MONTREAL, Nov. 3, 2015 /CNW Telbec/ - 5N Plus Inc. (TSX: VNP), the leading producer of specialty metal and chemical products, today reported financial results for the third quarter ended September 30, 2015.
- Revenues for the three and nine-month periods ended September 30, 2015 reached $68.7 million and $251.6 million down from $114.4 million and $393.4 million for the corresponding periods of the previous fiscal year, negatively impacted by continuing erosion in relevant underlying commodity prices which have on average decreased by 55% since the beginning of the year.
- Total debt and net debt1 decreased by $20.2 million and $11.7 million respectively in the quarter positively impacted by working capital management. As at September 30, 2015 net debt stood at $46.7 million, down from $84.0 million as at December 31, 2014.
- Adjusted EBITDA1 and EBITDA1 reached positive $1.1 million and negative $26.1 million respectively in the third quarter of 2015 compared to $8.1 million and $12.7 million for the same quarter of 2014. Margins were similarly negatively impacted by decreasing metal prices including bismuth, indium, selenium and tellurium which fell by 20%, 33%, 29% and 56% respectively in the third quarter alone. The EBITDA for the third quarter was negatively impacted by an inventory impairment charge of $27.2 million as well as an allowance for a doubtful note receivable from an affiliate.
- Net loss for the third quarter of 2015 reached $32.2 million, compared to net earnings of $4.2 million for the third quarter of 2014.
- Backlog1 as at September 30, 2015 stood at 134 days of sales outstanding up by 12 days and 25 days when compared to the backlog level of December 31, 2014 and September 30, 2014. Backlog and bookings1 are also negatively impacted by decreases in underlying commodity pricing.
-
5N Plus also announced today that Mr. Jacques L'Ecuyer has informed the Board of Directors of the Company of his desire to step aside from his current position of President and Chief Executive Officer. As a result, a process has been initiated during the last quarter by the board of directors of the Company to identify a new President and Chief Executive Officer to succeed to Mr. L'Ecuyer whom will remain as President and Chief Executive Officer until the new President and Chief Executive Officer has been appointed by the board of directors.
Jacques L'Ecuyer, President and Chief Executive Officer, said "Demand for our products remained in line with expectations with a slight decrease in shipments following the usual pattern of the European summer slowdown. Continuing and persistent erosion in prices of almost all of our key metals continues to significantly weigh on our financial performance. Until this trend stops or its magnitude decreases, we expect our financial performance to remain disappointing other than from a cash flow standpoint which should stay relatively strong as we reduce our working capital requirements in line with underlying commodity pricing trends. "
1 See Non-IFRS Measures |
Webcast Information
5N Plus will host a conference call on Wednesday, November 4, 2015 at 8:00 am ET with financial analysts to discuss results of the quarter ended September 30, 2015. All interested parties are invited to participate in the live broadcast on the Company's Web site at www.5nplus.com. A replay of the webcast and a recording of the Q&A will be available until November 11, 2015.
To participate in the conference call:
- Montreal area: 514-807-9895
- Toronto area: 647-427-7450
- Toll-Free : 1-888-231-8191
Enter access code 70617320.
Non-IFRS Measures
Adjusted EBITDA means EBITDA as defined above before impairment of inventories, allowance for doubtful of a receivable from a related party, litigation and restructuring costs, gain on disposal of property, plant and equipment, change in fair value of debenture conversion option, foreign exchange and derivatives loss (gain). We use adjusted EBITDA because we believe it is a meaningful measure of the operating performance of our ongoing business without the effects of inventory write-downs. The definition of this non-IFRS measure used by the Company may differ from that used by other companies.
Net debt or net cash is a measure we use to monitor how much debt we have after taking into account cash and cash equivalents and restricted cash. We use it as an indicator of our overall financial position, and calculate it by taking our total debt, including the current portion, and subtracting cash and cash equivalents and restricted cash.
Backlog represents the expected orders we have received but have not yet executed and that are expected to translate into sales within the next twelve months expressed in number of days. Bookings represent orders received during the period considered, expressed in days, and is calculated by adding revenues to the increase or decrease in backlog for the period considered divided by annualized year revenues. We use backlog to provide an indication of expected future revenues in days, and bookings to determine our ability to sustain and increase our revenues.
About 5N Plus Inc.
5N Plus is the leading producer of specialty metal and chemical products. Fully integrated with closed-loop recycling facilities, the Company is headquartered in Montreal, Québec, Canada and operates manufacturing facilities and sales offices in several locations in Europe, the Americas and Asia. 5N Plus deploys a range of proprietary and proven technologies to produce products which are used in a number of advanced pharmaceutical, electronic and industrial applications. Typical products include purified metals such as bismuth, gallium, germanium, indium, selenium and tellurium, inorganic chemicals based on such metals and compound semiconductor wafers. Many of these are critical precursors and key enablers in markets such as solar, light-emitting diodes and eco-friendly materials.
