MONTREAL, Aug. 4, 2015 /CNW Telbec/ - 5N Plus Inc. (TSX:
VNP), the leading producer of specialty metal and
chemical products, today reported financial results for the second
quarter ended June 30, 2015.
- Revenues for the second quarter and six-month period ended
June 30, reached $87.3 million and $182.9
million down from $136.6
million and $279.0 million for
the corresponding periods of the previous fiscal year, negatively
impacted by underlying commodity pricing trends.
- Adjusted EBITDA1 for the second quarter and the
six-month period ended June 30, 2015
reached $2.0 million and $2.2 million down from $10.8 million and $21.3
million for the corresponding period of the previous fiscal
year, also negatively impacted by underlying commodity pricing
trends.
- Net loss for the second quarter and the six-month period ended
June 30, 2015 reached $20.5 million and $22.4
million compared to net earnings of $4.4 million and $9.0
million for the corresponding period of the previous fiscal
year. The loss for the second quarter of 2015 is negatively
impacted by an accelerated amortization of $11.8 million of selected intangible assets and
an inventory impairment charge of $6.5
million associated with selenium and bismuth.
- Net debt1 decreased by $16.5M in the quarter and stood at $58.4 million as at June
30, 2015, down from $84.0
million as at December 31,
2014, positively impacted by working capital
management.
- Backlog1 as at June 30,
2015 stood at 137 days of sales outstanding up by 15 days
and 37 days when compared to the backlog level on December 31, 2014 and June
30, 2014.
Jacques L'Ecuyer, President and Chief Executive Officer, said
"Demand for most of our products remained strong during the second
quarter with shipments, backlog and booking levels in line with
expectations. Adjusted EBITDA figures improved somewhat over
the first quarter figures driven by initiatives aimed at reducing
costs and inventory levels leading to a another sizeable reduction
of $16.5M in net debt levels during
the quarter which now stands at $58.4M. We plan on continuing to reduce
debt."
Mr. L'Ecuyer continued, "The overall financial performance of
the company remains very disappointing however as relentless
erosion in underlying commodity prices, which have now fallen by
more than 40% since the beginning of the year, continues to weigh
on our results. We expect this situation to change
significantly as soon as prices find a floor leading to a marked
improvement in our financial results. We also believe that
the intensification of our efforts aimed at improving operational
performance and reaching functional excellence, which have
already started to pay off as shown by the significant cost
reductions realized this year and which will be accelerated
following the most recent review and diagnostic exercise carried
out with the support of a renowned strategic consulting firm, will
further support these improvements."
Mr. L'Ecuyer concluded, "We continue to make progress in our
added-value and supply integration strategy with important
technical milestones having been achieved in both our Montreal-based metal powder activities and in
our Laos-based primary refining
activities. Together with our efforts aimed at achieving
functional excellence, this should enable us to better isolate our
future financial performance from underlying commodity pricing
trends and thus reduce volatility and improve shareholder
value. We therefore remain very optimistic on our ability to
deliver long term shareholder value even though we expect the
coming quarters to remain very challenging given the sizeable
headwinds in underlying commodity pricing trends."
Webcast Information
5N Plus will host a
conference call on Wednesday, August 5,
2015 at 8:00 am ET with
financial analysts to discuss results of the quarter ended
June 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 August 12, 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 96647572.
