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    • Husky Injection Molding Systems Ltd. issues fiscal 2005 third quarter results

      For release 2005-06-08


      Toronto, Ontario — Husky Injection Molding Systems Ltd. (TSX: HKY) today announced its results for the third quarter ended April 30, 2005. All figures in this press release are in US dollars unless otherwise stated.

      Management's Discussion and Analysis

      The following is a discussion of the third quarter fiscal 2005 consolidated financial condition and results of operations of Husky Injection Molding Systems Ltd. (the "Company"). This analysis is current as of June 6, 2005, and should be read in conjunction with the Company's unaudited interim consolidated financial statements for the three and nine month periods ended April 30, 2005, and the Company's Annual Report 2004 - Financial Supplement for the year ended July 31, 2004. Additional information regarding the Company, including its Annual Information Form, can be found on SEDAR at www.sedar.com.

      The Company assesses its performance by reviewing the geographic mix of sales from its territories, and gross profit and profitability on a consolidated basis.

      Summarized Financial Results
           (in millions of US dollars, except per share data, unaudited)
       
                                     Three Months Ended      Nine Months Ended
                                     April        April      April       April
                                  30, 2005     30, 2004   30, 2005    30, 2004
           -------------------------------------------------------------------
           Orders                    200.8        191.1      655.4       636.0
           -------------------------------------------------------------------
           Sales                     240.1        234.4      606.4       545.8
           -------------------------------------------------------------------
           Net Income (Loss)          12.2         15.2       (3.9)        9.1
           -------------------------------------------------------------------
           Earnings (Loss) Per Share  0.10         0.13      (0.03)       0.08
           -------------------------------------------------------------------
      

      Results of Operations
      For the three and nine month periods ended April 30, 2005 compared to the same periods in the previous year.

      Sales
      Sales in the third quarter increased marginally to $240.1 million. In North America, sales grew 44% reflecting higher shipments in all application markets, except technical and general. Sales in Europe decreased 27%, due to lower shipments in all application markets, except automotive. The decrease was partly offset by favourable foreign exchange rates on the translation of Euro-denominated sales, which totalled approximately $4.0 million. In Latin America, sales increased by 43% as a result of higher shipments in the automotive and PET markets, partly offset by lower shipments in packaging applications. In Asia Pacific, sales decreased 5% due to lower shipments in the technical, general and PET markets, partly offset by growth in packaging and automotive applications.

      Sales for the first nine months grew 11% to $606.4 million, as a result of stronger opening backlog levels in all territories and higher order intake in the Americas. In North America, sales increased 29%, due to increased shipments in all application markets, except technical and general. Sales in Europe declined 14% due to weaker order intake in the first half of the year. The decrease was partly offset by favourable foreign exchange rates on the translation of Euro-denominated sales, which totalled approximately $12.0 million. Shipments were lower in all application markets, except automotive. In Latin America, sales increased 50% as a result of higher shipments in all application markets. In Asia Pacific, sales grew 14% due to increased shipments in PET, packaging and automotive applications.

      Net Income (Loss)
      Net income for the third quarter was $12.2 million ($0.10 earnings per share) compared to net income of $15.2 million ($0.13 earnings per share) last year. For the first nine months the net loss of $3.9 million ($0.03 loss per share) compares to a net income of $9.1 million ($0.08 earnings per share) last year.

      President's Message

      Robert Schad, Husky's President and Chief Executive Officer commented, "Globally, the injection molding equipment industry continues to face excess capacity. In the Americas, orders are ahead of expectations, with increased market share. However, because of tough market conditions, orders in Asia Pacific and Europe are lower than expected. As a result, overall orders are only marginally ahead of last year, on a year-to-date basis.

      We are taking significant steps in face of these market conditions:

      • Aggressive cost reduction initiatives are in progress to partially offset currency and commodity price increases;
      • Global purchasing has started to take effect and we are beginning to implement best practices throughout the organization;
      • We have started building small machines in Asia and expect to reduce costs as a result;
      • We are taking a hard nosed approach to eliminate any unnecessary costs in our organization and cut discretionary spending; and
      • For fiscal 2006, we expect to cut capital expenditures by approximately 50% of current fiscal year spending.