Forward-Looking Statements and Disclaimer
This press release may contain forward-looking information within the meaning of applicable securities laws. All information and statements other than statements of historical facts contained in this press release are forward-looking information. Such statements and information may be identified by words such as "about", "approximately", "may", "believes", "expects", "will", "intends", "should", "plans", "predicts", "potential", "projects", "anticipates", "estimates", "continues" or similar words or the negative thereof or other comparable terminology. Forward-looking statements are based on the best estimates available to 5N Plus at this time and involve known and unknown risks, uncertainties and other factors that may cause 5N Plus' actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. A description of the risks affecting 5N Plus' business and activities appears under the heading "Risk and Uncertainties" of 5N Plus' 2014 MD&A dated February 24, 2015 and notes 11 and 12 of the unaudited condensed interim consolidated financial statements for the three and nine-month periods ended September 30, 2015 and 2014, available on SEDAR at www.sedar.com. No assurance can be given that any events anticipated by the forward-looking information in this press release will transpire or occur, or if any of them do so, what benefits that 5N Plus will derive therefrom. In particular, no assurance can be given as to the future financial performance of 5N Plus. The forward-looking information contained in this press release is made as of the date hereof and 5N Plus undertakes no obligation to publicly update such forward-looking information to reflect new information, subsequent or otherwise, unless required by applicable securities laws. The reader is warned against placing undue reliance on these forward-looking statements.
5N PLUS INC. |
||
Condensed Interim Consolidated Statements of Financial Position |
||
(unaudited) (Figures in thousands of United States dollars) |
|
|
$ |
$ |
|
ASSETS |
||
Current |
||
Cash and cash equivalents |
8,025 |
12,777 |
Restricted cash |
- |
2,115 |
Accounts receivable |
44,330 |
72,391 |
Inventories |
121,753 |
204,454 |
Income tax receivable |
6,095 |
2,705 |
Derivative financial assets |
- |
147 |
Other current assets |
1,936 |
2,965 |
Total current assets |
182,139 |
297,554 |
Property, plant and equipment |
72,345 |
68,261 |
Intangible assets |
6,336 |
15,728 |
Deferred tax asset |
9,746 |
11,037 |
Investment accounted for using the equity method |
331 |
316 |
Other assets |
3,099 |
6,635 |
Total non-current assets |
91,857 |
101,977 |
Total assets |
273,996 |
399,531 |
LIABILITIES AND EQUITY |
||
Current |
||
Bank indebtedness |
- |
975 |
Trade and accrued liabilities |
36,862 |
60,286 |
Income tax payable |
5,857 |
6,064 |
Long-term debt due within one year |
459 |
667 |
Total current liabilities |
43,178 |
67,992 |
Long-term debt |
13,042 |
51,156 |
Convertible debentures |
41,216 |
46,101 |
Deferred tax liability |
1,487 |
3,111 |
Retirement benefit obligation |
14,566 |
16,928 |
Derivative financial liabilities |
89 |
2,093 |
Other liabilities |
18,590 |
15,711 |
Total non-current liabilities |
88,990 |
135,100 |
Total liabilities |
132,168 |
203,092 |
Shareholders' equity |
141,835 |
196,443 |
Non-controlling interest |
(7) |
(4) |
Total equity |
141,828 |
196,439 |
Total liabilities and equity |
273,996 |
399,531 |
5N PLUS INC. |
|||||||||
Condensed Interim Consolidated Statements of (Loss) Earnings |
|||||||||
For the three month and nine-month periods September 30, 2015 and 2014 |
|||||||||
(unaudited) |
Three months |
Nine months |
|||||||
(Figures in thousands of United States dollars, |
2015 |
2014 |
2015 |
2014 |
|||||
$ |
$ |
$ |
$ |
||||||
Revenues |
68,732 |
114,438 |
251,645 |
393,414 |
|||||
Cost of sales |
88,923 |
99,085 |
265,469 |
338,869 |
|||||
Selling, general and administrative expenses |
7,443 |
8,480 |
21,186 |
28,283 |
|||||
Other expenses |
3,964 |
1,844 |
18,291 |
6,023 |
|||||
Share of (gain) loss from joint ventures |
(36) |
130 |
(15) |
227 |
|||||
100,294 |
109,539 |
304,931 |
373,402 |
||||||
Operating (loss) earnings |
(31,562) |
