Exco Technologies Limited - Fourth Quarter ended September 30, 2009

Quarterly Dividend Declared

 

TORONTO, Nov. 30 /CNW/ - Exco Technologies Limited (TSX-XTC) today announced results for its fourth quarter ended September 30, 2009 . In addition, the Company announced that a quarterly cash dividend of $0.0175 per share will be paid December 23, 2009 to shareholders of record on December 16, 2009 . The dividend is an "eligible dividend" in accordance with the Income Tax Act of Canada .

 

 

    -------------------------------------------------------------------------

                                    12 Months ended         3 Months ended

                                      September 30            September 30

 

                                       ($000s, except per share amounts)

 

                                    2009        2008        2009        2008

                                    ----        ----        ----        ----

 

    Sales                       $143,716    $201,681     $37,694     $50,132

    Net income (loss) from

     continuing operations      ($17,666)   ($13,398)       $364    ($20,753)

    Net loss from discontinued

     operations                       $-       ($536)         $-       ($425)

    Net income (loss)           ($17,666)   ($13,934)       $364    ($21,178)

    Basic and diluted earnings

     (loss) per share from

     continuing operations        ($0.43)     ($0.33)      $0.01      ($0.51)

    Basic and diluted (loss)

     per share from

     discontinued operations       $0.00      ($0.01)      $0.00      ($0.01)

    Basic and diluted earnings

     (loss) per share             ($0.43)     ($0.34)      $0.01      ($0.52)

    Common shares

     outstanding              40,666,176  40,948,276  40,666,176  40,948,276

    -------------------------------------------------------------------------

 

In the fourth quarter sales of $37.7 million increased 33% over the third quarter and is the strongest quarterly sales performance in the last three quarters. While sales in the quarter are still below prior year levels this trend points to a continuing recovery from low sales levels at the peak of the recession in the third quarter of this fiscal year. Sales in the Casting and Extrusion segment of $26 million in the quarter were 37% higher than the third quarter and was comparable to last year's sales of $26.9 million . Leading this improvement was the large mould business with strong shipments to Chrysler of engine block moulds. The Automotive Solutions segment also reported top line improvement in the fourth quarter over the third quarter of 24% with sales of $11.7 million compared to $9.4 million . In this segment resumption of more traditional production and purchasing patterns by our customers and the launch of new programs at Polytech and Neocon, in particular, is responsible for the increase.

 

This improving sales environment combined with the impact of cost reductions and operating improvements implemented earlier in the year has enabled Exco to return to profitability in the quarter with net income of $364 thousand or 1 cent earnings per share. Segment income in the Casting and Extrusion segment improved from a pre tax loss of $1.2 million in the third quarter to a pre tax profit of $1.5 million in the fourth quarter. Segment results for the Automotive Solutions segment, while still a loss at $631 thousand , improved over the third quarter loss of $781 thousand . Both figures include losses from the Neocon USA operation (fourth quarter $350 thousand , third quarter $338 thousand ) which was closed at the end of the fourth quarter.

 

Gross margin improved by 1% over last quarter to 21% and cash provided by operating activities of continuing operations improved to $3.4 million compared to $2.6 million in the third quarter. Exco continues to have no bank debt and closed the year with cash deposits of $11.4 million compared to cash net of bank debt last year of $3.5 million.

 

During the fourth quarter the Company successfully put to rest the difficulties and distractions of the bankruptcies that took place in the third quarter and focused on operations. Shipments by Polydesign on the Honda CRV and Civic seat cover programs resumed and takeover business with Visteon Europe for instrument panel and door panel leather inserts were successfully launched. New business including cluster hood and other componentry on the Buick Lacrosse (Allure) was successfully launched by Polytech. At Neocon numerous new launches, including the Prius tray, took place during the quarter and both Polytech and Neocon deliveries on existing programs spiked upwards during the quarter creating a backlog situation, particularly Neocon, which is expected to continue into January.

 

"2009 has certainly been an extraordinary year for Exco's Board, management and staff," said Brian Robbins, President and CEO of Exco. "I am pleased to see it coming to an end and I am convinced that the situation is improving with each passing day and the difficult decisions made over the past twelve months have made us a stronger competitor and will hold us in good standing in the years to come."

(For further information and prior year comparison please refer to the Company's Fourth Quarter Interim Financial Statements in the Investor Relations section posted at www.excocorp.com. Alternatively, please refer to www.sedar.com after November 30 , 2009.)

 

Exco Technologies Limited is a global supplier of innovative technologies servicing the die-cast, extrusion and automotive industries. Through our 10 strategic locations, we employ 1,350 people and service a diverse and broad customer base.

 

Management will hold a conference call to discuss the fourth quarter results on Monday November 30, 2009 at 11:30 am (EST ). The local dial in number for the call is (647) 427-7450 or toll free 1-888-231-8191. To access the live audio webcast, please log on to www.excocorp.com or www.q1234.com a few minutes before the event. Real Player is required for access. For those unable to participate on November 30, 2009 an archived version will be available on the Exco website.

 

This news release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws. We use words such as "anticipate", "plan", "may", "will", "should", "expect", "believe", "estimate" and similar expressions to identify forward-looking information and statements. Such forward-looking information and statements are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe to be relevant and appropriate in the circumstances. Readers are cautioned not to place undue reliance on forward-looking information and statements, as there can be no assurance that the assumptions, plans, intentions or expectations upon which such statements are based will occur. Forward-looking information and statements are subject to known and unknown risks, uncertainties, assumptions and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed, implied or anticipated by such information and statements. These risks, uncertainties and assumptions are described in the Company's Management's Discussion and Analysis included in our 2008 Annual Report, in our 2008 Annual Information Form and, from time to time, in other reports and filings made by the Company with securities regulatory authorities.

 

While the Company believes that the expectations expressed by such forward-looking information and statements are reasonable, there can be no assurance that such expectations and assumptions will prove to be correct. In evaluating forward-looking information and statements, readers should carefully consider the various factors which could cause actual results or events to differ materially from those indicated in the forward-looking information and statements. Readers are cautioned that the foregoing list of important factors is not exhaustive. Furthermore, the Company disclaims any obligations to update publicly or otherwise revise any such factors or any of the forward-looking information or statements contained herein to reflect subsequent information, events or developments, changes in risk factors or otherwise.

 

NOTICE TO READER

 

The attached consolidated financial statements have been prepared by management of the Company. The consolidated financial statements for the twelve-month periods ended September 30, 2009 and 2008 have not been reviewed by the auditors of the Company.