      As a result, we are cautiously optimistic about prospects for the coming fiscal year. In addition, there are encouraging signs which have the potential to show significant improvements to our results:

      • We are seeing the first opportunities to sell replacement machines for PET applications;
      • Our hot runner business in Europe and Asia is growing; and
      • We have received genuine interest in our Thixomolding business where we are outperforming competitors.

      Next year, we plan to introduce an improved version of the Hylectric machine that will be even more productive and more cost efficient. We believe that this version will be a technology leader and will allow us to gain profitable market share. Profitability is our number one focus, and we look ahead to achieve it without compromising our long- term ability to compete.

       

      We are also pleased to announce that at today's Board of Directors meeting, John Galt was appointed as a Director, in anticipation of his appointment as Husky's next President & Chief Executive Officer."

      2005 Outlook
      Global market conditions continue to be difficult to predict, and the Company expects that this uncertainty will persist through calendar 2005. For the fourth quarter, the Company expects that sales will exceed levels reached last year. However, given the current product mix in backlog, the make-whole payment on the refinancing of the existing debentures (as discussed in the "Capital Resources" section below), and the unfavourable foreign exchange rate, net income in the quarter will be lower than levels achieved last year. Furthermore, last year's fourth quarter results included favourable tax rates due to the recognition of tax loss carryforwards, which will not recur this year.

      Gross Profit
      Gross profit for the third quarter increased to $64.1 million from $56.3 million last year. As a result, margins were 26.7% of sales compared to 24.0%. Cost reduction initiatives and higher margin product mix accounted for approximately $8.0 million of the increase. Other contributing factors included increased sales and reduced compensation incentives. These factors were partly offset by unfavourable foreign exchange rates on the translation of Canadian dollar-denominated expenses, totalling approximately $2.0 million. The Company cautions that the positive factors taken together contributed to exceptional margins in the quarter.

      For the first nine months, gross profit increased to $130.2 million from $119.1 million last year. Margins were 21.5% of sales compared to 21.8%. The increase in gross profit was principally due to higher sales and reduced compensation incentives. These factors were partly offset by unfavourable foreign exchange rates on the translation of Canadian dollar-denominated expenses, which totalled approximately $6.0 million. Other offsetting factors included competitive pricing pressures, lower margin product mix, and lower investment tax credits. The Company is not recording investment tax credits in a particular jurisdiction, as a result of reduced profitability levels.

      Other Income and Expenses
      Selling and administration expenses, in the third quarter, decreased marginally to $36.6 million from $37.2 million. The decrease was principally due to lower compensation incentives, partly offset by unfavourable foreign exchange rates on the translation of Euro and Canadian dollar-denominated expenses. For the first nine months, selling and administration expenses were $117.8 million, up from $107.5 million. The increase was primarily due to higher salary and people-related expenses, unfavourable foreign exchange rates on the translation of Euro and Canadian dollar-denominated expenses, and increased expenses related to the Company's participation in a triennial trade show in Germany. These factors were partly offset by lower compensation incentives, which were reduced for the quarter and year-to-date periods as a result of lower profitability levels.

      Interest expense, net of interest income, for the third quarter increased to $2.7 million from $2.4 million last year, due to increased borrowing levels and higher average borrowing rates. For the first nine months interest expense, net of interest income, was $7.8 million, up from $7.1 million, due to higher borrowing levels, lower interest income earned on decreased cash and cash equivalent balances, and higher average borrowing rates.

      Earnings Before Interest, Taxes, Depreciation and Amortization(EBITDA)(1) EBITDA for the third quarter increased to $39.9 million from $30.8 million last year primarily due to the increase in gross profit. For the first nine months EBITDA increased to $49.6 million from $46.2 million, due to higher gross profit, partly offset by higher selling and administration expenses.

      Income Taxes
      The income tax provision for both the three and nine month periods ended April 30, 2005, included a $4.6 million increase in the Company's future income tax asset valuation allowance. The Company records its future income tax assets (net of its valuation allowance) only to the extent that it is more likely than not it will realize the assets in the foreseeable future. In fiscal 2004, both the third quarter income tax provision and the year-to-date income tax recovery are attributable to recognition of tax loss carryforwards.

      The quarterly tax provision was recorded in accordance with the Company's practice of evaluating its future tax assets, which is discussed in more detail on page 8 under the "Critical Accounting Estimates" section in the Company's Annual Report 2004 - Financial Supplement.

