- Sales up 18% in the quarter
- Earnings up 27% in the quarter
- EPS reduced by $0.05 for
impact of tax asset write-off
- $24.5 million cash, net of
bank indebtedness
- EBITDA up 41% to $21.9 million
in the quarter
TORONTO, Dec. 2, 2015 /CNW/ - Exco Technologies Limited
(TSX-XTC) today announced results for its fourth quarter and
year ended September 30, 2015. In
addition, the Company announced the quarterly dividend of
$0.06 per common share which will be
paid on December 30, 2015 to
shareholders of record on December
16, 2015. The dividend is an "eligible dividend" in
accordance with the Income Tax Act of Canada.
|
|
Three Months
ended
September 30
|
Twelve Months
ended September 30
|
|
(in $ millions
except per share amounts)
|
|
2015
|
2014
|
2015
|
2014
|
Sales
|
$131.0
|
$110.9
|
$498.3
|
$368.3
|
Net income for the
period
|
$10.3
|
$8.1
|
$40.8
|
$30.7
|
Earnings per share
from net income
|
|
|
|
|
|
Basic
|
$0.24
|
$0.19
|
$0.96
|
$0.74
|
|
Diluted
|
$0.24
|
$0.19
|
$0.96
|
$0.73
|
Total
assets
|
$342.8
|
$290.6
|
$342.8
|
$290.6
|
Cash dividend paid
per share
|
$0.06
|
$0.05
|
$0.23
|
$0.195
|
EBITDA
1
|
$21.9
|
$15.6
|
$77.0
|
$53.9
|
Consolidated sales for the fourth quarter were $131.0 million – an increase of 18% compared to
last year. Full year, consolidated sales were $498.3 million – up 35% over last year.
Sales from our seat cover business which was acquired by Exco on
March 1, 2014 were fully included in
both the current and prior year quarters. However, full year
sales this year included twelve months of seat cover sales compared
to seven months last year. While seat cover sales accounted
for a considerable amount of the sales growth Exco's other
businesses also grew by 24% in the quarter and 21% in the year.
The Automotive Solutions segment reported significantly higher
sales of $78.5 million in the fourth
quarter and $303.1 million for the
year – increases of 21% and 52% respectively. Seat cover
sales in the quarter were up 6% to $36.3
million and for the year were up 77% to $148.3 million once again reflecting full year
inclusion compared to seven months last year. The other
businesses in this segment experienced strong growth in both the
quarter and the year by 38% and 35% respectively. North American
sales continued at elevated levels - sustained by strong vehicle
unit sales as well as new product launches for refreshed,
redesigned or entirely new vehicle models. European sales
increased substantially over prior year as the smooth launch of new
programs in Morocco continued at a
strong pace and our Bulgarian operation completed the launch of our
Mini variants as well as some other non-seat cover programs.
Improving European vehicle unit sales have also helped support our
sales.
The Casting and Extrusion segment reported sales of $52.5 million for the fourth quarter and
$195.2 million for the year –
increases of 14% and 15% respectively. All businesses in the
segment contributed to these sales increases. Sales in this segment
were supported by generally buoyant market conditions in
North America and in the case of
Castool Europe and Asia as
well. Combined sales from our greenfield facilities in
Brazil and Thailand contributed modestly at $1.7 million in the quarter ($721 thousand - 2014) and $5.1 million for the year ($758 thousand – 2014).
Consolidated net income for the fourth quarter was $10.3 million or diluted earnings of $0.24 per share compared to consolidated net
income of $8.1 million or diluted
earnings of $0.19 per share
last year – an increase of 27%. Full year consolidated net income
was $40.8 million or diluted earnings
of $0.96 per common share compared to
$30.7 million or diluted earnings of
$0.73 per common share last year – an
increase of 33%.
The quarter's earnings were impacted by a 42% effective tax rate
compared to 27% last year. In the quarter Exco wrote off
$1.9 million in deferred tax assets
related to South Africa as the
planned closure of that facility renders the utilization of these
tax assets unlikely in the future. Without this write-off the
tax expense would have been $5.5
million or 31% and earnings would have been $0.29 per share instead of $0.24 per share as reported.
The Automotive Solutions segment reported higher pretax profit
of $10.1 million in the fourth
quarter – an increase of 59% over last year. For the full year, the
segment also reported higher pretax profit of $36.6 million – an increase over last year of
53%. In both Europe and
North America, stronger sales
provided increased earnings. This earnings improvement took place
in spite of continuing weakness at ALC South Africa/Lesotho which experienced higher losses in the
quarter as production was moved among plants and as provisions were
taken in the run up to the closure of the South Africa facility. These losses
amounted to $0.05 per share in the
quarter and $0.15 per share in the
year.