 

 

    EXCO TECHNOLOGIES LIMITED

    INTERIM CONSOLIDATED BALANCE SHEETS (Unaudited)

    $(000)'s

 

                                                        As at          As at

                                                 September 30,  September 30,

                                                         2009           2008

    -------------------------------------------------------------------------

 

    ASSETS

    Current

      Cash                                            $11,364         $8,141

      Accounts receivable (note 4)                     26,711         34,120

      Inventories (note 5)                             23,330         30,527

      Prepaid expenses and deposits                     2,589          3,013

      Income taxes receivable                             668              -

      Mortgage receivable                                 600              -

      Assets held for sale (note 8)                     1,501          5,068

      Discontinued operations                               -            540

    -------------------------------------------------------------------------

    Total current assets                               66,763         81,409

    -------------------------------------------------------------------------

 

    Mortgage receivable                                     -            600

    Fixed assets (notes 3 and 9)                       71,696         74,915

    Goodwill (note 10)                                      -         10,086

    Future income tax assets                            1,855          1,373

    -------------------------------------------------------------------------

                                                     $140,314       $168,383

                                                 ----------------------------

                                                 ----------------------------

 

    LIABILITIES AND SHAREHOLDERS' EQUITY

    Current

      Bank indebtedness                                    $-         $4,634

      Accounts payable and accrued liabilities         15,848         25,125

      Income taxes payable                                  -            641

      Customer advance payments                         4,931            944

      Capital lease obligations (note 7)                  125              -

    -------------------------------------------------------------------------

    Total current liabilities                          20,904         31,344

    -------------------------------------------------------------------------

 

      Long-term capital lease obligations (note 7)        148              -

      Future income tax liabilities                     4,344          5,277

    -------------------------------------------------------------------------

    Total liabilities                                  25,396         36,621

 

    Shareholders' Equity

      Share capital (note 2)                           35,435         35,681

      Contributed surplus (note 2)                      3,130          2,789

      Retained earnings                                89,108        109,912

      Accumulated other comprehensive loss (note 2)   (12,755)       (16,620)

    -------------------------------------------------------------------------

    Total shareholders' equity                        114,918        131,762

    -------------------------------------------------------------------------

                                                     $140,314       $168,383

                                                 ----------------------------

                                                 ----------------------------

 

    The accompanying notes are an integral part of these consolidated

    financial statements.

 

 

 

    EXCO TECHNOLOGIES LIMITED

    INTERIM CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE LOSS

    (Unaudited)

    $(000)'s except for earnings (loss) per share

 

 

                                  Three Months ended     Twelve Months ended

                                        September 30            September 30

                                    2009        2008        2009        2008

    -------------------------------------------------------------------------

 

    Sales                        $37,694     $50,132    $143,716    $201,681

    -------------------------------------------------------------------------

    Cost of sales and

     operating expenses

     before the following

     (note 5)                     29,885      39,271     115,547     158,519

      Selling, general and

       administrative

       (notes 2 and 4)             5,114 a     7,613      25,389 b    25,690

      Depreciation and

       amortization (note 9)       2,226       2,252      10,131 c     9,345

      Goodwill impairment

       (note 10)                       -      23,586      10,086      23,586

      Asset held for sale

       write-down (note 8)             -           -       1,415           -

      Loss (gain) on sale

       of fixed assets               (52)        297         (27)     (2,135)

      Interest expense                70          46         156         210

    -------------------------------------------------------------------------

                                  37,243      73,065     162,697     215,215

    -------------------------------------------------------------------------

 

    Income (loss) from

     continuing operations

     before income taxes             451     (22,933)    (18,981)    (13,534)

    Provision (recovery) for

     income taxes                     87      (2,180)     (1,315)       (136)

    -------------------------------------------------------------------------

    Income (loss) from

     continuing operations           364     (20,753)    (17,666)    (13,398)

    Loss from discontinued

     operations, net of tax            -        (425)          -        (536)

    -------------------------------------------------------------------------

    Net income (loss) for

     the period                     $364    ($21,178)   ($17,666)   ($13,934)

                                ---------------------------------------------

                                ---------------------------------------------

 

    Other comprehensive

     income (loss)

      Unrealized (loss) gain

       on foreign currency

       translation of self-

       sustaining operations      (3,902)        461       3,865       3,618

    -------------------------------------------------------------------------

    Comprehensive loss           ($3,538)   ($20,717)   ($13,801)   ($10,316)

                                ---------------------------------------------

                                ---------------------------------------------

 

    (Loss) earnings per

     common share

      Basic and diluted from

       continuing operations       $0.01      ($0.51)     ($0.43)     ($0.33)

      Basic and diluted from

       discontinued operations         -       (0.01)          -       (0.01)

    -------------------------------------------------------------------------

    Basic and diluted (loss)

     earnings                      $0.01      ($0.52)     ($0.43)     ($0.34)

                                ---------------------------------------------

                                ---------------------------------------------

 

    a. Includes $227 foreign exchange valuation gain, $403 severance charges

       and $88 bad debts

    b. Includes $1,107 foreign exchange valuation loss, $2,392 severance

       charges and $1,754 bad debts

    c. Includes $590 impairment charge on fixed assets.

 

    The accompanying notes are an integral part of these consolidated

    financial statements.

 

 

 

    EXCO TECHNOLOGIES LIMITED

    INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited)

    $(000)'s

 

                                                      Accumulated

                                                            other

                                                           compre-     Total

                                     Contri-              hensive      share-

                           Share      buted   Retained     income    holders'

                         capital    surplus   earnings      (loss)    equity

    -------------------------------------------------------------------------

 

    Balance,

     October 1,

     2008                $35,681     $2,789   $109,912   ($16,620)  $131,762

    Net loss for

     the quarter               -          -     (2,425)         -     (2,425)

    Dividends                  -          -       (712)         -       (712)

    Stock option

     expense                   -         67          -          -         67

    Repurchase of

     share capital          (239)         -       (290)         -       (529)

    Unrealized gains

     on translation

     of self-sustaining

     operations                -          -          -     12,187     12,187

    -------------------------------------------------------------------------

    Balance,

     December 31,

     2008                 35,442      2,856    106,485     (4,433)   140,350

    Net loss for

     the quarter               -          -    (14,607)         -    (14,607)

    Dividends                  -          -       (712)         -       (712)

    Stock option

     expense                   -        102          -          -        102

    Unrealized losses

     on translation

     of self-sustaining

     operations                -          -          -       (113)      (113)

    -------------------------------------------------------------------------

    Balance,

     March 31, 2009      $35,442     $2,958    $91,166    ($4,546)  $125,020

    Net loss for

     the quarter               -          -       (998)         -       (998)

    Dividends                  -          -       (711)         -       (711)

    Stock option

     expense                   -         88          -          -         88

    Repurchase of

     share capital            (7)                   (2)                   (9)

    Unrealized losses

     on translation

     of self-sustaining

     operations                -          -          -     (4,307)    (4,307)

    -------------------------------------------------------------------------

    Balance,

     June 30, 2009       $35,435     $3,046    $89,455    ($8,853)  $119,083

    Net income for

     the quarter               -          -        364          -        364

    Dividends                  -          -       (711)         -       (711)

    Stock option

     expense                   -         84          -          -         84

    Repurchase of

     share capital             -                     -                     -

    Unrealized losses

     on translation

     of self-sustaining

     operations                -          -          -     (3,902)    (3,902)

    -------------------------------------------------------------------------

    Balance,

     September 30,

     2009                $35,435     $3,130    $89,108   ($12,755)  $114,918

                       ------------------------------------------------------

                       ------------------------------------------------------

 

    The accompanying notes are an integral part of these consolidated

    financial statements.

