Atrium Innovations Inc. (TSX: ATB), a globally recognized leader in the development, manufacturing, and commercialization of innovative, science-based dietary supplements endorsed by health professionals, today released its 2011 third quarter results for the period ended September 30, 2011.
Third Quarter Highlights:
(All amounts are in US dollars.)
- Revenue growth of 9.1% over previous year to reach $97.0 million
- EBITDA of $22.4 million or 23.1% of revenues, an increase of 5.6% compared to last year
- Diluted EPS of $0.41 for the quarter, an increase of 8% over last year
- Cash flow before working capital was up 12% to $19.2 million
- Closing of CAN$100 million of convertible debentures
- Vertical acquisition of Enzimas SA well in progress
"Our branded organic growth was 3.5% for the quarter, when adjusted for the shipment lag to our distributor in Eastern Europe. This organic growth was affected by the completion of our repositioning of our Direct to Consumer business which should allow us to report higher global branded organic growth in the future. We are satisfied with our sequential improvement in the EBITDA margin which should continue to improve throughout 2012 in each segments, as we complete our various improvement programs including our Pittsburgh manufacturing facility," said Pierre Fitzgibbon, President and Chief Executive Officer.
"With the appointment of Mr. Hannema, the new management structure will allow us to solidify our foundation and thoroughly implement our operating efficiencies and synergies. We now have the operating platform to generate strong results and confirm our leadership position in the industry and we will continue our acquisition program on a selective basis,'' concluded Mr. Fitzgibbon.
For the quarter ended September 30, 2011, Atrium recorded revenues of $97.0 million representing an increase of 9.1% compared to revenues of $88.9 million in 2010. This increase is mainly attributable to the acquisitions of Seroyal and Minami.
EBITDA increased by 5.6% to $22.4 million, or 23.1% of revenues, compared to $21.2 million, or 23.8% of revenues, for the same period in 2010. The acquisitions of Seroyal and Minami contributed to the increase in EBITDA.
Net earnings attributable to shareholders were $13.4 million in 2011 compared to $12.7 million in 2010, representing an increase of 5.4%. Net earnings per share ("EPS") on a diluted basis rose to $0.41 per share, as compared to $0.38 per share for the same period in 2010.
Cash flows from operating activities before changes in non-cash working capital items were $19.2 million compared to $17.1 million in 2010. As at September 30, 2011, the Company had a total debt of $190.8 million and a cash position of $13.7 million. During this quarter, the Company announced the closing of a convertible debenture public offering of CAN$75 million and a concurrent private placement of CAN$25 million. The net proceeds were used to reduce the Company's outstanding indebtedness.
New Management Structure Completed
Recently, Paul Hannema was appointed to the position of Executive Vice President, Head of European Operations. Mr. Hannema has been President and Chief Executive Officer of MCO Health since June 2010 and will continue to hold that position. Other key changes to the executive team include the addition at the corporate level of David Torralbo as Vice President, Corporate and Legal Affairs, and Annie Blanchette as Vice President, Human Resources, a new position at Atrium. With these appointments, the new management structure, initiated at the beginning of 2011 was completed. The Atrium Executive Committee is now comprised of the following individuals:
- Pierre Fitzgibbon, President and CEO
- Carmen Fortino, President, North American Operations
- Paul Hannema, Executive Vice President, Head of European Operations
- Annie Blanchette, Vice President, Human Resources
- Mario Paradis, Vice President and CFO
- Barry W. Ritz, Vice President, Scientific and Regulatory Affairs
- David Torralbo, Vice President, Corporate and Legal Affairs
- Serge Yelle, Executive Vice President, Strategy and Business Development
Renewed NCIB Program
The Company also announced today that it has filed with the Toronto Stock Exchange ("TSX"), and the TSX has accepted, a Notice of Intention to make a Normal Course Issuer Bid. Under its normal course issuer bid, Atrium intends to purchase up to 813,970 of its common shares, representing approximately 2.5% of the 32,558,816 common shares issued and outstanding as of October 31, 2011. The average daily trading volume for the 6-month period preceding October 31, 2011 represents 31,531 common shares. In accordance with the TSX requirements, a maximum daily purchase of the greater of 25% of this average or 1,000 shares may be made, which represents a total of 7,882 common shares.
Purchases will be made on the open market by Atrium through the facilities of the TSX. The purchases may commence on November 15, 2011 and will terminate on November 14, 2012, or on such earlier date as Atrium will have completed its purchases pursuant to the Notice of Intention to make a Normal Course Issuer Bid filed with the TSX. Atrium will cancel any common shares purchased pursuant to the normal course issuer bid. Atrium will pay the market price of common shares on the TSX at the time of purchase and no purchases of common shares will be made other than open-market purchases.
Under its previous normal course issuer bid which was announced on November 10, 2010, Atrium repurchased a total of 386,524 common shares as at October 31, 2011 at the weighted average price per share of $14.5620.
Atrium considers that repurchasing its common shares is a sound business and financial decision as shares in circulation will be reduced and the proportionate interest of all remaining shareholders in the share capital of Atrium will be increased on a pro rata basis.
No appraisal or valuation regarding Atrium, its material assets or securities was prepared within the two years preceding the date of the Notice of Intention to make a Normal Course Issuer Bid.
Atrium Innovations Inc. is a globally recognized leader in the development, manufacturing, and commercialization of innovative, science-based dietary supplements endorsed by health professionals. The Company distributes its extensive portfolio of products mainly in the healthcare practitioner and health food and specialized store channels, with a primary focus in North America and Europe. Atrium is at the forefront of science, innovation and education in the dietary supplement industry. The Company has over 1,100 employees and operates eight manufacturing facilities.