Bennett Environmental Announces Small Q1 Loss.Business Editors/Environment Writers OAKVILLE Oakville, town (1991 pop. 114,670), Ont., Canada, on Lake Ontario, between Toronto and Hamilton. A major component of the local economy is the Ford Motor Co plant, one of the largest auto plants in Canada. , Ontario--(BUSINESS WIRE)--April 29, 2004 Bennett Environmental Bennett Environmental TSX: BEV AMEX: BEL is a Canadian company based in Oakville, Ontario. It specializes in the recovering of soils contaminated with chlorinated hydrocarbons, including PCB's and PCP's, Dioxins and Furans. Inc. (AMEX AMEX See: American Stock Exchange :BEL Bel (bāl, bĕl), deity of the Middle Eastern religions. The name is a cognate of that of Baal. For Bel in the Bible, see Bel and the Dragon. ) (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :BEV) announces a loss in its first quarter ended March 31, 2004 of $0.4 million, or $0.02 per fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share compared to earnings in the same quarter a year ago of $3.1 million or $0.17 per fully diluted share. Revenues were $8.9 million versus $12.1 million a year earlier. While volumes processed during the quarter increased to 20,000 tonnes compared to 16,000 tonnes in the first quarter of 2003, soil mix was far less favourable. In addition, our plant in Saint Ambroise Ambroise (flourished c. 1190) was a Norman poet and chronicler of the Third Crusade, author of a work called L'Estoire de la guerre sainte, which describes in rhyming French verse the adventures of Richard Coeur de Lion as a crusader. , Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. experienced an unplanned shutdown shut·down n. A cessation of operations or activity, as at a factory. shutdown Noun the closing of a factory, shop, or other business Verb shut down due to a lack of soil available for processing. Administrative and business development expenses increased to $3.1 million in the quarter from $2.0 million in the same period a year ago as we continue to staff up in anticipation of the start-up Start-up The earliest stage of a new business venture. of our Belledune, New Brunswick Belledune (2006 population: 1,711) is a Canadian village in Gloucester County, New Brunswick. Located on Chaleur Bay, the village was amalgamated in 1994 with the community of Jacquet River. facility. There were also additional legal and other costs related to permitting for the Belledune plant. "The quarter is a great disappointment and our second quarter will not be easy either," said Allan Allan can refer to:
1. Contraction of do not. 2. Nonstandard Contraction of does not. n. A statement of what should not be done: a list of the dos and don'ts. believe these kinds of results are indicative of Bennett's longer term performance. I am just as positive today about Bennett's prospects as I was when I accepted this position two months ago. The company's fundamentals remain sound and while there are clear areas for process and business improvements, I see the current period as more of an anomaly Abnormality or deviation. Pronounced "uh-nom-uh-lee," it is a favorite word among computer people when complex systems produce output that is inexplicable. See software conflict and anomaly detection. in Bennett's long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. progress." On March 29, the Company advised shareholders that first quarter earnings would be significantly lower than expected due to the processing of high volumes of low margin soil, primarily from the Saglek, Labrador Labrador: see Labrador-Ungava; Newfoundland and Labrador, Canada. Labrador Large peninsula, northeastern Canada. Divided between the provinces of Quebec and Newfoundland and Labrador, it occupies an area of about 625,000 sq mi (1,620,000 sq km). project. While the Saglek project is profitable for Bennett, revenue recognition for soil processing is lower than on other aspects of the project, such as site clean up and shipping. Normally, the Company is able to process a more optimum mix of soils, increasing revenues on the same cost base. However, a shortage of other soils during the first quarter was compounded by delays in shipping of higher margin material from two larger customers. The Company still expects to receive the same volume of contaminated contaminated, v 1. made radioactive by the addition of small quantities of radioactive material. 2. made contaminated by adding infective or radiographic materials. 3. an infective surface or object. soil from these customers, with shipments at a later date than originally expected. Upon resumption RESUMPTION. To reassume; to promise again; as, the resumption of payment of specie by the banks is general. It also signifies to take things back; as the government has resumed the possession of all the lands which have not been paid for according to the requisitions of the law, and the of normal deliveries, the Company expects a return to historical margins. "Our challenge is to ensure we have a constant flow of material from a variety of projects throughout the year and to fill our storage facilities by year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. ," said Mr. Bulckaert. "Only by ensuring that we have an ample inventory of soil available, can we reduce the risk of unscheduled unscheduled Adjective not planned or intended Adj. 1. unscheduled - not scheduled or not on a regular schedule; "an unscheduled meeting"; "the plane made an unscheduled stop at Gander for refueling" plant shutdowns and better manage overall margins." The Company's plant at Saint Ambroise has been shut down since the end of March. A planned two-week maintenance shutdown in July July: see month. was moved forward and most of this work has been completed. The Company now expects the plant to resume processing