 

 

 

    EXCO TECHNOLOGIES LIMITED

    INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

    $(000)'s

 

 

                                      3 Months ended         12 Months ended

                                        September 30            September 30

                                    2009        2008        2009        2008

    -------------------------------------------------------------------------

 

    OPERATING ACTIVITIES:

      Net (loss) income from

       continuing operations        $364    ($20,753)   ($17,666)   ($13,398)

      Add (deduct) items not

       involving a current

       outlay of cash

        Goodwill impairment

         (note 10)                     -      23,586      10,086      23,586

        Assets held for sale

         write-down (note 8)           -           -       1,415           -

        Depreciation and

         amortization (note 9)     2,226       2,252      10,131       9,345

        Stock-based compensation

         expense (note 2)            124          73         393         402

        Future income taxes         (764)     (2,120)     (1,415)     (2,186)

        Loss (gain) on sale

         of fixed assets             (52)        297         (27)     (2,135)

        Loss (gain) on financial

         instrument valuation

         (note 4)                   (227)        488       1,107         376

    -------------------------------------------------------------------------

                                   1,671       3,823       4,024      15,990

    -------------------------------------------------------------------------

      Net change in non-cash

       working capital

       balances related to

       continuing operations       1,774      (3,129)     11,365      (3,699)

    -------------------------------------------------------------------------

      Cash provided by

       operating activities of

       continuing operations       3,445         694      15,389      12,291

    -------------------------------------------------------------------------

 

    FINANCING ACTIVITIES:

      Increase (decrease) in

       bank indebtedness           1,572       1,638      (4,809)      2,760

      Increase (decrease) in

       long-term debt                  -           -           -         (85)

      Repayment of capital

       lease obligations             (35)          -        (134)          -

      Dividends paid (note 2)       (711)       (717)     (2,846)     (2,772)

      Repurchase of share

       capital (note 2)                -        (105)       (538)     (1,843)

    -------------------------------------------------------------------------

      Cash provided by

       (used in) financing

       activities of

       continuing operations         826         816      (8,327)     (1,940)

    -------------------------------------------------------------------------

 

    INVESTING ACTIVITIES:

      Investment in fixed

       assets                     (1,534)     (2,875)     (8,020)    (11,238)

      Proceeds on sale of

       fixed assets                  165          25       3,841       3,087

    -------------------------------------------------------------------------

      Cash used in investing

       activities of

       continuing operations      (1,369)     (2,850)     (4,179)     (8,151)

    -------------------------------------------------------------------------

 

    CASH FLOWS FROM

     DISCONTINUED OPERATIONS:

      Net cash provided by

      discontinued operations          -         341           -          80

    -------------------------------------------------------------------------

      Net cash provided by

       discontinued operations         -         341           -          80

    -------------------------------------------------------------------------

 

    Effect of exchange rate

     changes on cash                (400)        115         340         184

    -------------------------------------------------------------------------

 

    Net increase in cash

     during the period             2,502        (884)      3,223       2,464

 

    Cash, beginning of period      8,862       9,025       8,141       5,677

    -------------------------------------------------------------------------

    Cash, end of period          $11,364      $8,141     $11,364      $8,141

                                ---------------------------------------------

                                ---------------------------------------------

 

    The accompanying notes are an integral part of these consolidated

    financial statements.

 

 

 

    NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

    (Unaudited)

    $(000)'s except per share amounts

 

 

    1.  ACCOUNTING POLICIES

 

    Basis of presentation

 

    These unaudited interim consolidated financial statements of Exco

    Technologies Limited (the "Company") have been prepared in accordance

    with Canadian generally accepted accounting principles ("GAAP"), except

    that certain disclosures required for annual financial statements have

    not been included. Accordingly, the unaudited interim consolidated

    financial statements should be read in conjunction with the Company's

    annual consolidated financial statements included in the 2008 Annual

    Report. The unaudited interim consolidated financial statements have been

    prepared on a basis that is consistent with the accounting policies set

    out in the Company's 2008 annual consolidated financial statements,

    except for the changes described below.

 

    Accounting policy changes

 

    Effective October 1, 2008, the Company has adopted the new Canadian

    Institute of Chartered Accountants ("CICA") accounting sections: 3064

    (Goodwill and Intangible Assets), 3031 (Inventories) and 1400 (General

    Standards of Financial Statement Presentation).

 

    Section 3064 (Goodwill and Intangible Assets) provides guidance on the

    recognition of intangible assets in accordance with the definition of an

    asset and the criteria for asset recognition, clarifying the application

    of the concept of matching revenues and expenses and whether these assets

    are separately acquired or are developed internally. Adoption of this new

    section has no material impact on the Company's unaudited interim

    consolidated financial statements.

 

    Section 3031 (Inventories) which has replaced Section 3030, establishes

    new standards for the measurement and disclosure of inventories. It

    requires inventories to be measured at the lower of cost and net

    realizable value, provides guidance on the determination of cost and

    requires the reversal of prior write downs when the net realizable value

    of impaired inventory subsequently recovers. Adoption of this new section

    has no material impact on the Company's unaudited interim consolidated

    financial statements.

 

    Section 1400 (General Standards of Financial Statement Presentation) was

    amended to include requirements to assess and disclose an entity's

    ability to continue as a going concern. Adoption of the amendment of this

    section did not have an impact on the Company's unaudited interim

    consolidated financial statements.

 

    Credit risk and the fair value of financial assets and financial

    liabilities (EIC 173) - On January 20, 2009, the Emerging Issues

    Committee (EIC) issued the above abstract which provides further guidance

    on the determination of the fair value of financial assets and financial

    liabilities under Section 3855. EIC 173 concluded that when determining

    the fair value of financial assets and financial liabilities, the entity

    should consider its own credit risk as well as the credit risk of the

    counterparty. This abstract should be applied retrospectively, without

    restatement of prior periods, to all financial assets and liabilities

    measured at fair value in interim and annual financial statements for

    periods ending on or after January 20, 2009. Adoption of this abstract

    has no material impact on the Company's unaudited interim consolidated

    financial statements.

