November 12, 2013
VANCOUVER: Avcorp Industries Inc. (TSX: AVP) (the “Company” or “Avcorp”) today announced its
consolidated financial results for the quarter ended September 30, 2013.
During the quarter ended September 30, 2013, the Company generated $19,767,000 revenue as
compared to $19,324,000 revenue for the quarter ended September 30, 2012. Current quarter revenues
have remained relatively stable from the same quarter in the preceding year, primarily as the wind‐down
of Cessna Aircraft Company (“Cessna”) programs has been offset by an increase in F‐35 Outboard Wing
Earnings before interest, taxes, depreciation and amortization (EBITDA) was positive $514,000 for the
quarter ended September 30, 2013 compared to a negative EBITDA of $1,205,000 for the quarter ended
September 30, 2012. The increase in EBITDA was primarily as a result of increased gross profit, as well as
reduced administrative and general expenses.
On September 5, 2013 the Company entered into a settlement agreement, from a court directed
mediation with Cessna, which settled all outstanding litigation between the Company and Cessna. The
settlement required payment by Cessna of US$27,964,000 in satisfaction of the US$28,464,000
judgement entered against Cessna by the United States District Court for the District of Kansas (the
“District Court”) on May 8, 2013 which judgement was under appeal to the United States Court of Appeals
for the Tenth Circuit. The settlement funds were received in full by the Company on September 6, 2013.
The acceptance by the Company of a settlement amount less than that awarded by the District Court in a
previous quarter has resulted in the Company reducing a previously recorded gain by $525,000 during the
current quarter. The settlement satisfies the judgement and has resulted in the dismissal of the
A restructuring provision amounting to approximately $224,000 has been recorded during the current
quarter to reflect severance costs associated with employees laid‐off during the current quarter.
In addition to the above‐noted charges against income, the current quarter $1,139,000 loss (September
30, 2012: $2,729,000 loss) includes a $644,000 foreign exchange loss resulting from holding foreign
currency denominated cash, accounts receivable and payable; while the loss for the quarter ended
September 30, 2012 included a $300,000 foreign exchange loss.
Cash flows from operating activities, before consideration of changes in non‐cash working capital utilized
$4,063,000 of cash for the quarter ended September 30, 2013 compared to utilizing $2,866,000 of cash
during the same quarter in the previous year. The increase in cash utilization in 2013 from 2012 is
primarily attributable to recognition of revenues which were funded in previous periods. The Company
has a working capital surplus of $30,103,000 as at September 30, 2013 which has decreased from the
December 31, 2012 $34,819,000 surplus, as a result of repaying bank indebtedness from settlement
proceeds. The Company’s accumulated deficit as at September 30, 2013 is $54,810,000 (December 31,
Avcorp designs and builds major airframe structures for some of the world’s leading aircraft companies,
including BAE Systems, Boeing, and Bombardier. With more than 50 years of experience, over 400 skilled
employees and 354,000 square feet of facilities in Delta BC and Burlington ON, Avcorp offers integrated
composite and metallic aircraft structures to aircraft manufacturers, a distinct advantage in the pursuit of
contracts for new aircraft designs, which require lower‐cost, light weight, strong, reliable structures. Our
Comtek subsidiary also offers composite repairs for commercial aircraft out of their Burlington location.
Avcorp is a Canadian public company traded on the Toronto Stock Exchange (TSX:AVP).
Sandi DiPrimo, Investor Relations Contact | 604-587-4938