5N Plus Inc. Reports Third Quarter Results and Record Sales
MONTREAL, April 6 /CNW Telbec/ - 5N Plus Inc. (TSX: VNP) today announced financial results for the third quarter of fiscal 2010 ended February 28, 2010. Sales reached a record level of $19,227,127 up by 0.4% over sales of $19,150,195 for the third quarter of the previous fiscal year. Net earnings were of $4,075,513 ($0.09 per share), which represents a 21.5% decrease over net earnings of $5,189,673 ($0.11 per share) for the third quarter of the previous fiscal year. EBITDA(1) decreased by 22.0% to $6,253,513 down from $8,012,408 during the third quarter of the previous fiscal year.
For the nine-month period ended February 28, 2010, sales decreased by 0.5% to $51,033,792 and net earnings by 32.0% to $10,307,869 ($0.23 per share). This compares with sales of $51,315,894 and net earnings of $15,159,673 ($0.33 per share) for the same period of the previous fiscal year. EBITDA also decreased during the nine-month period ended February 28, 2010 to $16,444,458 down by 28.0% from $22,833,752 for the corresponding period of the previous fiscal year.
As at February 28, 2010 the backlog of orders expected to translate into sales over the following twelve months stood at $53,791,253 which represents a 3.4% increase over its level of $52,024,064 one year earlier.
On December 1, 2009, 5N Plus announced the acquisition of Firebird Technologies Inc., a leading manufacturer of compound semiconductor products and pure metals and also announced that its had signed a memorandum of understanding for the long-term supply of strategic metals including indium, cadmium and germanium with Teck Metals Ltd.
On January 25, 2010, 5N Plus and Abound Solar announced that they had signed a photovoltaic module recycling agreement and a memorandum of understanding for the supply of semiconductor compounds.
Jacques L'Ecuyer, President and Chief Executive Officer said, "We are pleased to report the results of our third quarter which was characterized by record sales and an improved profitability with respect to the previous two quarters. This is despite a continuing strengthening of the Canadian dollar with respect to its European and American counterparts which had a negative impact on sales of approximately $3 million. Demand for our solar grade products continued to be strong but it is the increase in sales of our non-solar products which was largely responsible for the record quarter. These non-solar products include for the first time those produced by our subsidiary Firebird Technologies, the performance of which positively impacted both our sales and earnings in the quarter."
Mr. L'Ecuyer continued, "We made several announcements in the quarter primarily centered on our compound semiconductor wafer business and our recycling activities. Concurrently with the purchase of Firebird Technologies we announced the signature of a memorandum of understanding which Teck Metals Ltd, which was later converted into binding agreements ensuring that our subsidiary is provided with a reliable supply of critical feedstock including indium and germanium. We also made great strides in the quarter to further establish our recycling business and announced an agreement with Abound Solar for the recycling of solar modules and manufacturing scrap. A similar announcement was made shortly after the quarter ended with Calyxo another manufacturer of solar modules. Both agreements together with our joint development efforts carried out with First Solar are aimed at providing our customers and more generally the solar industry with environmentally sustainable recycling solutions. "
Further continuing Mr. L'Ecuyer added, "We also announced more recently and after the end of the quarter some further changes including the promotion of Nicholas of Audet to Vice-President, with the corresponding additional responsibilities, as well as the sale of our stake in ZT Plus, which follows the slower than anticipated commercial development of this venture."
Mr. L'Ecuyer concluded, "We are grateful to our employees for this recent quarter and would like to thank the Firebird team for their first contribution to our quarterly results. We are very hopeful about Firebird's future prospects and have begun construction of a new facility in Trail which will allow for expansion of their current activities. We are confident that our investment in this new facility will enable Firebird to develop into a major producer of semiconductor wafers and a significant provider of products for the germanium and solar markets.This is in line with the growth plan to which we remain committed which calls for diversification of our product offering and accretive acquisitions. "
The interim unaudited consolidated financial statements of 5N Plus, as well as the Management's Report of this third quarter ended February 28, 2010 are available on the 5N Plus website, at www.5nplus.com and on the SEDAR website at www.sedar.com.
Conference Call Information
The Company will host a conference call at 10:00 Eastern Time on Wednesday, April 7, 2010 with financial analysts to discuss the second quarter results. All interested parties are invited to participate to the live broadcast on the Company's Web site at www.5nplus.com. A replay of the webcast will be available until April 23, 2010.
About 5N Plus Inc.
5N Plus draws its name from the purity of its products, 99.999% (five nines or 5N) and more. 5N Plus, which has its head office in Montreal, Quebec, develops and produces high-purity metals and compounds for electronic applications and provides its customers with recycling solutions. The Company is an integrated producer with both primary and secondary refining capabilities. 5N Plus focuses on specialty metals such as tellurium, cadmium and selenium and on related compounds such as cadmium telluride and cadmium sulphide. The Company's products are critical precursors in a number of electronic applications, including the rapidly-expanding solar (thin-film photovoltaic) market, for which 5N Plus is a major supplier of cadmium telluride, and the radiation detector market.
Forward-Looking Statements and Disclaimer
Certain statements in this press release may be forward-looking. Forward-looking statements are based on the best estimates available to the Company at the time and involve known and unknown risks, uncertainties or other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements in order to account for any new information or any other event. The reader is warned against undue reliance on these forward- looking statements.
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(1) EBITDA means earnings before financing costs, interest income, income
taxes, depreciation and amortization and is presented on a consistent
basis from period to period. We use EBITDA, because we believe it is
a meaningful measure of the operating performance of our ongoing
business without the effects of certain expenses. The definition of
this non-GAAP measure used by the Company may differ from that used
by other companies.
5N Plus Inc.
