Bennett Reports Fourth Quarter and Full Year Results.OAKVILLE, Ontario Oakville (2006 population 165,613[2]) is a town on Lake Ontario in southern Ontario, Canada, midway between Toronto (about 31 km or 19 mi away) on its eastern border and Hamilton (about 20 km or 12 mi away) from its western border. -- 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. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :BEV)(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. ) today announced its financial and operating results (unaudited) for the fourth quarter and full year 2004 and reported on other developments. Highlights - Loss of $8.3 million or $0.45 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. on revenues of $4.5 million for the three months ended December December: see month. 31, 2004. For the full year, the net loss was $18.5 million ($1.01 per common share) - Closing of a $12 million financing and the issue of 3 million common shares at $4.00 per share in a bought underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. - Retirement, as an employee, of Company founder, John Bennett
John Bennett may refer to:
Financial results Fourth Quarter The Company announced an after tax loss in the fourth quarter of $8.3 million or $0.45 cents per share on revenues of $4.5 million. Reduced soil processing volumes at the 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. facility and additional costs related to the Company's now completed Saglek project significantly contributed to the loss. In the fourth quarter, on a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta basis, additional severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and pension costs related to the Vancouver Vancouver, city, Canada Vancouver, city (1991 pop. 471,844), SW British Columbia, Canada, on Burrard Inlet of the Strait of Georgia, opposite Vancouver Island and just N of the Wash. border. office closure costs added $0.8 million to administration and business development expenses. Legal costs associated with class action 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. were approximately $1.3 million. Foreign exchange and investment losses totalled approximately $1.1 million. In the three months ended December 31, 2003, Bennett reported a net income of $6.3 million ($0.38 per common share) on sales of $22.0 million. 12 months ended 12/31/2004 For the year ended December 31, 2004, the Company recorded a loss of $18.5 million ($1.01 per common share) on revenues of $25.3 million, compared to a profit of $18.2 million ($1.08 per common share) on revenues of $69.8 million. The impact of the completion of Saglek Contract and lower volumes of processed material negatively impacted margin contributions for the year and were the key factors in the 2004 loss. In 2004, contribution (gross) margins were negative $1.4 million compared to $37.4 million in the prior year. Saglek Contract Gross margins were negatively impacted by approximately $15.6 million by the Saglek contract, a fixed rate contract originally awarded in 2002 to remediate re·me·di·a·tion n. The act or process of correcting a fault or deficiency: remediation of a learning disability. re·me 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 at the site of a former US DEW line DEW line n. A line of radar stations near the 70th parallel across the North American continent, maintained by the United States and Canada and intended to give advance warning of approaching enemy aircraft and missiles. radar installation in northern 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). . For this contract, revenue and expenses were accounted for under the "percentage of completion" method, since Bennett was prime contractor. At the end of 2003, the Company had estimated that total revenue remaining on the Saglek Contract in 2004 would be approximately $10.2 million. During the year the Company received lower than anticipated volumes of soil and actual revenue recorded was approximately $2.4 million. This is a result of lower volumes and reduced expectations for the recovery of a $9.1 million claim against the client for extra expenses. A net amount of $4.9 million was included in accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying in respect of this claim. At the end of 2003, Bennett had estimated remaining costs to complete the project to be approximately $6.8 million based on the anticipated additional work discussed with the customer. Actual expenses were $18.1 million because of significantly higher than estimated processing costs ($6.8 million), and higher site, fuel and transportation costs ($4.5 million). In 2004, administration and business development costs were $15.8 million compared to $8.5 million the prior year. The increase is attributable to $2.9 million in severance and other costs related to the closure of the Vancouver office, and $3.2 million in higher legal and professional fees related to the class action suits filed against the Company in 2004. In addition, as a result of the changes to management, the Company incurred additional one time costs of approximately $0.8 million for salary and recruiting costs. The Company also recorded a charge to its passive investments of $0.8 million ($0.1 million in 2003) and a loss from asset impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. of $4.3 million related to the Kirkland Lake Kirkland Lake, mining town, E Ont., Canada. An important gold-mining center, gold was