Wescast Industries Inc.

Wescast Industries Inc.

October 28, 2009 14:28 ET

Wescast Reports Third Quarter Results

BRANTFORD, ONTARIO--(Marketwire - Oct. 28, 2009) - Wescast Industries Inc. (TSX:WCS.A) today reported 2009 third quarter sales of $52.2 million and a net loss of $6.1 million.

(In thousands of Canadian dollars, except per Three Months Ended Nine Months Ended
share amounts)        
  Sept 27, 2009Sept 28, 2008 Sept 27, 2009Sept 28, 2008
Sales 52,15569,923 144,311239,761
Gross profit (loss) 1,087(3,547) (1,943)7,462
Net loss (6,092)(9,824) (24,043)(15,015)
Diluted net loss per share (0.46)(0.75) (1.82)(1.14)
Cash applied to operations (8,466)(2,636) (4,788)(10,605)
 •The Company reported consolidated sales of $52.2 million, a decline of 25.4% compared to the $69.9 million reported in the third quarter of 2008, reflecting much lower sales generated by the Company's North American and European operations. The level of sales generated in North America and Europe was significantly impacted by the continuing recession. The Company's primary North American customer base, the Detroit 3 automakers, experienced a 23.8% decline in light vehicle production in the third quarter of 2009 compared to the same period of 2008.
 •The Company reported a net loss of $6.1 million for the quarter compared with a net loss of $9.8 million reported in the third quarter of 2008. Excluding the restructuring charge of $2.6 million which was recorded in the third quarter of 2008, the Company still reported improved results in the third quarter of 2009 compared to 2008 even though casting and machining volumes were significantly lower. Reduced fixed costs, due to the various restructuring activities that have occurred, and lower raw material costs had a significant positive impact on the financial results during the quarter.
 •The third quarter net loss per share on a diluted basis was $0.46, compared with a net loss per share of $0.75 reported in the third quarter of 2008.

The Company's entire quarterly financial statements and Management's Discussion and Analysis will be available at www.sedar.com by the start of business on October 29, 2009.

About Wescast

Wescast Industries Inc. is the world's leading supplier of cast iron exhaust manifolds for passenger cars and light trucks. The Company designs, casts, machines and assembles exhaust system components for automotive original equipment manufacturers ("OEMs") and Tier 1 customers for the car and light truck markets in North America, Europe and Asia. The Company employs approximately 1,625 people in 7 production facilities and 5 sales and design centres in Canada, Hungary, the United States, Germany, Japan and China. The Company also has sales and technical design representation in the United Kingdom and France. The Company is recognized worldwide for its quality products, innovative design solutions and highly committed workforce.

Learn more at www.wescast.com.

Forward Looking Statements

The contents of this news release contain statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking statements based on certain assumptions. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Persons reading this news release are cautioned that such information may not be appropriate for other purposes. Such forward-looking statements may include financial and other projections as well as statements regarding Wescast's future plans, objectives or performance for the current period and subsequent periods and regarding the markets for our products. The words "may", "would", "could", "will", "likely", "expect", "anticipate", "estimate", "intend", "plan", "forecast", "project" and "believe" or other similar words and phrases are intended to identify forward-looking statements. Persons reading this news release are cautioned that such statements are only predictions, and that Wescast's actual future results or performance may be materially different.

This information is based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking statements, including our perception of historical trends, current conditions and expected future developments as well as other factors we believe are appropriate in the circumstances.

Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties principally relate to the risks associated with the automotive industry and include, but are not limited to: our operating and/or financial performance, including the effect of new accounting standards on our reported financial results, fluctuations in interest rates, changes in consumer and business confidence levels, consumers' personal debt levels, vehicle prices, the extent and nature of purchasing or leasing incentive campaigns offered by automotive manufacturers, environmental emission regulations, fuel prices and availability, the continuation and extent of outsourcing by automotive manufacturers, changes in raw material and other input costs, our ability to continue to meet customer specifications relating to product performance, cost, quality, delivery and service, industry cyclicality or seasonality, trade and/or labour issues or disruptions, customer pricing pressures, pricing concessions and cost absorptions, actual levels of program production volumes by our customers compared to original expectations, including program cancellations or delays, price reduction pressures, dependence on certain engine programs and the market success and consumer acceptance of the vehicles into which such powertrain products are installed, our relationship with and dependence on certain customers, currency exposure, failures in implementing Wescast's strategy, technological developments by Wescast's competitors, government and regulatory policies and changes in the competitive environment in which Wescast operates.

Wescast does not undertake any obligation to update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by law.

Contact Information

  • Wescast Industries Inc.
    Mr. Edward G. Frackowiak
    Chairman and Chief Executive Officer
    (519) 750-0000