Winnipeg, Manitoba, April 30th, 2010 – Empire Industries Ltd. (TSX-V: EIL) (“Empire” or the “Company”), today announced its audited consolidated financial results for the year ended December 31, 2009. The audited consolidated financial statements and Management’s Discussion and Analysis (“MD&A”) for the fourth quarter and year ended December 31, 2009 have been filed on SEDAR and can be viewed at www.sedar.com or on our web-site at www.empind.com.
Fiscal 2009 Financial Highlights (compared to fiscal 2008):
Funded debt reduced to $18.7 million from $41.6 million (decrease of 55.0%)
Consolidated revenue decreased to $109.3 million from $180.0 million (decrease of 39.3%);
Consolidated gross profit decreased to $11.2 million from $26.7 million (decrease of 58.1%);
Consolidated earnings before interest, taxes, depreciation and amortization (“EBITDA”) decreased to a loss of $6.5 million from a gain of $5.3 million;
Cash used by operations in 2009 was a $9.6 million loss versus cash provided by operations of $1.9 million in 2008;
Net loss was $15.5 million, or $0.17 loss per share, compared with net loss of $1.8 million or $0.02 loss per share; and
Cash flow provided by operating activities improved to $13.9 million from $0.8 million.
“Fiscal 2009 was an incredibly challenging year for Empire,” said Guy Nelson, Chairman and CEO of Empire Industries Ltd. “We were very disappointed with the magnitude of our operating losses, but we were pleased with our cash flow generation through non-core asset sales and the freeing up of non-cash working capital. We were able to reduce our funded debt load from $41.6 million at December 31, 2008 to $18.7 million at December 31, 2009. Moreover, our new $17.5 million credit facility executed in the first quarter of 2010 with Canadian Western Bank has now eliminated the bank covenant breaches that constrained us throughout 2009. This transaction added $six million of working capital to our 2009 year end working capital of $2.7 million.”
The Company also completed a sale and leaseback of its Port Coquitlam facility for $9.5 million in July 2009, with a gain on sale of $1.5 million. These proceeds were also used to retire short and long term debt.
The Company disposed of Petrofield’s combustion business for $10.2 million on October 5, 2009. The proceeds were used to retire short and long term debt.
“We are seeing improvements in the marketplace in 2010,” said Mr. Nelson. “Bidding activity is significantly higher than it was a year ago. The federal and provincial governments’ stimulus funding is beginning to work its way into the production cycle and the private sector capital spending in western Canada, especially the oil sands, is recovering.” Mr. Nelson added, “We are on track with our restructuring plan, which will help us to profit from the improving market. The Company and the board of directors continue to evaluate various structural and operational alternatives to increase our competitiveness and maximize shareholder value. Non-core asset sales, debt refinancing, and cost containment and reduction will continue to be evaluated and executed as part of our drive to return to profitability.”
