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    • Husky Injection Molding Systems Ltd. issues fiscal 2007 third quarter results

      For release 2007-06-06


      Toronto, Ontario — Husky Injection Molding Systems Ltd. (TSX: HKY) today announced its results for the third quarter ended April 30, 2007. All figures in this press release are in US dollars unless otherwise noted.

      Management's Discussion and Analysis

      The following is a discussion of the third quarter fiscal 2007 consolidated financial condition and results of operations of Husky Injection Molding Systems Ltd. (the "Company"). This analysis is current as of June 6, 2007, 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, 2007, and the Company's Annual Report 2006 - Financial Supplement for the year ended July 31, 2006. 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 30, April 30, April 30, April 30,
      2007 2006 2007 2006
      -----------------------------------------------
      Orders 258.4 173.4 857.9 720.9
      -------------------------------------------------------------------------
      Sales 303.9 279.6 755.4 687.1
      -------------------------------------------------------------------------
      Net Income 17.6 20.7 20.4 23.4
      -------------------------------------------------------------------------
      Earnings Per Share 0.15 0.18 0.17 0.20
      -------------------------------------------------------------------------

       

      President's Message

      John Galt, the Company's President and Chief Executive Officer commented, "I am pleased with our third quarter financial results. Orders in the quarter were approximately 50% higher than last year, representing the fourth consecutive quarter of order improvements over the same quarter in the previous year.

      Since announcing Robert Schad's decision to consider a sale of his shares in the Company, we have been working closely with Citigroup Global Markets to properly present Husky's vision, strategy and strengths to interested parties. In the meantime, we continue to make progress on a number of fronts, despite continued competitive pressures and the added challenge of the Canadian dollar's recent surge in value.

      For the quarter, order levels were higher in all markets and territories. We remain focused on clear priorities in order to continue this momentum and grow the business:

      • Develop new technologies for customers in our core markets, including innovations that will build on our leading position in packaging, develop our market for metal molding systems and expand our addressable market for machines
      • Evaluate new partnership opportunities and acquisitions
      • Manage our costs and improve the efficiency of our global operations
      • Expand our footprint in emerging markets of Asia Pacific and Eastern Europe
      • Improve the range of services we offer customers

      In summary, I am encouraged in our ability to offer new technologies and products to a growing base of customers that will provide their best long term return on investment. This will translate into increased value for all of Husky's stakeholders."

      Results of Operations

      For the three and nine month periods ended April 30, 2007 compared to the same periods in the previous year

      Sales

      Sales for the third quarter increased 9% to $303.9 million from $279.6 million, as a result of higher opening backlog.

      In North America, sales decreased 9% primarily as a result of lower opening backlog. Shipments were down in all markets except technical and general. Sales in Europe grew 38% due to increased shipments in all application markets except technical and general. The impact of year-over- year currency rate changes on Euro-denominated shipments increased sales by approximately $12.0 million. Sales in Asia Pacific increased 15% as a result of strong beverage packaging (PET) and automotive shipments which more than offset declines in other application markets. In Latin America, sales decreased 46% due to reduced shipments in all markets except technical and general, and lower opening backlog.

      For the first nine months, sales increased 10% to $755.4 million from $687.1 million in the prior year. The increase was due to strong order intake in the first three quarters in addition to higher opening backlog levels.

      North American sales decreased marginally as higher shipments in technical, general and beverage packaging applications were more than offset by declines in packaging and automotive markets. Sales in Europe and Asia Pacific were up 25% and 30%, respectively. These increases were due to higher opening backlog levels and increased order intake in the first nine months of the fiscal year. In addition, year-over-year currency rate changes on Euro- denominated shipments increased sales in Europe by approximately $21.0 million. Sales in Latin America declined 22% as a result of lower opening backlog levels. The decrease was in all markets except technical and general.

      Net Income

      Net income for the third quarter was $17.6 million ($0.15 earnings per share), compared to net income of $20.7 million ($0.18 earnings per share) last year. On a year-to-date basis, net income was $20.4 million ($0.17 earnings per share), compared to a net income of $23.4 million ($0.20 earnings per share) last year.

      Gross Profit

      For the quarter, gross profit increased to $74.8 million (24.6% of sales) from $68.4 million last year (24.5% of sales). Gross profit increased approximately $15.0 million as a result of higher volume, a recovery of research and development (R&D) investment tax credits and cost reduction initiatives. The R&D investment tax credit recovery of $5.7 million was realized on income earned in a jurisdiction where the Company has investment tax credits that were not previously recognized. These factors were partly offset by increased compensation incentives and competitive pricing pressures.

      Gross profit for the first nine months increased to $161.1 million from $149.9 million last year. As a result, margins were 21.3% of sales compared to 21.8% last year. Higher sales, cost reduction initiatives and a recovery of R&D investment tax credits of $7.5 million increased gross profit by approximately $47.0 million. Cost reductions include lean manufacturing, Six Sigma principles, global purchasing processes and moving certain manufacturing activities to lower-cost regions. These factors were partly offset by competitive pricing pressures, unfavorable foreign exchange rates, higher expenses, most of which were people related, higher compensation incentives, and lower margin product mix. Unfavorable foreign exchange rates reduced gross profit approximately $9.0 million principally due to the translation of Canadian dollar-denominated expenses, partly offset by the stronger Euro.