      Orders and Backlog
      Orders in the third quarter increased 5% to $200.8 million, with growth in all territories except Asia Pacific. Non-PET orders increased 14% principally due to strong growth in packaging and automotive markets, partly offset by reduced order intake in technical and general applications. PET orders decreased 5% and represented approximately 42% of total orders.

      Orders in North America were consistent with last year's levels as strong growth in packaging applications was offset by lower order intake in other markets. European orders increased, with growth in all markets except PET. Increased orders in Western Europe were partly offset by weakness in other regions. European PET orders declined as processors continue to focus on utilizing installed capacity following a year of strong growth. Approximately 40% of the increase in European orders resulted from favourable foreign exchange rates on the translation of Euro-denominated orders. In Latin America, orders increased principally due to growth in Mexico in automotive and packaging applications. Asia Pacific orders decreased principally due to challenging market conditions in China.

      For the first nine months orders increased to $655.4 million from $636.0 million last year. PET orders were down as weakness in Europe and Asia Pacific was partly offset by growth in the Americas. Non-PET orders increased from last year as higher orders in packaging and automotive applications were partly offset by lower orders in the technical and general markets.

      Backlog at April 30, 2005 increased 8% to $315.8 million from $291.4 million last year.

      Segmented Information

      Sales and Orders
      Please refer to the discussion of sales and orders above.

      Gross Profit
      The Company evaluates gross profit on a consolidated basis. The change in gross profit margin of the Company's manufacturing operations during the quarter is attributable to the factors discussed previously under "Gross Profit". In general, gross profit earned by the Company's Service and Sales territories fluctuates primarily as a result of changes to internal pricing between business units, foreign exchange fluctuations, and competitive pricing pressures. In the third quarter, Asia Pacific gross profit margins improved as last year's results reflected competitive pricing pressures that did not recur. In Latin America, for both the quarter and year-to-date periods, gross profit margins decreased as last year's results were favourably impacted by changes in allowance for doubtful accounts. The reader is reminded that internal changes in pricing between business units and foreign exchange fluctuations may affect comparative Service and Sales and manufacturing profit margins, and that such changes may give rise to segmented results which are not necessarily indicative of external business or market conditions.

      Liquidity and Capital Resources

      Cash Position

      Cash provided by operating activities in the third quarter totalled $11.5 million compared to cash used in operating activities of $16.2 million last year. The increase was primarily attributable to a comparative decrease in the use of non-cash working capital. For the quarter, working capital increased as a result of lower accounts payable and accruals, higher accounts receivable, and increased inventory.

      For the first nine months, cash provided by operating activities totalled $12.1 million, compared to cash used in operating activities of $48.9 million last year. The increase was primarily due to a comparative decline in the use of non-cash working capital. From the beginning of the current fiscal year, working capital increased due to higher inventory levels and reduced accounts payable and accruals, partly offset by increased customer deposits and reductions in income taxes and accounts receivable. The increase in inventory is consistent with the growth in backlog levels and increased finished goods in technical centers.

      Capital Additions
      Capital additions for the third quarter were $9.2 million compared to $16.0 million last year. Additions principally related to manufacturing equipment purchases.

      Capital Resources
      At April 30, 2005 the Company had committed, but unutilized, credit facilities totalling $83.7 million.

      In March 2005, the Company renewed its 10.0 million Euro committed, unsecured, multi-currency, credit facility with Dexia Banque International of Luxembourg. The facility matures in March 2008.

      Debt at the end of April 30, 2005 totalled $172.5 million compared to $172.3 million at July 31, 2004. The increase was due to the translation of Canadian dollar and Euro-denominated debt, partly offset by scheduled principal repayments. Net debt(2) increased to $156.7 million from $132.4 million at July 31, 2004, primarily as a result of lower cash and cash equivalent balances. Debt as a percentage of capital was 32% at April 30, 2005 compared to 31% at July 31, 2004. Net debt as a percentage of capital increased to 30% from 26% at July 31, 2004.

      The Company expects to meet its operating cash requirements through fiscal 2005, including required working capital investments, capital expenditures, and currently scheduled repayments of debt, from cash on hand, cash flow from operations, and its committed borrowing capacity.