in mid-May. Second quarter results will be affected by the shutdown. The Company is in negotiations with the Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. Department of National Defence for the recovery of extraordinary costs associated with the Saglek project. Negotiations are also continuing on a contract for a second phase of the Saglek project. An announcement on this contract is expected by the end of the second quarter. "We are confident that we will have adequate volumes for the start-up of Belledune in the third quarter as well as for its continued operation," said Mr. Bulckaert. "There is no lack of opportunities out there. We are increasing sales staffing and improving our ability to win new business." The Company's operating costs operating costs npl → gastos mpl operacionales of $5.7 million for the first quarter were higher than the $5.2 million for the same period last year, reflecting higher plant utilization in the quarter. Plant capacity utilization Capacity Utilization measures the rate at which a firm makes use of their capital productive capacities, such as factories and machinery. Capacity Utilization generally rises when the economy is healthy and falls when demand softens. of about 80% was limited by a lack of soil for processing during the quarter. Administrative and business development costs of $3.1 million compare to $2.3 million in the fourth quarter of 2003 and $2.0 million in the first quarter 2003. Expenditures for insurance, salaries, legal and professional fees comprise the bulk of the increase. Non-recurring expenditures represent about $300,000 of the quarterly total. Amortization and depreciation was $657,337 for the quarter and reflect the increase in depreciation for the new storage facility constructed at the Saint Ambroise plant in mid 2003 and depreciation of assets and operating permits associated with the Eco Logic International purchase in late 2003. Effective January 1, 2004, the Company adopted the amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. recommendations of the Canadian Institute of Chartered Accountants The Canadian Institute of Chartered Accountants (CICA) is the umbrella body for the Chartered Accountant profession in Canada and Bermuda. Membership of the CICA totals 70,000 Chartered Accountants and 8,500 students. for accounting of stock based compensation. These recommendations have been applied retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin , with restatement Restatement A revision in a company's earlier financial statements. Notes: The need for restating financial figures can result from fraud, misrepresentation, or a simple clerical error. of prior periods. In total, stock compensation expense was $169,059 in the quarter versus $180,304 incurred in the comparable quarter last year. The Company has cash of $23.2 million after the expenditure of $9.4 million for the construction of the new Belledune facility. The Company also has an untapped line of credit of $10 million and has no current plans for its use. Receivable balances of $26.1 million are down slightly from last quarter and are expected to decline significantly in the second quarter due to the payment of outstanding invoices by the Government of Canada The Government of Canada is the federal government of Canada. The powers and structure of the federal government are set out in the Constitution of Canada. In modern Canadian use, the term "government" (or "federal government") refers broadly to the cabinet of the day and as part of the payment schedule for the Saglek Labrador project. The balance of outstanding shares at March 31, 2004 was 18,305,739. Current contract backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. stands at $218 million Can. or $163 million US. About Bennett Environmental Inc. Bennett Environmental Inc. is a North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. leader in high temperature treatment services for the remediation of contaminated soil and has provided thermal solutions to contamination problems throughout Canada and the US. Bennett Environmental's proprietary technology provides for the safe, economical and permanent solution to contaminated soil. Independent testing has consistently proven that the technology operates well within the most stringent criteria in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . Bennett Environmental is listed on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. (Trading Symbol Trading symbol See: Ticker symbol "BEV") and the American Stock Exchange American Stock Exchange (AMEX) Stock exchange in the U.S. Originally known as “the Curb,” it began as an outdoor marketplace in New York City c. 1850. It moved indoors to its present location in the Wall Street area in 1921. (Trading Symbol "BEL"). Note for Investors: This news release includes statements about expected future events and/or financial results that are forward looking in nature and subject to risks and uncertainties. For those statements, we claim the protection of the safe harbour for forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. provisions contained in the Private Litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. Reform Act of 1995. The Company cautions that actual performance will be affected by a number of various factors, many of which are beyond the Company's control. Discussions of the various factors that may affect future results are contained in the Company's filings with the Securities and Exchange Commission and Ontario Securities Commission The Ontario Securities Commission (OSC) is a regulatory agency which administers and enforces securities legislation in the Canadian province of Ontario. The OSC is an Ontario Crown corporation which reports to the Ontario legislature through the Minister of Finance. .
