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Third Quarter Results
Toronto - October 24, 2003
Automodular Corporation earned $3.0 million or $0.16 per share for the nine months ended September 30, 2003 compared to $4.2 million or $0.22 for the same period in 2002.
The current quarter was a breakeven position compared to net earnings of $1.3 million or $0.07 per share in 2002. The following factors contributed to the disappointing earnings performance compared to 2002:
- Reduced production volumes of the Saturn L series vehicles;
- Increased strength in the Canadian dollar causing a lower earnings contribution from our U.S. operations when expressed in Canadian currency;
- Lost production arising from the power outage in Canada and the Northeastern United States;
- Higher than expected start up costs of the Company's new Lansing facility
As a result of the breakeven performance of the third quarter, Automodular is in breach of a bank covenant. All interest and principal payments have been met. The Company is working with the bank to obtain a waiver and to renegotiate its banking arrangements to ensure no further breaches of its bank covenants.
As a result of the above factors, Automodular's board of directors has decided to omit the fourth quarter dividend and will review the dividend policy going forward at its meeting in January, 2004.
Automodular management forecasts that 2003 net earnings will fall in the range of $3.5 to $4.5 million, and is cautiously optimistic of improvement in 2004.
The results are summarized as follows:
|
2003
YTD
|
2002
YTD
|
2003
QTR
|
2002
QTR
|
| Sales (in millions) |
$80.0 |
$41.4 |
$25.4 |
$13.6 |
| Net earnings (in millions) |
$ 3.0 |
$ 4.2 |
$ 0.0 |
$ 1.3 |
| Earnings per share |
$0.16 |
$0.22 |
$0.00 |
$0.07 |
| Shares o/s (wtd avg in thousands) |
18,903 |
18,815 |
18,939 |
18,862 |
Note:2003 results include 8 months of post-acquisition operations of Tec-Mar.
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