Highlights of the Quarter
(unless otherwise noted, all financial amounts in this news release are expressed in U.S. dollars)‘
- IBC Swings to Profitability in the Quarter ended December 31, 2021 on 44.5% YoY Sales Growth; Sales Higher by 51.9% YTD
- Sixth Straight Quarter of Higher Sales of IBC’s Innovative Beryllium-Aluminum Alloy Products, Driven by Semiconductor Industry and Defense Demand
- Copper Alloys Division Sales Higher by 11.4% YTD as New Manufacturing Facility in Indiana Nears Completion
- IBC reported comprehensive income of $344,000 for the quarter, sharply narrowing its YTD loss as compared to the prior-year period
- Adjusted EBITDA1 Soars by 301% and 757% in the Three and Six Months ended December 31, 2021
FRANKLIN, Ind., March 01, 2022 (GLOBE NEWSWIRE) -- IBC Advanced Alloys Corp. (“IBC” or the “Company”) (TSX-V: IB; OTCQB: IAALF) announces its financial results for the six months ended December 31, 2021.
The Company swung to profitability in the quarter ended December 31, 2021, boosted by strong sales growth across both operating divisions. IBC reported comprehensive income of $344,000 in the quarter, or $0.00 per share, which compared to a loss of $304,000, or ($0.00) per share in the prior-year period. For the six months ended Dec. 31, 2021, the Company reported a loss of $237,000, which sharply narrowed its loss of $1.3 million for the comparable prior-year period.
Sales increased 44.5% in the quarter over the prior-year period and were higher by 51.9% year to date over the comparable prior-year period. Sales of high-performance beryllium-aluminum (“BeAl”) alloy products from the Company’s Engineered Materials (“EM”) division rose by 89% in the quarter and jumped by 126.5% in the six months ended December 31, 2021, both as compared to prior-year periods. This marked the sixth straight quarter of higher EM division sales.
IBC’s Copper Alloy division drove sales higher by 12.7% in the quarter, and by 11.4% year to date, over comparable prior-year periods.
Consolidated adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”)2 rose by 301% to $1.1 million in the quarter, from $273,000 for the prior-year period. In the six-month period ended December 31, 2021, Adjusted EBITDA2 jumped 757% to $1.3 million, from $152,000 in the prior-year period.
Consolidated gross margin improved in the quarter to 26.7% from 17.0% in the prior-year period and rose to 20.5% in the six months ended December 31, 2021, as compared to 15.0% in the prior-year period. Gross margin for the EM division rose to 42.1% from 26.0% for the quarter, and improved to 33.0% year-to-date, from 24.5% in the comparable prior-year period. Copper Alloy’s gross margin decreased in the quarter to 8.3% from 10.6%, and in the six months ended December 31, 2021, to 6.7% from 9.8%, both as compared to prior-year periods, mostly due to higher material costs and costs associated with the division’s consolidation and new facility construction efforts at the Franklin, Ind. facility.
“Sales across both operating divisions of IBC were robust in the quarter and year-to-date, which helped drive us to profitability in the quarter ended last December,” said IBC CEO and Chairman Mark A. Smith. “I have been pleased to see our Engineered Materials team hitting all-time highs in terms of production output in this fiscal year and generating greater than a 125 percent increase in sales in the year to date as compared to the previous year.”
“It also is very exciting to see the Copper Alloys team deliver double-digit percentage increases in sales in this fiscal year to date while they work virtually seven days a week to complete construction and commissioning operations of our new production plant at our Franklin, Indiana facility,” Mr. Smith added. “In my view, IBC is strongly positioned to have a break-out year in 2022 and increased financial performance in the years ahead.”