      On June 3, 2005, the Company completed a private placement of senior unsecured debentures, totalling $137.8 million. The debentures were issued in two series, both of which mature on June 4, 2010. Series D totals $62.5 million and bears interest payable semi-annually at 6.82%; Series E totals C$95.0 million and bears interest payable semi-annually at 6.38%. The proceeds were used for the repayment of the Company's Series A, B and C unsecured debentures totalling $139.0 million. As a result of the early redemption of Series A, B and C debentures the Company made a $3.6 million make-whole payment, which was financed from the Company's revolving credit facility. The make-whole payment, along with $0.2 million in deferred financing costs, which are associated with the existing debentures, will be expensed in the fourth quarter of fiscal 2005.

      On June 3, 2005, the Company's existing cross currency swap, which is described in Note 11 in the Company's Annual Report 2004 - Financial Supplement, was unwound for net proceeds of C$9.0 million, or approximately $7.1 million, in conjunction with the repayment of the Series C debentures. In addition, the Company entered into a cross currency swap coincident with the issuance of its Series E Canadian dollar debentures, whereby the Company will receive semi-annual fixed Canadian dollar payments at 6.38% on C$95.0 million and make semi-annual fixed US dollar payments at 7.01% on $75.4 million. The agreement provides for exchange of the notional amounts at maturity.

      Concurrent with the issuance of the new debentures, on June 3, 2005, the Company closed a $90.0 million committed, unsecured, multi-currency revolving credit facility. The credit facility, which matures in June 2008, is available to the Company and its subsidiaries in the U.S.A. and Luxembourg and will be used for general corporate purposes and to replace the Company's existing $75.0 million credit facility, which was scheduled to mature in July 2005. The new facility is extendable with the approval of the lenders.

      Changes in Accounting Policies Including Initial Adoption
      Effective August 1, 2004, the Company adopted the Canadian Institute of Chartered Accountants Handbook Section 3110 "Asset Retirement Obligations". The Company estimated and accrued the present value of its obligations to restore certain leased premises at the end of the lease term. At lease inception, the present value of this obligation is recognized in other long-term liabilities with a corresponding amount recognized in capital assets. The capital asset amount is amortized over the period from lease inception to the time the Company expects to vacate the premises, resulting in depreciation expense in the consolidated statement of operations. Subsequently, the obligation is adjusted for the accretion of discount and any changes in the amount or timing of the underlying liability.

      The Company adopted the new recommendations retroactively and comparative figures have been restated. Adopting the new standard for the reported figures as of July 31, 2004 resulted in an increase in capital assets, future income tax assets and other long-term liabilities of $203,000, $85,000 and $453,000 respectively, and a decrease in retained earnings of $165,000. The impact of this accounting policy change on reported net income for the three and nine month periods ended April 30, 2005 was a decrease of $36,000 and $142,000 respectively. The impact on reported net income for the three and nine month periods ended April 30, 2004 was a decrease of $19,000 and $53,000 respectively.

      Forward-Looking Statements
      This press release contains certain forward-looking statements which reflect the Company's current view of future events, business outlook and anticipated financial performance. Such statements are subject to assumptions which may be incorrect, and to risks and uncertainties which are difficult to predict. Future events, outcomes and financial performance may differ materially from those predicted in these statements as a result of factors which may include, but are not limited to, those described on pages 10 and 11 under the "Risks and Uncertainties" section in the Company's Annual Report 2004 - Financial Supplement for the year ended July 31, 2004.

      About Husky
      Husky Injection Molding Systems Ltd. (www.husky.ca) is a leading supplier of injection molding equipment and services to the plastics industry. The Company designs and manufactures the industry's most comprehensive range of injection molding equipment, including machines, molds, hot runners and robots. In addition, Husky's value-added services include factory planning, customer training and systems integration. In fiscal 2004, sales were $774 million, with approximately 3,000 people employed worldwide.

      Customers use Husky's equipment and services to produce a wide range of plastic parts, including bottles and caps for water and soft drinks; containers, from yogurt cups to recycling bins; medical applications, such as syringes and vials; automotive components, from headlight housings to bumpers; and parts for electronic equipment, including personal digital assistants and mobile audio devices.

      Husky has more than 40 Service and Sales offices - including 19 Technical Centers - supporting customers in over 100 countries. Manufacturing facilities are located on campuses in Canada, the United States, Luxembourg, and China. Our core values - a passion for excellence, bold goals, proactive environmental responsibility, making a contribution and uncompromising honesty - are the foundation of our business practices worldwide. They are integral to everything we do and define who we are as a company.

