Welcome!

News Feed Item

Hammond Power Solutions Inc. Announces Q1 2014 Financial Results

Gaining Momentum - Bookings Increase 32%

GUELPH, ONTARIO -- (Marketwired) -- 04/24/14 -- Hammond Power Solutions Inc. ("HPS") (TSX:HPS.A) a leading manufacturer of dry-type and cast resin transformers and related magnetics, today announced its financial results for the first quarter of 2014.

Bill Hammond, Chairman & Chief Executive Officer of Hammond Power Solutions Inc. commented, "Hammond Power Solutions first quarter of 2014 has been challenging, but we are finally seeing concrete reasons to believe that a more positive business environment lays ahead for HPS."

FIRST QUARTER RESULTS

Sales for the quarter-ended March 29, 2014 were $59,953, a decline of $3,719 or 5.8% from Quarter 1, 2013 sales of $63,672. U.S. sales were $33,747 in Quarter 1, 2014 a reduction of $1,438 or 4.1% from Quarter 1, 2013. Canadian sales were $17,930 for the quarter, a decrease over Quarter 1, 2013, of $3,342 or 15.7%. These declines were largely due to lower Quarter 4, 2013 booking rates in several market segments which include delayed construction related business attributed to the severe weather conditions in the quarter. International sales in Quarter 1, 2014 were $8,276 versus $7,222 in Quarter 1, 2013, an increase of $1,054 or 14.6%.

The Company realized an increase in bookings of 13.3% over Quarter 4, 2013 as a result of higher direct bookings and an increase of 31.5% as compared against Quarter 1, 2013, due to a significant increase in bookings in both the direct and distributor channels in North America.

"We are pleased with our lift in bookings rates. This bodes well going forward. We are starting to see general activity in the United States to slowly accelerate in most markets and regions. We are also seeing growth from our European and Indian operations compared to 2013," Bill Hammond further commented.

Quarter 1, 2014 gross margin dollars decreased by $2,330 compared to Quarter 1, 2013. Gross margin rate decreased to 23.2% in Quarter 1, 2014 versus 24.0% in Quarter 1, 2013 due to selling price pressures and the effect that lower production has on the absorption of factory costs.

Total selling and distribution expenses were $7,058 in Quarter 1, 2014 versus $6,542 in Quarter 1, 2013, an increase of $516 or 7.9%. These expenses represent 11.8% of sales in Quarter 1, 2014 and 10.9% of sales in Quarter 1, 2013.

The general and administrative expenses for Quarter 1, 2014 totaled $5,546, a slight increase of $151 or 2.8% when compared to Quarter 1, 2013 expenses of $5,395. This represents 9.3% of sales in Quarter 1, 2014 as compared to 8.5% of sales in Quarter 1, 2013

Quarter 1, 2014 earnings from operations decreased by $2,056 or 61.2% from the same quarter last year, finishing at $1,303 compared to $3,359. This reduction was a result of the lower sales.

The interest expense for Quarter 1, 2014 finished at $257, an increase of $88 or 52.1% compared to the Quarter 1, 2013 expense of $169. The increase in interest expense for the quarter was a result of higher operating debt levels attributed to higher working capital utilization.

The foreign exchange gain in Quarter 1, 2014 was $97, relating primarily to the transactional exchange pertaining to the Company's U.S. dollar trade accounts payable in Canada, compared to a foreign exchange gain of $8 in Quarter 1, 2013.

Net earnings for Quarter 1, 2014 decreased by $1,387 or 72.7% and finished at $520 compared to net earnings of $1,907 in Quarter 1, 2013. Decreased sales, lower gross margin rate dollars, increased interest costs and higher general and administrative expenses were the main contributing factors to the quarter decline.

Net cash used in operating activities for Quarter 1, 2014 was $1,645 versus $1,011 in Quarter 1, 2013, an increase of $634 as a result of lower net earnings.

The Company's overall debt, net of cash was $24,965 in Quarter 1, 2014 compared to a net debt position of $18,934 in Quarter 1, 2013, an increase in debt position of $6,031. This debt position change was a result of the purchase of Marnate and the change in non-cash working capital.

The Company continued with its regular quarterly dividend program, paying six cents ($0.06) per Class A Subordinate Voting Share of HPS and six cents ($0.06) per Class B Common Share of HPS on March 27, 2014.

