SAINT-ÉPHREM-DE-BEAUCE, QC, Dec. 8, 2014 /CNW Telbec/ - Sigma Industries Inc.
(TSXV: SSG), a manufacturing company specializing in the production
of composite components, announces results for the second quarter
of its 2015 fiscal year ended October 25,
2014. The results reflect the sale of the PNS Tech division
effective October 1, 2013 and in
accordance with IFRS, this division has been presented as
discontinued operations in the Company's unaudited condensed
interim consolidated financial statements.
"Sigma Industries' improved operating
results reflect the strength of the U.S. economy and further
validate our strategic decision to focus on our core competence of
closed mould manufacturing," said Denis
Bertrand, President and Chief Executive Officer of Sigma
Industries. "Sales rose by 6.9%, while specialization initiatives
and the favourable impact of greater business activity led to
improved profitability. We also further strengthened our financial
position, as we received final tranche payments from a private
placement. The sums received, combined with a solid cash flow
provided by operating activities, were used to reduce our bank loan
by more than $1.0 million during the
quarter. With this greater financial flexibility, we can now
leverage Sigma's expertise and its proven reputation in regards to
quality and innovation to further develop its presence in its
strategic markets to the benefit of customers, employees and
shareholders."
SECOND QUARTER RESULTS
Revenues from
continuing operations for the second quarter of fiscal 2015
totalled $15.3 million, up 6.9%
from $14.3 million in the second
quarter of fiscal 2014. This increase is mainly attributable to a
rise of $620,809 in sales to the
heavy-duty truck market resulting from the recovery in that market.
In addition, sales to the wind energy market rose $568,016 due to increased demand from an
important customer, while sales to the bus industry increased by
$106,223 as a result of a new
manufacturing contract.
Sigma Industries recorded adjusted earnings
before interest, taxes, depreciation and amortization ("EBITDA")
from continuing operations of $1.2
million, or 7.9% of revenues, in the second quarter of
fiscal 2015, versus adjusted EBITDA of $696,850, or 4.9% of revenues, in the second
quarter of last year. This increase is attributable to the
Company's specialization in closed mould manufacturing and to the
favourable effect of higher business activity on the absorption of
fixed overhead costs.
In the second quarter, the Company recorded a
gain on lease cancellation of $601,868 following the definitive closure of its
U.S. facility during the period. As a result, net income from
continuing operations for the second quarter of fiscal 2015
amounted to $1.1 million, or
$0.09 per basic and diluted share,
versus a net loss from continuing operations of ($18,134), or ($0.001) per basic and diluted share last
year.
During the quarter, the Company renewed its
credit facility and a bank loan with its main lender. The new
maturing date on the credit facility is August 31, 2015. The Company also received the
final portions of a secured loan and of secured convertible
debentures as part of a private placement. These sources of funds
show the confidence that Sigma Industries' lenders have in its
business plan and provide the Company flexibility to proceed with
its execution.
SIX-MONTH RESULTS
For the six-month
period ended October 25, 2014,
revenues from continuing operations amounted to $30.3 million, versus $27.8 million for the
six-month period ended October 26,
2013. Adjusted EBITDA from continuing operations totalled
$2.0 million, or 6.7% of revenues, up
from $619,824, or 2.2% of revenues,
last year. Reflecting the aforementioned gain, net income from
continuing operations reached $1.1
million, or $0.10 per basic
and diluted share, versus a net loss from continuing operations of
($834,906), or ($0.07) per basic and diluted share, a year
earlier.
