Click here to close now.



Welcome!

News Feed Item

Hammond Power Solutions Inc. Quarter 2, 2014 Financial Results

HIGHLIGHTS

GUELPH, ONTARIO -- (Marketwired) -- 07/24/14 -- 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 second quarter of 2014.

Bill Hammond, Chairman & Chief Executive Officer of Hammond Power Solutions Inc. commented, "Hammond Power Solutions Inc. is pleased to report rising sales and profits in Quarter 2, 2014 amid a slower-than-expected recovery in the North American economy."

SECOND QUARTER RESULTS

Sales for the quarter-ended June 28, 2014 were $61,716, an increase of $2,644 or 4.5% from Quarter 2, 2013 sales of $59,072 and an increase of $1,763 or 2.9% from Quarter 1, 2014 sales of $59,953. Year-to- date sales were $121,669 in 2014 and $122,744 in 2013, a small decrease of $1,075 or 0.9%. Sales in the U.S., were $34,936 in Quarter 2, 2014 a decrease of $1,080 or 3.0% from Quarter 2, 2013 and an increase of $1,189 from Quarter 1, 2014 sales of $33,747. The Company continued to increase both its market share and sales through the distributor channel in the Quarter. Year-to-date U.S. sales were $68,683 in 2014 and $71,201 in 2013, a decrease of $2,518 or 3.5%. Canadian sales were $18,635 for the quarter, consistent with Quarter 2, 2013 Canadian sales of $18,610. Sales in Canada have increased $705 or 3.9% from Quarter 1, 2014 of $17,930. International sales in Quarter 2, 2014 were $8,145 versus $4,446 in Quarter 2, 2013, an increase of $3,699 or 83.2%. Year-to-date sales have been negatively impacted by the continuing softness in OEM, construction and mining markets.

The Company realized an increase in bookings of 13.0% over Quarter 2, 2013 and 3.6% over Quarter 1, 2014 due to a lift in bookings in the U.S. distributor channel. Year-to-date bookings were 17.9% higher due to the increased U.S. distributor and European and Indian market original equipment manufacturer bookings.

"Over the last two months we are also seeing the U.S. economy beginning to gain momentum as well as positive signs from our international markets. The Company continues to focus intensely on market development and penetration." Bill Hammond further commented.

The Company has maintained its gross margin rates this quarter as compared to the same quarter last year despite market pressures and poorer market conditions. Gross margin rates for Quarter 2, 2014 were 23.3% compared to Quarter 2, 2013 which finished at 23.9%. Year-to-date the margin rate was 23.3% in 2014, which has decreased slightly from the 2013 rate of 24.0%.

Total selling and distribution expenses were $6,973 in Quarter 2, 2014 versus $6,617 in Quarter 2, 2013, an increase of $356 or 5.4%. These expenses represent 11.3% of sales in Quarter 2, 2014 and 11.2% of sales in Quarter 2, 2013. Year-to-date selling and distribution expenses were $14,031 or 11.5% of sales in 2014, compared to $13,159 or 10.7% in 2013.

The general and administrative expenses for Quarter 2, 2014 totaled $5,658, a decrease of $258 or 4.4% when compared to Quarter 2, 2013 expenses of $5,916. These expenses represent 9.2% of sales in Quarter 2, 2014 as compared to 10.0% of sales in Quarter 2, 2013. Year-to-date general and administrative expenses were $11,204 or 9.2% of sales in 2014, compared to $11,311 or 9.2% of sales in 2013, a decrease of $107 or 0.9%.

Quarter 2, 2014 earnings from operations increased by $171 or 10.7% from the same quarter last year, finishing at $1,770 compared to $1,599 in Quarter 2, 2013. The improvement in the quarter is a result of higher sales and increased gross margin contribution. The year-to-date earnings from operations were $3,073 in 2014 compared to $4,958 in 2013, a decrease of $1,885 or 38.0% as a result of the decreased sales, and decline in gross margin.

The interest expense for Quarter 2, 2014 finished at $259, a decrease of $34 or 11.6% compared to the Quarter 2, 2013 expense of $293. Year-to-date interest cost was $516, an increase of $54 when compared to the 2013 year-to-date expense of $462. Interest expense is generated as a result of higher operating debt levels attributed to higher working capital utilization.

