Canam Group Posts a Net Income of $17M in 2012

BOUCHERVILLE, QC, Feb. 20, 2013 /CNW Telbec/ - Canam Group Inc. (TSX: CAM), which specializes in the design and fabrication of construction products, closed its recent financial year ended December 31, 2012 with a net income of $17M, or $0.40 per share, compared with a net loss of $32.5M, or $0.72 per share, in 2011. Consolidated sales totaled $905.4M, up 2.8% from $881M in 2011. The 2011 financial results contained a $25M after-tax provision that was recognized in the first quarter for the BC Place project.

In the fourth quarter of 2012, net income totaled $7.4M, or $0.18 per share, compared with $3.3M, or $0.07 per share, for the corresponding period in 2011. Consolidated sales in the fourth quarter came to $238.5M.

As at December 31, 2012, Canam Group's backlog of orders stood at $493M compared with $462M at the end of 2011.

Canam Group President and Chief Executive Officer Marc Dutil explained that the increase in sales in 2012 is primarily attributable to joist and steel deck activities in Canada and the United States, and to FabSouth. Enhanced profit margins in joist, steel deck, structural steel and bridge activities largely account for the improved results in 2012.

Sale of ownership interests in joint ventures
At the very end of 2012, Canam Group sold its ownership interest held since 2007 in Chinese company United Steel Structures Limited (USSL) for a total consideration of US$13.5M. This transaction is in line with the Corporation's strategy to dispose of certain investments in order to focus on its core activities in North America. It follows the sale of its ownership interest in the Canadian joint venture, Amcan-Jumax, and the Canam Asia joint venture in 2012.

Repurchase of shares
In 2012, Canam Group took advantage of the share buyback program authorized by the Toronto Stock Exchange to acquire 1,346,588 common shares at an average price of $5.04 per share. A total of 3,258,488 common shares have been acquired and cancelled since the start of the program on November 1, 2011. As at December 31, 2012, the book value of the Corporation's 42,079,145 outstanding common shares was $8.61 per share.

About Canam Group Inc.
Canam Group is a manufacturing company that operates 20 plants across North America. Specialized in designing construction solutions and fabricating customized products since 1961. Canam Group takes part in close to 10,000 construction projects each year in three activity sectors: buildings, structural steel and bridges. The Corporation employs close to 3,500 people in Canada, the United States, Romania, India and Hong Kong. 

Conference call
Canam Group will hold a conference call with financial analysts and media representatives on Wednesday, February 20, 2013 at 4:30 p.m. A podcast will be available at www.canamgroup.ws and www.cnw.ca. A replay of the conference call will be available until March 7, 2013 by dialing 1-800-408-3053 and entering access code 3303467, followed by the pound key (#).

CONSOLIDATED STATEMENTS OF INCOME (LOSS)
Periods and Years ended December 31
  Three-month periods Years
(in thousands of Canadian dollars, except per share amounts)   2012   2011   2012   2011
Revenues $ 238,471 $ 286,319 $ 905,400 $ 881,028
Cost of sales, excluding depreciation and amortization (1)   194,395   248,211   767,917   821,835
Selling and administrative expenses   23,217   24,249   83,094   86,557
Profit sharing program   1,963   707   3,123   932
Depreciation of property, plant and equipment   5,262   5,205   20,952   20,322
Amortization of intangible assets   357   359   1,449   1,986
Other losses (gains) — net   (1,480)   449   (5,935)   (11,117)
    14,757   7,139   34,800   (39,487)
Finance costs   3,899   4,844   16,746   18,322
Finance revenue   (383)   (422)   (2,144)   (1,881)
Impairment of goodwill   - -   2,346   - -   11,326
Gain on revaluation of balances of purchase price of businesses   - -   (2,155)   - -   (11,282)
Share of loss (income) of joint ventures and associates   468   (1,007)   120   (1,464)
Income (loss) before income tax   10,773   3,533   20,078   (54,508)
Tax expense (income)                
  Current (recovered)   2,209   (827)   5,541   (15,120)
  Deferred   1,179   1,072   (2,497)   (6,880)
    3,388   245   3,044   (22,000)
Net income (loss) $ 7,385 $ 3,288 $ 17,034 $ (32,508)
                 
Net earnings (loss) per share                
  Basic $ 0.18 $ 0.07 $ 0.40 $ (0.72)
  Diluted $ 0.18 $ 0.07 $ 0.40 $ (0.72)
                 
Weighted average number of common shares (in thousands of shares)                
  Basic   42,012   44,710   42,562   45,097
  Diluted   42,085   44,825   42,633   45,218
Number of common shares outstanding (in thousands of shares)           42,079   43,440
(1) As at December 31, 2012 and 2011, the cost of sales, including depreciation and amortization, totaled $198,760
and $252,655, respectively, for the three-month periods, and $785,673 and $839,292, respectively, for the years.



CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Periods and years ended December 31
  Three-month periods Years
(in thousands of Canadian dollars)   2012   2011   2012   2011
Net income (loss) $ 7,385 $ 3,288 $ 17,034 $ (32,508)
Other comprehensive income (loss):                
  Change in unrealized gains (losses) on translating foreign operations   3,379   (3,245)   (5,533)   4,725
                 
  Defined benefit plans:                
    Actuarial losses of the defined benefit plan   (4,502)   (4,648)   (4,502)   (4,648)
    Tax income   1,183   1,217   1,183   1,217
    (3,319)   (3,431)   (3,319)   (3,431)
Available-for-sale assets:                
  Unrealized gains on available-for-sale assets arising during the periods and years   40   90   103   50
  Reclassified to statements of income (loss)   - -   - -   (274)   - -
  Tax income (expense)   (6)   (12)   22   (7)
    34   78   (149)   43
Other comprehensive income (loss)   94   (6,598)   (9,001)   1,337
Comprehensive income (loss) $ 7,479 $ (3,310) $ 8,033 $ (31,171)




CONSOLIDATED BALANCE SHEETS
(in thousands of Canadian dollars) As at
December 31,
2012
As at
December 31,
2011
Assets        
Current assets        
Cash and cash equivalents $ 6,787 $ 7,368
Accounts receivable   273,383   304,551
Inventories   113,217   111,955
Recoverable tax assets   122   16,588
Prepaid expenses and other assets   3,040   4,063
    396,549   444,525
Property, plant and equipment classified as held for sale   1,466   1,498
    398,015   446,023
Non-current assets        
Investments   6,036   4,959
Ownership interests in joint ventures and associates   44,316   61,954
Property, plant and equipment   282,556   279,554
Intangible assets   9,563   9,772
Goodwill   38,088   38,930
Deferred tax assets   7,897   4,472
Long-term receivables and other assets   17,656   21,820
Total assets $ 804,127 $ 867,484
Liabilities        
Current liabilities        
Bank loans $ - - $ 32,761
Accounts payable and accrued liabilities   148,202   169,110
Current tax liabilities   6,942   165
Current portion of long-term debt   10,382   37,038
Current portion of balances of purchase price of businesses   8,988   7,315
    174,514   246,389
Non-current liabilities        
Debt   175,605   163,782
Balances of purchase price of businesses   - -   8,768
Convertible debentures   63,446   61,816
Provisions   2,156   1,613
Deferred tax liabilities   8,629   8,107
Other liabilities   17,592   16,242
Total liabilities   441,942   506,717
Equity        
Share capital   168,529   172,869
Retained earnings   197,148   184,774
Other equity items   (3,492)   3,124
Total equity   362,185   360,767
Total equity and liabilities $ 804,127 $ 867,484




CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in thousands of Canadian dollars) Employee
benefits paid
in equity
instruments
Exchange
differences
resulting from
the translation
of foreign
operations
Available-for
-sale financial
assets
Debenture
conversion
options
Total other
equity items
Share capital Retained
earnings
Total
equity
Balance as at January 1, 2011 $ 4,036 $ (11,133) $ 797 $ 5,764 $ (536) $ 179,102 $ 222,877 $ 401,443
Net loss for the year   - -   - -   - -   - -   - -   - -   (32,508)   (32,508)
Comprehensive income   - -   4,725   43   - -   4,768   - -   (3,431)   1,337
Dividends   - -   - -   - -   - -   - -   - -   (3,592)   (3,592)
Issuance of shares pursuant to options   (13)   - -   - -   - -   (13)   57   - -   44
Shares purchased by a trust in employees' name on the secondary market   - -   - -   - -   - -   - -   (318)   - -   (318)
Shares acquired by employees   (1,841)   - -   - -   - -   (1,841)   1,841   - -   - -
Repurchase of shares   - -   - -   - -   - -   - -   (7,813)   - -   (7,813)
Excess of acquisition cost over carrying amount of acquired common shares   - -   - -   - -   - -   - -   - -   1,428   1,428
Amortization of compensation costs related to the profit sharing program - stock ownership component   746   - -   - -   - -   746   - -   - -   746
Balance as at December 31, 2011 $ 2,928 $ (6,408) $ 840 $ 5,764 $ 3,124 $ 172,869 $ 184,774 $ 360,767
Balance as at January 1, 2012 $ 2,928 $ (6,408) $ 840 $ 5,764 $ 3,124 $ 172,869 $ 184,774 $ 360,767
Net income for the year   - -   - -   - -   - -   - -   - -   17,034   17,034
Comprehensive loss   - -   (5,533)   (149)   - -   (5,682)   - -   (3,319)   (9,001)
Shares acquired by employees   (1,160)   - -   - -   - -   (1,160)   1,160   - -   - -
Repurchase of shares   - -   - -   - -   - -   - -   (5,500)   - -   (5,500)
Excess of acquisition cost over carrying amount of acquired common shares   - -   - -   - -   - -   - -   - -   (1,341)   (1,341)
Amortization of compensation costs related to the profit sharing program - stock ownership component   226   - -   - -   - -   226   - -   - -   226
Balance as at December 31, 2012 $ 1,994 $ (11,941) $ 691 $ 5,764 $ (3,492) $ 168,529 $ 197,148 $ 362,185




