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Avcorp Announces 2021 Second Quarter Financial Results
Friday, August 27, 2021Company Profile | Follow Company
Delta, BC, August 27, 2021--(T-Net)--Avcorp Industries Inc. (TSX: AVP) today announced its financial results for the quarter ended June 30, 2021. All amounts are in Canadian currency unless otherwise stated.
2021 Second Quarter Highlights
Review of 2021 Second Quarter Results
For the quarter ended June 30, 2021, the Avcorp Group recorded an operating loss of $1,978,000 from $24,385,000 of revenue, as compared to an operating loss of $1,080,000 from $32,246,000 of revenue from the same quarter in the previous year. The second quarter of 2021 operating loss increased in comparison to 2020 by $898,000 mainly due to lower revenue, lower gross profit of $1,320,000 and higher administrative and general expenses of $992,000, partially offset by higher other income of $1,396,000.
During the quarter ended June 30, 2021, cash flows from operating activities generated $704,000 as compared to providing $3,189,000 cash in 2020. The decrease was attributed to lower operational earnings in the current quarter.
As at June 30, 2021, the Company had $4,470,000 cash on hand (December 31, 2020: $7,044,000) and had utilized $72,407,000 of its operating line of credit (December 31, 2020: $76,439,000). The bank indebtedness balance of the modification and related adjustments as a result of executing an amending agreement in 2021 was $1,229,000 as at June 30, 2021 (December 31, 2020 loss of $269,000 from the 2019 amendment). The Company has a working capital deficit of $56,482,000 as at June 30, 2021, compared with $77,780,000 deficit as at December 31, 2020. Working capital is defined as the difference between current assets and current liabilities. The Company's accounts receivable, government grant receivable, contract assets, and inventories net of accounts payable amount to a $41,849,000 surplus as at June 30, 2021 (December 31, 2020: $33,174,000 surplus). The Company's accumulated deficit as at June 30, 2021 is $132,741,000 (December 31, 2020: $148,919,000).
About Avcorp
The Avcorp Group designs and builds major airframe structures for some of the world's leading aircraft companies, including BAE Systems, Boeing, Bombardier, Lockheed Martin and Subaru Corporation. The Avcorp Group has more than 65 years of experience, over 500 skilled employees and 560,000 square feet of facilities. Avcorp Structures & Integration located in Delta British Columbia, Canada is dedicated to metallic and composite aerostructures assembly and integration; Avcorp Engineered Composites located in Burlington Ontario, Canada is dedicated to design and manufacture of composite aerostructures, and Avcorp Composite Fabrication located in Gardena California, USA has advanced composite aerostructures fabrication capabilities for composite aerostructures.
The Avcorp Group offers integrated composite and metallic aircraft structures to aircraft manufacturers, a distinct advantage in the pursuit of contracts for new aircraft designs, which require lowercost, light-weight, strong, reliable structures. Comtek Advanced Structures Ltd., at our Burlington, Ontario, Canada location also provides aircraft operators with aircraft structural component repair services for commercial aircraft.
Avcorp Composite Fabrication Inc. is wholly owned by Avcorp US Holdings Inc. Both companies are incorporated in the State of Delaware, USA, and are wholly owned subsidiaries of Avcorp Industries Inc.
Comtek Advanced Structures Ltd., incorporated in the Province of Ontario, Canada, is a wholly owned subsidiary of Avcorp Industries Inc.
Avcorp Industries Inc. is a federally incorporated reporting company in Canada and traded on the Toronto Stock Exchange (TSX:AVP).
Forward-Looking Statements
This release should be read in conjunction with the Company's audited financial statements contained in the Company's Annual Report, and with the quarterly financial statements and accompanying notes filed with Sedar (www.sedar.com).
Certain statements in this release and other oral and written statements made by the Company from time to time are forward-looking statements, including those that discuss strategies, goals, outlook or other non-historical matters; or projected revenues, income, returns or other financial measures. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in the statements, including the following: (a) changes in worldwide economic and political conditions that impact interest and foreign exchange rates; (b) the occurrence of work stoppages and strikes at key facilities of the Corporation or the Corporation's customers or suppliers; (c) government funding and program approvals affecting products being developed or sold under government programs; (d) cost and delivery performance under various program and development contracts; (e) the adequacy of cost estimates for various customer care programs including servicing warranties; (f) the ability to control costs and successful implementation of various cost reduction programs; (g) the timing of certifications of new aircraft products; (h) the occurrence of downturns in customer markets to which the Corporation products are sold or supplied or where the Corporation offers financing; (i) changes in aircraft delivery schedules or cancellation of orders; (j) the Corporation's ability to offset, through cost reductions, raw material price increases and pricing pressure brought by original equipment manufacturer customers; (k) the availability and cost of insurance; (l) the Corporation's ability to maintain portfolio credit quality; (m) the Corporation's access to debt financing at competitive rates; (n) uncertainty in estimating contingent liabilities and establishing reserves tailored to address such contingencies; and (o) integration of newly acquired operations and associated expenses may adversely affect profitability.
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