The foreign exchange loss in Quarter 2, 2014 was $34, relating primarily to the transactional exchange pertaining to the Company's U.S. dollar trade accounts payable in Canada, compared to a foreign exchange loss of $122 in Quarter 2, 2013. For the first six months of 2014, the Company realized a foreign exchange gain of $63 compared to a foreign exchange loss of $114 for the same period in 2013.

Net earnings for Quarter 2, 2014 increased by $426 or 83.5% and finished at $936 compared to net earnings of $510 in Quarter 2, 2013. Year-to-date net earnings were $1,456 in 2014 and $2,417 in 2013, a decrease of $961 or 39.8%. The increase in sales, consistent margin rates, and lower general and administrative costs as well as a lower foreign exchange loss were the main contributing factors to the quarterly improvement.

Net cash provided by operating activities for Quarter 2, 2014 was $3,892 versus $1,429 in Quarter 2, 2013, an increase of $2,463 as a result of lower income tax payments and a decline in provisions. Year- to-date cash generated by operating activities was $2,247 in 2014 and $418 in 2013, a difference of $1,829.

The Company's overall debt, net of cash was $23,419 in Quarter 2, 2014 compared to a net debt position of $20,552 in Quarter 2, 2013, an increase in debt position of $2,867 due to the change in non-cash working capital. The Company's overall debt, net of cash reduced $1,546 from Quarter 1, 2014.

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 June 25, 2014.

Mr. Hammond concluded, "The slower-than-expected opening quarters in the U.S. and especially Canada have dampened the outlook for 2014 in the minds of many economists and companies. At HPS, we are adjusting to this unexpected volatility and building on our diversification and competitive advantages to grow our sales, and we anticipate business momentum to build as the year unfolds and the U.S. economy finally moves into a stronger growth phase."


FINANCIAL RESULTS                                                           
                                                                            
THREE MONTHS ENDED:                                                         
(dollars in thousands)                                                      
                                                                            
----------------------------------------------------------------------------
                                  June 28, 2014     June 29, 2013    Change 
----------------------------------------------------------------------------
Sales                           $        61,716   $        59,072   $ 2,644 
----------------------------------------------------------------------------
                                                                            
Earnings from Operations        $         1,770   $         1,599   $   171 
----------------------------------------------------------------------------
                                                                            
Exchange Loss                   $            34   $           122   $   (88)
----------------------------------------------------------------------------
                                                                            
Net Earnings                    $           936   $           510   $   426 
----------------------------------------------------------------------------
                                                                            
Earnings per share                                                          
Basic                           $          0.08   $          0.04   $  0.04 
Diluted                         $          0.08   $          0.04   $  0.04 
----------------------------------------------------------------------------
                                                                            
Cash provided by operations     $         3,892   $         1,429   $ 2,463 
----------------------------------------------------------------------------
                                                                            
SIX MONTHS ENDED:                                                           
(dollars in thousands)                                                      
                                                                            
                                  June 28, 2014     June 29, 2013    Change 
----------------------------------------------------------------------------
Sales                           $       121,669   $       122,744   $(1,075)
----------------------------------------------------------------------------
                                                                            
Earnings from Operations        $         3,073   $         4,958   $(1,885)
----------------------------------------------------------------------------
                                                                            
Exchange (Gain)/Loss            $           (63)  $           114   $   177 
----------------------------------------------------------------------------
                                                                            
Net Earnings                    $         1,456   $         2,417   $  (961)
----------------------------------------------------------------------------
                                                                            
Earnings per share              $          0.12   $          0.20   $ (0.08)
Basic                           $          0.12   $          0.20   $ (0.08)
Diluted                                                                     
----------------------------------------------------------------------------
Cash provided by operations     $        2,247    $           418   $ 1,829 
----------------------------------------------------------------------------

TELECONFERENCE

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

Listeners may attend the conference by dialing:


