Reko Announces Year End Results for Fiscal 2012
(firmenpresse) - WINDSOR, ONTARIO -- (Marketwire) -- 10/09/12 -- Reko International Group Inc. (TSX VENTURE: REK) today announced results for its fourth quarter and year ended July 31, 2012.
Consolidated sales for the year ended July 31, 2012, were $42.1 million, compared to $39.9 million in the prior year, an increase of $2.2 million, or 5.5%. The increase in sales in the year primarily relates to increases in the amount earned per hour of work at all of our facilities, volume increases for the capital equipment market, increased material and sub-contracting as a component of the projects we accepted, and is offset by reductions in the capacity of our tooling operations.
Gross profit for the year ended July 31, 2012, was $7.2 million, or 17.1% of sales, compared to a gross loss of $3.0 million, or 7.5% of sales in the prior year. The increase in gross profit for the year is related to the substantial reduction in fixed costs, including wages and benefits, generated as a result of implementing our business transformation project in the prior year, and an increased sales level during the year.
Selling and administrative expenses for the year ended July 31, 2012, were $5.5 million, or 13.1% of sales, compared to $5.9 million, or 14.8% of sales. The decrease in selling and administrative expenses are primarily related to reductions in wages and benefits as a result of implementing our business transformation project, and reductions in our commission expense as a result of a change in sales mix. These factors were offset by increased professional fees and accounts receivable insurance costs.
Net income for the year ended July 31, 2012, was $1.3 million, or $0.20 per share, compared to a net loss of $9.7 million or $1.51 per share, the same period last year.
The Company's working capital at July 31, 2012 was $2.8 million. However it should be noted that this calculation of working capital includes $8.4 million related to the real estate mortgage due in 2013 which for accounting purposes is considered short-term debt. Absent the mortgage, working capital at July 31, 2012 would have been $11.2 million. The Company is currently in discussions with existing and prospective lenders to refinance the mortgage.
"The success of this past year has marked a new beginning for the Reko Team," stated Diane Reko, chief executive officer. "Our focus for the upcoming year is to maintain this momentum and secure new business opportunities that will generate acceptable returns for the Company. The added capacity at our custom machining facility will allow us to increase our presence in the capital equipment market, thus reducing our dependence upon automotive projects. Having returned Reko to a state of profitability the Company is entering fiscal 2013 with a renewed sense of optimism."
About Reko International Group Inc.
Reko International Group Inc. is a publicly traded, certified woman owned manufacturing company located in Southwestern, Ontario. Established in 1976, Reko International Group Inc. is a diverse value-added designer and manufacturer of customized machining and engineering solutions to OEMs and their Tier I suppliers in dynamic sectors as rail equipment, oil and gas distribution, mining, military, capital equipment, and automotive. For more information, visit .
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Reko International Group Inc.
Carl A. Merton
Chief Financial Officer
(519) 727-3287
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Datum: 09.10.2012 - 12:24 Uhr
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