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Imaflex Announces Second Quarter 2018 Results and Provides Business Update

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Imaflex Announces Second Quarter 2018 Results and Provides Business Update

Canada NewsWire

Receives another CDN $0.9 million citrus film order and secures up to CDN $10 million equipment leasing facility for business expansion

  • Q2 revenues of $21.9 million, down from $24.1 million in 2017
  • Q2 EBITDA[1] of $1.7 million, versus $2.5 million in 2017
  • Q2 net income of $0.7 million, compared to $1.3 million in 2017
  • YTD net income of $2.4 million or basic earnings per share of $0.05, unchanged from 2017
  • Follow-on citrus film order received – reaffirms the benefits Shine N' Ripe XL brings citrus growers
  • CDN $10 million equipment lease facility provides important growth capital

MONTREAL, Aug. 27, 2018 /CNW Telbec/ - Imaflex Inc. ("Imaflex" or the "Corporation") (TSX-V: IFX), announces its consolidated financial results for the second quarter ended June 30, 2018 and provides business update. All amounts are in Canadian dollars.

"Although year-over-year results were somewhat muted in the second quarter, current business fundamentals are looking stronger," highlighted Mr. Joe Abbandonato, President and Chief Executive Officer of Imaflex. "We just received another CDN $0.9 million citrus film order and we are beginning to see sales momentum in our core flexible packaging business. As well, we are setting the stage for future growth, recently securing CDN $10 million of equipment financing to fund business expansion." 

 

Consolidated Financial Highlights (unaudited)





Three months ended June 30,

Six months ended June 30,

CDN $ thousands, except per share amounts
(or otherwise indicated)

2018

2017

Change

2018

2017

Change








Revenues

21,927

24,055

(8.8)%

42,544

46,111

(7.7)%

Gross profit

2,460

4,219

(41.7)%

6,063

7,921

(23.5)%

Selling & admin. expenses

1,593

1,793

(11.2)%

3,277

3,543

(7.5)%

Foreign exchange (gains) losses

(305)

415

(173.5)%

(696)

507

(237.3)%

Net income

727

1,300

(44.1)%

2,400

2,445

(1.8)%

Basic EPS

0.015

0.026

(42.3)%

0.049

0.049

0.0%

Diluted EPS

0.014

0.026

(46.2)%

0.047

0.049

(4.1)%

Gross margin

11.2%

17.5%

 (6.3) pp

14.3%

17.2%

 (2.9) pp

Selling & admin. expenses as % of revenues

7.3%

7.5%

 (0.2) pp

7.7%

7.7%

0.0  pp

EBITDA (Excluding FX)

1,381

2,902

(52.4)%

3,790

5,313

(28.7)%

EBITDA

1,686

2,487

(32.2)%

4,486

4,806

(6.7)%

EBITDA margin

7.7%

10.3%

 (2.6) pp

10.5%

10.4%

0.1  pp



1

EBITDA: Earnings Before Interest, Taxes, Depreciation, and Amortization.  See "Caution Regarding Non-IFRS Financial Measures" which follows. 

 

Financial Review: Quarter and Year-to-Date Ended June 30

Revenue
Revenues were $21.9 million for the quarter, down from $24.1 million in 2017. The decrease was largely due to the timing of citrus film sales, and lower flexible packaging sales volumes, partially offset by improvements to product mix. Citrus film sales totaled $1.0 million for the quarter, including $0.1 million for field trials. This compares to $2.4 million of Shine N' Ripe sales in the second quarter of 2017.  

For the year-to-date, revenues came in at $42.5 million, versus $46.1 million in the corresponding prior-year period. The decrease was largely due to the same factors outlined for the quarter.

Gross Profit
The gross margin stood at 11.2% for the quarter, down from 17.5% in 2017. For the year-to-date, the gross margin came in at 14.3%, versus 17.2% over the same period last year. Margins for the quarter and first half of 2018 were impacted by lower year-over-year sales, which also resulted in fewer production efficiencies.

Operating Expenses
Selling and administrative expenses were $1.6 million for the quarter, down 11.2% from $1.8 million in 2017, reflecting the lower sales base. Correspondingly, selling and administrative expenses as a percentage of sales came in slightly lower, declining from 7.5% in 2017 to 7.3% for the current quarter.     

For the six months ended June 30, 2018, selling and administrative expenses were $3.3 million, down from $3.5 million in 2017, once again reflecting the lower sales base.      

As a result of favourable currency fluctuations, the Corporation realized foreign exchange gains of $0.3 million in the second quarter of 2018 and $0.7 million for the year-to-date. This compares to foreign exchange losses of $0.4 million and $0.5 million, respectively in 2017.      

Net Income and EBITDA
Net income was $0.7 million for the current quarter, down from $1.3 million in 2017. For the first half of 2018, net income was $2.4 million, essentially in-line with 2017. Year-over-year profitability for 2018 was impacted by the re

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