Canam Group posts net earnings of $20M, or $0.45 per share, in 2009
BOUCHERVILLE, QC, Feb. 24 /CNW Telbec/ - Construction products fabricator Canam Group Inc. (TSX: CAM) reported net earnings of $20.1 million, or $0.45 per share, for the 12-month period ended December 31, 2009, compared with $48.4 million, or $1 per share, in 2008. Consolidated sales were $625.8 million versus $796.1 million a year earlier.
Fourth-quarter net earnings were $5 million, or $0.11 per share, as compared to $13.7 million, or $0.29 per share, for the corresponding 2008 period. Consolidated sales for the quarter fell 35%, from $230.9 million in 2008 to $149.7 million in 2009.
Canam Group president and chief operating officer Marc Dutil attributes the decline in sales to the slowdown in non-residential construction in North America and to lower prices for raw materials. Despite fierce competition and the ensuing pressure on gross margins, Mr. Dutil explains that the company was able to remain profitable during this difficult economic period because of its excellent performance in executing infrastructure and complex large-scale structural steel projects.
Canam Group turned in a gross profit of $121.7 million, and its gross margin was 19.4% against 22.6% at the close of fiscal 2008. EBITDA went from $93.4 million at the end of 2008 to $51.8 million one year later. By the end of 2009, the company's net debt stood at $0.3 million versus $69.9 million at the close of 2008. Shareholders' equity was $400.6 million.
As at December 31, 2009, Canam Group's order backlog totaled $460 million, including $277 million worth of fabricated products, in contrast to $444 million, including $313 million worth of fabricated products, at the same time a year earlier.
In January 2010, Canam Group increased its 37.5% ownership in structural nut and bolt distributor Amcan-Jumax to 50% and acquired the assets of Hong Kong-based InteliBuild Limited, a leading consulting services provider on construction projects that use BIM and 3D digital models.
In a press release issued yesterday, Canam Group announced that it has signed an agreement to purchase an additional 65% membership interest in structural steel fabricator FabSouth for $65 million. Once the transaction is finalized, Canam Group will own 80% of FabSouth, which operates six plants with a total capacity of 122,000 tons in the southeastern United States.
The board of directors approved the payment of a quarterly dividend of $0.04 per common share on March 31, 2010 to shareholders of record on March 17, 2010.
Canam Group is an industrial company operating 18 plants specialized in the design and fabrication of construction products and solutions. The company employs close to 3,000 people in Canada, the United States, Romania and India, and has partnerships with companies in Saudi Arabia, the United Arab Emirates and China.
Conference call
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Canam Group will hold a conference call with financial analysts and media representatives at 9 a.m. on Wednesday, February 24, 2010. A podcast will be available at www.canamgroup.ws and www.cnw.ca. A replay of the conference call will be available until March 12, 2010, by dialing 1-800-408-3053 and entering access code 2184748, followed by the pound key #.
Consolidated Statements of Earnings
Periods ended December 31
(in thousands of dollars,
except per share amounts) 3 months 12 months
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2009 2008 2009 2008
(restated) (restated)
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Sales $ 149,678 $ 230,898 $ 625,843 $ 796,080
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Cost of sales 121,204 173,573 504,121 615,780
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Gross profit 28,474 57,325 121,722 180,300
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Selling and administrative
expenses 19,464 22,137 71,541 79,193
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Profit sharing programs 1,111 3,837 2,929 9,029
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Exchange loss (gain) (1,186) 1,694 (2,493) 133
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Interest income and other
investment income (784) (284) (2,392) (662)
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Increase in the redemption
value of an investment
in a related company - (437) - (1,811)
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Gain on disposal of
investments (110) - (319) -
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Loss on disposal of
property, plant and
equipment, and on
property, plant and
equipment held for sale 481 567 497 712
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Impairment of property,
plant and equipment held
for sale 132 154 132 331
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9,366 29,657 51,827 93,375
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Depreciation of property,
plant and equipment 4,468 4,562 16,665 15,914
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Amortization of intangible
assets 256 407 1,294 1,760
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Financial expenses 1,158 1,282 4,512 5,677
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Earnings before income tax
expense and undermentioned
items 3,484 23,406 29,356 70,024
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Income tax expense
Current (4,392) 4,990 4,026 18,979
Future 3,019 2,907 3,114 2,934
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(1,373) 7,897 7,140 21,913
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Earnings before
undermentioned items 4,857 15,509 22,216 48,111
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Share in earnings (loss)
of companies subject to
significant influence 149 (1,096) (701) (93)
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Net earnings from
continuing operations 5,006 14,413 21,515 48,018
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Net earnings (net loss)
from discontinued
operations 17 (696) (1,465) 413
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Net earnings $ 5,023 $ 13,717 $ 20,050 $ 48,431
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Net earnings (net loss)