SELECTED FINANCIAL INFORMATION
Consolidated
results of operations
|
Three months
ended
|
|
Six months
ended
|
(unaudited, in
thousands of Canadian dollars except per-share amounts)
|
October 25,
2014
|
October 26,
2013
|
|
October 25,
2014
|
October 26,
2013
|
|
$
|
$
|
|
$
|
$
|
Revenues from
continuing operations
|
15,286
|
14,302
|
|
30,287
|
27,795
|
Adjusted EBITDA from
continuing operations
|
1,213
|
697
|
|
2,020
|
620
|
Net income (loss)
from continuing operations
|
1,068
|
(18)
|
|
1,125
|
(835)
|
|
Per share (basic and
diluted)
|
0.09
|
(0.001)
|
|
0.10
|
(0.07)
|
Net income
(loss)
|
1,068
|
192
|
|
1,125
|
(591)
|
|
Per share (basic and
diluted)
|
0.09
|
0.02
|
|
0.10
|
(0.05)
|
Reconciliation of
EBITDA, adjusted EBITDA and net income
(unaudited, in
thousands of Canadian dollars)
|
Three months
ended
|
|
Six months
ended
|
October 25,
2014
|
October 26,
2013
|
|
October 25,
2014
|
October 26,
2013
|
|
$
|
$
|
|
$
|
$
|
Net income
(loss)
|
1,068
|
192
|
|
1,125
|
(591)
|
MINUS:
|
|
|
|
|
|
Net income from
discontinued operations
|
-
|
210
|
|
-
|
244
|
Net income (loss)
from continuing operations
|
1,068
|
(18)
|
|
1,125
|
(835)
|
PLUS
(less):
|
|
|
|
|
|
Income tax expense
recovery
|
-
|
(21)
|
|
(10)
|
(21)
|
Gain on lease
cancellation
|
(602)
|
-
|
|
(602)
|
-
|
Depreciation and
amortization
|
310
|
307
|
|
622
|
621
|
Financial
expenses
|
437
|
429
|
|
885
|
855
|
Adjusted EBITDA
from continuing operations
|
1,213
|
697
|
|
2,020
|
620
|
PLUS
(less):
|
|
|
|
|
|
Foreign exchange
gain
|
(148)
|
(91)
|
|
(44)
|
(93)
|
Gain on disposal of
property, plant and equipment
|
(1)
|
-
|
|
-
|
-
|
EBITDA from
continuing operations
|
1,064
|
606
|
|
1,976
|
527
|
Consolidated
balance sheet data
|
As at
|
(in thousands of
Canadian dollars)
|
October 25,
2014
|
April 26,
2014
|
|
$
|
$
|
Total
assets
|
25,581
|
25,344
|
Total
liabilities
|
24,562
|
25,854
|
Shareholders'
equity
|
1,019
|
(510)
|
NON-IFRS FINANCIAL MEASURES
The
information in this press release includes certain measures that
are not financial measures prescribed under IFRS. Sigma Industries
uses adjusted earnings before interest, taxes, depreciation and
amortization ("Adjusted EBITDA") and earnings before interest,
taxes, depreciation and amortization ("EBITDA") in assessing its
financial performance. As there is no generally accepted method of
calculating these financial measures, they may not be comparable to
similar measures reported by other companies. Adjusted EBITDA is
earnings before interest, income taxes, depreciation, amortization
and other non-operating expenses and revenues, EBITDA consists of
adjusted EBITDA plus (minus) foreign exchange loss (gain) and loss
(gain) on disposal of property, plant and equipment. These measures
do not represent cash flow available for repayment of debt, payment
of dividends, reinvestment or other discretionary uses, and should
not be considered in isolation or as a substitute for other
measures of performance calculated according to IFRS.
ABOUT SIGMA INDUSTRIES
Sigma Industries
Inc. (TSX-V: SSG), a manufacturing company specializing in the
production of composite components, has two operating subsidiaries
and employs 350 people. The Company is active in the heavy-duty
truck, coach, transit, machinery and wind energy markets. Sigma
sells its products to original equipment manufacturers and
distributors in the United States,
Canada and Europe.
FORWARD-LOOKING STATEMENTS
This press
release contains certain forward-looking statements about the
Company. Such forward-looking statements are dependent on a number
of factors and are subject to risks and uncertainties. Actual
results may differ from those expected. The information contained
in this press release is dated December 8,
2014, the date on which management approved the press
release. Management does not assume any obligation to update or
revise any forward-looking statements, whether as a result of new
information or future events, except as required by law.
Note to readers: Complete unaudited condensed
interim financial statements and Management's Discussion &
Analysis of Financial Position and Operating Results have been
posted on SEDAR and are available at www.sedar.com.
Neither the TSX Venture Exchange nor its
regulation services provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
SOURCE Sigma Industries Inc.