| SELECTED RESULTS: Consolidated Operations ($000s)3 | ||||
| Quarter Ended 12-31-2021 | Quarter Ended 12-31-2020 | |||
| Revenue | 7,124 | 4,929 | ||
| Operating income (loss)3 | 554 | (214 | ) | |
| Adjusted EBITDA3 | 1,095 | 273 | ||
| Income (loss) for the period | 344 | (304 | ) | |
| SELECTED RESULTS: Copper Alloys ($000s)3 | ||||
| Quarter Ended 12-31-2021 | Quarter Ended 12-31-2020 | |||
| Revenue | 3,239 | 2,873 | ||
| Operating loss3 | (359 | ) | (202 | ) |
| Adjusted EBITDA3 | (129 | ) | (54 | ) |
| Loss for the period | (165 | ) | (280 | ) |
| SELECTED RESULTS: Engineered Materials ($000s)3 | ||||
| Quarter Ended 12-31-2021 | Quarter Ended 12-31-2020 | |||
| Revenue | 3,885 | 2,056 | ||
| Operating income3 | 1,036 | 198 | ||
| Adjusted EBITDA3 | 1,299 | 395 | ||
| Income for the period | 981 | 173 | ||
Full results can be seen in the Company’s financial statements and management’s discussion and analysis (“MD&A”), available at Sedar.ca and on the Company’s website at https://ibcadvancedalloys.com/investors-center/.
NON-IFRS MEASURES
To supplement its consolidated financial statements, which are prepared and presented in accordance with IFRS, IBC uses “operating income (loss)” and “Adjusted EBITDA”, which are non-IFRS financial measures. IBC believes that operating income (loss) helps identify underlying trends in the business that could otherwise be distorted by the effect of certain income or expenses that the Company includes in loss for the period, and provides useful information about core operating results, enhances the overall understanding of past performance and future prospects, and allows for greater visibility with respect to key metrics used by management in financial and operational decision-making. The Company believes that Adjusted EBITDA is a useful indicator for cash flow generated by the business that is independent of IBC’s capital structure.
Operating income (loss) and Adjusted EBITDA1 should not be considered in isolation or construed as an alternative to loss for the period or any other measure of performance or as an indicator of our operating performance. Operating income (loss) and Adjusted EBITDA presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to IBC’s data.
OPERATING INCOME (LOSS)
Operating income (loss) represents income or loss for the quarter, excluding foreign exchange loss, interest expense, interest income, other income (expense) and income taxes that the Company does not believe are reflective of its core operating performance during the periods presented. A reconciliation of the quarter and year-to-date income (loss) to operating income follows:
| Quarter Ended Dec. 31 | 2021 | 2020 | ||
| ($000s) | ($000s) | |||
| Income (loss) for the period | 344 | (304 | ) | |
| Foreign exchange (gain) loss | 3 | (86 | ) | |
| Interest expense | 270 | 172 | ||
| Loss on disposal of assets | (70 | ) | -- | |
| Other income | 7 | (19 | ) | |
| Income tax expense (recovery) | -- | 23 | ||
| Operating income (loss) | 554 | (214 | ) |
| Six Months Ended Dec. 31 | 2021 | 2020 | ||
| ($000s) | ($000s) | |||
| Loss for the period | (237 | ) | (1,259 | ) |
| Foreign exchange (gain) loss | 2 | (24 | ) | |
| Interest expense | 598 | 571 | ||
| Loss on disposal of assets | (21 | ) | (3 | ) |
| Other income | 2 | (24 | ) | |
| Income tax expense (recovery) | 24 | 20 | ||
| Operating income (loss) | 368 | (719 | ) |
ADJUSTED EBITDA
Adjusted EBITDA represents our income (loss) for the period before interest, income taxes, depreciation, amortization, and share-based compensation. A reconciliation of the quarter and year-to-date income (loss) to Adjusted EBITDA follows:
| Three months ended Dec. 31 | 2021 | 2020 | |
| ($000s) | ($000s) | ||
| Income (loss) for the period | 344 | (304 | ) |
| Income tax expense (recovery) | -- | 23 | |
| Interest expense | 270 | 172 | |
| Depreciation, amortization, & impairment | 389 | 313 | |
| Stock-based compensation expense (non-cash) | 92 | 69 | |
| Adjusted EBITDA | 1,095 | 273 |
| Six months ended Dec. 31 | 2021 | 2020 | ||
| ($000s) | ($000s) | |||
| Loss for the period | (237 | ) | (1,259 | ) |
| Income tax expense (recovery) | 24 | 20 | ||
| Interest expense | 598 | 571 | ||
| Depreciation, amortization, & impairment | 781 | 653 | ||
| Stock-based compensation expense (non-cash) | 137 | 167 | ||
| Adjusted EBITDA | 1,303 | 152 |
For more information on IBC and its innovative alloy products, go here.