      The Company's common shares are listed on the Toronto Stock Exchange (HKY) and are included in the S&P/TSX Composite Index.

      -------------------------
      (1) EBITDA: Earnings before interest, taxes, depreciation and amortization is a non-GAAP measure. EBITDA does not have a standardized meaning prescribed by GAAP, and may not be directly comparable to similar measures presented by other companies due to the nature of its calculation. The Company believes this measure may be relevant to stakeholders.

      (2) Net debt: Is a non-GAAP measure, which is defined by the Company as total debt, less cash and cash equivalents. Net debt does not have a standardized meaning prescribed by GAAP, and may not be directly comparable to similar measures presented by other companies due to the nature of its calculation. The Company believes this measure may be relevant to stakeholders.

      HUSKY INJECTION MOLDING SYSTEMS LTD.
           CONSOLIDATED BALANCE SHEETS
       
           (IN THOUSANDS OF US DOLLARS, UNAUDITED)
       
                                                    April 30, 2005    July 31, 2004
                                                                          (restated)
           -------------------------------------------------------------------------
       
           ASSETS
           Current
           Cash and cash equivalents                        15,777           39,901
           Accounts receivable                             127,435          129,957
           Income taxes receivable                           2,672            6,541
           Inventories                                     223,257          186,261
           Prepaid expenses and other assets                11,365           11,147
           Future income tax assets                         19,006           22,724
           -------------------------------------------------------------------------
           Total current assets                            399,512          396,531
           Cross currency swap receivable                   35,940           34,091
           Future income tax assets                         11,447            9,856
           Capital assets, net                             371,584          379,614
           -------------------------------------------------------------------------
           Total assets                                    818,483          820,092
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
           LIABILITIES AND SHAREHOLDERS' EQUITY
           Current
           Accounts payable and accrued charges            155,881          174,373
           Customers' deposits                              73,899           54,668
           Current portion of long-term debt                 4,175            3,910
           -------------------------------------------------------------------------
           Total current liabilities                       233,955          232,951
           Cross currency swap payable                      29,032           29,032
           Long-term debt                                  168,320          168,378
           Employee future benefits                         13,543           12,410
           Future income tax liabilities                       587              888
           Other long-term liabilities                         565              453
           -------------------------------------------------------------------------
           Total liabilities                               446,002          444,112
           -------------------------------------------------------------------------
       
           Shareholders' equity
           Share capital                                   133,917          133,510
           Retained earnings                               238,564          242,470
           -------------------------------------------------------------------------
           Total shareholders' equity                      372,481          375,980
           -------------------------------------------------------------------------
           Total liabilities and shareholders' equity      818,483          820,092
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
       
       
           HUSKY INJECTION MOLDING SYSTEMS LTD.
           CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
       
           (IN THOUSANDS OF US DOLLARS, EXCEPT PER SHARE DATA, UNAUDITED)
       
                                       Three Months Ended       Nine Months Ended
                                       April 30,   April 30,   April 30,   April 30,
                                           2005        2004        2005        2004
                                                  (restated)              (restated)
           -------------------------------------------------------------------------
       
           Sales                        240,122     234,377     606,414     545,815
           Cost of sales                176,025     178,116     476,178     426,683
           -------------------------------------------------------------------------
           Gross profit                  64,097      56,261     130,236     119,132
           -------------------------------------------------------------------------
       
           Other expenses
           Sales and administration      36,644      37,222     117,766     107,534
           Interest - current, net          (71)       (167)       (276)       (630)
                    - long-term           2,760       2,556       8,121       7,777
           -------------------------------------------------------------------------
           Total expenses                39,333      39,611     125,611     114,681
           -------------------------------------------------------------------------
       
           Income before income
            taxes                        24,764      16,650       4,625       4,451
           Provision for (recovery
            of) income taxes
             Current                      4,738       1,221       6,036       2,533
             Future                       7,815         259       2,495      (7,144)
           -------------------------------------------------------------------------
                                         12,553       1,480       8,531      (4,611)
           -------------------------------------------------------------------------
           Net income (loss) for
            the period                   12,211      15,170      (3,906)      9,062
       