4,899 |
(53,286) |
20,012 |
|||||
Gain on disposal of property, plant and equipment |
- |
- |
- |
1,312 |
|||||
Financial (revenues) expenses |
|||||||||
Interest on long-term debt |
1,187 |
1,687 |
3,575 |
4,149 |
|||||
Imputed interest and other financial expense |
938 |
1,075 |
3,380 |
1,760 |
|||||
Changes in fair value of debenture conversion option |
(194) |
(5,623) |
(1,840) |
(5,811) |
|||||
Foreign exchange and derivative (gain) loss |
(2,810) |
824 |
(2,871) |
314 |
|||||
(879) |
(2,037) |
2,244 |
412 |
||||||
(Loss) earnings before income tax |
(30,683) |
6,936 |
(55,530) |
20,912 |
|||||
Income tax expense (recovery) |
|||||||||
Current |
(417) |
2,717 |
(389) |
7,112 |
|||||
Deferred |
1,905 |
48 |
(555) |
674 |
|||||
1,488 |
2,765 |
(944) |
7,786 |
||||||
Net (loss) earnings for the period |
(32,171) |
4,171 |
(54,586) |
13,126 |
|||||
Attributable to: |
|||||||||
Equity holders of 5N Plus Inc. |
(32,171) |
4,172 |
(54,583) |
13,263 |
|||||
Non-controlling interest |
- |
(1) |
(3) |
(137) |
|||||
(32,171) |
4,171 |
(54,586) |
13,126 |
||||||
(Loss) earnings per share attributable to equity holders of 5N Plus Inc. |
(0.38) |
0.05 |
(0.65) |
0.16 |
|||||
Basic (loss) earnings per share |
(0.38) |
0.05 |
(0.65) |
0.16 |
|||||
Diluted (loss) earnings per share |
(0.38) |
(0.01) |
(0.65) |
0.10 |
5N PLUS INC. |
||||||||
(Figures in thousands of United States dollars) |
||||||||
Cash Flows |
||||||||
Q3 2015 |
Q3 2014 |
Change |
YTD 2015 |
YTD 2014 |
Change |
|||
$ |
$ |
$ |
$ |
|||||
Funds (used in) from operations1 |
(620) |
982 |
(163%) |
(4,117) |
13,562 |
(130%) |
||
Net changes in non-cash working capital items |
14,460 |
(528) |
(2,839%) |
51,994 |
(26,746) |
(294%) |
||
Operating activities |
13,840 |
454 |
2,948% |
47,877 |
(13,184) |
(463%) |
||
Investing activities |
(5,094) |
(5,906) |
(14%) |
(14,645) |
(11,224) |
30% |
||
Financing activities |
(17,156) |
(5,305) |
(223%) |
(37,593) |
12,853 |
(392%) |
||
Effect of foreign exchange rate changes on cash and cash equivalents related to operations |
(84) |
(610) |
(86%) |
(391) |
(584) |
(33%) |
||
Net decrease in cash and cash equivalents |
(8,494) |
(11,367) |
(25%) |
(4,752) |
(12,139) |
(61%) |
||
Revenues by Segment |
||||||||
Q3 2015 |
Q3 2014 |
Change |
YTD 2015 |
YTD 2014 |
Change |
|||
$ |
$ |
$ |
$ |
|||||
Electronic Materials |
24,999 |
34,784 |
(28%) |
85,432 |
127,469 |
(33%) |
||
Eco-Friendly Materials |
43,733 |
79,654 |
(45%) |
166,213 |
265,945 |
(38%) |
||
Total revenues |
68,732 |
114,438 |
(40%) |
251,645 |
393,414 |
(36%) |
||
Adjusted EBITDA |
||||||||
Q3 2015 |
Q3 2014 |
Change |
YTD 2015 |
YTD 2014 |
Change |
|||
$ |
$ |
$ |
$ |
|||||
Electronic Materials |
2,884 |
4,684 |
(38%) |
10,676 |
18,789 |
(43%) |
||
Eco-Friendly Materials |
804 |
6,415 |
(87%) |
(538) |
19,061 |
(103%) |
||
Corporate |
||||||||
Research and Development |
(400) |
(362) |
10% |
(1,124) |
(741) |
52% |
||
Other |
(2,236) |
(2,666) |
(16%) |
(5,729) |
(7,721) |
(26%) |
||
Adjusted EBITDA1 |
1,052 |
8,071 |
(87%) |
3,285 |
29,388 |
(89%) |
||
EBITDA1 |
(26,136) |
12,721 |
(305%) |
(28,696) |
35,423 |
(181%) |
||
Backlog and Bookings |
||||||||
BACKLOG1 |
BOOKINGS1 |
|||||||
Q3 2015 |
Q2 2015 |
Q3 2014 |
Q3 2015 |
Q2 2015 |
Q3 2014 |
|||
$ |
$ |
$ |
$ |
$ |
$ |
|||
Electronic Materials |
54,965 |
68,368 |
79,753 |
11,596 |
18,095 |
37,259 |
||
Eco-Friendly Materials |
45,603 |
62,981 |
57,430 |
26,355 |
51,742 |
63,999 |
||
Total |
100,568 |
131,349 |
137,183 |
37,951 |
69,837 |
101,258 |
||
(number of days based on annualized revenues) |
||||||||
BACKLOG1 |
BOOKINGS1 |
|||||||
Q3 2015 |
Q2 2015 |
Q3 2014 |
Q3 2015 |
Q2 2015 |
Q3 2014 |
|||
Electronic Materials |
201 |
203 |
209 |
42 |
54 |
98 |
||
Eco-Friendly Materials |
95 |
102 |
66 |
55 |
84 |
73 |
||
Weighted average |
134 |
137 |
109 |
50 |
73 |
81 |
*Bookings and backlog are also presented in number of days to normalize the impact of commodity prices.
1 See Non-IFRS Measures |
SOURCE 5N Plus Inc.
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Jean Mayer, Vice President, Legal Affairs and Corporate Secretary, 5N Plus Inc., (514) 856-0644 x6178, [email protected]
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