Mr. Hammond concluded, "We are cautiously optimistic about our growth going forward. This is supported by our growing bookings and backlog and we continue to expand our penetration of the geographies we serve. We are confident that our financial strength, core competencies and long term strategies will accelerate our growth as markets start to improve."

FINANCIAL RESULTS


THREE MONTHS ENDED:                                                         
(dollars in thousands)                                                      
----------------------------------------------------------------------------
                            March 29, 2014   March 30, 2013          Change 
----------------------------------------------------------------------------
Sales                      $        59,953  $        63,672  $       (3,719)
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
Earnings from Operations   $         1,303  $         3,359  $       (2,056)
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
Exchange Gain              $            97  $             8  $           89 
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
Net Earnings               $           520  $         1,907  $       (1,387)
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
Earnings per share                                                          
----------------------------------------------------------------------------
                           $          0.04  $          0.16  $        (0.12)
----------------------------------------------------------------------------
Basic                                                                       
----------------------------------------------------------------------------
                           $          0.04  $          0.16  $        (0.12)
----------------------------------------------------------------------------
Diluted                                                                     
----------------------------------------------------------------------------
Cash Used in Operations    $         1,645  $         1,011  $          634 
----------------------------------------------------------------------------

TELECONFERENCE

Hammond Power Solutions Inc. will hold a conference call on Friday, April 25, 2014 at 10:00 a.m. EST, to discuss the Company's financial results for the first quarter 2014.

Listeners may attend the conference by dialing:


1-416-340-2216 / 1-866-226-1792 / 1-800-9559-6849                
                                                                 
Instant Replay                                                   
Dial in numbers  905-694-9451 or 1-800-408-3053                  
Pass code        7239947                                         
End date         May 9, 2014                                     

Caution Regarding Forward-Looking Information

This press release contains forward-looking statements that involve a number of risks and uncertainties, including statements that relate to among other things, HPS' strategies, intentions, plans, beliefs, expectations and estimates, and can generally be identified by the use of words such as "may", "will", "could", "should", "would", "likely", "expect", "intend", "estimate", "anticipate", "believe", "plan", "objective" and "continue" and words and expressions of similar import. Although HPS believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. Important factors that could cause actual results to differ materially from expectations include but are not limited to: general business and economic conditions (including but not limited to currency rates); changes in laws and regulations; legal and regulatory proceedings; and the ability to execute strategic plans. HPS does not undertake any obligation to update publicly or to revise any of the forward-looking statements contained in this document, whether as a result of new information, future events or otherwise, except as required by law.

ABOUT HAMMOND POWER SOLUTIONS INC.

Hammond Power Solutions Inc. (TSX:HPS.A) is a North American leader for the design and manufacture of dry-type custom electrical engineered magnetics, electrical dry-type and cast resin transformers. Leading edge engineering capabilities, high quality products, and responsive service to customers' needs have all served to establish HPS as a technical and innovative leader in the electrical and electronic industries.

