OAKVILLE, ON, Nov. 7, 2012 /CNW/ - Vicwest Inc. (the "Company") (TSX:
VIC, VIC.DB) today reported its financial results for the three months
ended September 30, 2012, a period punctuated by its best EBITDA1 performance in 12 quarters, significant debt reduction and the
successful advancement of two strategic capital projects.
Third Quarter Consolidated Summary
Revenue was $113.4 million compared to $117.9 million a year ago.
Gross profit increased 21.4% to $21.4 million (18.9% margin) from $17.7
million (15.0% margin) in 2011.
EBITDA1 increased 56.0% to $11.0 million from $7.1 million in the same period
Net income was $4.1 million ($0.20 per share basic) compared to net
income of $4.5 million ($0.24 per share basic) a year ago.
Net income excluding change in fair value of embedded derivative2 increased 114.3% to $4.9 million ($0.24 per share basic) from $2.3
million in the corresponding period of 2011 ($0.11 per share basic).
"We achieved the highest EBITDA as a percentage of revenue this quarter
than at any time since the end of the recession and did it in a period
of mixed global economic performance," said Colin Osborne, President
and CEO. "While we did benefit from reduced input costs, we also
realized efficiency gains, and benefitted from the growth trajectory
we've created in the U.S. insulated metal panel market, Western
Canadian construction sectors, and agriculture and liquid storage
markets including water containment. Our leadership position in key
markets and our increasingly efficient operations give us confidence in
our continued positive earnings momentum."
"Strong cash generation and effective working capital management enabled
us to reduce net debt 18.3% or $16.5 million since June 30th," said
Kent Harris, Chief Financial Officer. "At the same time, we continued
to invest in new productive capacity and efficiency enhancements. From
a balance sheet and operations perspective, we continue to build
flexibility and position the business for further growth."
On November 6, 2012 the Board declared a fourth quarter dividend of
$0.15 per share, payable on January 15, 2013 for shareholders of record
on December 31, 2012. This is consistent with the quarterly dividends
declared and paid in respect of the first, second and third quarters of
1EBITDA is calculated as earnings before finance expense, income taxes,
depreciation and amortization and change in fair value of embedded
derivative. EBITDA and EBITDA margin are non-IFRS measures.
2 Net income excluding change in fair value of the embedded derivative is
a non-IFRS measure.
Third Quarter Divisional Results
Vicwest Building Product's net income increased 84.2% to $7.3 million on
improved pricing and All Weather's contribution. Revenue was $80.7
million, off 5.2% or $4.4 million year over year on reduced volumes in
Eastern and Central Canada regions.
Westeel's net income increased year-over-year by 15.7% to $1.3 million
on higher liquid storage product sales and lower material costs.
Westeel's revenue of $32.7 million was flat to last year as strong
domestic sales were offset by softness in U.S. and export markets.
Nine Month Consolidated Summary
Revenue was $308.6 million compared to $308.5 million a year ago.
Gross profit increased 12.6% to $57.1 million (18.5% margin) from $50.7
million (16.4% margin) in 2011.
Net income was $8.8 million ($0.46 per share basic) compared to net
income of $10.7 million ($0.58 per share basic) a year ago.
Net income excluding change in fair value of embedded derivative2 improved 36.8% to $9.4 million ($0.49 per share basic) from $6.9
million ($0.36 per share basic) in the corresponding period of 2011.
At September 30, 2012, net senior debt to EBITDA1 improved to 0.7 to 1 compared to 1.4 to 1 at June 30, 2012. At period
end, the Company had net debt of $73.6 million, down from $90.1 million
at June 30, 2012 on improved working capital management and increasing
earnings. At period end, the Company had $69.2 million in unused
availability under its $100 million senior revolving credit facility
secured February 27, 2012.
The Company expects to end 2012 with ongoing improvements in financial
performance compared to a year ago. This positive outlook reflects a
combination of factors including current crop harvest and pricing
forecasts, internal efficiency and expansion activities, the steel
price environment and the varying impacts of fourth quarter seasonality
on its business units.
"Isolating our outlook by business line, we expect Westeel to generate
record revenues this year on both strong Canadian agriculture
fundamentals that should drive fourth quarter customer booking programs
and on growth in our liquid storage tank markets, including sales of
our new water containment systems for frac ponds," said Mr. Osborne.
"Building Products should also sustain its momentum in insulated metal
panel markets with the opening of our new Little Rock, Arkansas plant
this quarter, solidifying Vicwest and All Weather as one of the leaders
in this segment."
The Company continues to expect headwinds in international territories
due to economic and political issues, and anticipates both a normal
tailing off of activity in construction markets in the fourth quarter
and continued softness in construction programs in Eastern and Central
"Current marketplace realities make us more determined than ever to
sharpen our focus on key growth areas and maximize profitability, and
we are executing on both," said Mr. Osborne. "In addition to opening
our new IMP plant, we recently completed a significant Westeel plant
automation project that will shorten lead times and lower costs going
into 2013. And we are getting an early return on our investment in
enterprise resource planning systems, with more to follow as we
activate ERP across Westeel early next year. Together, these
investments make us a stronger, more capable business."
Third Quarter Conference Call and Webcast
Vicwest Inc. will host its third quarter 2012 conference call and
webcast on webcast on Thursday, November 8, 2012 at 11:00 a.m. (ET). To
participate in the teleconference, the numbers are 416-644-3414 or 1-800-814-4859. Callers are advised to call in at least 10 minutes in advance. To
participate in the webcast, please visit www.vicwestinc.com.
ABOUT VICWEST INC.
Vicwest Inc. is a leading North American manufacturer and distributor of
engineered storage and handling systems for grain, fertilizer and
liquid storage as well as building construction products for
agricultural, institutional, commercial, industrial and residential
markets. We operate through two strategically aligned divisions:
Vicwest Building Products and Westeel. With approximately 7,000
customers, 1,200 dedicated employees and 34 business partners, we are
positioned for growth in domestic and international markets. Vicwest
Inc. is a member of the S&P/TSX SmallCap Index. For more information,
Certain statements in this news release constitute forward-looking
statements within the meaning of applicable securities laws.
Forward-looking statements include, but are not limited to,
management's beliefs, plans, estimates, and intentions, and similar
statements concerning anticipated future events, results,
circumstances, performance or expectations that are not historical
facts. Forward-looking statements generally can be identified by the
use of forward-looking terminology such as "outlook", "objective",
"may", "will", "expect", "intend", "estimate", "anticipate", "believe",
"should", "plans" or "continue", or similar expressions suggesting
future outcomes or events. Such forward-looking statements reflect
management's current beliefs and are based on information currently
available to management. Forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from
those contemplated by such statements. Readers are encouraged to
review the most recently filed Management's Discussion and Analysis and
other disclosure documents filed by the Company with Canadian
securities regulatory agencies and commissions. Readers are cautioned
not to place undue reliance on the Company's forward-looking
statements. The forward-looking statements contained herein are made
as of the date of this press release and except as required by
applicable law, the Company undertakes no obligation to publicly update
or revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
SOURCE: Vicwest Inc.
For further information:
President & Chief Executive Officer
Tel: (905) 469-5700
Chief Financial Officer
Tel: (905) 469-5706