TORONTO, April 26 /CNW/ - Exco Technologies Limited (TSX-XTC) today announced results for its second quarter ended March 31, 2007. In addition, the Company announced that a quarterly cash dividend of $0.015 per share will be paid June 29, 2007 to shareholders of record on June 15, 2007.
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6 Months Ended 3 Months ended
March 31 March 31
($000s, except per share amounts)
2007 2006 2007 2006
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Sales $104,133 $104,157 $55,382 $53,968
Net income (loss)
before taxes $4,416 ($3,694) $2,579 ($6,653)
Net income (loss) $2,967 ($5,364) $1,859 ($7,360)
Basic and diluted
earnings (loss)
per share $0.07 ($0.13) $0.04 ($0.18)
Common shares
outstanding 41,406,000 41,606,000 41,406,000 41,606,000
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Exco Technologies Limited recorded net income of $1.9 million, or 4 cents per share, on revenues of $55.4 million. In the same quarter last year, the Company recorded a net loss of $7.4 million, or 18 cents per share, on revenue of $54.0 million. The improvement in net income is primarily attributable to the absence of any goodwill impairment charge which in the second quarter of last year was $8.3 million or $0.20 per share.
Exco's quarterly sales of $55.4 million represent the highest sales level for the Company since September 2005. The increase is primarily due to the impressive growth at the Polydesign division in Morocco. Sales increased 123.2% compared to the comparable quarter last year and 47.3% compared to the first quarter in 2007. Overall gross margin in the quarter also improved 2% over last year to 24%.
"We are pleased with the growth at our Moroccan facility and the improvement in the Company's gross margin. We will continue to focus our attention on our lower margin facilities in order to return them to traditional margin levels," said Brian Robbins, President and CEO of Exco Technologies Limited. "We feel the Company is well positioned to grow in the European market while focusing on profit margins through cost cutting and pricing strategies."
Exco's Casting and Extrusion segment reported revenues of $34.1 million in the second quarter compared to $34.3 million in the same period last year. This segment's operating earnings were $870 thousand compared to a loss of $8.6 million last year. Last year's goodwill impairment of $8.3 million accounts for the majority of this change. The Automotive Solutions segment reported sales of $21.3 million in the second quarter compared to $19.6 million in the same period last year. This segment's operating earnings were $1.8 million compared to $2.1 million last year.
The company is also pleased to announce the appointment of Stephen Rodgers as a director of the Board effective April 26, 2007. Mr. Rodgers has held numerous operational and marketing positions at General Motors of Canada and Magna International including Tesma, Intier and the corporate office over a 30 year career in the automotive industry. His knowledge of global automotive OEM and Tier 1 customers make him a valuable addition to Exco's Board at a time when the company is executing its strategy of European expansion and further penetration of the foreign domestic OEM market.
The Company also announced that it will be renewing its normal course issuer bid for an additional twelve month period until May 7, 2008. Under the terms of the renewed bid, Exco may acquire up to 2,050,000 common shares, representing approximately 5% of Exco's currently issued and outstanding common shares. All purchases will be made through the facilities of, and in accordance with the rules of the Toronto Stock Exchange. All shares purchased under the bid will be cancelled. Under Exco's current normal course issuer bid which expires on May 7, 2007, Exco has to date purchased 212,600 common shares at an average price per share of $3.77. The Board of Directors of Exco believes that, given the Exco's strong cash position, the purchase of shares under the bid to be an appropriate and desirable use of available funds.
The dividend is an "eligible dividend" in the accordance with Section 89(14) of the Income Tax Act of Canada.
(for further information please refer to the Company's Second Quarter Interim Financial Statements in the Investor Relations section posted at www.excocorp.com. Alternatively, please refer to www.sedar.com after April 26, 2007.)
Exco Technologies Limited is a global supplier of innovative technologies servicing the die-cast, extrusion and automotive industries. Through our 13 strategic locations, we employ 2,200 people and service a diverse and broad customer base.
Management will hold a conference call to discuss the second quarter results on Friday April 27, 2007 at 11:00 am (EST). The local dial in number for the call is (416) 644-3415 or toll free 1-800-732-9307. 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 April 27, 2007, 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 include, among other things: industry cyclicality; global economic conditions, causing decreases in automobile production volumes and demand for capital goods; changing demand for specific models or products; price reduction pressures; pressure to absorb certain fixed costs; dependence on major customers and changes in such customers' financial capabilities; technological changes; compliance with various laws; obtaining necessary permits and consents; fluctuations in currency exchange and interest rates; employee work stoppages; dependence on key employees; the competitive nature of the automotive and capital goods industries, including competition with suppliers operating in low cost countries; product supply and demand; the conduct of business in foreign countries; and other risks, uncertainties and assumptions as described in the Company's Management's Discussion and Analysis included in our 2006 Annual Report, in our 2006 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.
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