WINDSOR, ONTARIO — (Marketwire) — 10/07/11 — Reko International Group Inc. (TSX VENTURE: REK) today announced results for the quarter and year ended July 31, 2011.
Financial Highlights (complete statements follow):
Consolidated sales for the quarter ended July 31, 2011, were $11.5 million, compared to $12.7 million in the prior year, a decrease of $1.3 million or 10.2%. The decrease in sales in the quarter relates primarily to a busier than normal quarter in the prior year. Consolidated sales for the year ended July 31, 2011 were $41,078, compared to $40,151 in the prior year, an increase of 2.3%.
The gross profit earned in the three months ended July 31, 2011, was $0.9 million, or 7.8% of sales, compared to a gross loss of $0.0 million in the prior year. The increase in gross profit for the quarter relates primarily to an improvement in product mix, combined with reduced overhead costs at our tool building facilities. The gross profit for the year ended July 31, 2011 was $2.4 million, or 5.9% of sales, compared to a gross loss of $1.0 million, or 2.5% of sales. The increased level of profitability can be attributed to the above-mentioned improvement in product mix and the increase in sales.
Selling and administrative expenses for the three months ended July 31, 2011 were $1.3 million, or 11.3% of sales, compared to $1.6 million or 12.6% of sales in the prior year. The decrease in selling and administrative expenses in the quarter relates primarily to changes announced as part of our business transformation project. Selling and administrative expenses for the year ended July 31, 2011 were $5.9 million or 14.3%, compared to $6.0 million, or 14.9% of sales, in the prior year, a 1.7% decline.
Adjusted net loss for the quarter was $0.6 million or $0.10 per share, compared to $2.2 million, or $0.33 per share in the prior year. Adjusted net loss for the year was $4.2 million, or $0.65 per share, compared to $7.5 million, or $1.16 per share, in the prior year. The adjusted net loss excludes pre-tax expenses associated with Reko-s business transformation, which are considered non-operating in nature.
Net loss for the quarter was $0.7 million or $0.11 per share, compared to $2.2 million, or $0.33 per share in the same period of the prior year. Net loss for the year was $9.9 million, or $1.55 per share, compared to $7.5 million, or $1.16 per share, in the prior year.
„I am pleased with the improvement in operating results over the last five quarters,“ said Diane Reko, Chief Executive Officer. „We are seeing a recovery of the capital equipment market and its impact upon our business. This recovery, in combination with our business transformation project, should position Reko to enjoy an improved fiscal 2012.“
Founded in 1976, Reko International Group (TSX VENTURE: REK) is a manufacturing firm providing high precision machining of very large parts, as well as tooling and automated solutions for the transportation, energy, automotive, aerospace and consumer product markets, all delivered through its two production facilities in Ontario.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts: Reko International Group Inc. Carl A. Merton Chief Financial Officer (519) 727-3287
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