Exco Reports Fourth Consecutive Quarter of Improved Revenue and
Earnings
Quarterly Dividend Declared
TORONTO, July 28 /PRNewswire-FirstCall/ - Exco
Technologies Limited (TSX-XTC) today announced results for its
third quarter ended June 30, 2010. In
addition, the Company announced a $0.02 dividend per share which will be paid on
September 30, 2010 to shareholders of
record on September 15, 2010. The
dividend is an "eligible dividend" in accordance with the Income
Tax Act of Canada.
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9 Months ended 3 Months ended
June 30 June 30
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($000s, except per share amounts)
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2010 2009 2010 2009
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Sales $119,583 $106,022 $42,681 $28,345
Net income (loss) $7,628 ($18,030) $3,502 ($998)
Basic and diluted earnings
(loss) per share $0.19 ($0.44) $0.09 ($0.02)
Common shares
outstanding 40,911,000 40,666,000 40,911,000 40,666,000
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Consolidated sales for the quarter ended June 30, 2010 were $42.7
million compared to $28.3
million last year - an increase of $14.3 million or 51%. Year-to-date sales were
$119.6 million - an increase of
$13.6 million or 13% compared to last
year. Sales in the quarter continued the climbing trend begun
several quarters ago as the business climate continues to improve
over last year. The large mould group and Castool experiencing the
strongest improvement in the Casting and Extrusion segment as
automotive customers are feeling increasingly comfortable
proceeding with capital investments and long delayed powertrain
projects. The extrusion group sales were slightly higher in the
quarter reflecting its limited exposure to the automotive industry
and anaemic recovery in its main industrial markets. In the
Automotive Solutions segment the sales increase was led by North
American operations where Neocon more than doubled its prior year
quarterly sales level followed by Polytech which increased sales by
more than 50%. Even at Polydesign, which services the challenged
European automotive market with interior trim products, sales grew
by more than 50%.
Net income for the third quarter was $3.5
million or $0.09 per share
compared to a net loss of $998
thousand or $0.02 per share
last year. Year-to-date, Exco reported net income of $7.6 million or $0.19 per share compared to a net loss of
$18.0 million or $0.44 per share in the prior year. Overall
stronger sales this quarter and year-to-date have significantly
improved the absorption of fixed overheads and positively impacted
overall profitability. The retention of a downsized cost structure
has also played a significant part in improving profitability. This
has caused gross margin to continue climbing. For the third quarter
it was 27.6% compared to 20.0% in the prior year. Year-to-date,
gross margin was 27.1% compared to 19.2% last year.
Operating cash flow in the current quarter increased to
$4 million from $2.6 million in the prior year primarily due to
improved earnings. This demonstrates that earnings are generating
more than sufficient cash flow to cover the working capital
requirements of our growing sales volume. The Company's cash
position at quarter end totalled $18.1
million compared to $11.4
million at the beginning of the fiscal year and $16.3 million at the end of the second
quarter.
As 2010 continues to unfold our opinion that the business
climate is improving remains intact. We have seen automotive
production in North America
continue firming up after persistent and, at times, dramatic
decline during 2009. We expect the growth to continue at a gradual
yet steady pace through the next several quarters. This should
continue to positively impact Exco sales and earnings in both
business segments. In the Casting and Extrusion segment Castool and
the large mould group in particular are benefiting from the
resurgence in automotive production as are all businesses in the
Automotive Solutions segment where growth is fuelled by a
combination of improved volumes on existing programs and the launch
of numerous new programs for a wide range of customers. Polydesign
in particular is posed to launch approximately (euro)7 million in
annualized sales in the next several quarters.
Exco continues to have a low overall cost structure and a very
strong balance sheet with no bank debt and $18.1 million or 44
cents per share of cash on hand. This tangibly demonstrates
that Exco has successfully adjusted to the strong Canadian dollar
while putting in place the resources necessary to pursue growth
opportunities without requiring debt or dilution.
(For further information please refer to the Company's Third
Quarter Interim Financial Statements in the Investor Relations
section posted at www.excocorp.com. Alternatively, please refer to
www.sedar.com after July 28,
2010.)
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 1,580
people and service a diverse and broad customer base.
Management will hold a conference call to discuss the second
quarter results on Thursday July 29,
2010 at 10:00 am (EST). The
local dial in number for the call is (647) 427-7450 for local
(Toronto) calls or toll free
1-888-231-8191. 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 July 29, 2010, an archived version
will be available on the Exco website.
This Press Release contains forward-looking information and
forward-looking statements within the meaning of applicable
securities laws with respect to: 1) business unit sales and
earnings and 2) improvement in economic conditions. We use words
such as "anticipate", "plan", "may", "will", "should", "expect",
"believe", "estimate", "approximately", "confident", "modestly" and
similar expressions to identify forward-looking information and
statements. Such forward-looking information and statements are
based on assumptions and analyses made by management in light of
our field experiences and our interpretation of recent and current
automotive and industrial sales trends which are expected to
continue into the near future, as well as economic conditions and
other factors we believe to be relevant. 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 2009 Annual Report, in our 2009 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 unless
such factor is in and of itself material.
SOURCE Exco Technologies Limited