TECSYN INTERNATIONAL INC. ANNOUNCES THIRD QUARTER
RESULTS
ST. CATHARINES, ONTARIO--
For the third quarter ended May 31, 1999, TecSyn recorded net
income of $4,012,393 or $0.23 on revenue of $24,064,149 and for
the nine month period ended May 31, 1999, net income was
$9,422,104 or $0.54 per share on revenue of $56,559,063. Nine
month Net Income for Fiscal 99 was 23.6% higher than the prior
year.
3 months to May 31: 1999 1998
------------------- -----------------------
Revenue $24,064,149 $25,232,808
Net income $4,012,393 $3,948,736
Net income per share - basic $0.23 $0.22
Net income per share- fully diluted $0.21 $0.20
9 months to May 31: 1999 1998
------------------- -----------------------
Revenue $56,559,063 $58,470,108
Net income $9,442,104 $7,636,789
Net income per share - basic $0.54 $0.43
Net income per share - fully diluted $0.50 $0.40
Average Common Shares Outstanding 17,435,515 17,603,018
Poli-Twine has been experiencing a later season causing Q3 sales
to run into Q4. The previously announced cable filler line is
expected to be delivered in the fall, and a new 3 year Collective
Agreement at the Belleville facility was finalized in Q3.
Polytech is continuing its cost focused growth strategy by adding
a 250 ton injection molder to manufacturer larger bezels and
accessory parts. The launch of the cargo bag continues to unfold
smoothly as volumes grow. Polytech is continuing to capture
additional market share due to its low cost structure and
aggressive pricing.
TecSyn PMP ramped up on its first high volume production order
and is now shipping on a weekly basis. Thus far all shipments
have been made on time with no quality issues. Testing continues
on two other engine liners with final approval expected in
August. Productivity and equipment utilization for Q3 was better
than anticipated for a start-up venture and customer
satisfaction/confidence with the first volume production is very
high. Work continues on automation with Phase I of our sintering
furnace complete. Machining automation is expected to be
finalized by September, 1999. Our potential customer list is
expanding as the word of success and confidence in P.M. liners
builds. We continue to be very bullish about our ability to
become a dominant player in the cylinder liner market.
For further information please contact Wayne Corbett, President
& CEO or Paul E. Riganelli, VP Administration
TECSYN INTERNATIONAL INC
One St. Paul St., Suite 602, St. Catharines, ON
Telephone: (905) 687-8811 Facsimile: (905) 687-6917
TECSYN INTERNATIONAL INC
INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
AND RETAINED EARNINGS
(UNAUDITED)
Three Months Three Months
ended ended
May 31/99 May 31/98
------------ ------------
NET REVENUE $24,064,149 $25,232,808
============ ============
INCOME FROM OPERATIONS
BEFORE PROVIDING FOR
AMORTIZATION, INTEREST
OTHER AND INCOME TAXES 5,200,841 5,001,749
------------ ------------
Amortization 669,195 544,036
Interest on long-term debt 31,332 137,133
Interest (Income) expense on
short-term debt (78,908) 16,991
------------ ------------
621,619 698,160
------------ ------------
INCOME FROM OPERATIONS
BEFORE OTHER AND
INCOME TAXES 4,579,222 4,303,589
INCOME TAXES 566,829 354,853
------------ ------------
NET INCOME FOR THE PERIOD 4,012,393 3,948,736
RETAINED EARNINGS
BEGINNING OF THE PERIOD 25,962,242 12,351,638
------------ ------------
RETAINED EARNINGS ------------ ------------
END OF PERIOD $29,974,635 $16,300,374
============ ============
PER SHARE
---------
Net Income:
Basic earnings per share $0.23 $0.22
Fully diluted earnings per share $0.21 $0.20
TECSYN INTERNATIONAL INC
INTERIM CONSOLIDATED STATEMENT OF CHANGES
IN FINANCIAL POSITION
(UNAUDITED)
Three Months Three Months
ended ended
May 31/99 May 31/98
------------ ------------
OPERATING ACTIVITIES:
Net income for the period $4,012,393 $3,948,736
Add (deduct) items not requiring
an outflow (inflow ) of cash:
Amortization 669,195 544,036
Loss on disposal of capital assets - -
(Increase) Decrease in operating
working capital:
Accounts receivable (8,694,558) (10,605,601)
Inventory 997,713 2,080,121
Prepaid expenses 611,575 324,657
Accounts payable and accrued charges 1,833,264 2,718,653
Income Taxes (699,615) (107,147)
Effect of exchange rate changes (332,492) 516
------------ ------------
CASH CONSUMED BY OPERATING
ACTIVITIES (1,602,525) (1,096,029)
------------ ------------
INVESTING ACTIVITIES:
Principal receipts on notes receivable - 141,700
Purchase of capital assets (1,541,127) (112,130)
------------ ------------