 

    Future accounting policy changes

 

    In February 2008, the Canadian Accounting Standards Board (ACSB)

    confirmed that International Financial Reporting Standards (IFRS) will

    replace current Canadian GAAP for publicly accountable companies. The

    official change-over date is for interim and annual financial statements

    for fiscal years beginning on or after January 1, 2011. IFRS will be

    required for the Company's interim and annual consolidated financial

    statements for the fiscal year beginning on October 1, 2011. The Company

    is currently formulating and developing an implementation plan to comply

    with the new standards and its future reporting requirements.

 

    In January, 2009, the CICA issued Section 1582 (Business Combinations),

    which replaced former guidance on business combinations (Section 1581).

    This standard establishes principles and requirements of the acquisition

    method for business combinations and related disclosures. In addition,

    the CICA issued Section 1601 (Consolidated Financial Statements)

    (replaced Section 1600), and Section 1602 (Non-Controlling Interests).

    Section 1602 provides guidance for the treatment of non-controlling

    interests subsequent to a business combination. These new standards are

    effective for the Company's annual reporting period on October 1, 2011.

    The Company is currently assessing the impact and does not anticipate the

    adoption of this new section will have a material impact on its

    consolidated financial statements.

 

    In June 2009, the CICA issued amendments to CICA Handbook Section 3862

    (Financial Instruments - Disclosures) and 1506 (Accounting Changes).

    Section 3862 amendments include enhanced disclosures related to the fair

    value of financial instruments and the liquidity risk associated with

    financial instruments. The amendments will be effective for annual

    financial statements for fiscal years ending after September 30, 2009.

    The Company is currently evaluating the impact of the amended section on

    its consolidated financial statements. Section 1506 was amended to

    exclude from its scope changes in accounting policies upon the complete

    replacement of an entity's primary basis of accounting. The amendments

    are effective for annual and interim financial statements relating to

    fiscal years beginning on or after July 1, 2009. The adoption of IFRS is

    not expected to qualify as an accounting change under CICA 1506.

 

    2.  SHARE CAPITAL

 

    Authorized

 

    The Company's authorized share capital consists of an unlimited number of

    common shares, an unlimited number of non-voting preference shares

    issuable in one or more series and 275 special shares.

 

    Issued

 

    The Company has not issued any non-voting preference shares or special

    shares. Changes to the issued common shares are shown in the following

    table:

 

                                                           Common Shares

    -------------------------------------------------------------------------

    Issued and outstanding at September 30, 2008      40,948,276     $35,681

    Purchased and cancelled pursuant to

     normal course issuer bid                           (274,100)       (239)

    -------------------------------------------------------------------------

    Issued and outstanding at December 31, 2008       40,674,176      35,442

    -------------------------------------------------------------------------

    Issued and outstanding at March 31, 2009          40,674,176      35,442

    Purchased and cancelled pursuant to

     normal course issuer bid                             (8,000)         (7)

    -------------------------------------------------------------------------

    Issued and outstanding at June 30, 2009           40,666,176      35,435

    -------------------------------------------------------------------------

    Issued and outstanding at September 30, 2009      40,666,176     $35,435

                                                     ------------------------

                                                     ------------------------

 

    Currency translation adjustment

 

    All of the Company's foreign operations are self-sustaining. Gains and

    losses arising from the translation of the Company's net investment in

    its foreign subsidiaries are included in accumulated other comprehensive

    loss in shareholders' equity. The appropriate amount of exchange gain or

    loss included in accumulated other comprehensive loss is reflected in

    earnings when there is a sale or partial sale of the Company's investment

    in these operations or upon a complete or substantially complete

    liquidation of the investment.

 

    Unrealized translation adjustments which arise on the translation to

    Canadian dollars of assets and liabilities of the Company's self-

    sustaining foreign operations resulted in an unrealized currency

    translation loss of $3,902 during the three months ended September 30,

    2009 (three months ended September 30, 2008 - the unrealized translation

    gain was $461). For the twelve months ended September 30, 2009 the

    unrealized gain was $3,865 (twelve months ended September 30, 2008 - the

    unrealized gain was $3,618). Year-to-date unrealized gain of $3,865 is

    primarily attributable to the strengthening of the U.S. dollar against

    the Canadian dollar as measured at September 30, 2009 and September 30,

    2008.

 

    Cash dividend

 

    During the three months ended September 30, 2009, the Company paid cash

    dividends as outlined in the table below. The dividend rate per quarter

    was increased from $0.015 to $0.0175 per common share since the second

    quarter of fiscal 2008.

 

                                                            2009        2008

    -------------------------------------------------------------------------

    December 31                                             $712        $618

    March 31                                                 712         719

    June 30                                                  711         718

    September 30                                             711         717

    -------------------------------------------------------------------------

    Total dividends paid                                  $2,846      $2,772

                                                     ------------------------

                                                     ------------------------

 

    Stock option plan

 

    The Company has a stock option plan under which common shares may be

    acquired by employees and officers of the Company. Non-executive

    directors are not eligible to participate in the stock option plan. The

    following is a continuity schedule of options outstanding (number of

    options in the table below is expressed in whole numbers and has not been

    rounded to the nearest thousand):

 

                            2009                            2008

    -------------------------------------------------------------------------

             Options outstanding             Options outstanding

            ---------------------           ---------------------

                        Weighted                        Weighted

                Number   average                Number   average

                    of  exercise      Options       of  exercise      Options

               options     price  exercisable  options     price  exercisable

    -------------------------------------------------------------------------

 

    Opening

     balance   2,265,414   $4.36   1,793,196   2,410,849   $4.50   1,817,387

    Granted       87,049   $1.52           -      73,777   $3.79           -

    Vested             -       -     157,629           -       -     183,021

    Expired     (348,034)  $3.50    (348,034)   (179,212)  $5.42    (179,212)

    -------------------------------------------------------------------------

 

    Balance,

     December

     31        2,004,429   $4.39   1,602,791   2,305,414   $4.41   1,821,196

    Granted       30,000   $1.03           -           -       -           -

    Vested             -       -       2,000           -       -       6,000

    Expired      (40,000)   3.88     (40,000)          -       -           -

    Cancelled          -       -           -     (30,000)   6.85     (24,000)

    -------------------------------------------------------------------------

 

    Balance,

     March 31  1,994,429   $4.35   1,564,791   2,275,414   $4.38   1,803,196

    Expired      (65,000)  $4.78     (65,000)          -       -           -

    -------------------------------------------------------------------------

 

    Balance,

     June 30   1,929,429   $4.33   1,499,791   2,275,414   $4.38   1,803,196

    Expired            -       -           -     (10,000)  $7.60     (10,000)

    -------------------------------------------------------------------------

 

    Balance,

     September

     30        1,929,429   $4.33   1,499,791   2,265,414   $4.36   1,793,196

              ---------------------------------------------------------------

              ---------------------------------------------------------------

 

    Employee stock purchase plan

 

    The Company has an employee stock purchase plan (ESPP). The ESPP allows

    employees to purchase shares annually through payroll deductions at a

    predetermined price. During fiscal 2009, payroll deductions will be made

    supporting the purchase of a maximum of 401,150 at $1.29 per share. The

    purchase and payroll deductions with respect to these shares will be

    completed in the first quarter of fiscal 2010. Employees must decide

    annually whether or not they wish to purchase their common shares. During

    the twelve months ended September 30, 2009 no shares (2008 - nil) were

    issued under the terms of the ESPP. Effective December 31, 2009, the ESPP

    will be terminated. Options previously granted and outstanding will

    continue to be outstanding and exercisable in accordance with the terms

    of the plan.