discovered there in 1911 and again in the 1980s at Harker. The mining of iron ore and tourism are two other important industries. project. Amortization in 2004 was $3.7 million compared to $1.8 million as a result of accelerated amortization of Saglek equipment and higher amortization of licences the Company purchased in 2003. Balance sheet In December, the Company completed an equity financing Equity Financing The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. with net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of $11.1 million, and at year end had cash and equivalents on hand of $15.2 million. Working capital stood at $28.7 million at December 31, 2004. Operating results During the quarter, the Company processed approximately 8,900 tonnes of soil at its Saint Ambroise facility compared to 22,200 tonnes in the comparable quarter. In 2004, Saint Ambroise processed approximately 52,900 tonnes compared to 73,900 the prior year. The plant will resume full operations on March 7th. Bennett expects to process about 5,500 tonnes of soil in March and to have approximately 6,000 tonnes of soil inventory at the end of the quarter. The Company will begin compliance testing at its recently completed Belledune facility and expects to complete testing and anticipates receiving its operating permit from the Province of New Brunswick New Brunswick, province, Canada New Brunswick, province (2001 pop. 729,498), 28,345 sq mi (73,433 sq km), including 519 sq mi (1,345 sq km) of water surface, E Canada. , by the third quarter. Other Business John Bennett, who founded the Company in 1993, has retired as an employee. The Company has expressed its thanks and appreciation to Mr. Bennett for his dedication to the growth of the Company and for his pioneering contributions to the environmental sector 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. . The Company has accepted the resignation of Zul Tejpar as Vice President of Business Development. Danny Ponn has been re-assigned to the role of Vice President Engineering and Business Development. Danny, who has been with Bennett since 1993, is a graduate of the University of British Columbia Locations Vancouver The Vancouver campus is located at Point Grey, a twenty-minute drive from downtown Vancouver. It is near several beaches and has views of the North Shore mountains. The 7. , a Professional Engineer, and a recognized expert in the field of thermal oxidization. Al Bulckaert has assumed direct responsibility for plant operations. In January January: see month. 2005, Wendy Wendy is a female name which may be used as a short form for Gwendolyn, or in its own right. Its popularity is attributed to the character Wendy Darling from the children's play and novel Peter Pan, by J.M. Barrie. The character Wendy was inspired by a real girl. Ford joined the Company as Corporate Controller and has assumed all responsibility related to the transition of the accounting function from Vancouver to 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. and the day-to-day day-to-day adj. 1. Occurring on a routine or daily basis: the day-to-day movements of the stock market. 2. accounting and treasury function. Ms. Ford is a Chartered Accountant char·tered accountant n. Chiefly British Abbr. CA A member of one of the institutes of accountants granted a royal charter. with 17 years of experience and has a Bachelor of Commerce The Bachelor of Commerce is a bachelor's degree in business management, accounting and economic fields. The degree is also known as the Bachelor of Commerce and Administration (BCA). from the University of Toronto Research at the University of Toronto has been responsible for the world's first electronic heart pacemaker, artificial larynx, single-lung transplant, nerve transplant, artificial pancreas, chemical laser, G-suit, the first practical electron microscope, the first cloning of T-cells, . On September September: see month. 17, 2004, RSI (Repetitive Strain Injury) Ailments of the hands, neck, back and eyes due to computer use. The remedy for RSI is frequent breaks which should include stretching or yoga postures. received a Preliminary Notice to the issuance of an Order from the Ministry of Sustainable Development Sustainable development is a socio-ecological process characterized by the fulfilment of human needs while maintaining the quality of the natural environment indefinitely. The linkage between environment and development was globally recognized in 1980, when the International Union and Parks (formerly the Quebec Ministry of the Environment) concerning the RSI plant in Saint-Ambroise. The Preliminary Notice alleges that increases in levels of dioxins and furans measured in soils near the RSI plant are attributable to RSI. If issued, the Order seeks to require RSI to limit its emissions of dioxins and furans, to install equipment to further monitor the emissions and to transmit To send data over a communications line. See transfer. the collected data to the Ministry. On November 1, 2004, RSI filed its observations with respect to the allegations contained in the Preliminary Notice. The Company disputes allegations contained the Preliminary Notice. In support of its position, the Company commissioned several qualified third-party experts to review the allegations contained in the Preliminary Notice. The experts retained, support the Company's position that other sources may have contributed to increases in levels of dioxins and furans