Quarterly Dividend Declared
TORONTO, Nov. 26 /CNW/ - Exco Technologies Limited (TSX-XTC) today
announced results for its fourth quarter ended September 30, 2008. In
addition, the Company announced that a quarterly cash dividend of $0.0175 per
share will be paid December 30, 2008 to shareholders of record on December 15,
2008. The dividend is an "eligible dividend" in accordance with the Income Tax
Act of Canada.
-------------------------------------------------------------------------
12 Months Ended 3 Months ended
September 30 September 30
($000s, except per share amounts)
2008 2007 2008 2007
---- ---- ---- ----
Sales $201,681 $201,759 $50,132 $50,485
Net income (loss) from
continuing operations(x) ($13,398) $5,794 ($20,753) ($752)
Net loss from discontinued
operations ($536) ($2,732) ($425) ($1,321)
Net income (loss) ($13,934) $3,062 ($21,178) ($2,073)
Basic and diluted earnings
(loss) per share from
continuing operations ($0.33) $0.14 ($0.51) ($0.02)
Basic and diluted (loss)
per share from
discontinued operations ($0.01) ($0.07) ($0.01) ($0.03)
Basic and diluted earnings
(loss) per share ($0.34) $0.07 ($0.52) ($0.05)
Common shares
outstanding 40,948,276 41,478,476 40,948,276 41,478,476
(x) includes non-cash goodwill charge of $23.6 million for Neocon Canada
and Polytech.
-------------------------------------------------------------------------
The financial results for the 2008 and 2007 reflect the classification of
Exco's Techmire business as a discontinued operation.
In the fourth quarter sales of $50.1 million were flat compared to last
year's sales of $50.5 million. The value of the U.S. dollar having
strengthened by an average of one cent against the Canadian dollar in the
quarter had a negligible impact on sales. The Automotive Solutions segment
experienced a strong quarter with an increase in sales of $3.5 million or
17.7% to $23.3 million from $19.8 million last year. Increased European sales
by Polydesign more than offset the reduction in North American sales by
Polytech and the Neocon businesses. The Casting and Extrusion segment recorded
reduced quarterly sales of 12.6% or $3.9 million to $26.9 million from $30.7
million last year. Lower sales at Castool and the large mould businesses
(Extec had no sales for the quarter) were responsible for this reduction and
overwhelmed the slight increase in sales in the extrusion die businesses. Sale
of large moulds will improve as deliveries of our Phoenix engine block and six
speed transmission orders begins to take place throughout this year.
The Company reported a fourth quarter net loss from continuing operations
of $20.8 million compared to a loss of $800 thousand in 2007. This loss
includes non deductible goodwill charges of $23.6 million taken in the fourth
quarter to reflect impairment at our Neocon Canada and Polytech. This is a
non-cash item that does not affect the Company's cash flow, operations,
margins or bank covenants. The Company also expensed numerous other items in
the quarter relating to the closure of its Extec facility in Ontario, the
termination of its aircraft operating lease, general restructuring charges and
bad debt write-offs. The Company also recorded a pre-tax charge of $500
thousand from discontinued operations in the quarter to reduce the carrying
value of the Techmire facility to its current fair market value. Details of
these items are reconciled to net income in the table below.
Q.4-2008 Q.4-2007
-------------------------
Reported fully diluted loss per share ($0.52) ($0.05)
Goodwill impairment charges 0.57 0.03
Loss from terminating aircraft lease 0.01 0.03
Restructuring charges 0.01 0.01
Extec closing expenses 0.01 0.00
Bad debt write-offs 0.01 0.00
Discontinued operations - Techmire 0.01 0.03
-------------------------
Fully diluted earnings per share before above
items $0.10 $0.05
-------------------------
-------------------------
Apart from the above items, pre tax earnings more than tripled in the
quarter at our European operations. All North American business units
experienced weaker earnings and the large mould businesses, not including
Extec, recorded combined losses of $0.02 per share reflecting low capacity
utilization and the cost of restructuring charges taken in the fourth quarter.
Gross margin in the quarter was 21.7% compared to 25.9% last year
reflecting the poor performance of the large mould businesses, excluding
Extec, which operated well below capacity throughout the quarter and recorded
a loss of $0.02 per share.
Operating cash flow from operations before net changes in non-cash
working capital improved during the quarter to $3.8 million from $3.1 million
last year. After non-cash working capital is considered, operating cash flow
in the current quarter decreased to $694 thousand from $3.8 million in the
prior year. Exco has no net bank debt and its net cash position remained
strong at $3.5 million.
"The Company has faced a difficult business environment in the fourth
quarter including a 'par' Canadian dollar, high raw material costs and
declining automotive output" said Brian Robbins, President and CEO of Exco.
"The recent weakness of the Canadian dollar and declining steel and resin
costs are welcome developments that, if sustained, will help to improve the
Company's margin and earnings".
(For further information please refer to the Company's Fourth Quarter
Interim Financial Statements in the Investor Relations section posted at
www.excocorp.com. Alternatively, please refer to www.sedar.com after November
26, 2008.)
Exco Technologies Limited is a global supplier of innovative technologies
servicing the die-cast, extrusion and automotive industries. Through our 10
strategic locations, we employ 1,950 people and service a diverse and broad
customer base.
Management will hold a conference call to discuss the fourth quarter
results on Friday November 28, 2008 at 11:00 am (EST). The local dial in
number for the call is (416) 644-3414 or toll free 1-800-733-7571. To access
the live audio webcast, please log on to www.excocorp.com or www.q1234.com a
few minutes before the event. Real Player is required for access. For those
unable to participate on November 28, 2008 an archived version will be
available on the Exco website.
This news release contains forward-looking information and
forward-looking statements within the meaning of applicable securities laws.
We use words such as "anticipate", "plan", "may", "will", "should", "expect",
"believe", "estimate" and similar expressions to identify forward-looking
information and statements. Such forward-looking information and statements
are based on assumptions and analyses made by us in light of our experience
and our perception of historical trends, current conditions and expected
future developments, as well as other factors we believe to be relevant and
appropriate in the circumstances. Readers are cautioned not to place undue
reliance on forward-looking information and statements, as there can be no
assurance that the assumptions, plans, intentions or expectations upon which
such statements are based will occur. Forward-looking information and
statements are subject to known and unknown risks, uncertainties, assumptions
and other factors which may cause actual results, performance or achievements
to be materially different from any future results, performance or
achievements expressed, implied or anticipated by such information and
statements. These risks, uncertainties and assumptions are described in the
Company's Management's Discussion and Analysis included in our 2007 Annual
Report, in our 2007 Annual Information Form and, from time to time, in other
reports and filings made by the Company with securities regulatory
authorities.
While the Company believes that the expectations expressed by such
forward-looking information and statements are reasonable, there can be no
assurance that such expectations and assumptions will prove to be correct. In
evaluating forward-looking information and statements, readers should
carefully consider the various factors which could cause actual results or
events to differ materially from those indicated in the forward-looking
information and statements. Readers are cautioned that the foregoing list of
important factors is not exhaustive. Furthermore, the Company disclaims any
obligations to update publicly or otherwise revise any such factors or any of
the forward-looking information or statements contained herein to reflect
subsequent information, events or developments, changes in risk factors or
otherwise.
NOTICE TO READER
The attached consolidated financial statements have been prepared by
management of the Company.