 

    Stock-based compensation

 

    Stock-based compensation resulting from applying the Black-Scholes

    option-pricing model to the Company's Stock Option Plan and the ESPP was

    $84 for the three months ended September 30, 2009 (three months ended

    September 30, 2008 - $96) and for the twelve months ended September 30,

    2009 was $341 (twelve months ended September 30, 2008 - $425). All stock-

    based compensation has been recorded in selling, general and

    administrative expenses. The weighted average assumptions measuring the

    fair value of stock options and the weighted average fair value of

    options granted in the twelve months ended September 30, 2009 are as

    follows:

 

                                                       September   September

                                                        30, 2009    30, 2008

    -------------------------------------------------------------------------

    Risk free interest rates                               2.48%       4.00%

    Expected dividend yield                                6.24%       1.71%

    Expected volatility                                   36.89%      26.00%

    Expected time until exercise                      5.63 years  6.10 years

    Weighted average fair value of the

     options granted                                       $0.18       $0.84

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

 

    On November 18, 2005, the Company's Board of Directors adopted a Deferred

    Share Unit Plan ("DSU Plan") for eligible directors. The deferred share

    units will be redeemed by the Company in cash payable after the eligible

    director departs from the Board. The number of units in the table below

    is expressed in whole numbers and has not been rounded to the nearest

    thousand:

 

                                                       Number of

                                                           units

                                                          issued     Expense

    -------------------------------------------------------------------------

    December 31, 2008                                     11,535        ($18)

    March 31, 2009                                        12,088           8

    June 30, 2009                                         10,144          22

    September 30, 2009                                     7,377          40

    -------------------------------------------------------------------------

                                                          41,144         $52

                                                     ------------------------

                                                     ------------------------

 

    Contributed surplus

 

    Contributed surplus consists of accumulated stock option expense less the

    fair value of the options at the grant date that have been exercised and

    reclassified to share capital. The following is a continuity schedule of

    contributed surplus:

 

                                                            2009        2008

    -------------------------------------------------------------------------

    Balance, beginning of the year                        $2,789      $2,364

    Stock option compensation expense                         67         137

    -------------------------------------------------------------------------

    Balance, December 31                                   2,856       2,501

    Stock option compensation expense                        102          97

    -------------------------------------------------------------------------

    Balance, March 31                                      2,958       2,598

    Stock option compensation expense                         88          95

    -------------------------------------------------------------------------

    Balance, June 30                                       3,046       2,693

    Stock option compensation expense                         84          96

    -------------------------------------------------------------------------

    Balance, September 30                                 $3,130      $2,789

                                                     ------------------------

                                                     ------------------------

 

    Normal course issuer bid

 

    The Company received approval from the Toronto Stock Exchange for a

    normal course issuer bid for a 12-month period beginning on May 8, 2009

    replacing the normal course issuer bid which expired on May 7, 2009. The

    Company's Board of Directors authorized the purchase of up to 2,000,000

    common shares, representing approximately 5% of the Company's outstanding

    common shares. During the twelve months ended September 30, 2009, the

    Company purchased 282,100 common shares under both bids (2008 - 530,200)

    at a total cost of $538 (2008 - $1,843). The cost to purchase these

    shares exceeded their stated value by $292 (2008 - $1,382). This excess

    has been charged against retained earnings.

 

    3.  FIXED ASSETS

 

                                                          September 30, 2009

    -------------------------------------------------------------------------

                                                    Accumulated

                                                   Depreciation

                                                            and          Net

                                            Cost   Amortization   Book Value

    -------------------------------------------------------------------------

    Land                                  $6,653            $-        $6,653

    Buildings                             45,165        14,257        30,908

    Machinery and equipment              165,137       131,576        33,561

    Tools                                  5,755         5,181           574

                                      ---------------------------------------

                                        $222,710      $151,014       $71,696

                                      ---------------------------------------

                                      ---------------------------------------

 

 

                                                          September 30, 2008

    -------------------------------------------------------------------------

                                                    Accumulated

                                                   Depreciation

                                                            and          Net

                                            Cost   Amortization   Book Value

    -------------------------------------------------------------------------

    Land                                  $6,972            $-        $6,972

    Buildings                             44,128        14,059        30,069

    Machinery and equipment              182,099       144,768        37,331

    Tools                                  8,278         7,735           543

                                      ---------------------------------------

                                        $241,477      $166,562       $74,915

                                      ---------------------------------------

                                      ---------------------------------------

 

    At September 30, 2009, the Company had building, machinery and deposits

    relating to fixed assets of $3,739 (2008 - $4,906). These assets are not

    being depreciated because they are under construction and not in use.

    Fixed assets under capital leases amounted to $428 (2008 - nil) less

    accumulated depreciation of $154 (2008- nil).

 

    4.  FINANCIAL INSTRUMENTS

 

    Financial instruments of the Company consist primarily of cash, accounts

    receivable, mortgage receivable, bank indebtedness, accounts payable and

    accrued liabilities, customer advance payments, capital lease obligations

    and forward foreign exchange contracts. With the exception of forward

    foreign exchange contracts which the Company fair values quarterly and

    recognizes any changes in value in the consolidated statements of

    earnings and comprehensive loss the carrying value of these financial

    instruments approximates their fair value due to their nature.

