ProSep Reports Second Quarter 2013 Financial Results
(firmenpresse) - MONTREAL, QUEBEC -- (Marketwired) -- 08/08/13 -- ProSep Inc. (TSX: PRP) ("ProSep" or the "Company"), dedicated to providing process solutions to the oil and gas industry, today announced its financial results for the three and six-month periods ended June 30, 2013. All amounts are reported in Canadian dollars unless otherwise stated.
Highlights of the Second Quarter of 2013 and Subsequent Events
Financial Results
Financial Events
Commercial
Operations
Selected Financial Highlights (in $ millions except for loss per share)
"Since the start of the year, a special committee formed by the Board of Directors has been reviewing strategic alternatives in order to enhance shareholder value and develop long term partnerships that would help further the Company's business plan. We are currently reviewing various alternatives with a number of interested parties," said Jacques L. Drouin, President & CEO. "With a more streamlined organization, recent pick-up in orders, and promising short term prospects, we are in a good position entering the second half of the year."
Financial Results
This announcement reports on consolidated results. For detailed segmented financial results please see Management Discussion and Analysis and Interim Condensed Consolidated Statement for the three and six-month period ended June 30, 2013.
During the second quarter of 2013, ProSep reported consolidated revenues of $8.8 million, compared to $13.9 million reported in the equivalent period of 2012, a 37% reduction in revenues. During the first six-months of the year, consolidated revenues were down 21% to $17.6 million from $22.2 million for the first half of 2012. Revenue growth at the US Operations was not sufficient to offset declines at the Asia Pacific Operations. As further detailed in the segment comments below, the Asia Pacific Operations renewed their book of opportunities since the start of the year and concluded $6 million of new contracts, compared to $4.5 million announced in the first six months of 2012, leading to a stronger backlog entering the second half of this year.
Overall consolidated gross margin for the second quarter of 2013 stood at $2.1 million (or 24% or revenues) compared to $3.0 million (or 22% of revenues) for the equivalent period of 2012. For the first six months of 2013, consolidated gross margins stood at $5.3 million (or 30% of revenues) compared with $5.7 million (or 26% of revenues) for the equivalent period of 2012. Although gross margins remained low at the Asia Pacific operation, on a consolidated basis, gross margins as a percentage of revenues improved mainly on increased contribution from proprietary technologies.
The success of the new strategy introduced in 2010, which aims to accelerate the commercialization of the Company's proprietary technologies, is evidenced in the year-to-date consolidated gross margins. As these systems gain market acceptance and are deployed at existing and new customer's operations, gross margins should continue to improve.
EBITDA for the second quarter ended June 30, 2013 was negative $1.6 million compared to negative $0.7 million during the second quarter of last year. Non-recurring expenses related to the ongoing strategic review negatively affected EBITDA by approximately $0.5 million in the second quarter of 2013. Year-to-date, EBITDA stood at negative $2.2 million, an improvement over last year's EBITDA of negative $2.9 million. EBITDA further improves, to negative $1.3 million if non-recurring items related to the strategic review are removed.
Since the start of the year, higher gross margins from proprietary technologies, higher utilization rate of personnel to projects and implementation of a cost reduction plan contributed in reducing losses. Year-to-date, these initiatives provided cost savings of approximately $1.4 million in general and administrative expenses.
For the three-month period ended June 30, 2013, the Company reported a net profit of $2.5 million ($0.12 per share), on the realization of a gain on disposal of its investment in the South Korean joint venture company ProSep Kolon. This joint venture was created at the end of 2010 and ProSep sold its interest in the company during the start of the second quarter of 2013 for gross proceeds of $5 million. During the second quarter of last year, the Company reported a net loss of $1.6 million (or $0.08 per share). Year-to-date, net profit amounts to $1.1 million (or $0.05 per share), compared to a net loss of $3.1 million (or $0.15 per share) for the first six-months of last year.
At June 30, 2013, the Company had $1.9 million in cash compared to $2.8 million in cash at December 31, 2012.
Covenant Waiver
At June 30, 2013 one of the Company's wholly-owned subsidiaries was in breach of a covenant to maintain financial ratios as well as a "clean-down" obligation, whereby the facility is to be undrawn for a pre-determined period time. A conditional covenant waiver wherein the lender confirmed that the breached covenant is not deemed to constitute an event of default was obtained by the Company's subsidiary for the six-month period ended June 30, 2013. The Company also obtained an extension by which the subsidiary has to start a clean-down by October 1, 2013.
