Semcan Inc.
TSX VENTURE : STT

Semcan Inc.

November 30, 2010 15:02 ET

Semcan Inc. Reports Quarter Ended 30th September 2010 Financial Results

TORONTO, ONTARIO--(Marketwire - Nov. 30, 2010) - Semcan Inc. (TSX VENTURE:STT) ("Semcan" or the "Company") today reported financial results for its quarter ended 30th September 2010.

"During the first ten months of 2010 we received approximately $20.9 million of new orders, compared with approximately $17.6 million for all of 2009. Our backlog has improved from $6.7 million at 31st March 2010 to approximately $17.5 million at 31st October 2010. The operating results for Q3 2010 reflect the lag between securing this new work and beginning to execute it, which means that our revenues will remain relatively flat until 2011," said Phil Jamieson, Chairman & CEO. "We continue to see increased activity in the Mining sector of our markets due to the increased demand globally for metals to support the economic recovery." 

Continuing Operations

Revenues for the quarter were $3.6 million, compared with $7.2 million in Q3 2009. The net loss from continuing operations was $0.6 million, compared to a net loss of $0.05 million in Q3 2009. Non-GAAP adjusted EBITDA for the quarter was ($0.310) million, compared to $0.553 million for Q3 2009. Adjusted gross margins were 16.72% compared to 28.52% in Q3 2009.

Discontinued Operations

Revenues for the quarter were $0.021 million. Net loss from discontinued operations was $nil. Non-GAAP adjusted EBITDA was $nil. Comparatives to 2009 are not meaningful as the only discontinued operation in 2010 is Naston Limited, whereas in 2009 two other companies were classified this way and were subsequently sold. The Company's interest in Naston was sold on 15th July 2010, and the results for the quarter are for the period 1st July 2010 to 15th July 2010.

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. 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.

The term "backlog" 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 backlog may differ from the methods used by other issuers. Therefore, Semcan's measure of backlog, as presented in this press release, may not be comparable to similar measures presented by other issuers. Backlog is the value of revenue remaining to be earned from purchase orders received from customers. The projects represented in backlog are executed according to a schedule agreed with each customer, which could range in duration from one month to eighteen months. Revenues are earned on a percentage of completion basis. Management uses this measure to i) monitor the Company's success in securing new orders, and ii) gauge the likelihood of meeting revenue objectives in future periods.

Investors are cautioned that backlog, 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.

The TSX Venture Exchange has neither approved nor disapproved the contents of this press release.

Contact Information

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