9 April 2010


5N Plus’ sales rise 22% to record $19.2m

For its fiscal third-quarter 2010 (to end-February 2010), 5N Plus Inc of Montreal, Quebec, Canada has reported (in Canadian dollars) record revenue of $19.2m, up just 0.4% on $19.15m a year ago but up 22% on $15.8m last quarter.

5N Plus produces high-purity metals such as tellurium, cadmium and selenium, as well as II-VI semiconducting compounds such as cadmium telluride (CdTe) and cadmium sulphide (CdS) as precursors for the growth of crystals for applications including infra-red detectors for night-vision systems, radiation detectors for medical imaging, thermoelectric modules for cooling, and thin-film photovoltaic cells for solar panels. The firm is an integrated producer (with both primary and secondary refining).

Earnings before interest, taxes, depreciation and amortization (EBITDA) of $6.25m were down from $8m a year ago but up from $5.1m last quarter. Net earnings were $4.1m, down from $5.2m a year ago, but up from $3.2m the prior quarter.

The record sales and improved profitability with respect to the previous two quarters are despite a continuing strengthening of the Canadian dollar with respect to its European and American counterparts, which had a negative impact on sales of about $3m, says president & CEO Jacques L'Écuyer. “Demand for our solar-grade products continued to be strong, but it is the increase in sales of our non-solar products which was largely responsible for the record quarter,” he notes. “These non-solar products include for the first time those produced by our subsidiary Firebird Technologies, the performance of which positively impacted both our sales and earnings in the quarter.” 5N Plus acquired Firebird Technologies Inc of Trail, British Columbia, a manufacturer of compound semiconductor products and pure metals, on 1 December.

“We made several announcements in the quarter primarily centered on our compound semiconductor wafer business and our recycling activities,” L'Écuyer continues. Concurrently with the purchase of Firebird, 5N Plus also announced the a memorandum of understanding which Teck Metals Ltd, a subsidiary of Teck Resources Ltd (a producer of base metals and minor metals), for the long-term supply of strategic metals including indium, cadmium and germanium. The MOU was later converted into binding agreements, ensuring a reliable supply of critical feedstock including indium and germanium for Firebird.

“We also made great strides in the quarter to further establish our recycling business,” says L'Écuyer. On 25 January, 5N Plus and cadmium telluride (CdTe) thin-film photovoltaic (PV) module maker Abound Solar of Loveland, CO, USA said that they had signed a PV module recycling agreement and a memorandum of understanding for the supply of semiconductor compounds.

Shortly after the quarter ended (on 18 March), a similar deal was announced with CdTe PV maker Calyxo GmbH of Bitterfeld-Wolfen, Germany. “Both agreements, together with our joint development efforts carried out with First Solar, are aimed at providing our customers, and more generally the solar industry, with environmentally sustainable recycling solutions,” says L'Écuyer.

Also after the end of the quarter, 5N Plus announced further changes, including the promotion of Nicholas of Audet to vice president, with operational and commercial responsibility for all of 5N Plus’ activities (excluding those of subsidiary Firebird Technologies).

In addition, 5N Plus announced the sale of its stake in ZT Plus, formed just last August with BSST LLC of Irwindale, CA, USA (a subsidiary of Amerigon Inc of Northville, MI). This follows slower-than-expected commercial development of the joint venture.

As of end-February, 5N Plus’ backlog of orders expected to translate into sales over the following 12 months was $53.8m, up 3.4% on $52m a year earlier.

“We are very hopeful about Firebird's future prospects and have begun construction of a new facility in Trail which will allow for expansion of their current activities,” says L'Écuyer. “Investment in this new facility will enable Firebird to develop into a major producer of semiconductor wafers and a significant provider of products for the germanium and solar markets,” he believes. “This is in line with the growth plan to which we remain committed, which calls for diversification of our product offering and accretive acquisitions.”

See related item:

II-VI supplier 5N Plus reports dip in sales, but solar demand strong

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