-Company Generates $6.6 Million in EBITDA for Second Quarter 2014 -
- PCC Achieves 92% Utilization in July -
WINNIPEG, Aug. 7, 2014 /CNW/ - Legumex Walker Inc. (TSX: LWP) (the "Company") today reported its financial results for the three months ended June 30, 2014. All figures are in Canadian dollars unless otherwise stated.
Highlights for the Three Months Ended June 30, 2014 (all comparative metrics are relative to the second quarter of 2013, unless otherwise stated):
Special Crops Segment
- Revenue increased 9% to $99.5 million (119,200 tonnes shipped) compared with $91.2 million (104,400 tonnes sold);
- Adjusted Gross Profit1 increased 77% to $9.4 million from $5.3 million;
- EBITDA1 increased 162% to $6.6 million compared with $2.5 million, on comparable selling and administrative expenses;
- Cash Flow Provided by Operations1 increased 64% to $3.9 million compared with $2.4 million; and
- Days in receivable improved to 45 days from 51 days and days in inventory improved to 56 days from 63 days.
Oilseed Processing Segment (Pacific Coast Canola (PCC))
- Revenue increased 63% to $34.2 million on 50,600 tonnes sold compared with $20.9 million on 30,000 tonnes sold;
- Adjusted Gross Profit1 was $2.9 million compared with an Adjusted Gross Loss1 of $3.2 million;
- EBITDA1 was $1.9 million compared with a loss before interest, taxes, depreciation and amortization1 of $3.9 million;
- Cash Flow used in Operations1 of $3.6 improved $785,000 compared with $4.4 million; and
- PCC entered into an agreement with Dow AgroSciences Canada Inc. under which it has been granted a license to process NexeraTM canola and produce and sell Omega-9 Quality Canola Oil at its facility in Warden, Washington.
- Consolidated revenues increased 18% to $131.8 million from $112.1 million;
- Adjusted Gross Profit1 increased $10.2 million to $12.3 million from $2.1 million;
- EBITDA1 increased $9.8 million to $6.6 million compared to a loss before interest, taxes and depreciation1 of $3.2 million;
- Cash flow used in operations1 improved $2.4 million to $1.6 million compared with $4 million;
- Net earnings attributable to shareholders was $1.9 million, or $0.12 per share, compared with a loss attributable to shareholders of $8.7 million, or a $0.53 loss per share;
- Book value attributable to shareholders improved to $6.19 per share from $6.13 per share at March 31, 2014; and
- The current ratio of 1.22 times was consistent with March 31, 2014 and December 31, 2013.
Highlights Subsequent to Quarter End
- PCC crushed 28,900 tonnes, or about 92% of operating capacity, in July.
"Generating $1.9 million of Net Earnings on $6.6 million of EBITDA in Q2 represents another milestone for our Company as we continue to realize the value of the investments across our business," said Joel Horn, President and Chief Executive Officer, Legumex Walker Inc. "Our Special Crops segment achieved record EBITDA and had strong operating cash flow generation in the second quarter while achieving nearly $20 million of EBITDA in the last twelve months. At PCC, with the arrival of local new crop the plant operated at over 90% capacity in July, setting the stage for the remainder of 2014 as local new crop increasingly becomes available in the third and fourth quarters. We now look forward to sustainable cash flow generation from both Special Crops and PCC in the back half of the year."
