Invesprint Corporation Announces Sale of Surplus Land and Q2 Results
Press release from the issuing company
TORONTO, ONTARIO -- Invesprint Corporation today announced the sale of surplus land together with its results for the second quarter ended October 31, 2004.
The sale of approximately four acres of surplus land adjacent to the Company's manufacturing plant in St-Hubert, Quebec yielded gross proceeds of $340,000 which will be used for general working capital purposes. On December 10, 2004, the Company announced that its subsidiary, Jonergin Pacific, Inc. ("Jonergin Pacific") had ceased operations and had reached a full and final settlement with all of its secured lenders. In addition, the Company was fully released from its guarantee obligations to these lenders. The Company is now better able to seek additional financing to strengthen the financial position of the Company.
Sales for the second quarter of fiscal 2005 were $5.4 million compared to $5.7 million in the second quarter of fiscal 2004. Sales for the six months ended October 31, 2004 were $10.9 million compared to $12.5 million in the same period last year. The lower level of sales in fiscal 2005 reflects the very competitive environment in which the Company continues to operate. Consolidated gross margin expressed as a percentage of sales was 5.1% in the second quarter this year compared to 3.0% in the same period last year. Gross margin for Jonergin Pacific was negative 11.9% during the second quarter. The overall improvement in consolidated gross margin reflects the cost reduction programs which began in fiscal 2004, partially offset by a downward revaluation of Jonergin Pacific's inventory in the amount of $100,000. In addition, unutilized capacity at both locations adversely impacted margins. Selling, general and administrative expenses were 23% lower than in the second quarter la
st year reflecting the lower level of sales and a concerted effort to reduce costs in all expense categories. Year to date, selling, general and administrative expenses were 38% lower than in the first six months of fiscal 2004. Administrative expenses for the first half of fiscal 2004 include severance expense of $74,000 related to the closing of the corporate office in Toronto.
The loss from continuing operations before interest expense and income taxes for the second quarter was $832,000, compared to a loss of $1,271,000 for the second quarter last year. For the six months ended October 31, 2004 the loss from continuing operations before interest expense and income taxes was $1,033,000 compared to a loss of $2,516,000 in the same period last year.
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