CASH (CONSUMED) PROVIDED BY
INVESTING ACTIVITIES (1,541,127) 29,570
------------ ------------
FINANCING ACTIVITIES:
Principal payments on long-term debt (40,550) (422,476)
Redemption of common shares (1,165,459) -
------------ ------------
CASH CONSUMED BY FINANCING
ACTIVITIES (1,206,009) (422,476)
------------ ------------
CASH OUTFLOW FOR THE PERIOD (4,349,661) (1,488,935)
NET CASH AT BEGINNING OF
THE PERIOD 8,264,267 212,735
-------------------------
NET CASH AT END OF THE PERIOD $3,914,606 ($1,276,200)
=========================
INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
AND RETAINED EARNINGS
(UNAUDITED)
Nine Months Nine Months
ended ended
May 31/99 May 31/98
----------- -----------
NET REVENUE $56,559,063 $58,470,108
=========== ===========
INCOME FROM OPERATIONS
BEFORE PROVIDING FOR
AMORTIZATION, INTEREST,
OTHER AND INCOME TAXES 11,699,515 10,337,395
----------- -----------
Amortization 1,900,847 1,618,473
Interest on long-term debt 160,008 431,079
Interest (Income) expense on
short-term debt (332,172) 53,023
----------- -----------
1,728,683 2,102,575
----------- -----------
INCOME FROM OPERATIONS
BEFORE OTHER AND
INCOME TAXES 9,970,832 8,234,820
OTHER INCOME 898,961 -
----------- -----------
INCOME FROM OPERATIONS AND
OTHER BEFORE INCOME TAXES 10,869,793 8,234,820
INCOME TAXES 1,427,689 598,031
----------- -----------
NET INCOME FOR THE PERIOD 9,442,104 7,636,789
RETAINED EARNINGS
BEGINNING OF THE PERIOD 20,532,531 8,663,585
----------- -----------
RETAINED EARNINGS ----------- -----------
END OF PERIOD $29,974,635 $16,300,374
=========== ===========
PER SHARE
---------
Net Income:
Basic earnings per share $0.54 $0.43
Fully diluted earnings per share $0.50 $0.40
TECSYN INTERNATIONAL INC
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
May 31 May 31
1999 1998
----------- -----------
ASSETS
CURRENT
Cash $3,914,606 -
Accounts receivable 23,588,425 $23,633,991
Inventories 11,273,650 $11,832,263
Notes receivable - 1,216,800
Prepaid expenses 553,391 1,091,563
----------- -----------
Total current assets 39,330,072 37,774,617
CAPITAL ASSETS 12,118,006 10,416,075
----------- -----------
$51,448,078 $48,190,692
=========== ===========
LIABILITIES
CURRENT
Bank indebtedness - 1,276,200
Accounts payable and accrued
charges 8,507,355 9,466,156
Income taxes payable (241,754) (174,113)
Current portion of long-term debt 299,013 1,694,611
----------- -----------
Total current liabilities 8,564,614 12,262,854
----------- -----------
LONG-TERM DEBT 1,344,593 4,958,806
----------- -----------
SHAREHOLDERS' EQUITY
Capital stock 10,249,147 13,468,883
Accumulated unrealized gains
on foreign exchange 1,315,089 1,199,775
Retained Earnings 29,974,635 16,300,374
----------- -----------
Total shareholders' equity 41,538,871 30,969,032
----------- -----------
$51,448,078 $48,190,692
=========== ===========
INTERIM CONSOLIDATED STATEMENT
OF CHANGES IN FINANCIAL POSITION
(UNAUDITED)
Nine Months Nine Months
ended ended
May 31/99 May 31/98
------------ ------------
OPERATING ACTIVITIES:
Net income for the period $9,442,104 $7,636,789
Add (deduct) items not requiring
an outflow (inflow ) of cash:
Amortization 1,900,847 1,618,473
Loss (Gain) on disposal of
assets 3,745 (53,570)
(Increase) Decrease in operating
working capital:
Accounts receivable (11,624,467) (11,173,344)
Inventory (2,273,776) (1,813,569)
Prepaid expenses (170,631) (151,226)
Accounts payable accrued charges 2,591,234 1,003,772
Income Taxes (442,366) (484,458)
Effect of exchange rate changes (889,238) (21,479)
------------ ------------
CASH CONSUMED BY
OPERATING ACTIVITIES (1,462,548) (3,438,612)
------------ ------------
OTHER INCOME 898,961 -
------------ ------------
INVESTING ACTIVITIES:
Principal receipts on notes receivable 240,639 384,000
Proceeds from sale of capital assets - 258,743
Purchase of capital assets (2,777,266) (227,035)
------------ ------------
CASH (CONSUMED) PROVIDED BY
INVESTING ACTIVITIES (2,536,627) 415,708
------------ ------------
FINANCING ACTIVITIES:
Principal payments on long-term debt (5,398,590) (1,259,832)
Issuance of common shares - 66,960
Redemption of common shares (3,136,946) -
------------ ------------
CASH CONSUMED BY FINANCING
ACTIVITIES (8,535,536) (1,192,872)
------------ ------------
CASH OUTFLOW FOR THE PERIOD (11,635,750) (4,215,776)
NET CASH AT BEGINNING
OF THE PERIOD 15,550,356 2,939,576
------------ ------------
NET CASH (BORROWINGS) AT END
OF THE PERIOD $3,914,606 $(1,276,200)
============ ============
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