11 August 2010


5N’s profits still down despite further revenue growth

After completing its 10th year of operation, for fiscal 2010 (to end-May) 5N Plus Inc of Montreal, Quebec, Canada has reported (in Canadian dollars) record revenue of $70.8m, up 2% on fiscal 2009's $69.4m. This was boosted by a second consecutive quarter of record sales in the fiscal fourth quarter of $19.7m, up 2.6% on $19.2m last quarter and 9.3% on $18.1m a year ago.

5N Plus produces high-purity metals such as tellurium, cadmium, selenium, germanium, indium and antimony. It also produces II-VI semiconducting compounds such as cadmium telluride (CdTe), cadmium sulphide (CdS) and indium antimonide (InSb) 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) and recycler.

“The quarter and the year proved decisive for our flagship product cadmium telluride as our main customer [First Solar] continued to expand and demonstrate a significant cost advantage over competing technologies, leading in turn to an increasing demand for our products,” says president & CEO Jacques L’Écuyer. “Despite some currency headwinds, we turned in record revenues in fiscal year 2010 and net profit margins exceeded 20% for a third consecutive year as our facility in Germany [subsidiary 5N PV GmbH in Eisenhuttenstadt] operated for the first time throughout the year and contributed accordingly to both our sales and net profits,” he adds. “We have also seen a positive contribution from our new subsidiary Firebird Technologies Inc [of Trail, Canada], which turned in positive earnings in both quarters since joining us [last December].” Firebird produces indium antimonide (InSb) wafers as well as antimony, indium and tin pure metals.

Though up on last quarter’s $6.25m, Q4 earnings before interest, taxes, depreciation and amortization (EBITDA) of $6.7m were down on $8.6m a year ago. For fiscal 2010, EBITDA has fallen to $24.1m from fiscal 2009’s $31.4m.

Nevertheless, cash flow from continuing operating activities was $6.2m for Q4 (up on $5m a year ago) and $16.8m for fiscal 2010 (up fiscal 2009’s $16.2m). During the year, cash and cash equivalents rose from $65m to $68m.

“In the year ended, we have laid the foundation for sustainable growth as we made great strides to strengthen our business, leverage our existing facilities and position ourselves to play a larger role in recycling,” says L’Écuyer. “We also broadened our product portfolio to include semiconductor wafers, germanium and products for other thin-film photovoltaic technologies as we successfully completed the acquisition of Firebird Technologies,” he adds.

During fiscal 2010, the backlog of orders expected to translate into sales over the following 12 months rose only slightly, from $52.2m to $52.65m. However, changes in currency exchange rates had an adverse impact of about $4.3m.

See related items:

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

Search: 5N Plus