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Message: MagIndustries Corp. Reports Q1 Financial Results
| June 1, 2009 |
| MagIndustries Corp. Reports Q1 Financial Results |
| TORONTO, CANADA--(Marketwire - June 1, 2009) - MagIndustries Corp. (TSX VENTURE:MAA) ("MagIndustries" or the "Company") is pleased to provide shareholders with its financial results and an update on corporate developments for the period ended March 31, 2009. During the first quarter of 2009 MagMinerals, the Company's potash division, signed a gas supply agreement for the Kouilou potash project. The agreement represented the last significant cornerstone contract required for the full development of the project. The contracted supply of gas is sourced from EniCongo S.A. which operates the on-shore M'boundi oil field. EniCongo will supply the gas requirements for the project from its treatment plant to be located at Djeno, 25km southwest of the potash plant site. Additional gas quantities will also be made available to support the project's back-up power facilities if electricity supplies fail. The management discussion and analysis and financial statements can be viewed on SEDAR at www.sedar.com, and shareholders or interested parties are encouraged to review the complete financial statements for further details. A summary of key financial results for the year follows (expressed in US dollars unless otherwise stated). Financial results MagIndustries recorded total revenue of $6.7 million and held cash and cash equivalents of $70.3 million at March 31, 2009. Net earnings were negative $10.7 million for the quarter, compared to negative $6.7 million for the same period in 2008. The lower net earnings are largely due to: - Non-cash stock based compensation expense of $4.9 million relating to the fair value of the stock options vested during the period. - the appreciation of the US dollar relative to the Euro and Canadian dollar which negatively affected earnings by $1.5 million; - Lower revenue and operating profit from a deferral of a shipment of wood chips during the quarter; - Higher depreciation and amortization costs resulting from the construction of the chip plant which achieved commercial production in the fourth quarter of 2008; and - Interest of $0.9 million which was expensed during the quarter, whereas it was capitalized in the cost of construction of the chip mill in the prior year. Going forward In 2009, the Company plans on continuing to advance and develop its Kouilou potash project. To finance the necessary expenditures for this development, the Company is expecting to utilize cash on-hand, equity, debt financing and joint venture participation, or a combination thereof, depending upon prevailing market conditions at the time. The potash plant is projected to produce potash fertilizers principally to supply growing agricultural demand in South America, South Africa and other parts of the world. About MagIndustries Corp. MagIndustries Corp. is a Canadian company whose common shares are listed on the TSX-V Exchange and trades in Canadian currency under the symbol "MAA". The Company has approximately 288,079,962 shares outstanding on an undiluted basis. MagIndustries' resource subsidiaries are operating and developing major industrial projects in the Republic of Congo and the Democratic Republic of Congo. Except for historical information, this press release contains forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties, which may cause actual results to differ materially from those statements. Those risks and uncertainties include, but are not limited to, changing market conditions, and other risks detailed from time-to-time in the Company's ongoing filings. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in this press release might not occur. |
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