Mario, Q2 results
>>TRAILMOBILE CANADA ANNOUNCES 1999 SECOND QUARTER RESULTS
MISSISSAUGA, ONTARIO--
Trailmobile Canada Limited today announced its 1999 second
quarter and six month financial results for the periods ended June 30, 1999.
Revenue for the second quarter was $23.0 million, compared with $29.8 million for the second quarter of 1998. The Company's net loss for the quarter was $2.4 million or ($0.07) per share, compared with net income of $561,480 or $0.02 per share in the same period a year ago. Trailmobile Canada's unit sales in the second quarter of 1999 totalled 849 compared with 990 in the second quarter of 1998.
"The first six months of 1999 have been a period of transition for the Company and our financial results reflect that, " said Denis Arsenault, Chief Financial Officer of Trailmobile Canada. "We have undertaken a complete restructuring of our operations in order to enhance our longer-term growth and profitability. With our transition now largely complete, we look forward to improved performance in the coming quarters."
Trailmobile Canada initiated a complete redesign of its
production floor during the first quarter of 1999 and
construction carried over into the second quarter. The new
production process is based on the model employed by
Chicago-based Trailmobile Corporation at its manufacturing
facilities in the United States. For most of the second
quarter, the Company had only one of its two new production
lines in operation. In June, both newly designed production
lines were in operation and output increased considerably.
The Company also experienced production delays in the second
quarter as a result of the changeover to a Trailmobile-designed trailer. Delays were caused by a combination of factors, including sourcing new parts, staff training and variances in technical specifications. The changeover also affected Trailmobile Canada's margins in the quarter, as the remaining Mond-designed trailers were discounted off the line in anticipation of the Company producing trailers under the Trailmobile brand name.
For the six months ended June 30, 1999, Trailmobile Canada's
revenue declined 18% to $48.6 million compared with $59.0
million in the first six months of 1998. The Company's net loss for the first six months of 1999 was $3.8 million or ($0.11) per share, compared with net income of $1.0 million or $0.03 per share in the corresponding period in 1998.
"As expected, our restructuring initiatives negatively affected throughput and profitability in the first half. However, we have made a great deal of progress and I am very encouraged by the current outlook for Trailmobile Canada," said Ed Wanandi, Trailmobile Canada's Chairman and CEO. "We are receiving orders from customers in markets that Mond had previously not penetrated, particularly in the northeastern United States. Our current backlog is approaching 2,000 units, which is unprecedented, and we are gradually ramping up towards designed production capacity."
In July, the Company announced that it had successfully
completed a rights offering, resulting in the issuance of
8,975,000 common shares for gross proceeds of $2,782,250. The proceeds will be used primarily to finance the expansion of the Company's manufacturing capacity and to improve plant productivity, with the balance to be used for working capital.
About Trailmobile Canada Limited Trailmobile Canada Limited (formerly Mond Industries Inc.) manufactures dry freight trailers for commercial trucking customers in Canada and the United States. In December 1998, Chicago-based Trailmobile Corporation acquired a majority equity interest in the Company. Together, they form North America's third largest trailer manufacturer, with an extensive sales and distribution network throughout North America. Trailmobile Canada Limited is headquartered in Mississauga, Ontario.<<
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