BENNETT ENVIRONMENTAL INC.
Consolidated Balance Sheets
(Expressed in Canadian dollars)
As at March 31, 2004 with comparative figures
As at December 31, 2003
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March 31 December 31
2004 2003
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(Unaudited) (Audited)
(Restated -
Note 2)
Assets
Current assets
Cash and cash equivalents $ 23,231,571 $ 12,586,353
Accounts receivable 26,106,965 29,012,175
Work-in-progress 94,933 151,893
Prepaid expenses and other 3,238,342 2,154,983
---------------------------
52,671,811 43,905,404
Investment 534,894 568,193
Property Plant and Equipment 32,617,742 23,779,384
Other assets 7,088,629 6,777,953
Goodwill 646,638 646,638
---------------------------
$ 93,559,714 $ 75,677,572
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Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities $ 6,107,762 $ 9,964,937
Income taxes payable 143,400 2,961,632
Current portion of long-term debt 9,569 4,601
---------------------------
6,260,731 12,931,170
Future income tax liability 2,043,541 2,616,861
Deferred revenue 93,321 814,409
Long-term debt 5,399 417,143
Shareholders' equity
Share capital 54,925,305 28,397,470
(Common shares outstanding 18,305,739
(March 31, 2003 - 16,648,628))
Contributed surplus 1,267,517 1,201,776
Retained Earnings 28,963,900 29,298,743
---------------------------
85,156,722 58,897,989
$ 93,559,714 $ 75,677,572
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See accompanying notes to consolidated financial statements.
BENNETT ENVIRONMENTAL INC.
Consolidated Statement of Operations and Retained Earnings (Deficit)
(Unaudited)
(Expressed in Canadian dollars)
For the Three-Month Period Ended March 31, 2004 with comparative
figures for the Three-Month Period Ended March 31, 2003
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March 31 March 31
2004 2003
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(Restated -
Note 2)
Sales $ 8,942,184 $ 12,050,113
Interest and other income 120,879 268,280
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9,063,063 12,318,393
Expenses
Operating costs 5,682,943 5,174,071
Administration and business development 3,081,986 1,969,629
Amortization 657,337 441,175
Foreign exchange (3,688) 215,666
Interest expense 25,568 36,714
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9,444,146 7,837,255
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Earnings before income taxes (381,083) 4,481,138
Income tax expense (recovery)
Current 57,765 1,630,172
Future (104,005) (63,427)
---------------------------
(46,240) 1,566,745
Net earnings (loss) (334,843) 2,914,393
Retained Earnings, beginning of period 29,298,743 11,125,284
Retained Earnings, end of period $ 28,963,900 $ 14,039,677
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Basic earnings (loss) per share $ (0.02) $ 0.18
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Fully diluted earnings (loss) per share $ (0.02) $ 0.17
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See accompanying notes to consolidated financial statements.
BENNETT ENVIRONMENTAL INC.
Consolidated Statement of Cash Flows
(Unaudited)
(Expressed in Canadian dollars)
For the Three-Month Period Ended March 31, 2004 with comparative
figures for the Three-Month Period Ended March 31, 2003
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March 31 March 31
2004 2003
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(Restated -
Note 2)
CASH PROVIDED BY (USED IN):
Operations
Net earnings (loss) $ (334,843) $ 2,914,393
Items not involving cash
Amortization 657,337 441,175
Equity investment loss 33,299 -
Future income taxes (104,005) (63,427)
Stock-based compensation (Note 2) 169,059 180,304
Deferred revenue (721,088) -
---------------------------
(300,241) 3,472,445
Change in non-cash operating working capital
Accounts receivable 2,905,210 (2,087,350)
Work-in-progress 56,960 (53,687)
Prepaid expenses and other (1,083,359) (1,437,414)
Accounts payable and accrued liabilities (3,857,175) (2,226,669)
Income taxes payable (2,818,232) (4,126,755)
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(4,796,596) (9,931,875)
Financing Activities
Repayments of long-term debt (406,776) (263,392)
Share capital, issued for cash 25,955,202 488,715
Repurchase of share capital - -
---------------------------
25,548,426 225,323
Investing Activities
Purchase of capital assets (9,400,698) (1,526,398)
Increase in other assets (405,673) (61,482)
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(9,806,371) (1,587,880)
Increase (Decrease) in cash and cash
equivalents 10,645,218 (7,821,987)
Cash and cash equivalents, beginning of
period 12,586,353 19,267,639
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Cash and cash equivalents, end of period $ 23,231,571 $ 11,445,652
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---------------------------
See accompanying notes to consolidated financial statements.
