Tree Island Announces Second Quarter 2012 Results
(firmenpresse) - VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 08/13/12 -- Tree Island Wire Income Fund (TSX: TIL.UN)(TSX: TIL.DB) -
Q2 2012 Financial Highlights
Tree Island Wire Income Fund ("Tree Island" or the "Fund" (1)) announced today its financial results for the three and six month periods ended June 30, 2012.
For the three months ended June 30, 2012(2), higher selling prices resulted in increased revenues of $39.6 million, compared to $38.0 million during the corresponding period in 2011. Gross profit also increased by $0.7 million to $4.2 million, while gross profit per ton improved by $34 per ton to $163 per ton, compared to $129 per ton in the same period in 2011. The increase in gross profit and gross profit per ton primarily reflects the increase in sales prices which were partially offset by the increase in the cost of carbon rod. Gross profit and gross profit per ton continued to demonstrate improvement on a consecutive quarter basis as the Fund maintained price discipline and further improved efficiencies. As a result of higher revenues, gross profit and ongoing focus on pricing and price discipline, EBITDA increased by 15% to $2.0 million during the second quarter of 2012, which compares to $1.7 million during the corresponding period in 2011.
For the six months ended June 30, 2012(2), despite the 1,041 decrease in tonnage, the Fund's revenues increased by 9% to $83.6 million from $76.9 million during the same period in 2011. Gross profit and EBITDA also increased to $8.2 million and $3.7 million, respectively. The year-over-year improvement in financial results is largely the result of maintaining price discipline and ongoing cost management.
During the six months ended June 30, 2012, the Fund purchased 934,000 units at an average cost of $0.28 per unit under its previously announced normal course issuer bid. These units were cancelled by the Fund at the end of the month of purchase.
"Despite the continued challenges and uncertainties in our end markets, I am pleased with our ability to further strengthen the Fund's financial condition and overall performance," said Dale R. MacLean, President and CEO of Tree Island Industries. "Our priorities remain unchanged. Our second quarter results are indicative of our ongoing concentration on operating efficiencies which combined with our pricing discipline and target market focus have generated yet another quarter of improved results."
Amar S. Doman, Chairman of the Fund noted, "The Fund's second quarter results continue to demonstrate promise with improvement at the revenue, gross profit and EBITDA lines. Looking ahead, the Fund is positioned to take advantage of increased demand while further improving efficiencies and throughput in order to maximize margins."
Q2 2012 Significant Developments
About Tree Island Wire Income Fund
The Fund was launched on November 12, 2002 with the completion on an initial public offering. The Fund has a 100% ownership interest in Tree Island Industries Ltd and its performance depends on the performance of Tree Island Industries Ltd. Headquartered in Richmond, British Columbia, Tree Island Industries Ltd. produces wire products for a diverse range of construction, industrial, residential, manufacturing, and industrial applications. Its products include bright wire, stainless steel wire and galvanized wire; a broad array of fasteners, including packaged, collated and bulk nails; stucco reinforcing products, engineered structural mesh, fencing and other fabricated wire products. The company markets these products under the Tree Island, Halsteel, K-Lath, Industrial Alloys, Tough Strand, and TI Select brand names.
Forward-Looking Statements
This press release includes forward-looking information with respect to the Fund and the company, including their business, operations and strategies, as well as financial performance and conditions. The use of forward-looking words such as, "may", "will", "expect" or similar variations generally identify such statements. Any statements that are contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Although management believes that expectations reflected in forward-looking statements are reasonable, such statements involve risks and uncertainties including risks and uncertainties discussed under the heading "Risk Factors" in the Fund's most recent annual information form and management discussion and analysis.
The forward looking statements contained herein reflect management's current beliefs and are based upon certain assumptions that management believes to be reasonable based on the information currently available to management. By their very nature, forward looking statements involve inherent risks and uncertainties, both general and specific, and a number of factors could cause actual events or results to differ materially from the results discussed in the forward looking statements. In evaluating these statements, prospective investors should specifically consider various factors including the risks outlined in the Fund's most recent annual information form and management discussion and analysis which may cause actual results to differ materially from any forward looking statement. Such risks and uncertainties include, but are not limited to: general economic, market and business conditions, the cyclical nature of our business and demand for our products, financial condition of our customers, competition, volume and price pressure from import competition, deterioration in the Company's liquidity, disruption in the supply of raw materials, volatility in the costs of raw materials, significant exposure to the Western United States due to lack of geographic diversity, dependence on the construction industry, transportation costs, foreign exchange fluctuations, leverage and restrictive covenants, labour relations, trade actions, dependence on key personnel and skilled workers, reliance on key customers, intellectual property risks, energy costs, un-insured loss, credit risk, operating risk, management of growth, changes in tax, environmental and other legislation, and other risks and uncertainties set forth in our publicly filed materials.
This press release has been reviewed by the Fund's Board of Trustees and its Audit Committee, and contains information that is current as of the date of this press release, unless otherwise noted. Events occurring after that date could render the information contained herein inaccurate or misleading in a material respect. Readers are cautioned not to place undue reliance on this forward-looking information and management of the Fund undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise except as required by applicable securities laws.
(1) References to the Fund or Tree Island include references to Tree Island Industries Ltd. as the context may require.
(2) Please refer to our Q2 2012 MD&A for further information.
(3) References made above to "EBITDA" are to operating profit plus depreciation, references to "Adjusted Net Income (Loss)" are to net income (loss) per IFRS adjusted for certain non-cash items including non-cash financing expenses, changes in fair value of convertible instruments and gain (loss) on renegotiated debt, and references to "Adjusted Distributable Cash" are to net cash from operating activities less all capital expenditures, less restrictions on distributions arising from compliance issues with financial covenants, less any minority interests and less the impact of changes in non-cash working capital. EBITDA is a measure used by many investors to compare issuers on the basis of ability to generate cash flows from operations. Adjusted Net Income (Loss) is a measure for investors to understand the impact of significant non-cash items that affect our results from operations. Adjusted Distributable Cash is a measure for investors to understand the ability to sustain or support quarterly distributions. Neither EBITDA, Adjusted Net Income (Loss), nor Adjusted Distributable Cash are earnings measures recognized by IFRS and do not have a standardized meaning prescribed by IFRS. We believe that EBITDA, Adjusted Net Income (Loss), and Adjusted Distributable Cash are important supplemental measure in evaluating the Fund's performance. You are cautioned that EBITDA, Adjusted Net Income (Loss), and Adjusted Distributable Cash should not be construed as alternatives to net income or loss, determined in accordance with IFRS, as indicators of performance, to cash flows from operating, investing and financing activities as measures of liquidity and cash flows, or cash available for distributions. Our method of calculating EBITDA, Adjusted Net Income (Loss), and Adjusted Distributable Cash may differ from methods used by other issuers and, accordingly, our EBITDA, Adjusted Net Income (Loss), or Adjusted Distributable Cash may not be comparable to similar measures presented by other issuers.
Contacts:
Tree Island Industries Ltd.
Nancy Davies
Chief Financial Officer
(604) 523-4587
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Datum: 13.08.2012 - 14:52 Uhr
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