Stake Announces 2002 Year End Results; Reports Record Sales and Earnings
TORONTO--March 20, 2003--Stake Technology Ltd.
(Stake) (Nasdaq:STKL)(TSX:SOY) today announced results for the year
ended December 31, 2002. All amounts are expressed in US dollars.
The Company achieved record sales and earnings for the year ended
December 31, 2002, realizing its 21st consecutive quarter of record
sales growth. Sales in 2002 increased by 35% to $120,898,000 compared
to $89,822,000 in the prior year. These results were led by a 38%
increase in sales within the Company's vertically integrated food
operations which are focused on the natural and organic foods markets.
The Environmental Industrial Group realized a 25% increase in sales
versus 2001, primarily due to the acquisition of the operations of
Virginia Materials and International Materials in late 2001.
Net earnings for the year were a record $3,766,000 or $0.09 per
common share compared to $19,000 or $0.00 per common share in 2001.
The increase over the prior year was due to a number of factors
including significant improvements at the Nordic Aseptic packaging
operation, higher volumes and margins in dietary fiber and certain
grain and agronomy products, cost reductions throughout the
organization, the impact of the 2001 acquisition of Virginia Materials
and reduced borrowing costs as a result of the new banking
arrangements implemented in 2002.
During the fourth quarter of 2002, the Company used its strong
balance sheet to acquire Opta Food Ingredients, Inc. (Nasdaq - OPTS),
a leading developer and manufacturer of proprietary food ingredients,
headquartered in Bedford, MA., Wild West Organic Harvest Co-operative
Association, a privately held organic and natural foods distributor
based in Vancouver, British Columbia and Simply Organic Co. Ltd, a
privately held Toronto, Ontario based distributor of organic and
natural foods. These acquisitions were all competed late in the year
and consequently had a limited effect on 2002 results.
The Company continues to maintain a strong balance sheet with
working capital of $13,134,000, total assets of $115,287,000 and a
debt to equity ratio of 0.74:1. During the first quarter of 2003 the
Company refinanced the tender facility used to fund the acquisition of
Opta and as such the debt to equity ratio has been reduced to
approximately 0.55:1.
The Company has announced that it expects to achieve revenues of
$175,000,000 in 2003, an increase of 45% versus 2002. The increase is
based on a combination of continued internal growth and the impact of
the food based acquisitions completed in the fourth quarter of 2002.
Jeremy N. Kendall, Chairman and CEO of Stake Technology Ltd.,
commented that, "We are very pleased with the record results of the
past year and are confident that this will continue to improve as we
integrate our recent acquisitions and position the Company as a
dominant player in the fast growing natural and organic foods sectors.
Stake's commitment to profitable growth in these expanding food
categories should produce solid returns for our valued shareholders."
Selected financial information (Expressed in US dollars)
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December 31, December 31,
2002 2001 % Change
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Working Capital $13,134,000 $17,066,000 (23)%
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Total Assets $115,287,000 $80,061,000 44%
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Long-Term Debt $36,749,000 $16,648,000 121%
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Shareholders' Equity $49,527,000 $43,500,000 14%
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Equity per Share $1.18 $1.06 11%
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Year ended Year ended
December 31, December 31,
2002 2001 % Change
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Sales $120,898,000 $89,822,000 35%
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Gross Profit $19,467,000 $12,372,000 57%
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Operating Earnings $5,186,000 $1,230,000 322%
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Earnings Before Taxes $4,167,000 $166,000 2410%
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Net Earnings $3,766,000 $19,000 19721%
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Basic E.P.S. $0.09 $0.00 N/A
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Weighted # of Shares 41,547,302 32,220,352 29%
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EBITDA(1) $9,492,000 $5,291,000 79%
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(1) EBITDA is not a recognized measure under Canadian or United States
generally accepted accounting principles (GAAP). Management believes
that in addition to net income, EBITDA is a useful supplemental
measure as it provides investors with an indication of earnings from
our operations prior to debt service, amortization and income taxes.
Investors should be cautioned however, that EBITDA should not be
construed as an alternative to net income determined in accordance
with GAAP as an indicator of the Company's performance or to cash
flows from operating, investing and financing activities as a measure
of liquidity and cash flows. The Company's method of calculating
EBITDA may differ from other companies and, accordingly, EBITDA may
not be comparable to measures used by other companies.
Historical consolidated results have been restated using a translation
of convenience, whereby all historical results have been reflected
using the exchange rate in effect on December 31, 2001 of $1 US to
$1.5928 CDN.
Stake Technology will be holding a conference call for investors
and analysts at 10:00 am. Eastern Standard Time on Friday, March 21,
2003. Jeremy Kendall will discuss 2002 results, as well as recent
corporate developments. After opening remarks, there will be a
question and answer period. The dial in numbers are 1 (800) 946-0785
or (719) 457-2661 followed by pass code: 456591#. This conference call
will also be distributed live over CCBN's Investor Distribution
Network to both institutional and individual investors. Individual
investors may listen to the call via www.companyboardroom.com.
Institutional investors may access the call via www.streetevents.com.
Additionally, the call may be accessed via a link at the Company's
website at www.staketech.com. To listen to the live call over the
Internet please go to one of the websites at least 15 minutes early to
register, download and install any necessary audio software. A replay
number can also be accessed between March 21 and 31 with the toll fee
dial-in number (888) 203-1112 or (719) 457-0820 followed by pass code:
456591#
Stake Technology Ltd. is an owner/operator of high-growth ethical
businesses, focusing on integrated business models in the natural and
organic food markets. For the last four consecutive years, Stake was
included in Profit magazine's 'Profit 100' list of the 100 fastest
growing companies in Canada. Currently, the company has three business
units: the Food Group, which specializes in identity-preserved (IP)
grain products and natural and organic food products; from seed to
packaged product; the Environmental Industrial Group; a producer,
distributor, and recycler of industrial materials; and the Steam
Explosion Technology Group who market clean pulping technologies. Each
of these business units has proprietary products and services that
give it a solid competitive advantage in its sector.
Websites: www.staketech.com www.sunrich.com www.bei.ca
www.steamexplosion.com www.sunrichvalley.com www.organickitchen.ca
www.wildwestorganicharvest.com www.opta-food.com
Note: |
This news release may contain forward-looking information. |
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Actual future results may differ materially. The risks, uncertainties, |
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and other factors that could influence actual results are described in |
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the Company's annual report to shareholders and in SEC reports. |
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--30--KR/cl*
CONTACT: |
Stake Technology Ltd. |
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Jeremy N. Kendall, Chairman & C.E.O. |
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Steve Bromley, Executive Vice President & CFO |
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Susan Wiekenkamp, Information Officer |
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Tel: 905/455-2528, ext 103 |
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info@staketech.com |
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or |
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Investor Relations Counsel |
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The Equity Group Inc. |
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Adam Prior, 212/836-9606 |
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aprior@equityny.com |
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or |
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The Equity Group Inc. |
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Linda Latman 212/836-9609 |
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www.theequitygroup.com |
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