Supplementary disclosure of cash flow
information:
Cash paid for:
Interest paid 18,090 2,185
Income taxes paid 3,970,000 -
Notes to the Consolidated Financial Statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge (UNAUDITED) 1. Basis of Presentation: These consolidated interim financial statements have been prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with Canadian generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting for interim financial statements and accordingly, do not include all disclosures required for annual financial statements. In the opinion of management, all adjustments, including reclassifications and normal recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. adjustments necessary to present fairly the financial position, results of operations and retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. (deficit), and cash flows at March 31, 2004 and for all periods presented, have been made. Interim results are not necessarily indicative of the results for a full year. These consolidated interim financial statements should be read in conjunction with the December 31, 2003 annual financial statements and notes thereto there·to adv. 1. To that, this, or it. 2. Archaic In addition to that; furthermore. thereto Adverb Formal 1. to that or it 2. included in the 2003 Annual Report. 2. Change in accounting policies: These consolidated interim financial statements follow the same accounting policies and methods of application as our annual consolidated financial statements, except for the following: Effective January 1, 2004, the Company adopted the amended recommendations of the Canadian Institute of Chartered Accountants ("CICA CICA Competition In Contracting Act of 1984 (USA) CICA Canadian Institute of Chartered Accountants CICA Competition In Contracting Act CICA Criminal Injuries Compensation Authority (UK) ") for accounting for stock-based compensation. The amended standard requires recognition of an estimate of the fair value of stock-based awards in earnings. Previously, the Company provided note disclosure of pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma net income as if a fair value based method had been used. The amended recommendations have been applied retroactively, with restatement of prior periods. The restatement at January 1, 2004 resulted in an increase to share capital at December 31, 2003 of $493,601 (2002 - $4,498), contributed surplus of $1,201,776 (2002 - $492,077) and a decrease to retained earnings of $1,695,377 (2002 - $496,575). The adjustments represent the total compensation expense which would have been recorded had a fair value based method been used for stock options granted after January 1, 2002 and adjustments for exercised options. Compensation expense related to stock options for the three months ended March 31, 2004 is $169,059 (March 31, 2003 - $180,304).
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As previously
Reported Adjustment Restated
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As at December 31, 2002:
Retained Earnings $11,621,859 ($496,575) $11,125,284
Share Capital 2,388,2001 4,498 23,886,499
Contributed Surplus - 492,077 492,077
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As at December 31, 2003:
Retained Earnings 30,994,120 (1,695,377) 29,298,743
Share Capital 27,903,869 493,601 28,397,470
Contributed Surplus - 1,201,776 1,201,776
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3 months ended March 31, 2003:
Admin. and business development 1,789,325 180,304 1,969,629
Net Earnings 3,094,697 (180,304) 2,914,393
Basic earnings per share 0.19 0.18
Fully diluted earnings per share 0.18 0.17
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3. Share capital:
a. The issued share capital of the Company is as follows:
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Common Amount
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(Restated -
Note 2)
Balance at December 31, 2003 17,145,789 $ 28,397,470
Issued during the three months ended
March 31, 2004 for:
Exercise of options for cash 159,950 1,353,735
Stock-based compensation related to
exercise of options 103,318
Shares issued for Private Placement 1,000,000 26,000,000
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18,305,739 55,854,523
Share issuance cost (1,398,533)
Future income tax recovery 469,315
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Balance at March 31, 2004 18,305,739 $ 54,925,305
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b. Stock option activity for the three months ended March 31, 2004
is as follows:
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Shares
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Outstanding, December 31, 2003 1,120,602
Exercised (159,950)
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Outstanding, March 31, 2004 960,652
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4. Financial Statement Review: An Interim review of the Company's financial statements has been performed by KPMG KPMG Klynveld Peat Marwick Goerdeler (accounting firm) KPMG Kaiser Permanente Medical Group KPMG Keiner Prüft Mehr Genau (German) KPMG Kommen Prüfen Meckern Gehen . |
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