 

    The Company classifies its financial instruments as follows:

 

    -------------------------------------------------------------------------

    Cash                                 Financial assets - held for trading

    Accounts receivable*               Financial assets - loans and

                                          receivables

    Mortgage receivable*               Financial assets - loans and

                                          receivables

    Bank indebtedness                    Financial liabilities - held for

                                          trading

    Accounts payable and accrued         Financial liabilities - other

     liabilities                          financial liabilities

    Customer advance payments            Financial liabilities - held for

                                          trading

    Forward foreign exchange             Financial assets/liabilities -

     contracts                            held for trading

    Capital lease obligations*         Financial liabilities - other

                                          financial liabilities

    -------------------------------------------------------------------------

    * Recorded at amortized cost

 

    Foreign exchange contracts

 

    The Company has forward foreign exchange contracts to sell US$1,800 over

    the next three months at the rate ranges from 1.08 to 1.13 Canadian

    dollars for each US dollar sold. The Company also entered into a series

    of put and call options ("Collars") extending through to September 22,

    2011. The total value of these collars is 83.1 million Mexican pesos

    (September 30, 2008 - 138.1 million Mexican pesos). The selling price

    ranges from 11.00 to 12.20 Mexican pesos to each U.S. dollar.

 

    Management estimates that a combined loss of $1,338 (2008 - loss of $231)

    would be realized if these contracts and collars were terminated on

    September 30, 2009. As at September 30, 2009, the estimated fair value

    loss of $1,107 (2008 - loss of $376) has been included in the selling,

    general and administrative expense on the consolidated statements of

    earnings and comprehensive loss and the loss of $1,338 (2008 - loss of

    $231) is recorded in the accounts payable and accrued liabilities.

 

    Financial risk management

 

    The Company, through its financial assets and liabilities, is exposed to

    various risks. The following analysis provides a measurement of the risks

    and how they are managed:

 

    a) Credit risk

 

    Credit risk is the risk of an unexpected loss if a customer or third

    party fails to meet its contractual obligations. The Company's primary

    credit risk is its outstanding trade accounts receivable. The carrying

    amount of its outstanding trade accounts receivable represents the

    Company's estimate of its maximum credit exposure. The Company regularly

    monitors its credit risk exposure and takes steps such as credit approval

    procedures, establishing credit limits, utilizing credit assessments and

    monitoring practices to mitigate the likelihood of these exposures from

    resulting in an actual loss. The carrying amount of the trade accounts

    receivable disclosed in the unaudited interim consolidated balance sheets

    is net of allowances for doubtful accounts, estimated by the Company's

    management, based on prior experience and assessment of current financial

    conditions of customers as well as the general economic environment. When

    a receivable balance is considered uncollectible, it is written off

    against the allowance for doubtful accounts. Subsequent recoveries of

    amounts previously written off are credited against operating expenses in

    the consolidated statements of earnings and comprehensive loss. As at

    September 30, 2009, the accounts receivable balance (net of allowance for

    doubtful accounts) is $26,711 (September 30, 2008 - $34,120) and the

    Company's five largest trade debtors accounted for 41% of the total

    accounts receivable balance (2008 - 44%). At September 30, 2009, accounts

    receivable in the amount of $9,557 are insured against default.

 

    The following table presents a breakdown of the Company's accounts

    receivable balances:

 

                                                            2009        2008

    -------------------------------------------------------------------------

    Trade accounts receivable                            $26,425     $34,191

    Employee receivable*                                   283          64

    Sales tax receivable                                     414         160

    Vendor rebates                                             -          81

    Others                                                    51         105

    Allowance for doubtful accounts                         (462)       (481)

    -------------------------------------------------------------------------

    Total accounts receivable, net                       $26,711     $34,120

                                                     ------------------------

                                                     ------------------------

 

    * The indebtedness of the Chief Executive Officer of the Company is a

        loan in the amount of $186 evidenced by a promissory note due on the

        date on which the Company makes demand. The promissory note provides

        for a maximum loan amount of $200. Interest is payable on the

        outstanding balance at a rate equal to the Company's cost of

        borrowing plus 1%. No security has been provided to the Company and

        no other understanding, agreement or intention to limit recourse

        exists. In addition, the Company is owed a total of $46 on account of

        non-business expenses paid by the Company on behalf of this officer

        and interest accrued on the outstanding loan.

 

    The aging of trade accounts receivable balances is as follows:

 

                                                            2009        2008

    -------------------------------------------------------------------------

    Not past due                                         $19,698     $26,593

    Past due 1-30 days                                     3,829       4,155

    Past due 31-60 days                                    1,042       1,035

    Past due 61-90 days                                    1,513         599

    Past due over 90 days                                    343       1,809

    Less: allowance for doubtful accounts                   (462)       (481)

    -------------------------------------------------------------------------

    Total trade accounts receivable, net                 $25,963     $33,710

                                                     ------------------------

                                                     ------------------------

 

    The movement in the allowance for doubtful accounts is as follows:

 

                                                            2009        2008

    -------------------------------------------------------------------------

    Opening balance                                         $481        $696

    Bad debt expense                                       1,754       1,120

    Write-offs                                            (1,773)     (1,335)

    -------------------------------------------------------------------------

    Closing balance                                         $462        $481

                                                     ------------------------

                                                     ------------------------

 

    b) Liquidity risk

 

    Liquidity risk refers to the possibility that the Company may not be able

    to meet its financial obligations as they come due. The Company manages

    its liquidity risk by minimizing its financial leverage and arranging

    credit facilities in order to ensure sufficient funds are available to

    meet its financial obligations. This is achieved by continuously

    monitoring its cash flows from its operating, investing and financing

    activities. As at September 30, 2009, the Company has a net cash balance

    of $11,364 (2008 - $3,507) and unused credit facilities of

    $24,379 (2008 - $43,546).

 

    c) Foreign exchange risk

 

    The Company's functional and reporting currency is in Canadian dollars.

    It operates in Canada with subsidiaries located in the United States,

    Mexico and Morocco. It is exposed to foreign exchange transaction and

    translation risk through its operating activities and self-sustaining

    foreign operations. Unfavourable changes in the exchange rates may affect

    the operating results and shareholders' equity of the Company. In order

    to mitigate the foreign currency exposure, the Company reduces part of

    its foreign exchange risk by sourcing a significant portion of its

    manufacturing inputs in the currency that its sales are denominated in.

    In addition to above natural hedge, depending on the timing of foreign

    currency receipts and payments, the Company will occasionally enter into

    short term forward foreign exchange contracts to mitigate part of the

    remaining foreign exchange exposure. These contracts are classified as

    "held for trading" on the balance sheet and fair valued each quarter. The

    resulting gain or loss on the valuation of these financial instruments is

    recognized in the consolidated statements of earnings and comprehensive

    loss. The Company does not mitigate the translation risk exposure of its

    self-sustaining foreign operations due to the fact that these investments

    are considered to be long-term in nature.

 

    With all other variables held constant, the following table outlines the

    Company's foreign exchange exposure at one percent fluctuation between

    various currencies compared with the average year to date exchange rate.

 

    -------------------------------------------------------------------------

                                1 %          1 %          1 %          1 %

                           Fluctuation  Fluctuation  Fluctuation  Fluctuation

                              USD vs.    Dirham vs.    Euro vs.      USD vs.

