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Press release from CNW Group

5N Plus Inc. Reports Fourth Quarter Results and Record Sales for Fiscal Year 2010

Tuesday, August 10, 2010

5N Plus Inc. Reports Fourth Quarter Results and Record Sales for Fiscal Year 201019:41 EDT Tuesday, August 10, 2010MONTREAL, Aug. 10 /CNW Telbec/ - 5N Plus Inc. (TSX: VNP) today reported financial results for its fourth quarter and fiscal year ended May 31, 2010 including record levels of sales for the fiscal year.For a second consecutive quarter, sales reached a record level and stood at $19,729,553, representing an increase of 9.3% over sales of $18,057,223 for the fourth quarter of the previous fiscal year. Sales for the fiscal year ended May 31, 2010 were at a record level of $70,763,345, an increase of 2.0% compared to sales of $69,373,117 for the previous fiscal year. The backlog(1) of orders expected to translate into sales over the following twelve months stood at $52,650,764 at the fiscal year end over its level of $52,224,368 at the end of the previous fiscal year. Changes in currency exchange rates had an adverse impact of approximately $4,300,000 on the backlog comparisons.Net earnings from continuing operations for the fourth quarter were $4,362,612 or $0.10 per share, representing a 23.6% decrease compared to net earnings from continuing operations of $5,708,451 or $0.13 per share for the fourth quarter of the previous fiscal year. For the fiscal year ended May 31, 2010, net earnings from continuing operations were $15,143,310 or $0.33 per share, representing a decrease of 27.4% compared to net earnings of $20,868,124 or $0.46 per share for the previous fiscal year.EBITDA(2) for the fourth quarter was $6,742,096 representing a decrease of 21,4% compared to EBITDA of $8,576,126 for the fourth quarter of the previous fiscal year. EBITDA reached $24,109,939 for the fiscal year ended May 31, 2010, a decrease of 23.2% compared to EBITDA of $31,409,878 for the previous fiscal year.Cash flow provided by continuing operating activities was $6,188,039 for the quarter and $16,828,300 for the fiscal year ended May 31, 2010. This compares with cash flow provided by continuing operating activities of $4,965,655 and $16,239,645 for the corresponding periods of the previous fiscal year. Cash and cash equivalents increased by $2,925,791 during the fiscal year to $67,992,321 as at May 31, 2010, up from $65,066,530 as at May 31, 2009. Shareholders' equity also increased during the fiscal year to $125,678,537 as at May 31, 2010, up from $112,368,764 one year earlier.Jacques L'Écuyer, President and Chief Executive Officer, said "We are pleased to report our fourth quarter and year-end results as we complete our 10th year of operation in which there is much to celebrate. The quarter and the year proved decisive for our flagship product cadmium telluride as our main customer continued to expand and demonstrate a significant cost advantage over competing technologies leading in turn to an increasing demand for our products. Despite some currency headwinds, we turned in record revenues in fiscal year 2010 and net profit margins exceeded 20% for a third consecutive year as our facility in Germany operated for the first time throughout the year and contributed accordingly to both our sales and net profits. We have also seen a positive contribution from our new subsidiary Firebird which turned in positive earnings in both quarters since joining us."Mr. L'Écuyer continued, "In the year ended, we have laid the foundation for sustainable growth as we made great strides to strengthen our business, leverage our existing facilities and position ourselves to play a larger role in recycling. At the same time, we also broadened our product portfolio to include semiconductor wafers, germanium and products for other thin-film photovoltaic technologies as we successfully completed the acquisition of Firebird Technologies".Mr. L'Écuyer concluded, "All of these accomplishments would not have been possible without the support and dedication of our employees. Many thanks to them again for another great year and a special welcome to the Firebird employees who not only recently joined the 5N Plus team but also managed to make a positive contribution to our financial results."The audited consolidated financial statements of 5N Plus, as well as the Management's Report for the fiscal year ended May 31, 2010 are available on the 5N Plus website, at www.5nplus.com and at www.sedar.comWebcast InformationThe Company will host a conference call at 10:00 AM Eastern Time on Wednesday, August 11, 2010 with financial analysts to discuss the fourth quarter and year ended May 31, 2010 results. 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 26, 2010.About 5N Plus Inc.5N Plus Inc. draws its name from the purity of its products, 99.999% (five nines or 5N) and more. We have our head office in Montreal, Québec, and own two material subsidiaries which are 5N PV GmbH located in Eisenhuttenstadt, Germany and Firebird Technologies Inc. located in Trail, Canada. 5N Plus is a fully integrated producer and closed-loop recycler of highly purified metals and compounds. We use a range of proprietary and proven technologies to produce metals such as tellurium, cadmium, germanium, indium, antimony, selenium and related compounds such as cadmium telluride ("CdTe"), cadmium sulphide ("CdS") and indium antimonide ("InSb"). Our products are critical precursors that customers use in a number of electronic applications, including the rapidly-expanding solar (thin-film photovoltaic) market, for which we are a major supplier of CdTe, as well as the radiation detector and infrared markets.Forward-Looking Statements and DisclaimerCertain statements in this press release may be forward-looking. Forward-looking statements are based on the best estimates available to the Company at the time and involve known and unknown risks, uncertainties or other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements in order to account for any new information or any other event. The reader is warned against undue reliance on these forward- looking statements. << --------------- (1) Backlog is a non-GAAP measure that represents the expected value of orders we have received but have not yet executed and that are expected to translate into sales within the next 12 months. (2) EBITDA is a non-GAAP measure and means earnings from continued operations before financing costs, interest income, income taxes, depreciation and amortization and is presented on a consistent basis from period to period. The definition of this non-GAAP measure used by the Company may differ from that used by other companies. 