The Casting and Extrusion segment reported pretax profit of
$9.5 million in the fourth quarter
compared to $6.8 million last year –
an increase of 40%. For the full year, the segment reported pretax
profit of $32.4 million compared to
$25.0 million last year – an increase
of 30%. These improvements took place in spite of start-up costs at
our two greenfield facilities - Extrusion Brazil and Castool
Thailand. Excluding these start-up costs, which are expected
to recede as production increases, pretax income in the current
quarter and full year for this segment would have been $10.3 million and $35.4
million compared to $7.2
million and $26.9 million in
the same periods last year. This represents an increase of 43% in
the quarter and 32% full year.
Consolidated earnings before interest, taxes, depreciation and
amortization ("EBITDA") for the fourth quarter increased to
$21.9 million compared to
$15.6 million last year – an increase
of 40%. For the full year, consolidated EBITDA also increased
to $77.0 million compared to
$53.9 million last year – an increase
of 43%.
Cash provided by operating activities increased slightly to
$41.2 million compared to
$40.4 million last year – a steady
level despite funding working capital required to grow sales by
35%. Exco had no net bank debt as at September 30, 2015 and closed the year with net
cash deposits of $24.5 million
compared to $7.8 million at the end
of the 2014 fiscal year.
The outlook for Exco over the near term should continue to
remain strong. We continue to see a buoyant and dynamic
quoting environment with light vehicle production continuing at
least at current levels despite the possibility of moderate
interest rate tightening in the US. The European market also
seems to be improving with unit vehicle production climbing
modestly yet consistently. The Automotive Solutions group is
also actively engaged in quoting on both existing programs and new
content. Losses will continue at our greenfields in Brazil and Thailand in the near term with gradual
improvement as manufacturing capabilities mature and higher
production levels help to more efficiently absorb overheads. The
expected closure of the South
Africa facility in the second fiscal quarter is expected to
significantly benefit earnings and enable management to focus on
the remaining Lesotho
operation.
All our businesses continue experiencing a favorable input cost
environment with relatively abundant supply of both tool grade
steel and resin sheet and other polymer-based
materials. Pricing of these input costs are also stable with
little upward pressure as both global sourcing by our business
units and persistently low prices for key commodities such as oil
and base metals commodities, although partly mitigated by the
strengthening US dollar, make it difficult for upward cost momentum
to take root.
(For further information and prior year comparison please refer
to the Company's Fourth Quarter Condensed Financial Statements in
the Investor Relations section posted at www.excocorp.com.
Alternatively, please refer to www.sedar.com)
Quarterly Conference Call:
To access the live audio webcast, please log on to www.excocorp.com
or
http://event.on24.com/r.htm?e=1096759&s=1&k=2C4C114CA78D54EE4ABC2CD04651A2EC
a few minutes before the event. Real Player is required for
access. For those unable to participate on December 3, 2015, an archived version will be
available on the Exco website.
About Exco Technologies Limited:
Exco Technologies Limited is a global supplier of innovative
technologies servicing the die-cast, extrusion and automotive
industries. Through our 18 strategic locations in 10
countries, we employ 5,302 people and service a diverse and broad
customer base.
Notice To Reader: Forward Looking Statements
Information in this document relating to projected
growth and financial performance of the Company's
business units, contribution of our start-up business units,
contribution of awarded programs yet to be launched, margin
performance, financial performance of acquisitions and operating
efficiencies are forward-looking statements.
Readers are cautioned not to place undue reliance on
forward-looking statements found mainly in the Outlook section but
also elsewhere throughout this document. These forward-looking
statements are based on our plans, intentions or expectations which
are based on, among other things, assumptions about the number of
automobiles produced in North
America and Europe, the
number of extrusion dies required in North America and South America, the rate of economic growth in
North America, Europe and emerging market countries,
investment by OEMs in drivetrain architecture and other initiatives
intended to reduce fuel consumption and/or the weight of
automobiles, weakening raw material prices, continuing economic
recovery, currency fluctuations which may in fact not occur and the
rate at which our new operations in Brazil and Thailand achieve profitability. These
forward-looking statements include known and unknown risks,
uncertainties, assumptions and other factors which may cause actual
results or achievements to be materially different from those
expressed or implied. For a more extensive discussion of
Exco's risks and uncertainties see the 'Risks and Uncertainties'
section in the Annual Report, our Annual Information Form ("AIF")
and other reports and securities filings made by the
Company. This information is available at
www.sedar.com.
While Exco believes that the expectations expressed by such
forward-looking statements are reasonable, we cannot assure that
they will 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 will update its disclosure upon
publication of each fiscal quarter's financial results and
otherwise 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.
_______________________________
1 Non-IFRS
Measures: In this News Release, reference is made to EBITDA,
which is not a measure of financial performance under International
Financial Reporting Standards ("IFRS"). Exco calculates
EBITDA as earnings before interest, taxes, depreciation and
amortization. EBITDA is used by management, from time to
time, to facilitate period-to-period operating comparisons and we
believe some investors and analysts use them as well. This
measure, as calculated by Exco, may not be comparable to similarly
titled measures used by other companies.
SOURCE Exco Technologies Limited