Lakeside Steel announces second quarterresults
ANNOUNCES COMPLETION OF UPSETTING, THREADING, AND COUPLING LINE
ANNOUNCES EXPANDED SALES TEAM
WELLAND, ON, Nov. 12/CNW/ - Lakeside Steel Inc. (TSX-V: LS) ("Lakeside Steel" or the "Company")today reported results for the second quarter ended September 30,2009. For the three months ended September 30, 2009, theCompany's revenue was $17,812,672, which is a decline of$40,732,295 or 69.6% compared to revenue of$58,544,967 for the 3 months ended September 30,2008. The Company's net loss for the three months ended September30, 2009 was $3,021,570, a decline of$5,774,498 from net income of $2,752,928 for thethree months ended September 30, 2008. The Company had a loss pershare of
.05 for the three months ended September 30,2009, compared to earnings per share of
.04 for thethree months ended September 30, 2008.
The Company's EBITDA was($4,519,240) for the three months ended September 30,2009, a decline of $9,503,538 from EBITDA of$4,984,298 for the 3 months ended September 30,2008. Despite these losses, the Company has been able to maintainpositive cash flows of $5,040,180 in the three months endedSeptember 30, 2009 and $4,254,936 for the 6 monthsended September 30, 2009.
Demand in the oil and gas sectorfor the Oil Country Tubular Goods manufactured by Lakeside Steel Corporation("Lakeside"), Lakeside Steel's wholly-owned subsidiary, has experienced asubstantial reduction, as reflected in the performance above. Managementbelieves that this trend will continue into the third quarter of fiscal 2010,but is seeing an increase in orders from Western Canada inOCTG products, and as a result is planning to add an additional shift in itsproduction facilities starting January 2010.
Lakeside has completed theinstallation of its upsetting, threading, and coupling equipment along with theinstallation of its three slip rail yard. Upon completion of its APIcertification, Lakeside will be in a position to end finish its own products(upset, thread and coupled) and then ship the finished product directly to itscustomers via rail. Currently, this work is being outsourced to a processorTexas. This will reduce the lead time to customers and working capitalrequirements going forward.
Management is pleased to announcethe addition of Mark McMurray as General Manager of Sales & Procurement,Dan Jovanovicas Sales Representative, and 3 Sales Analysts toincrease Lakeside's exposure in the marketplace and provide its customers withenhanced customer service.
Lakeside is implementing a plan todispose of its PCB waste prior to its fiscal year end at March 31,2009, and eliminate the related environmental liability on its balancesheet. As a result of this plan, and latest estimates, the Company reduced itsenvironmental liability by $1,400,000 to $6,600,000 for theperiod ended September 30, 2009.