carbon footprints. With more than 1,300 customers worldwide, Xebec designs, engineers and manufactures innovative products that transform raw gases into marketable sources of clean energy mainly used as transportation fuel. Xebec's strategy is focused on establishing leadership positions in markets where demand for biogas upgrading, natural gas dehydration, liquefaction and hydrogen purification is growing. Headquartered in Montreal (QC), Xebec is a global company with two manufacturing facilities in Montreal and Shanghai, as well as a sales and distribution network in North America and Asia. Xebec trades on the TSXV under the symbol XBC-V. Since February 25th 2014, Xebec has opened a sales office in Houston, Texas (USA), in order to cover sales opportunities in the United States. For additional information on the company and its products and services, please visit the Xebec web site at www.xebecinc.com.

Caution Concerning Forward-Looking Statements
Certain statements in this press release may constitute "forward-looking" statements within the meaning of applicable securities laws. This forward looking information includes, but is not limited to, the expectations and/or claims of management of Xebec with respect to information regarding the business, operations and financial condition of Xebec. Forward-looking information contained in this press release involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Xebec or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. This list is not exhaustive of the factors that may affect forward-looking information contained in this press release. When used in this press release, such statements use such words as "anticipate", "believe", "plan", "estimate", "expect", "intend", "may", "will" and other similar terminology. These statements reflect current expectations regarding future events and operating performance and speak only as of the date of this presentation. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements. 

 

SOURCE Xebec Adsorption Inc.

For further information:

Kurt Sorschak
President and CEO
450-979-8701
ksorschak@xebecinc.com

Eric Favreau
Chief  Financial Officer
450-979-8706
efavreau@xebecinc.com