On Behalf of the Board of Directors:
"Mark A. Smith”
Mark A. Smith, CEO & Chairman of the Board
CONTACTS:
Mark A. Smith, Chairman of the Board
Jim Sims, Investor and Public Relations
IBC Advanced Alloys Corp.
+1 (303) 503-6203
Email: jim.sims@ibcadvancedalloys.com
Website: www.ibcadvancedalloys.com
@IBCAdvanced $IB $IAALF
ABOUT IBC ADVANCED ALLOYS CORP.
IBC is a leading beryllium and copper advanced alloys company serving a variety of industries such as defense, aerospace, automotive, telecommunications, precision manufacturing, and others. IBC's Copper Alloys Division manufactures and distributes a variety of copper alloys as castings and forgings, including beryllium copper, chrome copper, and aluminum bronze. IBC's Engineered Materials Division makes the Beralcast® family of alloys, which can be precision cast and are used in an increasing number of defense, aerospace, and other systems, including the F-35 Joint Strike Fighter. IBC's has production facilities in Indiana and Massachusetts. The Company's common shares are traded on the TSX Venture Exchange under the symbol "IB" and the OTCQB under the symbol "IAALF".
CAUTIONARY STATEMENTS
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy of this news release. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain information contained in this news release may be forward-looking information or forward-looking statements as defined under applicable securities laws. Forward-looking information and forward-looking statements are often, but not always identified by the use of words such as "expect", "anticipate", "believe", "foresee", "could", "estimate", "goal", "intend", "plan", "seek", "will", "may" and "should" and similar expressions or words suggesting future outcomes. This news release includes forward-looking information and statements pertaining to, among other things, the Company’s expectation of further growth in revenue and market demand, and the ability of the Copper Alloy division to increase its production capacity, reduce unit costs of production, expand its product portfolio and expand into new markets. Forward-looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control including: the impact of general economic conditions in the areas in which the Company or its customers operate, including the semiconductor manufacturing and oil and gas industries, risks associated with manufacturing activities, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, limited availability of raw materials, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. As a result of these risks and uncertainties, the Company's future results, performance or achievements could differ materially from those expressed in these forward-looking statements. All statements included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on assumptions made by the Company based on its experience, perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances.
Please see “Risks Factors” in our Annual Information Form available under the Company’s profile at www.sedar.com, for information on the risks and uncertainties associated with our business. Readers should not place undue reliance on forward-looking information and statements, which speak only as of the date made. The forward-looking information and statements contained in this release represent our expectations as of the date of this release. We disclaim any intention or obligation or undertaking to update or revise any forward-looking information or statements whether as a result of new information, future events or otherwise, except as required under applicable securities laws.
1 IBC reports non-IFRS measures such as “Adjusted EBITDA” and “Operating Income.” Please see information on this and other non-IFRS measures in the "Non-IFRS Measures" section of this news release and in IBC’s MD&A, available on Sedar.com
2 IBC reports non-IFRS measures such as “Adjusted EBITDA” and “Operating Income.” Please see information on this and other non-IFRS measures in the "Non-IFRS Measures" section of this news release and in IBC’s MD&A, available on Sedar.com
3 IBC reports non-IFRS measures such as “Adjusted EBITDA” and “Operating Income.” Please see information on this and other non-IFRS measures in the "Non-IFRS Measures" section of this news release and in IBC’s MD&A, available on Sedar.com