per share
Basic:
From continuing
operations $ 0.11 $ 0.31 $ 0.48 $ 0.99
From discontinued
operations - (0.02) (0.03) 0.01
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Total $ 0.11 $ 0.29 $ 0.45 $ 1.00
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Diluted:
From continuing
operations $ 0.11 $ 0.31 $ 0.47 $ 0.98
From discontinued
operations - (0.02) (0.03) 0.01
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Total $ 0.11 $ 0.29 $ 0.44 $ 0.99
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Weighted average number
of common shares
(in thousands of shares)
Basic 45,047 46,537 45,057 48,486
Diluted 45,385 46,722 45,385 48,787
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Number of common shares
outstanding 45,368 45,647
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Consolidated Statements of Comprehensive Income
Periods ended December 31
(in thousands of dollars) 3 months 12 months
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2009 2008 2009 2008
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Net earnings $ 5,023 $ 13,717 $ 20,050 $ 48,431
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Other comprehensive
income (loss):
Change in unrealized
gains and losses on
translating financial
statements of self-
sustaining foreign
operations $ (5,927) $ 25,603 $ (23,958) $ 32,103
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Unrealized gains (losses)
on available-for-sale
financial assets
arising during the
period $ (157) $ (269) $ 398 $ (208)
Income tax expense 24 26 (80) (10)
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Change in unrealized
gains and losses on
available-for-sale
financial assets $ (133) $ (243) $ 318 $ (218)
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Reclassification in
earnings of gains on
derivatives designated
as cash flow hedges on
sales $ - $ (558) $ - $ (2,343)
Income tax expense - 181 - 762
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Change in gains on
derivatives designated
as cash flow hedges $ - $ (377) $ - $ (1,581)
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Other comprehensive
income (loss) $ (6,060) $ 24,983 $ (23,640) $ 30,304
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Comprehensive income
(loss) $ (1,037) $ 38,700 $ (3,590) $ 78,735
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Consolidated Statements of Retained Earnings
Periods ended December 31
(in thousands of dollars) 3 months 12 months
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2009 2008 2009 2008
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Opening balance $ 240,820 $ 227,048 $ 232,208 $ 200,421
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Net earnings 5,023 13,717 20,050 48,431
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Dividends (1,814) (1,833) (7,261) (7,748)
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Excess of acquisition cost
over carrying value of
acquired common shares - (6,724) (968) (8,896)
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Closing balance $ 244,029 $ 232,208 $ 244,029 $ 232,208
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Consolidated Balance Sheets
As at December 31
(in thousands of dollars) 2009 2008
(restated)
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Assets
-------------------------------------------------------------------------
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Current assets
Cash and cash equivalents $ 67,393 $ 15,619
Accounts receivable 99,444 154,468
Inventories 104,540 176,871
Income taxes recoverable 6,701 5,281
Future income tax assets 1,008 2,062
Prepaid expenses and other assets 3,484 6,546
Current assets of discontinued operations 1,380 14,307
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----------------------
Total current assets 283,950 375,154
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Investments 63,503 48,400
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Property, plant and equipment 184,359 185,945
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Property, plant and equipment held for sale 1,549 1,958
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Intangible assets 1,127 2,096
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Goodwill 150 150
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Future income tax assets 363 340
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Long-term receivables and other assets 21,612 30,164
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Long-term assets of discontinued operations 9,440 14,082
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$ 566,053 $ 658,289
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Liabilities
-------------------------------------------------------------------------
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-------------------------------------------------------------------------
Current liabilities
Bank loans $ - $ 10,353
Accounts payable and accrued liabilities 77,112 126,177
Unrealized liability on foreign currency forward
contracts - 743
Income taxes payable 635 284
Future income tax liabilities 876 647
Current portion of long-term debt 5,477 5,475
Current liabilities of discontinued operations 1,495 13,903
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----------------------
Total current liabilities 85,595 157,582
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Long-term debt 62,212 69,672
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Deferred credits 4,749 4,394
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Future income tax liabilities 11,296 10,368
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Long-term liabilities of discontinued operations 1,604 2,659
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165,456 244,675
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Shareholders' Equity
-------------------------------------------------------------------------
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Share capital 178,024 179,681
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Retained earnings 244,029 232,208
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Contributed surplus 4,862 4,403
