ST-LAMBERT, QC, Nov. 8 /CNW Telbec/ - Roctest Ltd "Roctest" (TSX: RTT)
reports revenues of $5.23 million for the third quarter ended September 28,
2007, compared to revenues of $5.19 million for the same quarter in 2006,
which represents a slight increase of 0.7% from 2006 but also a slight
increase of 2.5% over the second quarter of 2007.
For the third quarter of the current exercise, Roctest's loss before
taxes amounted to $279,242 compared to a loss of $908,000 for the same quarter
in 2006 and a loss of $623,816 for the previous quarter. The net loss amounted
to $306,107 or $0.05 per share on a diluted basis in the third quarter of 2007
compared to a net loss of $577,347 or $0.11 per share for the same quarter in
2006 and a loss of $673,003 or $0.12 per share in the previous quarter.
Positive cash flows from operations amounted to $1.08 million compared to
negative cash flows of $0.59 million for the same period in 2006.
The reduction of the loss for the third quarter of 2007, when compared to
the same quarter in 2006, is mainly attributable to a 6 % improvement in gross
margin ($0.327 million) as a percentage of revenue, a decrease in research and
development expenses of $0.071 million, a reduction of amortization of
$0.033 million, a reduction in the cost of the cost reduction plan of
$0.175 million, a higher foreign exchange loss by $0.017 million, and a tax
expense of $0.027 million compared to a recovery of $0.331 million in 2006 as
the Company has not recorded any future income tax benefits from its operating
losses compared to last year.
"Even though the quarter resulted in a loss, we are encouraged by the
significant reduction of it. The industrial sector had a disappointing
performance but we quickly took actions to reduce our cost structure. In early
October, we reduced the headcount at our Quebec City facility in order to
generate over $600,000 of cost savings on an annual basis. On the other hand,
the civil engineering sector generated a profit during the third quarter while
it cumulated, during the first 6 months of this year, a loss greater than
$1 million." declared Francois Cordeau, President and chief executive officer.
Sales from the civil engineering sector increased by 12.4% from the previous
quarter while gross margins increased to 36.4% for this sector. "The various
initiatives taken since the beginning of the year have allowed us to generate
a positive cash flow for the third quarter and improve our financial position.
We are entering the fourth quarter optimistic about the civil engineering
sector. As well, the initiatives of our strategic review of the second quarter
are being implemented with the support of our advisers" declared Mr. François
Cordeau, President and CEO of Roctest.
On September 28, 2007, Roctest's working capital totalled $2,451,407
compared to $3,808,100 on December 29, 2006. Cash and cash equivalents stood
at $826,503 at the end of the third quarter of 2007, compared to $2,291,953 at
the end of the previous fiscal year. Roctest's total assets were valued at
$21,995,063 on September 28, 2007, compared to a value of $25,657,060 on
December 29, 2006. The Company's long term debt stood at $676,450 at the end
of the third quarter of 2007, compared to $775,046 at the end of the previous
fiscal year. Due to the fact that the Company did not respect certain
financial ratios with its main banker, an amount of $2.4 million, representing
long term debt instalments which would have been due beyond 2007, is
classified as current, reducing working capital by an equivalent amount.
The main banker of the Company previously indicated its intention not to
renew the credit facilities as of October 31, 2007. However, it has now agreed
to maintain the credit facilities until January 31, 2008, an additional period
of 3 months. The Company is confident that the implementation of the
initiatives from the review of its strategic plan as well as numerous cost
reduction measures will allow it to continue to reduce losses over the coming
months and improve liquidity. The support of PriceWaterhouseCoopers in this
activity should also accelerate the various initiatives.
Except for historical information provided herein, the press release may
contain information and statements of a forward-looking nature concerning the
future performance of the Company. These statements are based on suppositions
and uncertainties as well as on management's best possible evaluation of
future events, and as such involve a number of risk factors. Such factors may
include, without excluding other considerations, risks related to foreign
exchange fluctuations, evolution in customer demand for the Company's products
and services, the impact of price pressure from competitors and general market
trends, economic and geopolitical changes. As a result, readers are advised
that actual results may differ from expected results. The Company is not
required to update or revise publicly its forward-looking statements, except
as may be required under applicable law.
Roctest designs, manufactures and markets sensors and high-precision
measuring instruments for the civil engineering, energy, healthcare and
industrial control markets. The Company is recognized for its leading-edge
technology, the quality of its technical expertise and its product development
capabilities for challenging and demanding environments. Its products are
mainly sold internationally. The shares of the Company are listed on the
Toronto Stock Exchange under the symbol RTT.
Three months ended Nine months ended
September September September September
28, 29, 28, 29,
2007 2006 2007 2006
Revenues $5,232 963 $5,194,348 $15,290,038 $14,889,911
Operating profit $2,125 263 $1,797,772 $ 5,885,669 $ 5,641,752
EBITDA $ 71,641 ($536,598) ($541,621) ($890,468)
Loss before tax $ 279,242 $ 908,000 $ 1,572,087 $ 1,953,156
Net loss $ 306,107 $ 577,347 $ 1,674,821 $ 1,259,152
Net loss per share 0.05 0.11 0.30 0.24
number of shares 5,563,071 5,244,496 5,563,071 5,244,496
For further information:
For further information: François Cordeau, President and Chief Executive
Officer, Roctest Ltd., (450) 465-1113, firstname.lastname@example.org, www.roctest.com