Interim Consolidated Statements of Earnings
Three months ended Nine months ended
February 28 February 28
------------------------------------------------------------
(in Canadian 2009 2009
dollars) 2010 (Restated) 2010 (Restated)
-------------------------------------------------------------------------
Sales $ 19,227,127 $ 19,150,195 $ 51,033,792 $ 51,315,894
Cost of
sales 11,023,594 9,309,927 27,852,448 24,613,624
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Gross
profit 8,203,533 9,840,268 23,181,344 26,702,270
Expenses
Selling
and admi-
nistrative 1,512,646 1,343,814 5,285,279 3,606,876
Research
and deve-
lopment 827,584 333,238 1,971,690 817,865
Deprecia-
tion of
property,
plant and
equipment 662,008 603,077 1,919,425 1,553,111
Amortiza-
tion of
intangible
assets 103,142 - 202,894 -
Foreign
exchange
(gain)
loss (390,209) 96,926 (520,083) (1,265,775)
Financial 64,675 130,812 160,908 333,706
Interest
income (108,781) (227,205) (378,632) (996,316)
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2,671,065 2,280,662 8,641,481 4,049,467
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Earnings
before
undernoted
items 5,532,468 7,559,606 14,539,863 22,652,803
Start-up
costs, new
plant - 53,882 - 709,552
-------------------------------------------------------------------------
Earnings
before
income
taxes 5,532,468 7,505,724 14,539,863 21,943,251
Income
taxes 1,456,955 2,316,051 4,231,994 6,783,578
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Net
earnings $ 4,075,513 $ 5,189,673 $ 10,307,869 $ 15,159,673
------------------------------------------------------------
------------------------------------------------------------
Earnings
per share
Basic $ 0.09 $ 0.11 $ 0.23 $ 0.33
Diluted $ 0.09 $ 0.11 $ 0.23 $ 0.33
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Weighted
average
number of
common
shares
Basic 45,615,999 45,505,413 45,563,382 45,501,804
Diluted 46,016,585 45,815,527 45,772,957 45,889,182
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5N Plus Inc.
Interim Consolidated Balance Sheets
As at As at
February 28, May 31,
2010 2009
(in Canadian dollars) (unaudited) (audited)
-------------------------------------------------------------------------
Assets
Current assets
Cash and cash equivalents $ 61,472,756 $ 65,066,530
Accounts receivable 5,836,242 6,702,197
Inventories 29,362,033 27,054,960
Prepaid expenses and deposits 664,212 516,391
Income taxes recoverable 312,034 -
Future income taxes 205,488 249,958
Foreign currency forward contracts 482,926 1,685,076
-------------------------------------------------------------------------
98,335,691 101,275,112
Property, plant and equipment 28,082,085 25,823,473
Intangible assets 4,593,152 354,950
Goodwill 4,566,726 -
Future income taxes 1,825,270 662,639
Other assets 45,181 52,682
-------------------------------------------------------------------------
$ 137,448,105 $ 128,168,856
------------------------------
------------------------------
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued
liabilities $ 7,229,956 $ 6,791,675
Income taxes payable - 3,021,632
Current portion of long-term debt 587,875 549,922
Current portion of other long-term
liabilities 24,961 41,725
Future income taxes 65,338 311,897
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7,908,130 10,716,851
Long-term debt 4,654,145 3,997,923
Deferred revenue 472,643 641,618
Future income taxes 1,912,092 443,700
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14,947,010 15,800,092
-------------------------------------------------------------------------
Shareholders' equity
Share capital 82,360,021 81,881,914
Contributed surplus 1,164,139 797,800
Accumulated other comprehensive income (1,131,032) (111,048)
Retained earnings 40,107,967 29,800,098
-------------------------------------------------------------------------
122,501,095 112,368,764
-------------------------------------------------------------------------
$ 137,448,105 $ 128,168,856
------------------------------
------------------------------
Reconciliation of EBITDA
Three months ended February 28
-------------------------------------------------------------------------
2010 2009 (Decrease)
-------------------------------------------------------------------------
Net earnings $ 4,075,513 $ 5,189,673 (21.5%)
Add (deduct):
Income taxes 1,456,955 2,316,051
Financial expenses &
Interest income (44,106) (96,393)
Depreciation and
amortization 765,150 603,077
-------------------------------------------------------------------------
EBITDA $ 6,253,513 $ 8,012,408 (22.0%)
---------------------------------------------
---------------------------------------------
Nine months ended February 28
-------------------------------------------------------------------------
2010 2009 (Decrease)
-------------------------------------------------------------------------
Net earnings $ 10,307,869 $ 15,159,673 (32.0%)
Add (deduct):
Income taxes 4,231,994 6,783,578
Financial expenses &
Interest income (217,724) (662,610)
Depreciation and
amortization 2,122,319 1,553,111
-------------------------------------------------------------------------
EBITDA $ 16,444,458 $ 22,833,752 (28.0%)
---------------------------------------------
---------------------------------------------
Cash Flows
Three months ended Nine months ended
February 28 February 28
-------------------------------------------------------------------------
2010 2009 2010 2009
-------------------------------------------------------------------------
Operating
activities $ 1,958,888 $ 5,733,739 $ 9,482,909 $ 11,617,761
Financing
activities (95,310) (2,588,088) (125,965) (1,501,046)
Investing
activities (9,684,583) (1,497,028) (12,795,776) (7,531,368)
Effect of
changes in
foreign
currency
exchange (194,815) 10,705 (154,942) 25,473
-------------------------------------------------------------------------
(Decrease)
Increase in
cash and
cash equi-
valents $ (8,015,820) $ 1,659,328 $ (3,593,774) $ 2,610,820
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For further information: Jacques L'Écuyer, President and Chief Executive Officer, 5N Plus Inc., (514) 856-0644, [email protected]
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