           Retained earnings,
            beginning of period         226,353     217,747     242,635     223,821
           Adjustment due to change
            in accounting policy              -        (123)       (165)        (89)
           -------------------------------------------------------------------------
           Retained earnings,
            end of period               238,564     232,794     238,564     232,794
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
           Basic and diluted
            earnings (loss)
            per share                      0.10        0.13       (0.03)       0.08
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Weighted average
            number of common
            shares outstanding      116,995,022 116,896,660 116,960,090 116,856,962
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
       
       
           HUSKY INJECTION MOLDING SYSTEMS LTD.
           CONSOLIDATED STATEMENTS OF CASH FLOWS
       
           (IN THOUSANDS OF US DOLLARS, UNAUDITED)
       
                                       Three Months Ended       Nine Months Ended
                                       April 30,   April 30,   April 30,   April 30,
                                           2005        2004        2005        2004
                                                  (restated)              (restated)
           -------------------------------------------------------------------------
       
           OPERATING ACTIVITIES
           Net income (loss) for
            the period                   12,211      15,170      (3,906)      9,062
           Add (deduct) items not
            affecting cash
             Depreciation                12,456      11,729      36,938      34,350
             Amortization                    32          66         222         291
             Loss (gain) on disposal
              of capital assets              69         145       1,073        (516)
             Employee future benefits        30          89       1,133       1,526
             Future income taxes          8,612        (289)      1,826      (9,508)
           -------------------------------------------------------------------------
                                         33,410      26,910      37,286      35,205
           Net increase in non-cash
            working capital balances
            related to operations       (21,935)    (43,102)    (25,234)    (84,097)
           -------------------------------------------------------------------------
           Cash provided by (used in)
            operating activities         11,475     (16,192)     12,052     (48,892)
           -------------------------------------------------------------------------
       
           INVESTING ACTIVITIES
           Additions to capital assets   (9,236)    (16,018)    (30,410)    (44,903)
           Net increase (decrease) in
            accounts payable and
            accrued charges related to
            capital asset additions        (317)      1,230      (3,615)      2,170
           -------------------------------------------------------------------------
           Cash used for capital
            asset additions              (9,553)    (14,788)    (34,025)    (42,733)
           Proceeds from sale of
            capital assets                  355         145         503       2,712
           -------------------------------------------------------------------------
           Cash used in investing
            activities                   (9,198)    (14,643)    (33,522)    (40,021)
           -------------------------------------------------------------------------
       
           FINANCING ACTIVITIES
           Additional long-term debt          -           -       5,000           -
           Repayment of long-term debt   (6,061)       (858)     (8,061)     (2,601)
           Maturity of marketable
            securities                        -           -           -      49,966
           Issue of common shares           266         118         407         440
           -------------------------------------------------------------------------
           Cash provided by (used in)
            financing activities         (5,795)       (740)     (2,654)     47,805
           -------------------------------------------------------------------------
       
           Net decrease in cash
            and cash equivalents
            during the period            (3,518)    (31,575)    (24,124)    (41,108)
           Cash and cash equivalents,
            beginning of period          19,295      63,197      39,901      72,730
           -------------------------------------------------------------------------
           Cash and cash equivalents,
            end of period                15,777      31,622      15,777      31,622
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
           Supplementary cash flow
            information
           Cash income taxes paid, net      966          85       1,427       6,106
           -------------------------------------------------------------------------
           Cash interest paid, net        5,066       4,639      10,070       9,238
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
       
       
           HUSKY INJECTION MOLDING SYSTEMS LTD.
           SEGMENTED INFORMATION
       
           (IN THOUSANDS OF US DOLLARS, UNAUDITED)
       
                               Three Months Ended April 30, 2005
                     ---------------------------------------------------------------
                      Service and Sales territories
                     -------------------------------
                                                     Manufact-   Elimina-
                       North   Latin           Asia  uring       tions
                     America America  Europe Pacific operations  & other(i)    Total
           -------------------------------------------------------------------------
       
           External
            sales    103,841  18,853  79,577  37,851         -           -   240,122
           Intersegment
            sales          -       -       -       -   209,891    (209,891)        -
           -------------------------------------------------------------------------
           Total
            sales    103,841  18,853  79,577  37,851   209,891    (209,891)  240,122
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Gross
            profit    16,849   3,070  10,099   6,303    26,487       1,289    64,097
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Depreciation
            and amorti-
            zation       871     203     617     396     9,170       1,231    12,488
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Capital
            asset
            additions    879      54      23   1,081     4,164       3,035     9,236
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Total
            assets   114,316  35,874 106,439  66,401   383,247     112,206   818,483
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
       