in the soil around the RSI plant. Since the filing of its observations, RSI has exchanged correspondence and has had several discussions with the Ministry. Recently, at a meeting held on February 9, 2005, the Company met with Ministry officials where they asked the Company to develop an action plan to address the concerns raised in the Preliminary Notice. The Company developed an action plan that it believes addresses the Ministry's concerns, while at the same time allow it to remain commercially competitive. The action plan was submitted to the Ministry on February 21, 2005 and the Company anticipates further discussion with the Ministry. Several improvements to the plant have been already put it in place as part of the internationally recognized ISO (1) See ISO speed. (2) (International Organization for Standardization, Geneva, Switzerland, www.iso.ch) An organization that sets international standards, founded in 1946. The U.S. member body is ANSI. 14001 Certification that RSI was granted in 2004. The Company and certain of the current officers, former officers and former directors have received a letter dated February 11, 2005 from the 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. (OSC O.S.C. n. short for Order to Show Cause. (See: Order to Show Cause) ) giving such officers and directors the opportunity to provide written submissions to the OSC before the OSC determines it is going to commence enforcement proceedings. The OSC's view is that the company failed to disclose the change in status of the Federal Creosote creosote (krē`əsōt), volatile, heavy, oily liquid obtained by the distillation of coal tar or wood tar. Creosote derived from beechwood tar has been used medicinally as an antiseptic and in the treatment of chronic bronchitis. contract together with allegations of insider trading. Submissions, if any, are to be submitted to the OSC by March 17, 2005. The company continues to cooperate with all regulatory agencies regulatory agency Independent government commission charged by the legislature with setting and enforcing standards for specific industries in the private sector. The concept was invented by the U.S. regarding this issue. Comment "Bennett's overall results and performance were clearly unacceptable in 2004," said Al Bulckaert, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "Our priority in 2005 is to return Bennett to profit and build a good foundation for growth beyond 2005." "While much remains to be accomplished, there are some early but encouraging signs. The Saglek contract is behind us, and we've absorbed the necessary costs of closing the Vancouver office. With the new management team in place, we continue to enhance our business processes. We expect administration and business development levels to return to a more normalized level of $9 - $11 million in 2005, compared to $16 million in 2004. Our activities are supported by a strong balance sheet as a result of confidence the equity markets demonstrated by the recent financing the Company obtained in December 2004." Mr. Bulckaert added, "After an extensive recruitment process, our new management team is in place and is making rapid strides towards improving all aspects of the business. We have implemented new financial controls, accountability, and forecasting tools and we continue to strengthen our relationships with government agencies and regulatory bodies." "The Company's sales cycle is lengthy and can range anywhere from 6 months to 3 years. We took a series of important steps in 2004 to rebuild our sales organization and continue to forge forge Open furnace for heating metal ore and metal for working and forming, or a workshop containing forge hearths and related equipment. From earliest times, smiths (see smithing) heated iron in forges and formed it by hammering on an anvil. new business relationships, particularly in the larger US market. We are beginning to see the results of these efforts and have secured new contracts for approximately 6,000 tonnes this quarter". "The Company currently has purchase orders, subject to cancellation under certain circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or , for approximately 30,000 tonnes of soil for remediation in 2005. Of this amount, approximately 10,000 tonnes is from new business. We continue to work aggressively with the hope to secure, receive and process an additional 30,000 tonnes from new and existing customers for this year. 2005 is a year of rebuilding the Company, and we look forward to reporting on our progress as the year unfolds," concluded Mr. Bulckaert. 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 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. 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"). FORWARD LOOKING STATEMENTS Certain statements contained in this press release and in certain documents incorporated by reference into this press release constitute 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. . The use of any of the words "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "believe" and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Company believes that the expectations reflected in those forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in, or incorporated by reference into, this press release should not be unduly relied upon. These statements speak only as of the date of this press release. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
BENNETT ENVIRONMENTAL INC.