Conference Call and Webcast Details
ProSep will host a conference call and webcast on Thursday August 8th, 2013 at 8:00 a.m. (EST) to review the financial results and highlights of the second quarter of 2013. To access the conference call by telephone, dial 1-416-981-9000 or 1-800-734-8507. A live audio webcast of the conference call will also be available through ProSep's website under "Calendar of Events" in the "News and Investor Center" and on . For audio replay, dial 1-416-626-4100 or 1-800-558-5253 with the reservation code # 21669601.
Regulatory Filings
ProSep filed its Interim Condensed Consolidated Financial Statements for the three and six-month periods ended June 30, 2013 and related Management Discussion and Analysis with securities regulatory authorities. The material will be available through SEDAR at and on the Company's website at .
About ProSep
ProSep is a technology-focused process solutions provider to the upstream oil and gas industry. ProSep designs, develops, manufactures and commercializes technologies to separate oil, water and gas generated by oil and gas production. For more information, please visit .
Caution concerning forward-looking statements
This press release may contain forward-looking statements within the meaning of Canadian securities laws. Forward-looking statements can generally be identified by the use of the conditional tense, the words "may", "should", "would", "believe", "plan", "expect", "intend", "anticipate", "estimate", "foresee", "objective" or "continue" or the negative of these terms or variations of them or words and expressions of similar nature. In particular, forward-looking statements regarding ProSep's plans for its business development strategy, anticipated customer orders, sales and revenues, financial and operational projections and anticipated results, anticipated results of field testing with potential customers and expected benefits of ProSep's proprietary technologies; and anticipated impact on ProSep of the factors discussed under the heading "Selected Risks" in the latest management discussion and analysis document ("MD&A"). These forward-looking statements are based on, among other things, management's assumptions, expectations, estimates, objectives, plans and intentions as of the date hereof pertaining to, but not limited to demand for ProSep's solutions, projected revenues and expenses, the economic and industry environments in which the Company operates or which could affect its activities, the Company's ability to attract new customers, projected operating costs and cost of raw materials and energy supply, expected timing and amount of capital expenditures program of ProSep's potential customers, target market acceptance of ProSep's solutions, current and future solutions performance, evolving market conditions for oil & gas producers; and success of commercialization approach and strategic partnership initiatives. Although ProSep believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because ProSep can give no assurance that they will prove to be correct. Because forward-looking statements address future events and conditions, by their very nature they involve numerous inherent risks and uncertainties that contribute to the possibility that the forward-looking statements may prove to be incorrect. ProSep cannot assure investors that any of these forward-looking statements will prove to be accurate.
Further, if any of these statements are inaccurate, the inaccuracy may be material. Actual performance and results could differ materially from those currently anticipated in the forward-looking statements due to a number of factors and risks. Some of the factors that could cause such differences include, but are not limited to uncertainty as to market acceptance of new solutions and possible technological change, competition, economic environment and especially conditions in the oil & gas industry, legislative or regulatory developments, ProSep's ability to penetrate core markets, expand into new markets and manage future growth, the need for additional financing and uncertainties as to access to sufficient capital financing a timely basis and on acceptable terms, uncertainty as to achievement of profitability and ability to meet cash requirements, availability and retention of management and key personnel, the long sales and implementation cycles for ProSep's solutions, reliance on major customers, manufacturing, project execution, product defect and product liability risks, dependence on third party suppliers, exchange rate and currency fluctuations, protection of ProSep's intellectual property rights; and risks related to ProSep's foreign operations and compliance with anti-corruption and anti-bribery laws. Assumptions, expectations and estimates made in the preparation of forward-looking statements and risks that could cause actual results to differ materially from current expectations are further discussed under "Selected Risks" in the latest MD&A. In light of the significant risks and uncertainties in these forward-looking statements, investors should not place undue reliance on or regard these statements as a representation or warranty by the Company or any other person that the Company will achieve its objectives, strategies and plans in any specified time frame, if at all. The forward-looking statements contained or incorporated by reference in this management discussion and analysis relate only to events as of the date on which the statements are made. Except as required under applicable securities legislation, the Company does not undertake to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
Contacts:
ProSep Inc.
Investor Relations and Media:
Danielle Ste-Marie
VP Marketing & Corporate Development
(514) 522-5550 ext. 238
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Datum: 08.08.2013 - 11:00 Uhr
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News-ID 285911
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Kategorie:
Oil & Gas
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