Non-IFRS Measures
Adjusted EBITDA means EBITDA as
defined above before impairment of inventories, 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 six-month periods ended June 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)
|
June 30,
2015
|
December 31,
2014
|
|
$
|
$
|
|
|
|
ASSETS
|
|
|
Current
|
|
|
Cash and cash
equivalents
|
16,519
|
12,777
|
Restricted
cash
|
-
|
2,115
|
Accounts
receivable
|
52,317
|
72,391
|
Inventories
|
160,947
|
204,454
|
Income tax
receivable
|
4,437
|
2,705
|
Derivative financial
assets
|
-
|
147
|
Other current
assets
|
2,660
|
2,965
|
Total current
assets
|
236,880
|
297,554
|
Property, plant and
equipment
|
71,178
|
68,261
|
Intangible
assets
|
5,354
|
15,728
|
Deferred tax
asset
|
11,796
|
11,037
|
Investment accounted
for using the equity method
|
295
|
316
|
Other
assets
|
5,680
|
6,635
|
Total non-current
assets
|
94,303
|
101,977
|
Total
assets
|
331,183
|
399,531
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
Current
|
|
|
Bank
indebtedness
|
-
|
975
|
Trade and accrued
liabilities
|
41,786
|
60,286
|
Income tax
payable
|
5,049
|
6,064
|
Long-term debt due
within one year
|
589
|
667
|
Total current
liabilities
|
47,424
|
67,992
|
Long-term
debt
|
30,045
|
51,156
|
Convertible
debentures
|
44,266
|
46,101
|
Deferred tax
liability
|
1,625
|
3,111
|
Retirement benefit
obligation
|
14,606
|
16,928
|
Derivative financial
liabilities
|
307
|
2,093
|
Other
liabilities
|
18,272
|
15,711
|
Total non-current
liabilities
|
109,121
|
135,100
|
Total
liabilities
|
156,545
|
203,092
|
Shareholders'
equity
|
174,645
|
196,443
|
Non-controlling
interest
|
(7)
|
(4)
|
Total
equity
|
174,638
|
196,439
|
Total liabilities
and equity
|
331,183
|
399,531
|
5N PLUS
INC.
|
Condensed Interim
Consolidated Statements of (Loss) Earnings
|
For the three-month
and six-month periods ended June 30, 2015 and 2014
|
|
|
(unaudited)
|
Three
months
|
Six
months
|
(Figures in
thousands of United States dollars,
except per share information)
|
2015
|
2014
|
2015
|
2014
|
|
$
|
$
|
$
|
$
|
|
|
|
|
|
Revenues
|
87,250
|
136,597
|
182,913
|
278,976
|
Cost of
sales
|
86,624
|
117,041
|
176,546
|
239,784
|
Selling, general and
administrative expenses
|
6,719
|
10,041
|
13,743
|
19,803
|
Other
expenses
|
13,132
|
1,425
|
14,327
|
4,179
|
Share of (gain) loss
from joint ventures
|
(57)
|
120
|
21
|
97
|
|
106,418
|
128,627
|
204,637
|
263,863
|
Operating (loss)
earnings
|
(19,168)
|
7,970
|
(21,724)
|
15,113
|
|
|
|
|
|
Gain on disposal
of property, plant and equipment
|
-
|
-
|
-
|
1,312
|
|
|
|
|
|
Financial expenses
(revenues)
|
|
|
|
|
Interest on long-term
debt
|
1,198
|
1,322
|
2,388
|
2,462
|
Imputed interest and
other financial expense
|
1,549
|
409
|
2,442
|
685
|
Changes in fair value
of debenture conversion option
|
(933)
|
(188)
|
(1,646)
|
(188)
|
Foreign exchange and
derivative loss (gain)
|
2,362
|
(526)
|
(61)
|
(510)
|
|
4,176
|
1,017
|
3,123
|
2,449
|
(Loss) earnings
before income tax
|
(23,344)
|
6,953
|
(24,847)
|
13,976
|
Income tax (recovery)
expense
|
|
|
|
|
|
Current
|
316
|
2,002
|
28
|
4,395
|
|
Deferred
|
(3,196)
|
515
|
(2,460)
|
626
|
|
(2,880)
|
2,517
|
(2,432)
|
5,021
|
Net (loss)
earnings for the period
|
(20,464)
|
4,436
|
(22,415)
|
8,955
|
Attributable
to:
|
|
|
|
|
Equity holders of 5N
Plus Inc.
|
(20,463)
|
4,436
|
(22,412)
|
9,091
|
Non-controlling
interest
|
(1)
|
-
|
(3)
|
(136)
|
|
(20,464)
|
4,436
|
(22,415)
|
8,955
|
(Loss) earnings
per share attributable to equity holders of 5N Plus
Inc.
|
(0.24)
|
0.05
|
(0.27)
|
0.11
|
Basic (loss)
earnings per share
|
(0.24)
|
0.05
|
(0.27)
|
0.11
|
Diluted (loss)
earnings per share
|
(0.24)
|
0.05
|
(0.27)
|
0.11
|
5N PLUS
INC.
