TORONTO, Jan. 27 /CNW/ - Exco Technologies Limited (TSX-XTC) today announced results for its first quarter ended December 31, 2009.
3 Months ended
($000s, except per share amounts)
Sales $37,590 $44,444
Income (loss) before income taxes $3,046 ($1,543)
Net income (loss) for the period $1,900 ($2,425)
Basic and Diluted earnings (loss) per share $0.05 ($0.06)
Common shares outstanding 40,904,000 40,674,000
Consolidated sales for the first quarter ended December 31, 2009 were $37.6 million. This is a decrease of $6.9 million from the prior year first quarter but is consistent with the previous quarter ($37.7 million) and continues a trend of sales improvement from the recessionary low point experienced in the third quarter of fiscal 2009 ($28.3 million). While the Casting and Extrusion segment experienced slightly lower sales than the prior quarter this was offset by increased sales in the Automotive Solutions segment.
Consolidated net income for the first quarter was $1.9 million or $0.05 per share compared to a consolidated net loss of $2.4 million or $0.06 per share in the same quarter last year. This improvement was led by the Automotive Solutions segment which, despite the slower recovery of Polydesign reported segment income of $1.1 million in the first quarter compared to segment loss of $631 thousand in the prior quarter. The Casting and Extrusion segment also reported higher segment income in the first quarter of $2.4 million compared to segment income of $1.5 million in the previous quarter.
Gross margin in the first quarter increased to 24.7% - its highest level since the last quarter of fiscal 2007 (25.9%). Gross margin increased in both segments and was most pronounced among the business units with exposure to the North American automotive sector.
Operating cash flow in the first quarter was $7.8 million. This strong cash flow is primarily the result of improved earnings, lower working capital in the current quarter and reflects continuing controls on expenditures of all kind.
The Company's cash position on December 31, 2009 increased by 56% to $17.8 million compared to $11.4 million at the beginning of the quarter. This improvement stems in large part from the reduction of accounts receivable and inventory, the proceeds from the sale of certain surplus equipment and higher earnings in the current quarter. The Company continues to have no bank debt.
As 2010 unfolds our conviction that the business climate is improving remains unchanged. We have seen automotive production in North America finally improve after three consecutive quarters of decline. This improving North American production environment coupled with the successful emergence from bankruptcy of numerous OEMs and Tier one manufacturers is also resulting in much more activity in the large mould business and Castool. We are seeing strong quoting activity at these businesses and believe that our customers are finally ready, willing and, more importantly, financially able to proceed with the release of major powertrain product launches and capital projects. Improvement at Polydesign and the extrusion tooling businesses will be slower as their respective markets (European automotive production and North American construction) are taking longer to return to traditional levels.
Exco continues to benefit from its lower overall cost structure and a very strong balance sheet with no bank debt and in excess of $17.8 million cash on hand. We believe that our strong cash position and greater efficiency achieved over the last several years will greatly improve our competitive position and mitigate the impact of a strengthening Canadian dollar.
(for further information please refer to the Company's First Quarter Interim Financial Statements in the Investor Relations section posted at www.excocorp.com. Alternatively, please refer to www.sedar.com after January 27, 2010.)
Exco Technologies Limited is a global supplier of innovative technologies servicing the die-cast, extrusion and automotive industries. Through our 10 strategic locations, we employ 1,400 people and service a diverse and broad customer base.
The Annual Meeting of Shareholders of Exco Technologies Limited will be held at 4:30 pm (EST) on January 27, 2010 and will be simultaneously webcast. Management will discuss year-end and first quarter results. To access the live audio webcast, please log on to www.excocorp.com or www.q1234.com a few minutes before the event. Real Player is required for access. For those unable to participate on January 27, 2010, an archived version will be available on the Exco website.
Source: Exco Technologies Limited (TSX-XTC)
This news release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws. We use words such as "anticipate", "plan", "may", "will", "should", "expect", "believe", "estimate" and similar expressions to identify forward-looking information and statements. Such forward-looking information and statements are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe to be relevant and appropriate in the circumstances. Readers are cautioned not to place undue reliance on forward-looking information and statements, as there can be no assurance that the assumptions, plans, intentions or expectations upon which such statements are based will occur. Forward-looking information and statements are subject to known and unknown risks, uncertainties, assumptions and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed, implied or anticipated by such information and statements. These risks, uncertainties and assumptions are described in the Company's Management's Discussion and Analysis included in our 2009 Annual Report, in our 2009 Annual Information Form and, from time to time, in other reports and filings made by the Company with securities regulatory authorities.
While the Company believes that the expectations expressed by such forward-looking information and statements are reasonable, there can be no assurance that such expectations and assumptions will prove to be correct. In evaluating forward-looking information and statements, readers should carefully consider the various factors which could cause actual results or events to differ materially from those indicated in the forward-looking information and statements. Readers are cautioned that the foregoing list of important factors is not exhaustive. Furthermore, the Company disclaims any obligations to update publicly or otherwise revise any such factors or any of the forward-looking information or statements contained herein to reflect subsequent information, events or developments, changes in risk factors or otherwise.
SOURCE Exco Technologies Limited
For further information: For further information: Paul Riganelli, Vice-President, Finance and Chief Financial Officer, Telephone: (905) 477-3065 Ext. 7228, Website: http://www.excocorp.com