Xebec Announces 2018 First Quarter Operating Results
MONTREAL (QC), May 30, 2018 - Xebec Adsorption Inc. (TSXV: XBC) ("Xebec"), a provider of gas generation, purification, and filtration solutions announced today its 2018 first quarter operating results.
- Significant increase of 660% in order backlog to $66.1 million as of May 28, 2018, as compared to $8.6 million on May 23, 2017. This includes a firm order commitment of $51.0 million to be delivered over three years. This indicates significant anticipated revenue growth for 2018.
- Advance discussions to obtain significant new credit facilities.
- Slight reduction of revenues of $0.1 million for the first quarter of 2018 compared to 2017.
- Negative EBITDA at $1.0 million for 2018 compared to a positive EBITDA of $0.7 million in 2017, a deterioration of $1.7 million.
- Net loss of $1.4 million or $0.03/share in the first quarter 2018 compared to a net profit of $0.6 million or $0.01/share for the same period in 2017, a deterioration of $1.9 million.
- Positive working capital decreased to $0.9 million for a positive current ratio of 1.1:1 compared with a positive working capital of $1.8 million and a 1.3:1 ratio in December 31, 2017.
- Revenues of $3.2 million for the first quarter of 2018 compared to $3.3 million for the same quarter in 2017, a 2.9% decrease compared to the same period in 2017.
- Gross profit of $0.8 million or 24.3% of revenues for the first quarter of 2018 compared to $1.4 million for the same quarter in 2017, a 46% decrease compared to the same period in 2017.
- Net loss of $1.3 million or $(0.03) per share for the three month period ending March 31, 2018 compared to a
net profit of $0.6 million or $0.01 per share for the same period in 2017, a deterioration of $1.9 million.
- Negative EBITDA of $1.0 million for the three month period ending March 31, 2018 compared to a positive EBITDA of $0.7 million for the same period in 2017, a deterioration of $1.7 million.
- Backlog increased by $57.5 million, from $8.6 million in May 23, 2017 to $66.1 million in May 28, 2018.
- Selling and administrative increased by $0.5 million in the first quarter of 2018 compared to the same quarter of 2017. Intensive efforts and investments were made to support the anticipated rapid growth of the Company.
As of March 31, 2018, the Company had $1.1 million of cash on hand and its positive working capital was reduced from $1.8 million at December 31, 2017 to $0.9 million at March 31, 2018.
Current Market Conditions and Guidance for 2018
Q1/18 was influenced by working capital deficiencies and Management is actively working on resolving these issues. Management anticipates that once these issues have been overcome, revenue generation will significantly increase. In Xebec’s target markets current market conditions remain favorable allowing us to maintain our plan for increases in total revenue in 2018. Despite a weak Q1/18, we expect revenue growth for 2018 of 50% to 70% compared to 2017, leading to revenues in the range of CDN$ 22.0 to 25.0 million. Earnings per share (EPS) are expected in the range of 0.02 to 0.05.
Clean Technology – Hydrogen and Renewables
In our Cleantech segment we have made significant progress on order bookings both in North America and China. We have seen market interest for biogas upgrading plants increase significantly, especially in Italy and France, which are emerging as the largest renewable natural gas markets in the world. As previously announced we signed an agreement with an Italian company that will have a material positive impact on our future revenue growth. Consequently, we anticipate solid revenue growth in Europe in 2018. In North America we are seeing a strengthening of activities both in the U.S. and Canada. These activities could lead to significant order flow over the next few quarters. Timing of North American projects are more difficult to assess, since many projects are tender driven and therefore difficult to gage in relation to contract awards. We expect this segment to grow 80 % to 100% in 2018 compared to 2017, generating revenue of CDN$ 16 million to CDN$ 18 million.
Industrial Compressed Air and Gas Treatment
Xebec growth and acquisition strategy in the Industrial Products Segment will lead to both organic and inorganic revenue growth in 2018. The first acquisition is targeted to close in Q3/18. Xebec expects to grow this segment by 25% to 35% compared to last year, while maintaining solid gross margins. We expect revenues in the CDN $ 6.0 to 7.5 million range for 2018.
2018 First Quarter Financial Statements and Management’s Discussion and Analysis
The complete financial statements, notes to financial statements and Management’s Discussion and Analysis for the three-month period ended March 31, 2018, are available on the Company’s Website at www.xebecinc.com or on the SEDAR Website at www.sedar.com
About Xebec Adsorption Inc.
Xebec Adsorption Inc. is a global provider of gas generation, purification and filtration solutions for the industrial, energy and renewables marketplace. Its customers range from small to multi-national corporations and governments looking to reduce their carbon footprints. Headquartered in Montreal (QC), Xebec designs, engineers and manufactures innovative and transformative products, and has more than 1,500 customers worldwide. With two manufacturing facilities in Montreal and Shanghai, as well as a sales and distribution network in North America, Europe, and Asia, Xebec trades on the TSX Venture Exchange under the symbol XBC. For additional information on the company, its products and services, visit Xebec at xebecinc.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. Certain statements in this press release may constitute "forward-looking" statements within the meaning of applicable securities laws. This forward looking information includes, but is not limited to, the expectations and/or claims of management of Xebec with respect to information regarding the business, operations and financial condition of Xebec. Forward-looking information contained in this press release involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Xebec or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. This list is not exhaustive of the factors that may affect forward-looking information contained in this press release. When used in this press release, such statements use such words as "anticipate", "believe", "plan", "estimate", "expect", "intend", "may", "will" and other similar terminology. These statements reflect current expectations regarding future events and operating performance and speak only as of the date of this presentation. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements.
SOURCE: Xebec Adsorption Inc. For more information:
CONTACT: Kurt Sorschak, President and CEO, 450-979-8701 firstname.lastname@example.org