                                CDN          CDN        Dirham      MXN peso

    -------------------------------------------------------------------------

    Earnings (loss) before

     income taxes            +/- $586      +/- $11      +/- $36      +/- $50

    -------------------------------------------------------------------------

    Other comprehensive

     income (loss)         +/- $1,616     +/- $157           na           na

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

 

    d) Interest rate risk

 

    The Company's exposure to interest rate risk relates to its net cash

    position and variable rate credit facilities. The Company mitigates its

    interest risk exposure by reducing or eliminating its overall debt

    position. As at September 30, 2009, the Company has a net cash position

    of $11,364 (2008 - $3,507); therefore its interest rate risk exposure is

    insignificant.

 

    5.  INVENTORIES

 

                                                            2009        2008

    -------------------------------------------------------------------------

    Raw materials                                         $9,056     $12,628

    Work in process                                       10,434      12,322

    Finished goods                                         3,439       4,905

    Production supplies                                      401         672

    -------------------------------------------------------------------------

                                                         $23,330     $30,527

                                                     ------------------------

                                                     ------------------------

 

    Inventories are valued at the lower of cost and net realizable value,

    with cost being determined substantially on a first-in, first-out basis.

    Cost includes the cost of materials and, in the case of work in process

    and finished goods, direct labour and the applicable share of

    manufacturing overhead.

 

    During the twelve months ended September 30, 2009, inventories of $62,146

    (2008 - $94,100) were expensed of which $1,152 were from the write downs

    of inventory (2008 - $694) were included in cost of goods sold. No

    reversals of write downs were recorded during the twelve months ended

    September 30, 2009 and 2008.

 

    6.  CAPITAL MANAGEMENT

 

    The Company defines capital as net debt and shareholders' equity. As at

    September 30, 2009, total managed capital was $114,918 (September 30,

    2008 - $131,762) consisting of nil net debt (September 30, 2008 - nil)

    and shareholders' equity of $114,918 (September 30, 2008 - $131,762).

 

    The Company's objectives when managing capital are to:

 

    -   utilize short-term funding sources to manage its working capital

        requirements and fund capital expenditures required to execute its

        operating and strategic plans, and

    -   maintain low overall debt levels relative to shareholders' equity

        with a strong bias for short-term debt in order to minimize the cost

        of capital and allow maximum flexibility to respond to current and

        future industry, market and economic risks and opportunities.

 

    The following ratios are used by the Company to monitor its capital:

 

                                                       September   September

                                                        30, 2009    30, 2008

    -------------------------------------------------------------------------

    Net debt to equity                                    0.00:1      0.00:1

    Current ratio                                         2.58:1      2.55:1

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

 

    The following table details the net debt calculation used in the net debt

    to equity ratio as at the periods ended as indicated:

 

                                                       September   September

                                                        30, 2009    30, 2008

    -------------------------------------------------------------------------

    Bank indebtedness                                         $-      $4,634

    Capital lease obligations                                273           -

    Less: cash                                           (11,364)     (8,141)

    -------------------------------------------------------------------------

    Net debt                                                 nil         nil

                                                     ------------------------

                                                     ------------------------

 

    The current ratio is calculated by dividing current assets (excluding

    cash and assets held for sale) by current liabilities (excluding bank

    indebtedness).

 

    The Company is not subject to any capital requirement imposed by

    regulators; however, the Company must adhere to certain financial

    covenants related to the terms of its bank credit facility. As at

    September 30, 2009, the Company was in compliance with the required

    financial covenants.

 

    7.  CAPITAL LEASE OBLIGATIONS

 

                                                            2009        2008

    -------------------------------------------------------------------------

    Total minimum lease payments                            $283          $-

    Less: amount representing interest at average

     rate of 4.4%                                            (10)          -

    -------------------------------------------------------------------------

    Capital lease obligations                                273           -

    Less: current portion                                   (125)          -

    -------------------------------------------------------------------------

    Long-term portion of capital lease obligations          $148          $-

                                                     ------------------------

                                                     ------------------------

 

    Future minimum lease payments are as follows:

 

    -------------------------------------------------------------------------

                                                                       Total

                                             Capital                 Minimum

                                               Lease                   Lease

                                         Obligations    Interest    Payments

    -------------------------------------------------------------------------

    2010                                        $127          $8         135

    2011                                         103           2         105

    2012                                          26           -          26

    2013                                          10           -          10

    2014                                           7           -           7

    -------------------------------------------------------------------------

                                                $273         $10        $283

                                       --------------------------------------

                                       --------------------------------------

 

    8.  ASSETS HELD FOR SALE

 

    In May 2009, the Company concluded the sale of the Techmire production

    facility with a net loss of $1,415. This loss was recorded as a write-

    down of assets held for sale in the second quarter of the current year

    when the sale and purchase agreement was signed.

 

    In reacting to the current economic crisis and negative trend of the

    automotive industry, the Company has ceased to operate the Neocon USA

    subsidiary in order to consolidate the Group operations, reduce overhead

    and dispose of the production facility. Effectively, a total of $1,501 of

    its fixed assets, mainly land and building, is listed for sale. The

    Company expects the total proceeds from the sale of these assets to be

    higher than their net book values.

 

    9.  LONG-LIVED ASSETS IMPAIRMENT

 

    During the second quarter of the year, the Company's Automotive Solutions

    segment (Neocon USA) recorded an asset impairment charge on its machinery

    and equipment in the amount of $590. The impairment charge was included

    in the depreciation of its fixed assets. It was determined by comparing

    the current pricing of similar machinery and equipment. As a result,

    management estimated the fair value of its machinery and equipment

    exceeded its carrying value by $590 as at March 31, 2009.

 

    Also in the fourth quarter of the year, events occurred which indicated

    that there were potential impairments of long-lived assets at the

    divisions heavily impacted by the global automotive crisis. These

    indicators included 1) permanent reduced capacity in North American

    automotive industry, 2) global economic recession, 3) significant sales

    decline in fiscal 2009 experienced by all divisions in the automotive

    segment and the large mould businesses, and 4) equally weak sales

    projection in fiscal 2010 for the large mould businesses. Accordingly,

    long-lived assets at these divisions were tested for impairment. The test

    results indicated that there are no impairments of long-lived assets

    present at these divisions at this time.

 

    10. GOODWILL

 

    During the second quarter of the year events occurred which indicated

    that it was more likely than not that there was a significant further

    decline in the fair value of the Company's Polytech division due to the

    global economic crisis, generally negative development in the North

    American automotive industry, continuing poor light vehicle sales and

    tightening consumer credit. As a result, the Company tested the goodwill

    associated with the Polytech division in advance of the annual impairment

    test and the Company recorded a goodwill impairment charge of $10,086.

