TORONTO, Nov. 29, 2013 /CNW/ - McVicar Industries Inc. ("McVicar" or the "Company") today announces that the Company has filed its unaudited interim consolidated financial results for the three months and nine months ended September 30, 2013. All figures are in Canadian dollars unless otherwise stated. The unaudited interim consolidated financial statements and Management Discussion and Analysis may be downloaded from www.sedar.com.
Sales for the third quarter were $5.8 million, down 14% from $6.7 million for the same period of 2012. Sales for the first nine months were $18.7 million, down 13% from $21.5 million as compared to the same period of 2012. The decreases for the quarter and YTD 2013 were mainly attributable to decreased sales from its chemical business due to its Zhejiang Hongbo Chemical Co. Ltd. ("Hongbo") plant occupation.
Gross profit for the third quarter was $1.7 million, down 25% from $2.3 million for the same period of 2012. Gross profit for the first nine months was $6.6 million, down 1% from $6.7 million compared to the same period of 2012. Gross margin for the third quarter decreased to 30% from 34% compared to the same period of 2012. Gross margin for the first nine months increased to 35% compared to 31% for the same period of 2012.
Net loss for the third quarter was $4.8 million or $0.135 per share compared to net income of $1.0 million or $0.027 per share for the same period of 2012. Net loss for the first nine months was $2.9 million or $0.080 per share compared to a gain of $2.5 million or $0.071 per share for the same period of 2012.
One-time expenses included in the Company's income for the third quarter of 2013:
- A $4.2 million goodwill impairment charge in connection with the Company's chemical business.
- $0.9 million provision charge for the possible settlement of the occupation of the Hongbo plant.
As of September 30, 2013, the Company had $7.2 million in cash and cash equivalents, and a working capital balance of $15.3 million.
Business Update on the Hongbo Plant
Hongbo, through binding arbitration by the local labour dispute arbitration committees, reached a settlement with the occupying group including all employees of Hongbo on November 25, 2013. Pursuant to the settlement agreement, all the employees of the Hongbo plant will be laid off to clear the labour relationship, and a compensation package in the amount of RMB 5,386,258 ($904,000) will be fully paid by the Company before December 6, 2013. Further, the Company is required to pay to some of the employees, if any, for their work-related illnesses, which will be subject to the upcoming heath examination results. The future business plan of Hongbo is under further review.
McVicar Industries Inc., headquartered in Toronto, Canada, is focused on investments and acquisitions of businesses in China. At present, McVicar has operations in both electronic components and specialty chemicals in four operations in China.
Information set forth in this news release may involve forward-looking statements under applicable securities laws. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this document are made as of the date of this document and the Company 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 as expressly required by applicable securities legislation. Although Management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. This news release does not constitute an offer to sell or solicitation of an offer to buy any of the securities described herein and accordingly undue reliance should not be put on such.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
SOURCE: McVicar Industries Inc.
For further information:
Ms. eXavier Peterson or Gang Chai, CEO at: 55 University Avenue, Suite 605, Toronto, ON M5J 2H7 Tel: (416)366-7420 Fax (416)366-7421 www.mcvicar.ca.