TSX Trading Symbol: NAL
CALGARY, Jan. 19 /CNW/ - Newalta Inc. ("Newalta") (TSX:NAL) today
provided an update on its capital expenditures for 2008 and 2009.
Management remains very disciplined in committing to capital investments
in these times of market turmoil. A broad range of initiatives are underway to
maximize performance of the business as well as improve financial flexibility.
Management deferred orders on long-delivery equipment and as a result,
outstanding commitments are very modest. Total capital expenditures in 2008
are expected to be $125 million, comprised of growth capital expenditures of
approximately $105 million, and maintenance capital of approximately $20
million. Capital investments in the first half of 2009 will be tightly
controlled and are expected to total approximately $15 million, comprised of
growth capital expenditures of $10 million, and maintenance capital of $5
million. The capital program for the remainder of 2009 will be established in
the second quarter based on the performance of the business and the outlook
for the market.
Actions to control costs and reduce debt including the control of all
discretionary spending, travel and hiring restrictions, and the suspension of
salary increases are expected to have a positive impact in the first quarter.
As certain areas of Newalta's business are continuing to grow while others are
facing weakened demand, management will reallocate people to retain the talent
developed throughout the company, wherever possible.
Funded debt at the end of 2008 is expected to be substantially unchanged
from the third quarter of 2008 at approximately $315 million. Newalta's funded
debt consists of approximately $265 million of senior long term debt and $50
million of Letters of Credit which have been provided as security to certain
environmental regulatory authorities to satisfy asset retirement obligations.
Management is working with these authorities to provide alternative security
arrangements to eliminate the need for the majority of the Letters of Credit.
In addition, management is taking steps to improve working capital management,
sell redundant assets, and tightly control capital investments. These
initiatives are intended to reduce funded debt throughout 2009.
"Our priorities include driving performance from 2008 investments,
controlling variable costs, minimizing capital investments and reducing funded
debt," said Al Cadotte, President and CEO of Newalta. "We will remain
disciplined in assessing investment opportunities in the current uncertain
environment. Our focus is on strengthening our business as we deal with market
challenges in the short term and position Newalta for improved markets in the
Newalta Inc. is Canada's largest industrial waste management and
environmental services provider and focuses on maximizing the value inherent
in industrial waste through the recovery of saleable products and recycling.
It also provides environmentally sound disposal of solid, non-hazardous
industrial waste. With talented people and a national network of facilities,
Newalta serves customers in the automotive, forestry, lead, manufacturing,
mining, oil and gas, petrochemical, pulp and paper, refining, steel and
transportation service industries. Providing solid investor returns,
exceptional customer service, safe operations and environmental stewardship
has enabled Newalta to expand into new service sectors and geographic markets.
Newalta trades on the TSX as NAL. For more information, visit www.newalta.com.
This news release contains statements that may constitute
"forward-looking information" within the meaning of applicable Canadian
securities legislation. Forward-looking information includes, among others,
statements regarding business strategy, capital expenditures, funded debt
levels and other expectations, beliefs, goals, objectives, information and
statements about possible future events. Readers are cautioned not to place
undue reliance on such forward-looking information. Forward-looking
information is based on current expectations, estimates and assumptions that
involve a number of risks, which could cause actual results to vary and in
some instances to differ materially from those anticipated by Newalta and
described in the forward-looking information contained in this news release.
Among the various factors that could cause results to vary materially from
those indicated in the forward-looking information include, but are not
limited to, variations in operating results, successful implementation of
growth opportunities, the aggregate funded debt levels of Newalta including
the return of Letters of Credit and the timing thereof, industry conditions,
fluctuations in commodity prices, the availability of financing alternatives,
debt service and future capital needs. Readers should also be aware that the
forward-looking information is also affected by the risk factors described in
Newalta's Annual Information Form and those set forth from time to time in
Newalta's continuous disclosure filings with Canadian securities regulatory
authorities, which are available through Newalta's website at www.newalta.com
and on the SEDAR website at www.sedar.com. No assurance can be given that any
of the events anticipated by the forward-looking information will transpire or
occur or, if any of them do so, what benefits Newalta will derive therefrom.
For further information:
For further information: Anne M. MacMicken, Executive Director, Investor
Relations, Phone: (403) 806-7019