IBC Advanced Alloys Reports Fiscal 2015 Results

IBC Advanced Alloys Corporation (Vancouver, BC) has released their financial results for the year ended June 30, 2015. For detailed information about their year-end results, please read the company’s financial statements and management discussion and analysis by clicking here.

Fiscal Year Highlights

• Revenue of $17.8 million, representing a 5 percent increase over 2014.
• Copper Alloys revenue of $15.1 million, up 0.9 percent over the comparative period.
• Engineered Materials revenue of $2.7 million, an increase of 48 percent over 2014.
• Loss for the period was $2.8 million, representing a 1.4 percent improvement compared to the same period in the previous fiscal year.

Fourth Quarter Highlights

• Revenue of $3.6 million, representing 17 percent decrease over the same period in the previous fiscal year.
• Copper Alloys revenue of $3.0 million, down 15 percent over the comparative period.
• Engineered Materials revenue of $541,000, a decrease of 30 percent over the comparative fiscal period.
• Loss for the quarter was $996,000, up 26 percent from the comparative period.

Commentary and Corporate Update
The annual results, which show a modest increase in sales and a substantially unchanged loss, hid two general trends in IBC operations: Engineered Materials divisional activity increased with the commencement of F-35 component production and Copper Alloys sales softened as a result of declining copper prices, a much weaker oil and gas sector and a general softening in other key markets. While F-35 component production ramped up in the period, very little contract revenue was recognized in the fiscal year due to the time required for machining the castings. As a result, IBC will see most of the benefit of its fiscal 2015 F-35 production in fiscal 2016 operating results.

Anthony Dutton, the chief executive officer of IBC, commented, “In the fourth quarter, we continued to ramp up production of F-35 components. After our year end, in July 2015, we continued deliveries of components to Lockheed Martin from our first contract. Shortly afterwards, in October 2015, we made our first deliveries under the second contract. The delivery times have decreased significantly as the company is no longer managing the machining process; this change will expedite collection of sales proceeds by several months with a beneficial effect on our financial liquidity.”

“As a result, we are encouraged that Engineered Materials financial results will improve significantly over the course of the first quarters of fiscal 2016,” continued Dutton. “The Copper side of our business is generally being affected by global macro-economic trends which have resulted in a broad softening in the manufacturing sector. We are continuing to nurture new business development initiatives which we are confident will show results in fiscal 2016 and beyond.”

Engineered Materials
In the fourth quarter, the Engineered Materials division continued to ship F-35 components for machining. Most of the revenue and margin from our first contract for F-35 components will be recognized throughout fiscal 2016 as final components from the first contract are delivered. While Engineered Materials incurred a loss from operations in fiscal 2015 because of low plant utilization, the order backlog under contract will result in improved plant utilization and fiscal 2016 performance. The division is engaging with several aerospace and defense contractors regarding additional defense and military programs which, if the company is successful, will not require any immediate capacity expansion.

Copper Alloys
The Copper Alloys division generated reduced sales in the fourth quarter as a result of order deferrals by customers and a lower copper commodity price. These trends will continue to affect first quarter results in fiscal 2016.

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