News
Avcorp announces second quarter results
August 19, 2010, Vancouver - Avcorp announced on Friday its financial results for the quarter ended June 30, 2010.
August 19, 2010 By Carey Fredericks
During the quarter ended June 30, 2010, the Company recorded a loss from
operations of $1,991,000 on $18,710,000 revenue, as compared to$552,000
income from operations on $16,172,000 revenue for the same quarter of
the preceding year; and a net loss for the current quarter of$2,297,000
as compared to a net income of $65,000 for the quarter ended June 30,
2009.
It should be noted that the current quarter loss includes a $285,000
foreign exchange gain, while income for the quarter ended June 30,
2009included a $3,962,000 foreign exchange gain which occurred as a
result of holding foreign-currency-denominated receivables, payables and
debt.
The Company has realized the expected revenue growth in 2010 from full
rate production of the Boeing Defense Space & Security CH47
helicopter and the Cessna Citation CJ4 business jet; both programs were
in start-up phase for the Company in 2009. Additionally, the Company
will experience moderate revenue growth during the second half of 2010
as a result of program re-starts and production rate increases. The
previously announced signing of an agreement with BAE Systems Operations
Ltd. for the production of the F35 CV-OBW will further increase
revenues in 2011.
Cash flows from operating activities during the current quarter utilized
$1,042,000 of cash, as compared to providing $2,272,000 of cash during
the quarter ended June 30, 2009. The Company has a working capital
surplus of $2,130,000 as at June 30, 2010 (December 31, 2009:$820,000
surplus) and an accumulated deficit of $70,381,000 at June 30, 2010
(December 31, 2009: $65,379,000).
As at June 30, 2010, the Company was not in compliance with financial
covenants associated with its operating lines of credit. The lender had
agreed to forbear from demanding payment of the indebtedness and from
taking steps to enforce the security, subject to the Company complying
with terms and conditions of a Forbearance Agreement which ends on
October 15, 2010. Also, as at June 30, 2010, the Company was not in
compliance with a financial covenant associated with the convertible
debenture held by Export Development Canada. The Company has obtained a
waiver from the debenture holder for this non-compliance.
