VANCOUVER, June 13, 2017 /CNW/ - Polaris Materials Corporation ("Polaris", the "Company" or "we") (TSX:PLS) announces that Polaris, and its subsidiary Eagle Rock Aggregates, Inc. ("ERA") have provided notice of their election not to renew the strategic alliance agreement (the "SAA") and related joint co-operation and development agreements (the "JCDA"s) with CEMEX, Inc. ("CEMEX"). The agreements will now terminate in accordance with their terms on September 25, 2017. ERA and CEMEX remain bound by the terms of an aggregate supply and distribution agreement (the "ASDA") which provides for certain exclusive marketing and distribution rights in parts of the Northern California market, and which has an initial term expiring on September 25, 2027.
The SAA originally provided for high-level co-operation in the development of new markets by both companies, aided by detailed terms for sharing the risk and reward of joint investment opportunities via the JCDAs. However, changes in market conditions since 2007, Polaris' independent development and operation of its terminal in Long Beach, California and development of the Fine Sand product, as well as CEMEX's recent decision to sell certain assets in Washington and Oregon, have removed many of the factors which led to the creation of the strategic alliance.
The Company sees the potential for a number of compelling business opportunities in markets on the west coast including Seattle, Portland, and Southern California, including San Diego, as well as further opportunities in Hawaii and other areas. The termination of the SAA and the JCDAs provides Polaris with improved strategic flexibility to achieve our objectives in these markets.
CEMEX has been, and continues to be, a valued partner to Polaris in the Northern California market, and we look forward to continuing to work closely with them, and advancing our joint business interests in this region pursuant to the ASDA. The conclusion of the SAA does not prevent the companies from working together in the future in other markets where a relationship is mutually beneficial.
Ken Palko, President and CEO commented: "We appreciate the invaluable assistance provided by CEMEX in helping Polaris establish itself, and look forward to many more years of working together in Northern California. However, we believe that the flexibility to choose the right partner for the right markets will be more advantageous for our business going forward. We are well positioned to supply our high quality concrete aggregate and fine sand to numerous west coast markets, and we now have the proven track record and the expertise to truly differentiate ourselves from our competition."
About Polaris Materials Corporation:
Polaris Materials Corporation is engaged in the development and operation of construction aggregate quarries in Canada to supply distribution facilities in the United States through coastal shipping. The Company's active construction aggregate interests consist of its Orca Sand and Gravel Quarry in British Columbia and two associated receiving terminals in Richmond and Long Beach, California. The Company also owns the Black Bear Project located in close proximity to the Orca Quarry, and a controlling interest in the Eagle Rock Quarry Project, located on the south coast of Vancouver Island.
For further information, please contact:
Nicholas Van Dyk
Vice President, Investor Relations and Corporate Development
Polaris Materials Corporation
Tel: (604) 915-5000 Ext. 104
Cautionary Note Regarding Forward Looking Statements
This press release contains "forward-looking statements" and "forward-looking information" within the meaning of applicable securities laws. These statements and information appear in this document and include estimates, forecasts, information and statements as to management's expectations with respect to, among other things, the future financial or operating performance of the Company, including opportunities in various markets, increases in gross margins, increases in sales volumes and revenues (including in the Long Beach market), new customer contracts, shipments and selling prices, costs of production, capital and operating expenditures, requirements for additional capital, government regulation of quarrying operations, environmental risks, reclamation expenses, and title disputes, the Canadian dollar compared to the US dollar, increases in Californian construction activity and US infrastructure funding, statements regarding potential new customers and the development of Black Bear. Often, but not always, forward-looking statements and information can be identified by the use of words such as "may", "will", "should", "plans", "expects", "intends", "anticipates", "believes", "budget", and "scheduled" or the negative thereof or variations thereon or similar terminology. Forward-looking statements and information are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Readers are cautioned that any such forward-looking statements and information are not guarantees and there can be no assurance that such statements and information will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Company's continuous disclosure documents which are filed with Canadian regulators on SEDAR (www.sedar.com), including under the heading "Risks and Uncertainties" in the Company's Annual Report and under the heading "Risk Factors" in the Company's Annual Information Form. Such factors include, amongst others, the effects of general economic conditions, changing foreign exchange rates and actions by government authorities, uncertainties associated with legal proceedings and negotiations, industry supply levels, competitive pricing pressures, mineral resource and reserve estimates and the timing and development of the Black Bear project. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements and information whether as a result of new information, future events or otherwise, except as required by applicable law. All written and oral forward-looking statements and information attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements.
SOURCE Polaris Materials Corporation