1-416-340-8530 / 1-800-769-8320 / 1-800-2787-2090                           
                                                                            
Instant Replay                                                              
Dial in numbers          905-694-9451 or 1-800-408-3053                     
Pass code                6761570                                            
End date                 August 8, 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
SYS-CON Events announced today that Men & Mice, the leading global provider of DNS, DHCP and IP address management overlay solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. The Men & Mice Suite overlay solution is already known for its powerful application in heterogeneous operating environments, enabling enterprises to scale without fuss. Building on a solid range of diverse platform support,...
Father business cycles and digital consumers are forcing enterprises to respond faster to customer needs and competitive demands. Successful integration of DevOps and Agile development will be key for business success in today’s digital economy. In his session at DevOps Summit, Pradeep Prabhu, Co-Founder & CEO of Cloudmunch, covered the critical practices that enterprises should consider to seamlessly integrate Agile and DevOps processes, barriers to implementing this in the enterprise, and pr...
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
The principles behind DevOps are not new - for decades people have been automating system administration and decreasing the time to deploy apps and perform other management tasks. However, only recently did we see the tools and the will necessary to share the benefits and power of automation with a wider circle of people. In his session at DevOps Summit, Bernard Sanders, Chief Technology Officer at CloudBolt Software, explored the latest tools including Puppet, Chef, Docker, and CMPs needed to...
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management...
The cloud promises new levels of agility and cost-savings for Big Data, data warehousing and analytics. But it’s challenging to understand all the options – from IaaS and PaaS to newer services like HaaS (Hadoop as a Service) and BDaaS (Big Data as a Service). In her session at @BigDataExpo at @ThingsExpo, Hannah Smalltree, a director at Cazena, will provide an educational overview of emerging “as-a-service” options for Big Data in the cloud. This is critical background for IT and data profes...
One of the bewildering things about DevOps is integrating the massive toolchain including the dozens of new tools that seem to crop up every year. Part of DevOps is Continuous Delivery and having a complex toolchain can add additional integration and setup to your developer environment. In his session at @DevOpsSummit at 18th Cloud Expo, Miko Matsumura, Chief Marketing Officer of Gradle Inc., will discuss which tools to use in a developer stack, how to provision the toolchain to minimize onboa...
SYS-CON Events announced today that VAI, a leading ERP software provider, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. VAI (Vormittag Associates, Inc.) is a leading independent mid-market ERP software developer renowned for its flexible solutions and ability to automate critical business functions for the distribution, manufacturing, specialty retail and service sectors. An IBM Premier Business Part...
SYS-CON Events announced today that Alert Logic, Inc., the leading provider of Security-as-a-Service solutions for the cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Alert Logic, Inc., provides Security-as-a-Service for on-premises, cloud, and hybrid infrastructures, delivering deep security insight and continuous protection for customers at a lower cost than traditional security solutions. Ful...
Fortunately, meaningful and tangible business cases for IoT are plentiful in a broad array of industries and vertical markets. These range from simple warranty cost reduction for capital intensive assets, to minimizing downtime for vital business tools, to creating feedback loops improving product design, to improving and enhancing enterprise customer experiences. All of these business cases, which will be briefly explored in this session, hinge on cost effectively extracting relevant data from ...
In most cases, it is convenient to have some human interaction with a web (micro-)service, no matter how small it is. A traditional approach would be to create an HTTP interface, where user requests will be dispatched and HTML/CSS pages must be served. This approach is indeed very traditional for a web site, but not really convenient for a web service, which is not intended to be good looking, 24x7 up and running and UX-optimized. Instead, talking to a web service in a chat-bot mode would be muc...
SYS-CON Events announced today that Catchpoint Systems, Inc., a provider of innovative web and infrastructure monitoring solutions, has been named “Silver Sponsor” of SYS-CON's DevOps Summit at 18th Cloud Expo New York, which will take place June 7-9, 2016, at the Javits Center in New York City, NY. Catchpoint is a leading Digital Performance Analytics company that provides unparalleled insight into customer-critical services to help consistently deliver an amazing customer experience. Designed...
It's easy to assume that your app will run on a fast and reliable network. The reality for your app's users, though, is often a slow, unreliable network with spotty coverage. What happens when the network doesn't work, or when the device is in airplane mode? You get unhappy, frustrated users. An offline-first app is an app that works, without error, when there is no network connection.
With the Apple Watch making its way onto wrists all over the world, it’s only a matter of time before it becomes a staple in the workplace. In fact, Forrester reported that 68 percent of technology and business decision-makers characterize wearables as a top priority for 2015. Recognizing their business value early on, FinancialForce.com was the first to bring ERP to wearables, helping streamline communication across front and back office functions. In his session at @ThingsExpo, Kevin Roberts...
As someone who has been dedicated to automation and Application Release Automation (ARA) technology for almost six years now, one of the most common questions I get asked regards Platform-as-a-Service (PaaS). Specifically, people want to know whether release automation is still needed when a PaaS is in place, and why. Isn't that what a PaaS provides? A solution to the deployment and runtime challenges of an application? Why would anyone using a PaaS then need an automation engine with workflow ...