|
|
|
|
|
|
|
(Figures in thousands
of United States dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
Flows
|
|
|
|
|
|
|
|
Q2
2015
|
Q2 2014
|
% Change
|
YTD
2015
|
YTD 2014
|
% Change
|
|
$
|
$
|
|
$
|
$
|
|
Funds (used in) from
operations1
|
(1,482)
|
5,774
|
(126%)
|
(3,497)
|
12,580
|
(128%)
|
Net changes in
non-cash working capital items
|
22,877
|
(16,665)
|
237%
|
37,534
|
(26,218)
|
243%
|
Operating
activities
|
21,395
|
(10,891)
|
296%
|
34,037
|
(13,638)
|
350%
|
Investing
activities
|
(3,363)
|
(4,986)
|
(33%)
|
(9,551)
|
(5,318)
|
80%
|
Financing
activities
|
(14,336)
|
20,594
|
(170%)
|
(20,437)
|
18,158
|
(213%)
|
Effect of foreign
exchange rate changes on cash and cash equivalents related to
operations
|
243
|
52
|
367%
|
(307)
|
26
|
(1,281%)
|
Net increase
(decrease) in cash and cash equivalents
|
3,939
|
4,769
|
(17%)
|
3,742
|
(772)
|
(585%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues by
Segment
|
|
|
|
|
|
|
|
Q2
2015
|
Q2 2014
|
% Change
|
YTD
2015
|
YTD 2014
|
% Change
|
|
$
|
$
|
|
$
|
$
|
|
Electronic Materials
Segment
|
30,793
|
44,544
|
(31%)
|
60,433
|
92,685
|
(35%)
|
Eco-Friendly
Materials Segment
|
56,457
|
92,053
|
(39%)
|
122,480
|
186,291
|
(34%)
|
Total
revenues
|
87,250
|
136,597
|
(36%)
|
182,913
|
278,976
|
(34%)
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
Q2
2015
|
Q2 2014
|
% Change
|
YTD
2015
|
YTD 2014
|
% Change
|
|
$
|
$
|
|
$
|
$
|
|
Electronic
Materials
|
4,533
|
7,157
|
(37%)
|
7,792
|
14,105
|
(45%)
|
Eco-Friendly
Materials
|
(701)
|
6,241
|
(111%)
|
(1,342)
|
12,646
|
(111%)
|
Corporate
|
|
|
|
|
|
|
|
Research and
Development
|
(358)
|
(73)
|
(390%)
|
(724)
|
(379)
|
(91%)
|
|
Other
|
(1,511)
|
(2,509)
|
40%
|
(3,493)
|
(5,055)
|
31%
|
Adjusted
EBITDA1
|
1,963
|
10,816
|
(82%)
|
2,233
|
21,317
|
(90%)
|
EBITDA1
|
(5,966)
|
11,524
|
(152%)
|
(2,560)
|
22,702
|
(111%)
|
|
|
|
|
|
|
|
Backlog and
Bookings
|
|
|
|
|
|
|
|
BACKLOG1
|
BOOKINGS1
|
|
Q2
2015
|
Q1 2015
|
Q2 2014
|
Q2
2015
|
Q1 2015
|
Q2 2014
|
|
$
|
$
|
$
|
$
|
$
|
$
|
Electronic
Materials
|
68,368
|
81,066
|
77,278
|
16,942
|
27,030
|
42,460
|
Eco-Friendly
Materials
|
62,981
|
67,696
|
73,085
|
61,308
|
64,236
|
57,170
|
Total
|
131,349
|
148,762
|
150,363
|
78,250
|
91,266
|
99,630
|
|
|
|
|
BACKLOG1
|
BOOKINGS1
|
(number of days based
on annualized revenues)
|
Q2
2015
|
Q1 2015
|
Q2 2014
|
Q2
2015
|
Q1 2015
|
Q2 2014
|
Electronic
Materials
|
203
|
250
|
158
|
50
|
83
|
87
|
Eco-Friendly
Materials
|
102
|
94
|
72
|
99
|
89
|
57
|
Weighted
average
|
137
|
142
|
100
|
82
|
87
|
67
|
|
|
|
|
|
|
|
*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.