- Special Crops Delivers Another Quarter of Strong Performance While PCC Improves Capacity Utilization in a Challenging Market -
WINNIPEG, MB, Nov. 5, 2014 /CNW/ - Legumex Walker Inc. (TSX: LWP) (the "Company") today reported its financial results for the three months ended September 30, 2014. All figures are in Canadian dollars unless otherwise stated.
Highlights for the Three Months Ended September 30, 2014 (all comparative metrics are relative to the Three Months Ended September 30, 2013, unless otherwise stated):
Special Crops Segment
- Volumes shipped increased 8% to 90,300 tonnes;
- Adjusted EBITDA1 increased 36% to $3.3 million;
- Cash flow provided by operations1 improved $4.1 million; and
- Adjusted EBITDA1 for the twelve months ended September 30, 2014 of $20.6 million.
Oilseed Processing Segment (Pacific Coast Canola (PCC))
- Improved quarterly capacity utilization to 76%; and
- Tonnes sold increased 96% to 65,500 tonnes.
- Consolidated revenues increased 10% to $108.4 million;
- Adjusted EBITDA1 loss of $1.5 million compared to a loss of $200,000;
- Cash flow used in operations1 improved $2.6 million; and
- Net loss attributable to shareholders was $8.9 million, or $0.54 loss per share, compared with a net loss attributable to shareholders of $3.8 million, or $0.23 loss per share and included a loss of $6.1 million, or $0.31 loss per share, associated with the continued ramp up of the of the PCC Plant.
Highlights for the Nine Months Ended September 30, 2014 (all comparative metrics are relative to the Nine Months Ended September 30, 2013, unless otherwise stated):
- Consolidated adjusted EBITDA of $8.8 million;
- Consolidated cash flow used in operations improved by $8.1 million; and
- Consolidated net loss attributable to shareholders for the nine months ended September 30, 2014 was $13.1 million, or $0.80 loss per share, compared with a net loss attributable to shareholders of $18.3 million, or $1.12 loss per share.
Highlights Subsequent to Quarter End
- Entered into a strategic alliance with The Scoular Company ("Scoular") under which:
- PCC and Scoular entered into a long-term processing agreement where Scoular will procure all canola seed for processing at the PCC plant and will market all of the canola meal and canola oil produced by PCC; and
- Scoular invested $16.5 million in a Legumex Walker Inc. convertible debenture.
- Concurrently, PCC and CHS, Inc. mutually ended their supply agreement.
"Our Special Crops business delivered another quarter of strong performance and Pacific Coast Canola improved capacity utilization to 76% as the Company surpassed $500 million in revenue on a trailing 12-month basis," said Joel Horn, President and Chief Executive Officer, Legumex Walker Inc. "In addition, our Special Crops segment also exceeded $20 million in Adjusted EBITDA for the latest 12-months. PCC faced challenging market conditions including a temporary oversupply of DDGs (Dried Distillers Grains) that lowered meal prices, lower board crush, and continued feedstock constraints. Feedstock deliveries, meal prices and board crush margins are now all improving."
Mr. Horn added, "With the closing last week of our strategic alliance with Scoular, we look forward to capitalizing on our shared vision around the significant opportunities in the healthy, specialty food ingredients market. Scoular's $16.5 million investment will enable LWI to pursue those opportunities in Special Crops and PCC."
Legumex Walker also announced that David Carefoot will be stepping down from his role as Chief Financial Officer to accept a position as Chief Financial Officer of a large private enterprise in the retail sector. The Company has commenced a formal search for his successor.
"David has been integral to the maturing of our organization over the past two years as we consolidated several acquisitions, brought the PCC Plant into commercialization, and, just last week, completed a transformational partnership for our Company," said Mr. Horn. "He leaves our finance and accounting group in good shape, having built a great team, implemented a company-wide ERP system, and established the processes and controls to support the next stage of our evolution as an organization. We wish him well as he takes his unique set of capabilities to his next opportunity."
This news release contains references to "Adjusted EBITDA" and "Cash Flow from Operations". Adjusted EBITDA 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 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 EBITDA and Cash Flow from Operations as financial measures of liquidity. Adjusted EBITDA 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 EBITDA and Cash Flow from Operations may not be comparable to similar measures presented by other issuers. Investors are cautioned that Adjusted 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 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 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 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 September 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 Thursday, November 6, 2014 at 10:00 a.m. ET to discuss its third 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 Thursday, November 13, 2014 at midnight. To access the archived conference call, dial 1-855-859-2056 and enter the reservation number 21537496.
A live audio webcast of the conference call will be available at http://www.legumexwalker.com/investors-presentations.php or http://www.newswire.ca/en/webcast/detail/1427634/1586042. 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 is not limited to, statements relating to the pursuit of new opportunities and acceleration of growth strategy. 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 new opportunities will not materialize and that LWI's growth strategy will not be accelerated as a result of Scoular's investment, 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 new opportunities and growth strategy assume that sufficient feedstock will be available for delivery to PCC by rail and truck, including locally grown seed. 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.
For further information:
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