BRANTFORD, ONTARIO -- (Marketwire) -- 05/27/11 -- Wescast Industries Inc. (TSX: WCS.A) today reported first quarter sales of $71.6 million and net earnings of $1.4 million.
(In thousands of Canadian dollars, except per share amounts) Three months ended --------------------------------- April 3, 2011 March 28, 2010 -------------- -------------- Sales 71,606 62,957 Gross profit 9,692 14,682 Net earnings 1,406 8,311 Diluted net earnings per share 0.11 0.63 Cash (applied to) derived from operations (7,027) 486
The information presented in this news release is in accordance with International Financial Reporting Standards ("IFRS"). Accordingly, the comparative information provided for the three months ended March 28, 2010 has been restated from Canadian GAAP to IFRS.
Highlights -- The Company has booked $49.0 million of average annualized new and replacement business globally in the first four months of 2011 which the Company expects will positively impact our results in the near future. -- The Company reported consolidated sales of $71.6 million, an increase of 13.7% compared to the $63.0 million reported in the first quarter of 2010, reflecting significantly higher sales generated by the Company's European and Asian business units. The Company's European and Asian business units continue to launch many new programs resulting in a significant positive impact on each of those business units compared to the first quarter of 2010. -- The Company reported gross profit of $9.7 million for the first quarter compared to gross profit of $14.7 million in 2010. Included in gross profit in the first quarter of 2010 was a $7.7 million curtailment gain related to an amendment made to one of the Company's unfunded retiring allowance plans. This gain was recorded in cost of sales. Excluding the curtailment gain, gross profit in the first quarter of 2010 was $6.9 million. -- The Company reported first quarter net earnings of $1.4 million compared with net earnings of $8.3 million reported in 2010. The net earnings per share on a diluted basis were $0.11, compared with net earnings of $0.63 reported in the first quarter of 2010. Excluding the curtailment gain, net earnings in the first quarter of 2010 were $0.6 million ($0.04 per share on a diluted basis). -- Included in net earnings for the quarter was share-based payments expense of $1.6 million, compared to $0.2 million in the same period of 2010. The higher expense was due mainly to the significant increase in the Company's share price during the quarter. The negative impact on diluted net earnings per share for the quarter was $0.12.
The Company's entire quarterly financial statements and Management's Discussion and Analysis will be available May 28, 2011 online at SEDAR, www.sedar.com.
The restatement of the 2010 first quarter gross profit, net earnings and diluted net earnings per share to exclude the curtailment gain are non-GAAP measures as discussed in the Management's Discussion and Analysis.
Wescast Industries Inc. is a global automotive parts supplier that designs, engineers, casts, machines and assembles high quality engineered exhaust system components, including exhaust manifolds, turbocharger housings and integrated turbomanifolds, as well as various other components for the car and light truck markets. The Company supplies to a diversified group of global original equipment manufacturers ("OEMs") and Tier 1 customers in North America, Europe, Asia, Africa, South America and Australia. The Company employs approximately 1,900 people in its regionally-based operations and sales and design centres in Canada, the United States, Hungary, China, Germany, Japan, the United Kingdom and France.
Learn more at www.wescast.com.
Forward Looking Statements
The contents of this news release contain statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking statements based on certain assumptions. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Persons reading this news release are cautioned that such information may not be appropriate for other purposes. Such forward-looking statements may include financial and other projections as well as statements regarding Wescast's future plans, objectives or performance for the current period and subsequent periods and regarding the markets for our products. The words "may", "would", "could", "will", "likely", "expect", "anticipate", "estimate", "intend", "plan", "forecast", "project" and "believe" or other similar words and phrases are intended to identify forward-looking statements. Persons reading this news release are cautioned that such statements are only predictions, and that Wescast's actual future results or performance may be materially different.
This information is based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking statements, including our perception of historical trends, current conditions and expected future developments as well as other factors we believe are appropriate in the circumstances.
Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties principally relate to the risks associated with the automotive industry and include, but are not limited to: our operating and/or financial performance, including the effect of new accounting standards on our reported financial results, fluctuations in interest rates, changes in consumer and business confidence levels, consumers' personal debt levels, vehicle prices, the extent and nature of purchasing or leasing incentive campaigns offered by automotive manufacturers, environmental emission regulations, fuel prices and availability, the continuation and extent of outsourcing by automotive manufacturers, changes in raw material and other input costs, our ability to continue to meet customer specifications relating to product performance, cost, quality, delivery and service, industry cyclicality or seasonality, trade and/or labour issues or disruptions, customer pricing pressures, pricing concessions and cost absorptions, actual levels of program production volumes by our customers compared to original expectations, including program cancellations or delays, dependence on certain engine programs and the market success and consumer acceptance of the vehicles into which such powertrain products are installed, our relationship with and dependence on certain customers, currency exposure, failures in implementing Wescast's strategy, technological developments by Wescast's competitors and customers, government and regulatory policies and changes in the competitive environment in which Wescast operates.
Wescast does not undertake any obligation to update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by law.
Wescast Industries Inc.
Chief Financial Officer