Semcan Inc.
TSX VENTURE : STT

Semcan Inc.

March 03, 2011 19:00 ET

Semcan Inc. Announces Preliminary 2010 Financial Results

TORONTO, ONTARIO--(Marketwire - March 3, 2011) - Semcan Inc. (TSX VENTURE:STT) ("Semcan or the "Company") today announced its preliminary financial results for the year ended December 31, 2010, subject to completion of the annual audit.

The Company expects to report 2010 revenues from continuing operations in the range of $12.8 million to $13.3 million. The net loss after taxes from continuing operations is anticipated to be in the range of $8,700,000 to $9,100,000, including special charges of $7,000,000 to $7,200,000 relating to impairment of goodwill and intangible assets, and costs arising from the expiry of the merger agreement with Group DKG Corp. The non-GAAP adjusted EBITDA loss from continuing operations (excluding the special charges) is anticipated to be in the range of $1,500,000 to $1,700,000. The Company's working capital deficit at December 31, 2010 is in excess of $8,500,000.

The Company expects to release its audited financial statements and MD&A in early April, 2011. The filing deadline for these documents is May 2, 2011.

The Company is in the latter stages of attaining further financing by way of a transaction which, if successful, is anticipated to close in early April. Funding of approximately $2 million is being sought through a private placement of debt with accredited investors, which will be subject to, among other things, shareholder and regulatory approval. Final details of the new financing are being negotiated, and the terms will be announced shortly.

About Semcan Inc.

Semcan is a North American supplier of industrial processes and environmental solutions with specific emphasis on water remediation and emission control systems.

Caution Regarding Forward-Looking Information and Non-GAAP Measures Forward-Looking Information

This news release contains certain forward-looking statements. These statements relate to future events or future performance and reflect management's current expectations and assumptions regarding the growth, results of operations, performance, and business prospects and opportunities. Such forward-looking statements reflect management's current beliefs and expectations and are based on information currently available to management of Semcan. In particular, statements regarding the future operating results and economic performance are forward-looking statements.

Forward-looking statements involve significant risks and uncertainties. A number of factors could cause actual events or results to differ materially from the events and results discussed in the forward-looking statements, including risks outlined under "Risk Factors" in our Annual Information Form, which is posted at www.sedar.com. In evaluating these statements, investors should specifically consider various factors, including such risks as Investment Risk; Business Valuations; Condition of Capital Markets; Dependence on Key Personnel; General Economic Factors; Interest Rate Risk; Competition; and Reliance on Key Suppliers. One or more of these "Risk Factors" could cause actual events or results to differ materially from any forward-looking statement. These factors should not be considered exhaustive. Specifically, the Company's expectation to agree and conclude future financing is subject to risks including settling satisfactory terms and obtaining shareholder approval and other 3rd party consents. Although the forward-looking statements contained in this press release are based on what management of Semcan considers to be reasonable assumptions based on information currently available to them, there can be no assurance that actual events or results will be consistent with these forward-looking statements, and management's assumptions may prove to be incorrect. These forward-looking statements are made as of the date of this press release, and none of Semcan nor its directors assume any obligation to update or revise them to reflect new events or circumstances. Undue reliance should not be placed on forward-looking statements.

Non-GAAP Measures

The term "Adjusted EBITDA" is a financial measure used in this document which is not a standard measure under Canadian generally accepted accounting principles. Semcan's method of calculating Adjusted EBITDA may differ from the methods used by other issuers. Therefore, Semcan's measure of Adjusted EBITDA, as presented in this press release, may not be comparable to similar measures presented by other issuers. Adjusted EBITDA refers to net earnings determined in accordance with generally accepted accounting principles, before depreciation, amortization of intangible assets, gain or loss on disposal of property and equipment, interest expense, special charges, stock compensation expense and income tax expense. Management believes that Adjusted EBITDA is a useful supplemental measure of cash available for debt service, working capital, capital expenditures, income taxes, and distribution. Investors are cautioned that Adjusted EBITDA, as a non-GAAP measure, is not an alternative to measures under GAAP and should not, on its own, be construed as an indicator of performance or cash flows, a measure of liquidity or as a measure of actual return.

Neither the 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.

Contact Information

  • Semcan Inc.
    Phil Jamieson
    Chairman
    (905) 875-5577