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Accumulated other comprehensive income (26,318) (2,678)
----------------------
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400,597 413,614
----------------------
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$ 566,053 $ 658,289
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Consolidated Statements of Cash Flows
Periods ended December 31
(in thousands of dollars) 3 months 12 months
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2009 2008 2009 2008
(restated) (restated)
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Cash flows from the
following activities:
Operating activities
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Net earnings from
continuing operations $ 5,006 $ 14,413 $ 21,515 $ 48,018
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Items not affecting cash
and cash equivalents
Compensation cost
related to stock
options - 3 - 14
Amortization of
compensation costs
related to the profit
sharing program - stock
ownership component 431 390 1,780 1,559
Unrealized gain on
foreign currency
forward contracts 579 366 (743) (646)
Increase in the
redemption value of an
investment in a related
company - (437) - (1,811)
Gain on disposal of
investments (110) - (319) -
Impairment of property,
plant and equipment
held for sale 132 154 132 331
Loss on disposal of
property, plant and
equipment and on
property, plant and
equipment held for
sale 481 567 497 712
Depreciation of
property, plant and
equipment 4,468 4,562 16,665 15,914
Amortization of
intangible assets 256 407 1,294 1,760
Amortization of
deferred financing
expenses 54 54 214 235
Pension expense (298) 111 (322) (618)
Future income tax
expense 3,019 2,907 3,114 2,934
Share in loss (earnings)
of companies subject
to significant
influence (149) 1,096 701 93
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13,869 24,593 44,528 68,495
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Net change in non-cash
operating working capital
items
Decrease in accounts
receivable 20,229 13,493 46,590 15,359
Decrease (increase)
in inventories 15,362 13,756 62,179 (51,153)
Increase in income
taxes recoverable (3,180) (551) (1,614) (4,058)
Decrease (increase)
in prepaid expenses
and other assets (718) (3,486) 2,689 (1,901)
Increase (decrease)
in accounts payable
and accrued liabilities (15,686) (19,722) (40,928) 16,726
Decrease in interest
payable (211) (273) (26) (8)
Increase (decrease)
in income taxes payable (1,920) (225) 418 (7,616)
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13,876 2,992 69,308 (32,651)
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Cash flows from continuing
operating activities 27,745 27,585 113,836 35,844
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Financing activities
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Shares purchased by a
trust in employees' name
on the secondary market - - (1,871) (1,970)
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Repurchase of shares - (20,015) (2,122) (24,231)
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Proceeds from issuance
of shares - - 47 365
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Dividends (3,630) (1,833) (7,261) (7,748)
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Increase in long-term
debt and bank loans - 10,450 11,977 42,770
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Repayment of long-term
debt and bank loans (6,679) (15,799) (26,403) (28,814)
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Issue expenses related
to long-term debt - (78) - (216)
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Deferred credits (2) (40) (237) 134
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Cash flows from
continuing financing
activities (10,311) (27,315) (25,870) (19,710)
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Investing activities
-------------------------------------------------------------------------
Proceeds from sale of
property, plant and
equipment 531 16 923 1,594
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Proceeds from sale of
property, plant and
equipment held for sale - - - 3,797
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Additions to property,
plant and equipment (10,729) (8,319) (27,791) (27,075)
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Additions to intangible
assets (51) (301) (467) (957)
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Acquisition of
investments (16,111) - (20,704) (1,770)
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Proceeds from disposal
of investments 2,428 - 3,572 -
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Distribution from a
company subject to
significant influence 167 109 467 109
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Decrease in long-term
receivables 6,307 6,913 8,807 7,504
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Increase in long-term
receivables (93) (392) (4,383) (661)
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Cash flows from
continuing investing
activities (17,551) (1,974) (39,576) (17,459)
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Effect of changes in
foreign exchange rate on
cash and cash equivalents 294 3,336 (143) 3,598
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Net change in cash and
cash equivalents from
continuing operations 177 1,632 48,247 2,273
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Cash flows from
discontinued operations
Operating activities 667 1,035 3,132 1,525
Investing activities 17 150 395 1,273
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684 1,185 3,527 2,798
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Cash, beginning of period 66,532 12,802 15,619 10,548
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Cash and cash equivalents,
end of period $ 67,393 $ 15,619 $ 67,393 $ 15,619
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Supplementary information
Interest paid $ 1,177 $ 1,229 $ 3,894 $ 4,912
Income taxes paid
(recovered), net $ (428) $ 4,484 $ 3,271 $ 28,654
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For further information: Jasmin Gosselin, Vice President, Communications, (450) 641-4000, [email protected]; www.canamgroup.ws
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