    This impairment charge was not deductible for tax purposes; therefore

    there was no corresponding tax benefit. After this impairment charge,

    there remained no goodwill on the Company's balance sheet.

 

    11. SEGMENTED INFORMATION

 

    The Company operates in two business segments: Casting and Extrusion

    Technology and Automotive Solutions. The accounting policies followed in

    the operating segments are consistent with those outlined in note 1 to

    the annual consolidated financial statements.

 

    The Casting and Extrusion Technology segment designs and engineers

    tooling and other manufacturing equipment. Its operations are

    substantially for automotive and other industrial markets in North

    America.

 

    The Automotive Solutions segment produces automotive interior components

    and assemblies primarily for cargo storage and restraint for sale to

    automotive manufacturers and Tier 1 suppliers (suppliers to automakers).

 

    The Corporate segment involves administrative expenses that are not

    directly related to the business activities of the above two operating

    segments.

 

    -------------------------------------------------------------------------

                                   Three Months ended September 30, 2009

    -------------------------------------------------------------------------

                             Casting and  Automotive

                               Extrusion   Solutions   Corporate       Total

    -------------------------------------------------------------------------

    Sales                        $26,023     $11,671          $-     $37,694

    Depreciation                   1,623         592          11       2,226

    Goodwill impairment                -           -           -           -

    Segment income (loss)          1,504        (631)       (352)        521

    Interest expense                                                      70

    Loss before taxes                                                    451

    Fixed asset additions            817         717           -       1,534

    Fixed assets, net             51,480      18,671       1,545      71,696

    Total assets                 $53,879     $83,982      $2,453    $140,314

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

 

 

    -------------------------------------------------------------------------

                                   Three Months ended September 30, 2008

    -------------------------------------------------------------------------

                             Casting and  Automotive

                               Extrusion   Solutions   Corporate       Total

    -------------------------------------------------------------------------

    Sales                        $26,852     $23,280          $-     $50,132

    Depreciation                   1,585         646          21       2,252

    Goodwill impairment                -      23,586           -      23,586

    Segment loss                    (683)    (21,552)       (652)    (22,887)

    Interest expense                                                      46

    Loss before taxes                                                (22,933)

    Fixed asset additions          2,316         559           -       2,875

    Fixed assets, net             53,073      20,295       1,547      74,915

    Goodwill                           -      10,086           -      10,086

    Total assets -

     continuing operations        57,540     103,201       2,034     162,775

    Total assets -

     discontinued operations       5,608           -           -       5,608

    Total assets                 $63,148    $103,201      $2,034    $168,383

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

 

 

    -------------------------------------------------------------------------

                                   Twelve Months ended September 30, 2009

    -------------------------------------------------------------------------

                             Casting and  Automotive

                               Extrusion   Solutions  Corporate        Total

    -------------------------------------------------------------------------

    Sales                        $96,105     $47,611         $-     $143,716

    Depreciation                   6,970       3,116         45       10,131

    Goodwill impairment                -      10,086          -       10,086

    Segment income (loss)          2,339     (15,884)    (5,280)     (18,825)

    Interest expense                                                     156

    Loss before taxes                                                (18,981)

    Fixed asset additions          5,280       2,697         43        8,020

    Fixed assets, net             51,480      18,671      1,545       71,696

    Total assets                 $53,879     $83,982     $2,453     $140,314

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

 

 

    -------------------------------------------------------------------------

                                   Twelve Months ended September 30, 2008

    -------------------------------------------------------------------------

                             Casting and  Automotive

                               Extrusion   Solutions  Corporate        Total

    -------------------------------------------------------------------------

    Sales                       $111,493     $90,188         $-     $201,681

    Depreciation                   6,900       2,389         56        9,345

    Goodwill impairment                -      23,586          -       23,586

    Segment income (loss)          3,404     (14,843)    (1,885)     (13,324)

    Interest expense                                                     210

    Loss before taxes                                                (13,534)

    Fixed asset additions          7,606       3,514        118       11,238

    Fixed assets, net             53,073      20,295      1,547       74,915

    Goodwill                           -      10,086          -       10,086

    Total assets -

     continuing operations        57,540     103,201      2,034      162,775

    Total assets -

     discontinued operations       5,608           -          -        5,608

    Total assets                 $63,148    $103,201     $2,034     $168,383

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

 

    5 YEAR FINANCIAL HIGHLIGHTS

 

    -------------------------------------------------------------------------

                                2009      2008      2007      2006      2005

    -------------------------------------------------------------------------

    Sales                   $143,716  $201,681  $201,759  $199,271  $202,957

    -------------------------------------------------------------------------

    Net income (loss) from

     continuing operations  ($17,666) ($13,398)   $5,794    $3,311   $14,579

    -------------------------------------------------------------------------

    Net income (loss)       ($17,666) ($13,934)   $3,062     ($616)  $11,132

    -------------------------------------------------------------------------

    Diluted earnings (loss)

     per share from

     continuing operations    ($0.43)   ($0.33)    $0.14     $0.08     $0.35

    -------------------------------------------------------------------------

    Diluted earnings

     (loss) per share         ($0.43)   ($0.34)    $0.07    ($0.01)    $0.27

    -------------------------------------------------------------------------

    Cash flow from

     operations before

     non-cash items           $4,024   $15,990   $17,698   $22,581   $27,306

    -------------------------------------------------------------------------

    Total net debt to

     equity                   0.00:1    0.00:1    0.00:1    0.04:1    0.10:1

    -------------------------------------------------------------------------

    Capital expenditures,

     net of disposals         $4,179    $8,151   $11,392    $9,774    $8,477

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

 

 

    CORPORATE INFORMATION

 

    Exco Technologies Limited is a global supplier of innovative technologies

    servicing the die-cast, extrusion and automotive industries. Through our

    10 strategic locations, we employ 1,350 people and service a diverse and

    broad customer base.

 

    Telephone:   905-477-3065

    Fax:         905-477-2449

    Web:         www.excocorp.com

 

    TORONTO STOCK EXCHANGE LISTING

 

    XTC

 

    DIRECTORS

 

    Laurie Bennett, Chairman

    Geoffrey F. Hyland

    Edward Kernaghan

    Brian A. Robbins, President and CEO

    Stephen Rodgers

    Peter van Schaik

 

    TRANSFER AGENT

 

    Equity Transfer & Trust Company

    200 University Avenue

    Suite 400

    Toronto, Ontario

    M5H 4H1

 

    Shareholder Inquiries:

 

    Telephone:    416-361-0930

    Web:          www.equitytransfer.com

 

For further information:
Paul Riganelli, Vice-President, Finance and Chief Financial Officer,
Telephone: (905) 477-3065 ext. 7228
Website:http://www.excocorp.com

 

 
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