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VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 03/14/13 -- Tree Island Steel Ltd. (TSX: TSL)(TSX: TSL.DB) -
Q4 2012 Financial Highlights:
-- Revenue of $28.7 million as compared to $35.1 million in Q4 2011-- Gross Profit of $1.3 million or 4.6% of revenues as compared to $1.1 million or 3.1% of revenues in Q4 2011
2012 Financial Highlights:
-- Revenue of $146.2 million as compared to $150.0 million in 2011-- Gross Profit of $13.0 million or 8.9% of revenue as compared to $10.5 million or 7.0% of revenues in 2011-- EBITDA(3) (before foreign exchange) at $3.6 million as compared to $1.3 million in 2011
Tree Island Steel Ltd. (formerly Tree Island Wire Income Fund or the "Fund") ("Tree Island"(1) or the "Company") announced today its financial results for the three and twelve month periods ended December 31, 2012.
For the three-month period ended December 31, 2012(2), gross profit improved to $1.3 million from $1.1 million and gross profit per ton also improved to $61 per ton from $44 per ton in the same period in 2011. The increase in gross profit and gross profit per ton primarily reflects Tree Island's ongoing focus on profitable growth coupled with the decrease in raw material costs during the quarter. Gross profit and gross profit per ton continued to demonstrate improvement on a year over year basis as the Company maintained price discipline and further improved operational efficiencies. Despite a $0.4 million decrease in foreign exchange gain, EBITDA remained consistent at $1.1 million during the fourth quarter of 2012 as compared to the corresponding period in 2011 as a result of Tree Island's ongoing focus on pricing and cost management.
For the year ended December 31, 2012(2), Tree Island's gross profit and EBITDA increased to $13.0 million and $3.6 million, respectively. The year-over-year improvement in financial results is largely the result of management initiatives.
During the year ended December 31, 2012, Tree Island purchased 1,050,900 shares / units at an average price of $0.30 per share / unit, under its previously announced normal course issuer bid. These shares / units were cancelled by the Company at the end of the month of purchase. On September 6, 2012, the normal course issuer bid was extended to September 6, 2013. Under the renewed normal course issuer bid the Company may purchase up to 1,700,000 shares / units.
"I am pleased with our ability to navigate through the continued industry wide challenges faced in 2012. Our focus and sound strategies during the past year allowed Tree Island to further strengthen its position as a manufacturer and supplier of choice in a recovering market," said Dale R. MacLean, President and CEO of Tree Island Steel "On the heels of improved financial performance in 2012, we are seeing early market signals of demand recovery and price stabilization emerging which provides us with a reasonable opportunity to build a path to a stronger year in 2013."
Amar S. Doman, Chairman of Tree Island Steel noted, "2012 came with its challenges but the Tree Island team once again responded with strength and commitment to the industry-wide issues, focused on operational efficiencies and provided best in class service to customers and partners, all of which led to a significant year-over-year improvement in the Company's overall operational and financial performance. I am looking forward to working with the management team and another improvement year ahead for Tree Island."
Three Months Ended Year Ended December 31 December 31 2012 2011 2012 2011Summary of Results ($000's except for tonnage and per unit amounts)----------------------------------------------------------------------------Sales Volumes - Tons(1) 21,583 25,282 102,408 110,314Sales $ 28,657 $ 35,081 $ 146,238 $ 150,030Cost of sales (26,568) (33,196) (130,132) (136,331)Depreciation (775) (782) (3,074) (3,241)----------------------------------------------------------------------------Gross profit 1,314 1,103 13,032 10,458Selling, general and administrative expenses (3,221) (3,018) (12,527) (12,411)----------------------------------------------------------------------------Operating (loss) income (1,907) (1,915) 505 (1,953) Foreign exchange gain (loss) 12 517 87 (722) Gain on sale of property, plant and equipment 18 - 448 11 Changes in financial liabilities recognized at fair value 10 30 (717) 2,331 Gain (loss) on renegotiated debt - - 17,805 (3,234) Financing Expenses (1,324) (2,241) (7,299) (8,500)----------------------------------------------------------------------------(Loss) income before income taxes (3,191) (4,467) 10,829 (12,925) Income tax (expense) recovery 846 210 (458) 64----------------------------------------------------------------------------Net (loss) income (2,345) (4,257) 10,371 (12,861)----------------------------------------------------------------------------Operating (loss) income (1,907) (1,915) 505 (1,953) Add back depreciation 775 782 3,074 3,241----------------------------------------------------------------------------EBITDA (2) (1,132) (1,133) 3,579 1,288----------------------------------------------------------------------------Foreign exchange gain (loss) 12 517 87 (722)----------------------------------------------------------------------------EBITDA including foreign exchange (1,120) (616) 3,666 566----------------------------------------------------------------------------Net (loss) income (2,345) (4,257) 10,371 (12,861)Add back significant non- cash itemsNon-cash financing expenses 648 1,387 3,961 5,349Non-cash (gain) loss on renegotiated debt - - (17,805) 3,234Changes in financial liabilities recognized at fair value (10) (30) 717 (2,331)Deferred income tax recovery 200 99 1,207 (13)----------------------------------------------------------------------------Adjusted net loss (2) (1,507) (2,801) (1,549) (6,622)--------------------------------------------------------------------------------------------------------------------------------------------------------Per share / unit Net (loss) income per share / unit - basic (0.11) (0.19) 0.47 (0.56) Net (loss) income per share / unit - diluted (0.11) (0.19) 0.25 (0.56)--------------------------------------------------------------------------------------------------------------------------------------------------------Per ton Gross profit per ton 61 44 127 95 EBITDA per ton (52) (45) 35 12---------------------------------------------------------------------------- As at As at December December 31 31,Financial position 2012 2011---------------------------------------------------------------------------- Total assets $ 81,102 $ 91,005 Total non-current financial liabilities $ 29,790 $ 42,789----------------------------------------------------------------------------(a) Sales volumes exclude tons which were processed as part of tolling arrangements(b) See definition of EBITDA and Adjusted Net Loss in footnote 3 to the press release
