WINDSOR, ON, Oct. 4, 2018 /CNW/ - Reko International Group
Inc. (TSX-V: REKO) today announced results for its year ended
July 31, 2018.
Financial Highlights:
(in 000's except for
per share
amounts)
|
Three Months
ended
July 31,
2018
|
Twelve Months
ended
July 31,
2018
|
(unaudited)
|
(unaudited)
|
Fiscal
|
Fiscal
|
Fiscal
|
Fiscal
|
2018
|
2017
|
2018
|
2017
|
Sales
|
$10,206
|
$9,695
|
$42,272
|
$42,967
|
Net income
|
713
|
560
|
2,035
|
2,545
|
EPS basic
|
0.11
|
0.09
|
0.32
|
0.40
|
Working
capital
|
|
|
13,482
|
16,610*
|
Shareholders'
equity
|
|
|
45,181
|
43,115
|
Shareholders' Equity
per Share
|
|
|
7.02
|
6.70
|
|
|
|
|
|
(*Calculation amended
as a result of reclassification discussed below.)
|
Consolidated sales for the fourth quarter of 2018
were $10.2 million compared to
$9.7 million in the same period last
year, an increase of $0.5 million or
5.3%. This was largely due to the number of projects completed
during the quarter. Consolidated sales for the year ended
July 31, 2018, were $42.3 million, compared to $43.0 million in the prior year, a decrease of
$0.7 million or 1.6%. The decrease in
sales was related to consistently lower currency exchange rates
particularly in the early part of the fiscal year.
Gross profit for the quarter ended July 31, 2018 was $1.9
million compared to $1.7
million for the same period in the prior year. Consistent
with sales, this was due to the timing of completion of a number of
successful projects. Gross profit for the year ended July 31, 2018, was $6.7
million, or 15.9% of sales, compared to a gross profit of
$7.5 million, or 17.4% of sales in
the prior year. The decrease is a result of a combination of lower
currency exchange rates and investment in people to prepare for
future sales growth.
Selling and administrative expenses for the
fourth quarter of fiscal 2018 totaled $1.4
million compared to $0.8
million for the same period in fiscal 2017 – an increase of
$0.6 million or 81.2%. The
increase in S&A relates primarily to the addition of staff
including a director of business development, and expenses
associated with the recent capacity expansion, offset by decreases
in accounts receivable, insurance and sales commission. Selling and
administrative expenses for the year ended July 31, 2018 were $4.7
million, or 11.2% of sales, compared to $4.0 million, or 9.2% of sales in the prior year.
The increase in S&A for the year are consistent with those
described above for the fourth quarter.
Net income for the three months ended
July 31, 2018 was $0.7 million or $0.11 per share compared to $0.6 million or $0.09 per share for the same period in the prior
year. Net income for the year ended July 31,
2018 was $2.0 million or
$0.32 per share, compared to net
income of $2.5 million, or
$0.40 per share in the prior
year.
"Reko's fourth quarter results represent the
strongest quarter for fiscal 2018," stated Diane Reko, Chief Executive Officer. "We
reported a 27% increase in net income compared to the same period
last year. While sales remained steady throughout the quarter, we
continue to be impacted by delays in the launch of new tooling
programs as well as in portions of the energy industry. A favorable
resolution to trade agreements and tariff reductions to steel and
aluminum would assist the flow of new orders from our customers and
prospects."
It should be noted that on its financial
statements for the year ended July 31,
2018, the Company will be reclassifying an existing debt
from long term to current – including in comparative balances - as
the loan facility has a demand feature which gives the lender the
right to require repayment of term facilities. Despite this
feature and reclassification, it is not anticipated that any demand
will be made in the next twelve months and regularly scheduled
principal and interest payments are expected to continue throughout
the remaining term of the debt. As a result of this
reclassification, $996 thousand of
debt recorded at July 31, 2017 as
long-term debt has been moved to current liabilities.
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
About Reko International Group Inc.
Reko International Group Inc. (TSX-V:REKO) is
a diversified, technology-driven manufacturing organization located
in Southwestern Ontario, just
minutes from the U.S. border. Areas of expertise include robotic
factory automation solutions, the precision machining of large
critical parts, and plastic injection and low compression acoustic
tooling. Reko's family-oriented culture embraces past experience,
fosters innovation, and always ensures the highest standard of
quality. Reko believes in strengthening communities by advancing
manufacturing.
SOURCE Reko International Group Inc.