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.

Contacts:
Hammond Power Solutions Inc.
Dawn Henderson
Manager Investor Relations
(519) 822-2441 x414
[email protected]

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
"MobiDev is a software development company and we do complex, custom software development for everybody from entrepreneurs to large enterprises," explained Alan Winters, U.S. Head of Business Development at MobiDev, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Agile has finally jumped the technology shark, expanding outside the software world. Enterprises are now increasingly adopting Agile practices across their organizations in order to successfully navigate the disruptive waters that threaten to drown them. In our quest for establishing change as a core competency in our organizations, this business-centric notion of Agile is an essential component of Agile Digital Transformation. In the years since the publication of the Agile Manifesto, the conn...
In his session at 21st Cloud Expo, James Henry, Co-CEO/CTO of Calgary Scientific Inc., introduced you to the challenges, solutions and benefits of training AI systems to solve visual problems with an emphasis on improving AIs with continuous training in the field. He explored applications in several industries and discussed technologies that allow the deployment of advanced visualization solutions to the cloud.
Widespread fragmentation is stalling the growth of the IIoT and making it difficult for partners to work together. The number of software platforms, apps, hardware and connectivity standards is creating paralysis among businesses that are afraid of being locked into a solution. EdgeX Foundry is unifying the community around a common IoT edge framework and an ecosystem of interoperable components.
In his session at 21st Cloud Expo, Carl J. Levine, Senior Technical Evangelist for NS1, will objectively discuss how DNS is used to solve Digital Transformation challenges in large SaaS applications, CDNs, AdTech platforms, and other demanding use cases. Carl J. Levine is the Senior Technical Evangelist for NS1. A veteran of the Internet Infrastructure space, he has over a decade of experience with startups, networking protocols and Internet infrastructure, combined with the unique ability to it...
Vulnerability management is vital for large companies that need to secure containers across thousands of hosts, but many struggle to understand how exposed they are when they discover a new high security vulnerability. In his session at 21st Cloud Expo, John Morello, CTO of Twistlock, addressed this pressing concern by introducing the concept of the “Vulnerability Risk Tree API,” which brings all the data together in a simple REST endpoint, allowing companies to easily grasp the severity of the ...
Enterprises are adopting Kubernetes to accelerate the development and the delivery of cloud-native applications. However, sharing a Kubernetes cluster between members of the same team can be challenging. And, sharing clusters across multiple teams is even harder. Kubernetes offers several constructs to help implement segmentation and isolation. However, these primitives can be complex to understand and apply. As a result, it’s becoming common for enterprises to end up with several clusters. Thi...
While some developers care passionately about how data centers and clouds are architected, for most, it is only the end result that matters. To the majority of companies, technology exists to solve a business problem, and only delivers value when it is solving that problem. 2017 brings the mainstream adoption of containers for production workloads. In his session at 21st Cloud Expo, Ben McCormack, VP of Operations at Evernote, discussed how data centers of the future will be managed, how the p...
"NetApp is known as a data management leader but we do a lot more than just data management on-prem with the data centers of our customers. We're also big in the hybrid cloud," explained Wes Talbert, Principal Architect at NetApp, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
"Space Monkey by Vivent Smart Home is a product that is a distributed cloud-based edge storage network. Vivent Smart Home, our parent company, is a smart home provider that places a lot of hard drives across homes in North America," explained JT Olds, Director of Engineering, and Brandon Crowfeather, Product Manager, at Vivint Smart Home, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
The question before companies today is not whether to become intelligent, it’s a question of how and how fast. The key is to adopt and deploy an intelligent application strategy while simultaneously preparing to scale that intelligence. In her session at 21st Cloud Expo, Sangeeta Chakraborty, Chief Customer Officer at Ayasdi, provided a tactical framework to become a truly intelligent enterprise, including how to identify the right applications for AI, how to build a Center of Excellence to oper...
"IBM is really all in on blockchain. We take a look at sort of the history of blockchain ledger technologies. It started out with bitcoin, Ethereum, and IBM evaluated these particular blockchain technologies and found they were anonymous and permissionless and that many companies were looking for permissioned blockchain," stated René Bostic, Technical VP of the IBM Cloud Unit in North America, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Conventi...
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Coca-Cola’s Google powered digital signage system lays the groundwork for a more valuable connection between Coke and its customers. Digital signs pair software with high-resolution displays so that a message can be changed instantly based on what the operator wants to communicate or sell. In their Day 3 Keynote at 21st Cloud Expo, Greg Chambers, Global Group Director, Digital Innovation, Coca-Cola, and Vidya Nagarajan, a Senior Product Manager at Google, discussed how from store operations and ...
"Infoblox does DNS, DHCP and IP address management for not only enterprise networks but cloud networks as well. Customers are looking for a single platform that can extend not only in their private enterprise environment but private cloud, public cloud, tracking all the IP space and everything that is going on in that environment," explained Steve Salo, Principal Systems Engineer at Infoblox, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Conventio...