CONSOLIDATED STATEMENTS OF CASH FLOWS
Periods and years ended December 31
  Three-month periods   Years
(in thousands of Canadian dollars)   2012   2011   2012   2011
Cash flows from the following activities:                
Operating activities                
Net income (loss) $ 7,385 $ 3,288 $ 17,034 $ (32,508)
Adjustments:                
  Amortization of compensation costs related to the profit sharing program - stock ownership component   56   186   226   746
  Impairment of goodwill   - -   2,346   - -   11,326
  Gain on revaluation of balances of purchase price of businesses   - -   (2,155)   - -   (11,282)
  Loss (gain) on disposal of investments   102   - -   (2,259)   - -
  Loss (gain) on disposal of property, plant and equipment   41   16   17   (214)
  Depreciation of property, plant and equipment   5,262   5,205   20,952   20,322
  Amortization of intangible assets   357   359   1,449   1,986
  Amortization of deferred financing expenses   80   99   276   466
  Provisions   521   201   543   288
  Interest rate swaps   (15)   (69)   32   474
  Imputed interest   576   617   2,356   3,125
  Pension expense   (178)   (1,045)   (2,419)   (662)
  Deferred tax expense (income)   1,179   1,072   (2,497)   (6,880)
  Share of loss (income) of joint ventures and associates   468   (1,007)   120   (1,464)
    15,834   9,113   35,830   (14,277)
Net change in non-cash operating working capital items                
Decrease in the investment pledged as collateral   - -   2,449   - -   10,170
Decrease (increase) in accounts receivable   16,527   (49,004)   36,524   (78,087)
Decrease (increase) in inventories   (10,213)   22,085   (2,507)   (3,741)
Decrease (increase) in current tax assets   223   (1,668)   16,460   (12,390)
Decrease (increase) in prepaid expenses and other assets   658   (574)   976   (347)
Increase (decrease) in accounts payable and accrued liabilities   (11,978)   3,721   (18,497)   29,961
Decrease in provisions   - -   (2,740)   - -   (6,500)
Increase (decrease) in interest payable   151   (1,222)   (9)   (2)
Increase in current tax liabilities   5,858   62   6,782   154
    1,226   (26,891)   39,729   (60,782)
Cash flows from operating activities   17,060   (17,778)   75,559   (75,059)
Financing activities                
Shares purchased by a trust in employees' name on the secondary market   - -   (318)   - -   (318)
Repurchase of shares   - -   (6,229)   (6,841)   (6,385)
Proceeds from issuance of shares   - -   - -   - -   44
Dividends   - -   - -   - -   (3,592)
Increase in debt and bank loans   4,372   20,870   9,323   128,456
Repayment of debt and bank loans   (20,453)   (2,584)   (67,781)   (17,665)
Repayment of balances of purchase price of businesses   (284)   (1,689)   (7,213)   (8,866)
Issue expenses related to debt and debenture   (103)   (8)   (360)   (850)
Increase (decrease) in other liabilities   - -   (174)   63   (744)
Cash flows from financing activities   (16,468)   9,868   (72,809)   90,080
Investing activities                
Proceeds from sale of property, plant and equipment   44   12   278   92
Additions to property, plant and equipment   (3,463)   (3,144)   (8,706)   (17,954)
Additions to intangible assets   (444)   (61)   (1,343)   (406)
Acquisition of investments   (205)   (468)   (2,974)   (468)
Proceeds from disposal of investments   6,145   - -   11,317   - -
Distributions received   380   150   645   375
Decrease in receivables and other assets   2,798   1,130   5,092   1,882
Increase in receivables and other assets   - -   - -   - -   (52)
Business acquisitions, net of cash acquired   (6,936)   - -   (6,936)   - -
Cash flows from investing activities   (1,681)   (2,381)   (2,627)   (16,531)
Effects of changes in foreign exchange rate on cash and cash equivalents   389   159   (704)   348
Net change in cash   (700)   (10,132)   (581)   (1,162)
                 
Cash and cash equivalents - Beginning of periods and years   7,487   17,500   7,368   8,530
Cash and cash equivalents - End of periods and years $ 6,787 $ 7,368 $ 6,787 $ 7,368
Supplementary information                
  Interest paid $ 3,348 $ 6,327 $ 9,171 $ 12,345
  Income taxes paid (recovered), net $ (4,078) $ 70 $ (17,684) $ (2,867)

  

SOURCE: CANAM GROUP INC.

For further information:

François Bégin
Vice President, Communications
Canam Group Inc.
Telephone: 450-641-4000
Email:  francois.begin@canamgroup.ws

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CANAM GROUP INC.

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