Sigma Industries reports fiscal 2013 third quarter results

SAINT-ÉPHREM-DE-BEAUCE, QC, Feb. 28, 2013 /CNW Telbec/ - Sigma Industries Inc. (TSXV: SSG), a manufacturing company specializing in the production of composite and metal components, today announced results for the third quarter of its 2013 fiscal year ended January 26, 2013.

Revenues totalled $13.5 million in the third quarter of fiscal 2013, versus $19.7 million in the third quarter of fiscal 2012. This $6.2 million decrease is mainly attributable to a $5.0 million reduction in revenues from the heavy-duty truck industry as a result of political, economic and fiscal uncertainty in the United States. This uncertainty also caused a $519,910 reduction in revenues from wind energy products due to insecurity with regards to the renewal of production tax credits in the United States. Conversely, revenues related to snow removal products increased by $134,240, as the Company continues to reap benefits from greater marketing efforts.

Sigma Industries recorded adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA") of $70,763, or 0.5% of revenues, in the third quarter of fiscal 2013, down from $1.2 million, or 5.9% of revenues, a year earlier. This variation reflects the effect of lower business activity on the absorption of fixed costs and a less favourable product mix. The Company concluded the third quarter of fiscal 2013 with a net loss of $729,045, or ($0.06) per basic and diluted share, versus net income of $123,352, or $0.01 per basic and diluted share for the same period a year ago.

"The third quarter of fiscal 2013 was challenging for Sigma Industries, as several of our strategic markets were affected by the uncertainty surrounding the U.S. political, economic and fiscal situation. Nonetheless, our successful restructuring efforts of recent years, ongoing initiatives to optimize operations and asset utilization, as well as the successful renegotiation of our bank line of credit and of two long term loans with our principal bankers earlier this year, allow us to withstand this temporary setback," said Denis Bertrand, President and Chief Executive Officer of Sigma Industries.

NINE-MONTH RESULTS
For the nine-month period ended January 26, 2013, revenues amounted to $46.9 million, versus $52.1 million in the nine-month period ended January 28, 2012. This $5.2 million variation mainly results from decreases of $3.8 million and $827,215, respectively, in revenues from the heavy-duty truck and bus industries. Adjusted EBITDA reached $1.7 million, or 3.7% of revenues, compared with $3.6 million, or 6.9% of revenues, a year earlier. Sigma Industries' net loss for the nine-month period ended January 26, 2013 was $914,889, or ($0.08) per basic and diluted share, compared with net income of $2.9 million, or $0.25 per share for the nine-month period ended January 28, 2012. Excluding the $2.4-million gain on debt settlement recorded in the first nine months of last year, net income for that period was $540,378, or $0.05 per basic and diluted share.

CASH FLOW AND FINANCIAL POSITION
Cash flow from operations before changes in items of working capital was $632,905 in the first nine months of fiscal 2013. As working capital provided additional funds of $2.0 million, Sigma Industries further improved its financial position. As a result, the Company's net debt stood at $17.1 million as at January 26, 2013, versus $19.0 million at the beginning of the fiscal year.

OUTLOOK
"Sigma's proven reputation with regards to quality and its innovation capabilities should result in further market penetration. We remain well positioned to leverage the progress accomplished and we continue to proactively seek opportunities to further diversify our reach by broadening our customer base and product offering. Our constant focus on improving existing products and on developing new value-added solutions for our customers are the driving forces behind our resilience," concluded Mr. Bertrand.

SELECTED FINANCIAL INFORMATION

Consolidated results of operations	Three months ended				Nine months ended
(unaudited, in thousands of Canadian dollars except per-share amounts)	January 26, 2013		January 28, 2012		January 26, 2013		January 28, 2012
	$		$		$		$
Revenues	13,504		19,684		46,888		52,084
Adjusted EBITDA	71		1,156		1,720		3,575
Gain on debt settlement	0		0		0		(2,363)
Net income (loss)	(729)		123		(915)		2,903
Per share (basic and diluted)	(0.06)		0.01		(0.08)		0.25
Reconciliation of EBITDA, adjusted EBITDA and net income	Three months ended				Nine months ended
(unaudited, in thousands of Canadian dollars)	January 26, 2013		January 28, 2012		January 26, 2013		January 28, 2012
	$		$		$		$
Net income (loss)	(729)		123		(915)		2,903
PLUS (less):
Income tax expense (recovery)	21		0		53		0
Depreciation and amortization	338		463		1,035		1,392
Financial expenses	441		570		1,547		1,643
Gain on debt settlement	0		0		0		(2,363)
Adjusted EBITDA	71		1,156		1,720		3,575
PLUS (less):
Foreign exchange loss (gain)	(14)		(118)		(93)		(553)
Loss (gain) on disposal of property, plant and equipment	5		0		4		(198)
EBITDA	62		1,038		1,631		2,823
Consolidated balance sheet data	As at
(in thousands of Canadian dollars)	January 26, 2013		April 28, 2012
	$		$
Total assets	26,435		32,332
Total liabilities	23,030		28,080
Shareholders' equity	3,405		4,252

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 and metal components, has four operating subsidiaries and employs close to 400 people. The Company is active in the heavy-duty truck, coach, transit, machinery, agriculture, 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 February 28, 2013, 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 interim consolidated 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.

Sigma Industries Inc. 
Denis Bertrand,
President and Chief Executive Officer
418-484-5282
[email protected]

MaisonBrison
Martin Goulet, CFA
514-731-0000
[email protected]