HPS has operations in Canada, the United States, Mexico, India and Italy.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Everything run by electricity will eventually be connected to the Internet. Get ahead of the Internet of Things revolution and join Akvelon expert and IoT industry leader, Sergey Grebnov, in his session at @ThingsExpo, for an educational dive into the world of managing your home, workplace and all the devices they contain with the power of machine-based AI and intelligent Bot services for a completely streamlined experience.
Because IoT devices are deployed in mission-critical environments more than ever before, it’s increasingly imperative they be truly smart. IoT sensors simply stockpiling data isn’t useful. IoT must be artificially and naturally intelligent in order to provide more value In his session at @ThingsExpo, John Crupi, Vice President and Engineering System Architect at Greenwave Systems, will discuss how IoT artificial intelligence (AI) can be carried out via edge analytics and machine learning techn...
With tough new regulations coming to Europe on data privacy in May 2018, Calligo will explain why in reality the effect is global and transforms how you consider critical data. EU GDPR fundamentally rewrites the rules for cloud, Big Data and IoT. In his session at 21st Cloud Expo, Adam Ryan, Vice President and General Manager EMEA at Calligo, will examine the regulations and provide insight on how it affects technology, challenges the established rules and will usher in new levels of diligence a...
FinTechs use the cloud to operate at the speed and scale of digital financial activity, but are often hindered by the complexity of managing security and compliance in the cloud. In his session at 20th Cloud Expo, Sesh Murthy, co-founder and CTO of Cloud Raxak, showed how proactive and automated cloud security enables FinTechs to leverage the cloud to achieve their business goals. Through business-driven cloud security, FinTechs can speed time-to-market, diminish risk and costs, maintain continu...
When shopping for a new data processing platform for IoT solutions, many development teams want to be able to test-drive options before making a choice. Yet when evaluating an IoT solution, it’s simply not feasible to do so at scale with physical devices. Building a sensor simulator is the next best choice; however, generating a realistic simulation at very high TPS with ease of configurability is a formidable challenge. When dealing with multiple application or transport protocols, you would be...
Existing Big Data solutions are mainly focused on the discovery and analysis of data. The solutions are scalable and highly available but tedious when swapping in and swapping out occurs in disarray and thrashing takes place. The resolution for thrashing through machine learning algorithms and support nomenclature is through simple techniques. Organizations that have been collecting large customer data are increasingly seeing the need to use the data for swapping in and out and thrashing occurs ...
An increasing number of companies are creating products that combine data with analytical capabilities. Running interactive queries on Big Data requires complex architectures to store and query data effectively, typically involving data streams, an choosing efficient file format/database and multiple independent systems that are tied together through custom-engineered pipelines. In his session at @BigDataExpo at @ThingsExpo, Tomer Levi, a senior software engineer at Intel’s Advanced Analytics ...
In the enterprise today, connected IoT devices are everywhere – both inside and outside corporate environments. The need to identify, manage, control and secure a quickly growing web of connections and outside devices is making the already challenging task of security even more important, and onerous. In his session at @ThingsExpo, Rich Boyer, CISO and Chief Architect for Security at NTT i3, discussed new ways of thinking and the approaches needed to address the emerging challenges of security i...
As many know, the first generation of Cloud Management Platform (CMP) solutions were designed for managing virtual infrastructure (IaaS) and traditional applications. But that’s no longer enough to satisfy evolving and complex business requirements. In his session at 21st Cloud Expo, Scott Davis, Embotics CTO, will explore how next-generation CMPs ensure organizations can manage cloud-native and microservice-based application architectures, while also facilitating agile DevOps methodology. He wi...
When you focus on a journey from up-close, you look at your own technical and cultural history and how you changed it for the benefit of the customer. This was our starting point: too many integration issues, 13 SWP days and very long cycles. It was evident that in this fast-paced industry we could no longer afford this reality. We needed something that would take us beyond reducing the development lifecycles, CI and Agile methodologies. We made a fundamental difference, even changed our culture...
Historically, some banking activities such as trading have been relying heavily on analytics and cutting edge algorithmic tools. The coming of age of powerful data analytics solutions combined with the development of intelligent algorithms have created new opportunities for financial institutions. In his session at 20th Cloud Expo, Sebastien Meunier, Head of Digital for North America at Chappuis Halder & Co., discussed how these tools can be leveraged to develop a lasting competitive advantage ...
SYS-CON Events announced today that Dasher Technologies will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Dasher Technologies, Inc. ® is a premier IT solution provider that delivers expert technical resources along with trusted account executives to architect and deliver complete IT solutions and services to help our clients execute their goals, plans and objectives. Since 1999, we'v...
There is only one world-class Cloud event on earth, and that is Cloud Expo – which returns to Silicon Valley for the 21st Cloud Expo at the Santa Clara Convention Center, October 31 - November 2, 2017. Every Global 2000 enterprise in the world is now integrating cloud computing in some form into its IT development and operations. Midsize and small businesses are also migrating to the cloud in increasing numbers. Companies are each developing their unique mix of cloud technologies and service...
For financial firms, the cloud is going to increasingly become a crucial part of dealing with customers over the next five years and beyond, particularly with the growing use and acceptance of virtual currencies. There are new data storage paradigms on the horizon that will deliver secure solutions for storing and moving sensitive financial data around the world without touching terrestrial networks. In his session at 20th Cloud Expo, Cliff Beek, President of Cloud Constellation Corporation, d...
SYS-CON Events announced today that IBM has been named “Diamond Sponsor” of SYS-CON's 21st Cloud Expo, which will take place on October 31 through November 2nd 2017 at the Santa Clara Convention Center in Santa Clara, California.