Sigma Industries reports fiscal 2010 first quarter results

QUEBEC CITY, Sept. 23 /CNW Telbec/ - Sigma Industries Inc. (TSX Venture Exchange: SIC), a manufacturing company specialized in the production of composite and metal components, today announced fiscal 2010 first quarter results for the period ended July 25, 2009 .

Sales reached $11.2 million , down 26.2% from $15.2 million in the first quarter last year. As in the previous quarter, the decline is mainly attributable to the economic slowdown that continues to result in lower activity in the heavy-duty truck and industrial product markets, while lower sales of agricultural products follows the Company's decision to focus on the most profitable products. Conversely, sales to the bus market significantly increased to reach $2.5 million as a result of new contracts obtained in the second half of fiscal 2009.

The Company reported an adjusted loss before interest, taxes, depreciation and amortization of $491,627 , as opposed to adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $382,024 a year earlier. This reduction reflects the negative impact of a lower sales volume on fixed cost absorption. The net loss amounted to $1.5 million , or $0.034 per share, fully diluted, in the first quarter of fiscal 2010, including restructuring costs of $89,095 , compared with a net loss of $598,450 , or $0.014 per share, fully diluted, in the first quarter a year ago.

"The difficult economic climate continues to negatively impact Sigma Industries' main business sectors," mentioned Denis Bertrand , President and Chief Executive Officer. "However, our willingness to concentrate our efforts on high-margin innovative technical solutions will have a beneficial effect on our profitability once the recovery is firmly underway. This effect will be almost immediate given our leaner and more flexible organizational structure. Meanwhile, we must pursue our disciplined operating cost management and reduce production costs by modernizing machinery and equipment and by consolidating production facilities."

As at July 25, 2009 , the Company's balance sheet showed total net debt of $24.8 million , an improvement in comparison with $25.3 million at the end of the previous quarter. As at April 25, 2009 , main financial ratios were met.

OUTLOOK

"Our strategic objectives are clear. We aim to increase sales by penetrating new potential market segments in composite flooring and in component assembly. In addition, we will continue to further improve existing products and develop new value-added products. To this end, our initiatives must also reflect our willingness to offer environment-conscious solutions and our efforts are oriented towards the development of new natural resins as well as technological processes incorporating these materials. Reaching these milestones will bring us even closer to our ultimate goal of offering a complete portfolio of technological solutions and to act as integrator of these solutions for our clients," concluded Mr. Bertrand .

    
    SELECTED FINANCIAL INFORMATION

                                            ---------------------------------
    Consolidated results of operations            Three-month periods ended
    (unaudited, in '000s of Cdn$,           ---------------------------------
     except per share figures)                July 25, 2009   July 26, 2008
                                                          $               $
    Sales                                            11,230          15,209
    Adjusted EBITDA                                    (491)            382
    Restructuring costs                                  89               0
    Loss before income taxes                         (1,877)           (895)
    Net loss                                         (1,477)           (599)
    Net loss per share (basic and diluted)           (0.034)         (0.014)
    -------------------------------------------------------------------------

                                            ---------------------------------
    Reconciliation of Adjusted EBITDA and         Three-month periods ended
     Net earnings (net loss)                ---------------------------------
    (unaudited, in '000s of Cdn $)            July 25, 2009   July 26, 2008
                                                          $               $
    Net loss                                         (1,477)           (599)
    PLUS:
    Income tax recovery                                (400)           (296)
    Depreciation and amortization                       754             921
    Financial expenses                                  543             356
    Restructuring costs                                  89               0
                                                        ----            ----
    Adjusted EBITDA                                    (491)            382
    -------------------------------------------------------------------------

                                            ---------------------------------
                                                           As at
    Consolidated balance sheet data         ---------------------------------
    (in '000s of Canadian dollars)            July 25, 2009  April 25, 2009
                                                          $               $
      Total assets                                   46,688          46,558
    Total liabilities                                37,881          36,927
    Shareholders' equity                              8,807           9,631
    -------------------------------------------------------------------------
    

NON-GAAP FINANCIAL MEASURES

The information included in this press release contains certain information which are not financial measures prescribed under GAAP. Sigma Industries uses adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA"), excluding the non-recurring gain on insurance settlement, in the assessment of its financial performance. As there is no generally accepted method of calculating this financial measure, it may not be comparable to similar measures reported by other companies. Adjusted EBITDA refers to earnings before interest, income taxes, depreciation, amortization and other non-operating expenses and revenues. This measure does not represent the cash flow for the repayment of long-term debt, the payment of dividends, reinvestment or other discretionary uses, and should not be considered in isolation or as a substitute of other measures of performance calculated according to GAAP.

ABOUT SIGMA INDUSTRIES

Sigma Industries Inc. (TSX-V: SIC), a manufacturing company specialized in the production of composite and metal components, has five operating subsidiaries and employs close to 350 people. The Company is active in the heavy-duty truck, coach, transit and bus, train and subway, machinery, agriculture, and wind energy market segments. 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 with respect to the Company. Such forward-looking statements are dependent upon a certain 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 September 23, 2009 , the date on which the Directors 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 when required by law.

Note to readers: Complete unaudited interim consolidated financial statements and Management's Discussion & Analysis of Financial Position and Operating Results were posted on SEDAR and are available at www.sedar.com.

    
    Neither 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.
    

For further information: Sigma Industries Inc.: Denis Bertrand, President and Chief Executive Officer, [phone], [email protected]; MaisonBrison: Martin Goulet, CFA, [phone], [email protected]