Lakeside Announces Fiscal 2012 Third Quarter Results
02/28/2012 - Lakeside Steel Inc. recorded a net loss of $9,160,125 on revenue of $58,085,702 for the third quarter ended December 31, 2011 (Q3-2012), and a net loss of $17,854,604 on revenue of revenue of $158,884,734 for the first nine months of 2011.
Lakeside Steel Inc. recorded a net loss of $9,160,125 on revenue of $58,085,702 for the third quarter ended December 31, 2011 (Q3-2012), and a net loss of $17,854,604 on revenue of revenue of $158,884,734 for the first nine months of 2011.
Third Quarter Results — The net loss of $9,160,125 represents an $8,958,786 decrease from a net loss of $201,339 for Q3-2011. On a per-share basis, the Company reported a loss of $0.05, compared to a net loss of $0.00 per share for Q3-2011. Revenue of $58,085,702 represents an increase of $4,265,455 (7.9%) from revenue of $53,820,247 for the year-ago fiscal third quarter (Q3-2011).
Adjusted EBITDA was ($7,680,696), a decrease of $9,628,361 from adjusted EBITDA of $1,947,665 for Q3 2011.
Nine-Month Results — The company’s YTD net loss of $17,854,604 represents a decrease of $18,045,174 from net income of $190,570 for YTD 2011. On a per-share basis, the company reported a loss of $0.10 per share for YTD 2012, compared to earnings of $0.00 per share for YTD 2011. Revenue of $158,884,734 represents a decrease of $23,624,237 (12.9%) from revenue of $182,508,971 for the comparable year-ago period.
Adjusted EBITDA was ($13,970,825), which represents a decrease of $20,122,845 from adjusted EBITDA of $6,152,020 for YTD 2011.
The company noted that during fiscal 2012, customer demand for oil country tubular goods ("OCTG") shifted from plain end pipe to thermally treated end finished products. As a result, customer demand substantially exceeded available capacity among third-party thermal treatment and end-finishing processors, leading to extended wait times.
Milestones— In Alabama, the company's new casing mill began production in December 2011. The casing mill has an estimated annual capacity of 192,000 tons.
The company also completed in January its thermal treatment and end finishing facility, which has an estimated annual capacity of 67,000 tons of thermal treatment and 55,000 tons of end finishing capacity for tubing products. The thermal treatment and end finishing facility for casing products, with an estimated annual capacity of 150,000 tons of thermal treatment and 110,000 tons of end finishing for casing products, will be completed in June 2012.
On January 25, 2012, the company and JMC Steel Group, Inc. announced they had entered into an agreement under which JMC Steel has agreed to acquire all of the issued and outstanding common shares of Lakeside at a price of $0.2983 per share in cash pursuant to a statutory plan of arrangement under the Business Corporations Act (Ontario).
Lakeside isa diversified steel pipe and tubing manufacturer with a focus on manufacturing and upgrading Oil Country Tubular Goods. Lakeside, the parent company of Lakeside Steel Corp., Lakeside Steel Alabama Inc., and Lakeside Steel Texas Inc., has operating facilities in Welland, Ont., and Corpus Christi, Texas, and three facilities currently being constructed in Thomasville, Alabama. Lakeside Lakeside's list of customers includes large oil and gas end users as well as distributors across North America.
Lakeside Steel Alabama will be a diversified steel pipe manufacturer with thermal treatment and end-finishing capabilities strategically situated in the southern United States on successful completion of construction of the new facilities in Thomasville, Ala.