                               Three Months Ended April 30, 2004 (restated)
                     ---------------------------------------------------------------
                      Service and Sales territories
                     -------------------------------
                                                     Manufact-   Elimina-
                       North   Latin           Asia  uring       tions
                     America America  Europe Pacific operations  & other(i)    Total
           -------------------------------------------------------------------------
       
           External
            sales     72,360  13,180 108,967  39,870         -           -   234,377
           Intersegment
            sales          -       -       -       -   203,039    (203,039)        -
           -------------------------------------------------------------------------
           Total
            sales     72,360  13,180 108,967  39,870   203,039    (203,039)  234,377
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Gross
            profit    11,129   2,897  11,740   5,385    20,696       4,414    56,261
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Depreciation
            and amorti-
            zation       865     187     618     251     8,478       1,396    11,795
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Capital
            asset
            additions    128      81     385   2,310    10,626       2,488    16,018
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Total
            assets   105,145  31,685 141,992  62,766   370,478      98,808   810,874
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
       
                               Nine Months Ended April 30, 2005
                     ---------------------------------------------------------------
                      Service and Sales territories
                     -------------------------------
                                                     Manufact-   Elimina-
                       North   Latin           Asia  uring       tions
                     America America  Europe Pacific operations  & other(i)    Total
           -------------------------------------------------------------------------
       
           External
            sales    253,785  62,054 183,176 107,399         -           -   606,414
           Intersegment
            sales          -       -       -       -   526,418    (526,418)        -
           -------------------------------------------------------------------------
           Total
            sales    253,785  62,054 183,176 107,399   526,418    (526,418)  606,414
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Gross
            profit    42,670   9,317  23,163  17,283    27,040      10,763   130,236
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Depreciation
            and amorti-
            zation     2,584     605   1,864   1,231    27,218       3,658    37,160
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Capital
            asset
            additions  3,519     155     756   1,438    20,232       4,310    30,410
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Total
            assets   114,316  35,874 106,439  66,401   383,247     112,206   818,483
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
       
       
                               Nine Months Ended April 30, 2004 (restated)
                     ---------------------------------------------------------------
                      Service and Sales territories
                     -------------------------------
                                                     Manufact-   Elimina-
                       North   Latin           Asia  uring       tions
                     America America  Europe Pacific operations  & other(i)    Total
           -------------------------------------------------------------------------
       
           External
            sales    197,410  41,255 213,080  94,070         -           -   545,815
           Intersegment
            sales          -       -       -       -   473,560    (473,560)        -
           -------------------------------------------------------------------------
           Total
            sales    197,410  41,255 213,080  94,070   473,560    (473,560)  545,815
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Gross
            profit    34,557   8,052  24,104  15,721    37,524        (826)  119,132
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Depreciation
            and amorti-
            zation     2,667     505   1,836     756    24,859       4,018    34,641
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Capital
            asset
            additions    424     270     790   9,441    29,881       4,097    44,903
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           Total
            assets   105,145  31,685 141,992  62,766   370,478      98,808   810,874
           -------------------------------------------------------------------------
           -------------------------------------------------------------------------
           (i) Eliminations and other includes Corporate activities and assets not
           attributable to the operating segments.
       
           External sales to customers in Canada and the United States for the three
           months ended April 30, 2005 were $7,392 (2004 - $2,720) and $ 96,449
           (2004- $69,640), respectively. External sales to customers in Canada and
           the United States for the nine months ended April 30, 2005 were $21,443
           (2004 - $9,849) and $232,342 (2004 - $187,561), respectively.
       
           Capital assets in Canada, the United States and Luxembourg as at
           April 30, 2005 were $132,256 (2004 - $136,012), $98,806 (2004 - $107,241)
           and $96,508 (2004 - $101,753), respectively.
       
      
      

      For further information: please contact:
      Daniel Gagnon, Vice President,
      Finance & CFO, (905) 951-5191

      About Husky — Husky Injection Molding Systems (www.husky.ca) is a leading global supplier of injection molding equipment and services to the plastics industry. The company has more than 40 service and sales offices, supporting customers in over 100 countries. Husky's manufacturing facilities are located in Canada, the United States, Luxembourg and China. 

      For more information, please contact:
      Media Relations
      Husky Injection Molding Systems
      E-mail: media@husky.ca

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