5N Plus Inc. Consolidated Statements of Income Years ended May 31 (in Canadian dollars) 2010 2009 ------------------------------------------------------------------------- $ $ Sales 70,763,345 69,373,117 Cost of sales 38,910,641 34,174,231 ------------------------------------------------------------------------- Gross profit 31,852,704 35,198,886 Expenses Selling and administrative 7,068,705 5,277,745 Depreciation of property, plant and equipment 2,544,542 2,154,552 Amortization of intangible assets 188,249 - Research and development 1,858,038 1,241,142 Foreign exchange (gain) loss (1,183,978) (3,441,588) Financial 185,512 377,449 Interest income (463,678) (1,118,881) ------------------------------------------------------------------------- 10,197,390 4,490,419 ------------------------------------------------------------------------- Earnings before undernoted items 21,655,314 30,708,467 Start-up costs, new plant - 711,709 ------------------------------------------------------------------------- Earnings before income taxes from continuing operations 21,655,314 29,996,758 Income taxes 6,512,004 9,128,634 ------------------------------------------------------------------------- Net earnings from continuing operations 15,143,310 20,868,124 ------------------------------------------------------------------------- Net loss from discontinued operations (495,770) - ------------------------------------------------------------------------- Net earnings 14,647,540 20,868,124 -------------------------------- -------------------------------- Earnings per share from continuing operations Basic 0.33 0.46 Diluted 0.33 0.45 Earnings per share Basic 0.32 0.46 Diluted 0.32 0.45 Weighted average number of common shares Basic 45,578,992 45,505,213 Diluted 45,833,291 45,876,122 ------------------------------------------------------------------------- 5N Plus Inc. Consolidated Balance Sheets As at May 31 (in Canadian dollars) 2010 2009 ------------------------------------------------------------------------- $ $ Assets Current assets Cash and cash equivalents 67,992,321 65,066,530 Accounts receivable 4,774,460 6,702,197 Inventories 27,705,149 27,054,960 Prepaid expenses 1,073,025 516,391 Derivative financial instruments 1,362,804 1,685,076 Income taxes recoverable 516,602 - Future income taxes 150,598 249,958 ------------------------------------------------------------------------- 103,574,959 101,275,112 Property, plant and equipment 26,437,302 25,823,473 Intangible assets 1,770,913 354,950 Goodwill 4,381,762 - Future income taxes 2,311,191 662,639 Other assets 45,181 52,682 ------------------------------------------------------------------------- 138,521,308 128,168,856 -------------------------------- -------------------------------- Liabilities and Shareholders' Equity Current liabilities Accounts payable and accrued liabilities 4,646,220 6,791,675 Income taxes payable 43,826 3,021,632 Current portion of long-term debt 622,820 549,922 Current portion of other long-term liabilities - 41,725 Future income taxes 444,662 311,897 ------------------------------------------------------------------------- 5,757,528 10,716,851 Long-term debt 4,197,803 3,997,923 Deferred revenue 553,578 641,618 Future income taxes 2,333,862 443,700 ------------------------------------------------------------------------- 12,842,771 15,800,092 ------------------------------------------------------------------------- Shareholders' equity Share capital 82,389,870 81,881,914 Contributed surplus 1,372,523 797,800 Accumulated other comprehensive income (2,531,494) (111,048) Retained earnings 44,447,638 29,800,098 ------------------------------------------------------------------------- 125,678,537 112,368,764 ------------------------------------------------------------------------- 138,521,308 128,168,856 -------------------------------- -------------------------------- 5N Plus Inc. Reconciliation of EBITDA Three months ended May 31 ------------------------------------------------------------------------- 2010 2009 (Decrease) ------------------------------------------------------------------------- Net earnings from continuing operations $ 4,362,612 $ 5,708,451 (23.6%) Add (deduct): Income taxes 1,734,901 2,345,056 Financial expenses & Interest income (60,442) (78,822) Depreciation and amortization 705,025 601,441 ------------------------------------------------------------------------- EBITDA $ 6,742,096 $ 8,576,126 (21.4%) ----------------------------------------------- ----------------------------------------------- Twelve months ended May 31 ------------------------------------------------------------------------- 2010 2009 (Decrease) ------------------------------------------------------------------------- Net earnings from continuing operations $ 15,143,310 $ 20,868,124 (27.4%) Add (deduct): Income taxes 6,512,004 9,128,634 Financial expenses & Interest income (278,166) (741,432) Depreciation and amortization 2,732,791 2,154,552 ------------------------------------------------------------------------- EBITDA $ 24,109,939 $ 31,409,878 (23.2%) ----------------------------------------------- ----------------------------------------------- 5N Plus Inc. Cash Flows Three months ended May 31 Twelve months ended May 31 ------------------------------------------------------------------------- 2010 2009 2010 2009 ------------------------------------------------------------------------- Cash flow provided by continuing operating activities $ 6,188,039 $ 4,965,655 $ 16,828,300 $ 16,239,645 Investing activities (784,603) (1,129,436) (12,577,665) (8,660,804) Financing activities (169,334) (756,927) (295,299) (2,257,973) Effect of foreign exchange rate changes on cash and cash equivalents (280,794) (200,325) (533,775) 168,919 ------------------------------------------------------------------------- Net increase in cash and cash equivalents from continuing activities $ 4,953,308 $ 2,878,967 $ 3,421,561 $ 5,489,787 -------------------------------------------------------- -------------------------------------------------------- >> For further information: Jacques L'Écuyer, President and Chief Executive Officer, 5N Plus Inc., (514) 856-0644, jacques.lecuyer@5nplus.com