Consolidated Balance Sheets
(Expressed in Canadian dollars)
December 31, 2004 and 2003
2004 2003
---------------------------------------------------------------------
(Restated)
Assets
Current assets
Cash and cash equivalents $ 15,180,060 $ 12,586,353
Accounts receivable 14,316,648 28,839,675
Income tax receivable 5,342,370 -
Note receivable 315,000 172,500
Prepaid expenses and other 1,531,580 2,306,876
----------------------------
36,685,658 43,905,404
Investment - 568,193
Property, plant and equipment 48,920,377 23,779,384
Other assets 4,793,069 6,777,953
Goodwill 646,638 646,638
----------------------------
$ 91,045,742 $ 75,677,572
----------------------------
----------------------------
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued
liabilities $ 6,646,005 $ 9,964,937
Income taxes payable - 2,961,632
Deferred revenue 661,557 814,409
Current portion of long-term debt 727,132 4,601
----------------------------
8,034,694 13,745,579
Future income tax liability 1,033,340 2,616,861
Long-term debt 1,974,318 417,143
Shareholders' equity
Share capital 67,644,681 28,397,470
(Common shares outstanding
21,415,940 (2003 - 17,145,789)
Contributed surplus 1,595,205 1,201,776
Retained Earnings (Deficit) 10,763,504 29,298,743
----------------------------
80,003,390 58,897,989
----------------------------
$ 91,045,742 $ 75,677,572
----------------------------
----------------------------
BENNETT ENVIRONMENTAL INC.
Consolidated Statement of Operations and Retained Earnings
(Expressed in Canadian dollars)
Years ended December 31, 2004 and 2003
---------------------------------------------------------------------
---------------------------------------------------------------------
12 months 12 months 3 months 3 months
31-Dec-04 31-Dec-03 31-Dec-04 31-Dec-03
---------------------------------------------------------------------
(Restated) (Restated)
Sales $ 25,323,203 $ 69,806,526 4,518,393 21,984,054
Expenses
Operating costs 26,736,521 32,419,935 7,807,06 10,775,516
Administration
and business
development 15,780,332 8,542,452 4,528,906 2,291,307
Amortization 3,729,728 1,800,326 1,812,793 287,287
Foreign exchange 273,626 544,337 236,449 120,777
Loss from asset
impairment 4,343,979 - - -
Interest expense 305,313 156,675 233,335 70,390
--------------------------------------------------
51,169,499 43,463,725 14,618,549 13,545,277
--------------------------------------------------
(Loss) earnings
before undernoted (25,846,296) 26,342,801 (10,100,156) 8,438,777
Gain on debt
settlement - 1,316,936 0 1,316,936
Loss on investment (818,193) (133,202) (818,193) (133,202)
Interest and other
income 580,280 1,280,629 141,812 737,283
--------------------------------------------------
(Loss) earnings
before income
taxes (26,084,209) 28,807,164 (10,776,537) 10,359,794
Income tax
(recoverable)
expense
Current (6,727,600) 8,912,582 (3,158,225) 2,622,019
Future (821,370) 1,721,123 633,982 1,416,123
--------------------------------------------------
(7,548,970) 10,633,705 (2,524,243) 4,038,142
--------------------------------------------------
Net (Loss) earnings (18,535,239) 18,173,459 (8,252,294) 6,321,652
Retained Earnings,
beginning of
period 29,298,743 11,125,284 19,015,798 22,977,091
--------------------------------------------------
Retained Earnings,
end of period $ 10,763,504 $ 29,298,743 $10,763,504 $29,298,743
--------------------------------------------------
--------------------------------------------------
Basic earnings
per share $ (1.01) $ 1.08 $ (0.45) $ 0.38
--------------------------------------------------
--------------------------------------------------
Fully diluted
earnings per
share $ (1.01) $ 1.04 $ (0.45) $ 0.36
--------------------------------------------------
--------------------------------------------------
BENNETT ENVIRONMENTAL INC.
