US: Village Farms announces 2011 results
Year Ended December 31, 2011 Operating Results Summary:
Revenues increased 14% to $164.4 million compared to revenues of $144.8 million for the year ended December 31, 2010;
Earnings per share increased 36% to $0.15 versus $0.11 for the year ended December 31, 2010;
Net income increased 35% or $1.5 million to $5.8 million versus $4.3 million for the year ended December 31, 2010;
EBITDA increased 4% to $15.7 million versus $15.1 million for the year ended December 31, 2010.
Michael A. DeGiglio, Chief Executive Officer, stated "The Company's 2011 key financial results improved over our 2010 financial results with improvements in both revenue and profit. The 2011 full year results included incremental overhead costs to support future growth initiatives. If not for these costs our EBITDA increase would have been stronger. Fourth quarter profit contribution did not meet internal expectations which impacted what would have been an even better financial outcome due to the continued sluggish U.S. economy coupled with fourth quarter pricing pressure in our core tomato varieties from increasing Mexican and Central American supplies including non-greenhouse grown Mexican product labeled as "greenhouse grown".
Throughout 2011 we accomplished several planned key and significant corporate initiatives that bode well for our future operations and results. The most significant objective being the successful completion of phase one of our GATESTM technology greenhouse located in Monahans, Texas in late December 2012. We have commenced harvesting product in half of the facility with the other half commencing in ten days. We believe this greenhouse is the most advanced, productive and environmentally sustainable greenhouse ever built in North America and is a material advancement in production cost reduction and fulfils marketplace demands of retailers and consumers for local/regional supply. As with any construction project, we are still completing the final items, but overall from start to finish we have successfully completed a huge project in a record breaking period of time."
Fourth Quarter 2011 Operating Results Summary:
(Amounts in U.S. dollars)
Revenues increased 10% to $34.7 million compared to fourth quarter 2010 revenues of $31.7 million;
Earnings per share of $0.03 in both the fourth quarters of 2011 and 2010;
Net income was essentially flat at $1.0 million versus $1.0 million for the fourth quarter of 2010;
EBITDA increased 33% to $0.8 million versus $0.6 million in the fourth quarter of 2010.
Income (Loss) from Operations
Income from operations for the quarter ended December 31, 2011, increased by $1,827, to $1,656 from a loss of ($171) for the quarter ended December 31, 2010. The increase was the result of the net change in biological asset value of $1,771 as well as a small increase in gross profit.
Interest Expense
Interest expense, for the three month period ended December 31, 2011 increased $116 to $816 from $700 for the three month period ended December 31, 2010. The increase is due to an increase in the Company's borrowing balance on its new term loans.
Other Income
Other income for the quarter ended December 31, 2011, increased $62 to $361 from $299 for the quarter ended December 31, 2010. The increase was primarily due to the gain on derivative of $105 in the three months ended December 31, 2011.
Income Taxes
Income tax expense for the three month period ended December 31, 2011 was $228 compared to a recovery of ($1,573) for the three month period ended December 31, 2010, due to higher income from operations and the 2010 expense was reduced by the reversal of an U.S tax reserve originally created for a prior year tax loss carry-forward claim that closed.
Net Income (Loss)
Net income for the quarter ended December 31, 2011 decreased by $28, to $973 from a net income of $1,001 for the quarter ended December 31, 2010. The decrease was the result of an increase in the provision for income taxes of $1,801 offset by a combination of the increase in the change in biological asset value of $1,771 and a gain on derivative of $105 for the three months ended December 31, 2011.
EBITDA
EBITDA for the three month period ended December 31, 2011 increased $218 to $804 from $586 for the three month period ended December 31, 2010, as a result of higher revenue partially offset by an increase in cost of sales as a result of higher volumes. See the EBITDA calculation in "Non-IFRS Measures - Reconciliation of Net Earnings to EBITDA."
Non-IFRS Measures
EBITDA is not a recognized measure and does not have standardized meaning under International Financial Reporting Standards. Accordingly, this measure may not be comparable to similar measures presented by other issuers. Please refer to the Company's Management's Discussion and Analysis for the twelve months and quarter ended December 31, 2011, which will be available at www.sedar.com, for additional information concerning EBITDA and a reconciliation of EBITDA to net income and operating cash flows, for the periods presented.
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