This news release contains references to "Adjusted Gross Profit or Loss", "EBITDA" and "Cash Flow from Operations". Adjusted Gross Profit or Loss is defined for the purposes of this news release as gross profit or loss before depreciation and amortization. EBITDA (including loss before interest, taxes and depreciation) is defined for the purposes of this news release as earnings (loss) from operations before other income and expenses, depreciation and amortization, financing costs, and income taxes. Cash Flow from Operations is defined for the purposes of this news release as the cash provided by or used in operating activities excluding non-cash working capital changes. Management believes excluding the seasonal swings of non-cash working capital assists in evaluation of long-term liquidity. Management believes that Adjusted Gross Profit or Loss, EBITDA and Cash Flow from Operations are useful supplemental measures of cash flow prior to finance costs, capital expenditures, income taxes and other non-cash items included in earnings. Management uses Adjusted Gross Profit or Loss and Cash Flow from Operations as financial measures of liquidity. EBITDA, Adjusted Gross Profit or Loss and Cash Flow from Operations are not recognized earnings measures under Canadian Generally Accepted Accounting Principles or IFRS (collectively referred to herein as "Canadian GAAP") and do not have standardized meanings prescribed by Canadian GAAP. Therefore, Adjusted Gross Profit or Loss, EBITDA and Cash Flow from Operations may not be comparable to similar measures presented by other issuers. Investors are cautioned that Adjusted Gross Profit or Loss, EBITDA and Cash Flow from Operations should not be construed as an alternative to net earnings or loss (which are determined in accordance with Canadian GAAP) as an indicator of the performance of the Company or as a measure of liquidity and cash flows. The Company believes that Adjusted Gross Profit or Loss, EBITDA and Cash Flow from Operations are useful supplemental measures of cash flow prior to debt service, investing and financing activities and income taxes. The Company's method of calculating Adjusted Gross Profit or Loss, EBITDA and Cash Flow from Operations may differ materially from the methods used by other public companies and, accordingly, may not be comparable to similarly titled measures used by other public companies. A reconciliation of Adjusted Gross Profit or Loss and EBITDA to Net Earnings (loss) and a reconciliation of Cash Flow from Operations to Cash Flow provided by Operating Activities are set out in section 12 of the MD&A (as defined below).
Financial Statements and MD&A
Legumex Walker's Financial Statements and Management's Discussion and Analysis ("MD&A") for the period ended June 30, 2014 are available on the Company's website at www.legumexwalker.com in the "Investors" section.
Legumex Walker will host a conference call on Friday, August 8, 2014 at 12:00 p.m. ET to discuss its second quarter 2014 financial results. To access the conference call by telephone, dial (647) 427-7450 or (888) 231-8191. Please connect approximately 10 minutes prior to the start of the call to ensure access.
A recording of the conference call will be archived for replay by telephone until Friday, August 15, 2014 at midnight. To access the archived conference call, dial 1-855-859-2056 and enter the reservation number 74195894.
A live audio webcast of the conference call will be available at http://www.legumexwalker.com/investors-presentations.php. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast.
About Legumex Walker Inc.
Legumex Walker is a growth-oriented processor and merchandiser of special crops (sunflower seeds, flax and canary seed), pulses (lentils, peas, beans and chickpeas) and canola products. The Company is one of the largest processors of special crops and pulses in Canada. Legumex Walker has 15 processing facilities strategically located in key growing regions in the Canadian Prairie Provinces, the American Midwest and China; a global sales, logistics and distribution platform; and access to multimodal transportation capabilities. In addition, the Company has an 84 percent interest in Pacific Coast Canola, LLC, which operates the largest commercial-scale canola oilseed processing facility west of the Rocky Mountains.
Cautionary Note on Forward-looking Statements
This press release contains "forward-looking information" within the meaning of Canadian securities laws which may include, but are not limited to, statements relating to the PCC plant reaching higher production levels in the remainder of 2014, the availability of local new crop in the third and fourth quarters and the sustainability of cash flow generation in the back half of 2014. Such forward-looking information reflects the Company's views with respect to future events and is subject to risks, uncertainties and assumptions, including the risk that the PCC plant will not reach full production in the second half of 2014,the risk that local new crop will not become available and the risk that the Special Crops and PCC Divisions will not generate positive cash flow in the second half of 2014 as a result of various factors, including as a result of crush margins (being the difference between the sale price of oil and meal and the cost of canola seed) decreasing in future periods, problems related to the operation of the PCC Plant, weather related risks, availability of feedstock, the demand for and availability of rail, port and other transportation services, the actual results of harvests, fluctuations in the price of pulses and other crops and canola oil prices, failure of plant, equipment or processes to operate as anticipated, accidents, labour disputes, as well as those factors referred to in the section entitled "Risk Factors" in the Company's Management's Discussion and Analysis for the period ended December 31, 2013, the period ended June 30, 2014 and the Company's 2014 Annual Information Form, which are available on SEDAR at www.sedar.com and should be reviewed in conjunction with this document. The statements relating to the PCC plant reaching higher production levels in the second half of 2014 assume that sufficient feedstock will be available for delivery to PCC by rail and truck, including locally grown seed. The statements relating to local new crop assume that the crop will indeed be available. The statements relating to sustainable cash flow generation assume that the Special Crops and PCC decisions generate positive Cash Flow from Operations (See Non-GAAP Measures) in the third and fourth quarters of 2014. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Although the Company believes the assumptions inherent in forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this press release. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws.
SOURCE: Legumex Walker Inc.
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