Consolidated Statement of Cash Flows
(Expressed in Canadian dollars)
Years ended December 31, 2004 and 2003
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---------------------------------------------------------------------
12 months 12 months 3 months 3 months
31-Dec-04 31-Dec-03 31-Dec-04 31-Dec-03
---------------------------------------------------------------------
(Restated) (Restated)
CASH PROVIDED BY
(USED IN):
Operations
Net (Loss)
earnings $(18,535,239) $18,173,459 $(8,252,294) $6,321,652
Items not involving
cash
Debt settlement - (1,316,936) - (1,316,936)
Amortization 3,729,728 1,800,326 1,812,793 287,287
Stock -based
compensation 675,176 1,198,802 185,228
Partial
(cancellation)
redemption of
equity investment (150,000) 150,000 (150,000) 150,000
Loss from asset
impairment 4,343,979 - - 133,202
Future income
taxes (1,583,521) 1,721,123 341,146 1,416,123
Tax benefits of
share issue costs 762,753 293,438
Cash surrender value
of life insurance (606,825) (606,825)
Loss on guarantee
of investee line
of credit (100,000) (100,000)
Fair value of
options granted
and vested 436,461 - 436,461 -
Change in non-cash
operating working
capital
Deferred revenue (152,852) 718,981 661,557 -
Accounts
receivable 14,523,027 (16,506,230) 7,298,271 (2,519,562)
Note receivable
issued to investee
(including
interest) (315,000) - (15,000) 400,000
Cancellation of
note receivable
to investee 172,500 - -
Prepaid expenses
and other 775,296 (718,611) 1,606,141 (406,173)
Accounts payable
and accrued
liabilities (3,318,932) 2,082,269 (920,567) 3,813,660
Income taxes
payable (8,304,002) (2,900,891) (1,772,995) (1,245,460)
---------------------------------------------------
(7,647,451) 4,402,292 817,354 7,033,793
Investing Activities
Loss on Investments 818,193 133,202 737,380 -
Purchase of
property, plant
and equipment (28,553,047) (11,316,302) (4,570,995) (7,063,195)
Increase in
license, permits
and other assets (2,069,944) (3,516,569) (926,489) (2,067,106)
---------------------------------------------------
(29,804,798) (14,699,669) (4,760,104) (9,130,301)
Financing Activities
Repayments of
long-term debt 2,279,706 (405,777) 2,391,616 (174,246)
Share capital
issued for cash
net of costs 37,838,129 4,021,868 11,124,070 2,384,663
Repurchase of
share capital (71,879) - - -
---------------------------------------------------
40,045,956 3,616,091 13,515,686 2,210,417
---------------------------------------------------
Increase (Decrease)
in cash and cash
equivalents 2,593,707 (6,681,286) 9,572,936 113,909
Cash and cash
equivalents,
beginning of
period 12,586,353 19,267,639 5,607,124 12,472,444
---------------------------------------------------
Cash and cash
equivalents, end
of period $ 15,180,060 $12,586,353 $15,180,060 $12,586,353
---------------------------------------------------
---------------------------------------------------
Supplementary
disclosure of
cash flow
information:
Cash paid for:
Interest paid $ 20,800 $ 16,354 20,800 10,493
Income taxes paid 385,212 11,813,473 (688,242) 11,813,473
Bennett Environmental Inc. (TSX:BEV) (AMEX:BEL) |
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