      Other Income and Expenses

      In the third quarter, selling and administration expenses increased to $45.9 million from $37.9 million last year. The increase was primarily due to higher compensation incentives, increased people-related expenses and unfavorable foreign exchange rates on the translation of Euro and Canadian dollar-denominated expenses, which increased selling and administration expenses by $1.4 million.

      For the first nine months, selling and administration expenses were $125.3 million, up from $110.2 million last year. The increase was primarily due to higher people-related expenses, unfavorable foreign exchange rates on the translation of Euro and Canadian dollar-denominated expenses and increased compensation incentives. In addition, consulting expenses related to cost reduction initiatives, including steps to improve working capital management, increased selling and administration expenses.

      Interest expense for the third quarter, net of interest income, decreased to $1.6 million from $1.8 million last year. For the first nine months, interest expense, net of interest income, decreased to $5.0 million from $6.6 million last year. The decrease for both the quarter and year-to- date periods was primarily due to higher interest income.

      Restructuring Charge

      For the quarter, the Company recorded a $4.4 million restructuring charge related to severances and associated benefits. This charge resulted from a workforce reduction of 85 people on the Bolton campus and was in line with the Company's strategy of becoming a leaner organization to achieve profitable growth and to effectively serve its customers in emerging markets. For the full year, the Company expects the impact of this restructuring to have a negative effect on cash and pre-tax income of approximately $2.1 million.

      Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)(1)

      For the quarter, EBITDA decreased to $37.1 million from $44.2 million last year. For the first nine months, EBITDA was $69.6 million compared to $79.3 million last year.

      Income Taxes

      In the third quarter, the income tax provision was $5.2 million, resulting in an effective income tax rate of 22.9%, compared to $7.9 million last year with an effective income tax rate of 27.5%.

      The income tax provision for the nine month period was $5.9 million resulting in an effective income tax rate of 22.5%, compared to $9.7 million last year with an effective income tax rate of 29.2%. The income tax provision was lower as a result of income earned in jurisdictions with lower tax rates and the reversal of valuation allowances against certain future income tax assets.

      Orders and Backlog

      Orders for the quarter increased 49% to $258.4 million from $173.4 million last year. The increase was due to higher demand in all markets, and across all territories. In the prior year, third quarter orders were reduced as a result of rising commodity prices which led customers to postpone purchase decisions, choosing to increase capacity utilization of existing equipment.

      In North America, increased orders in beverage packaging (PET), automotive, technical and general application markets were partially offset by a decrease in other packaging applications. Beverage packaging orders were higher as a result of increased demand in carbonated soft drink (CSD) and water applications.

      European orders increased in packaging and PET applications, which were partly offset by declines in other markets. Packaging orders increased due to strong demand for closures, particularly for new package designs in Eastern Europe. The increase in beverage packaging orders was primarily due to higher demand in CSD, water and juice applications. The impact of year-over-year currency rate changes increased Euro-denominated orders by approximately $8.0 million.

      In Asia Pacific, orders increased in beverage packaging, technical and general applications, which were partly offset by declines in other markets. The growth in PET was principally due to higher demand in hot-fill and water applications.

      Orders in Latin America increased in all regions and application markets. Beverage packaging orders were up due to higher demand in CSD and isotonic applications.

      For the first nine months, orders increased to $857.9 million from $720.9 million last year with growth in all application markets and territories. The impact of year-over-year currency rate changes increased Euro-denominated orders by approximately $23.0 million, compared to last year.

      Backlog at April 30, 2007 increased 41% to $382.5 million from $272.2 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 changes in gross profit margin of the Company's manufacturing operations for the quarter and year-to-date periods are 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 Europe, margins for the third quarter decreased as a result of competitive pricing pressure. Margins in Asia Pacific, for the quarter and year-to-date periods, decreased as a result of competitive pricing pressure. 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 totaled $34.2 million, compared to $9.8 million last year. The increase was primarily attributable to a comparative improvement in non-cash working capital, partly offset by lower profitability. For the quarter, working capital decreased as a result of higher accounts payable and accruals, and increased customer deposits. The increase in accounts payable and accruals was primarily as a result of higher compensation incentives. Customer deposits increased as a result of higher backlog levels. These factors were partly offset by higher accounts receivable which was consistent with increased sales.

      For the first nine months, cash provided by operating activities totaled $59.8 million compared to $84.0 million last year. The reduction primarily resulted from a decline in cash generated by changes in non-cash working capital. From the beginning of the current fiscal year, non-cash working capital decreased due to higher accounts payable and accruals, and customer deposits, partly offset by higher accounts receivable and inventory. The higher accounts receivable was due to increased sales in the quarter. The increase in inventory was consistent with higher backlog levels.

      Capital Additions

      Capital additions for the third quarter were $9.2 million compared to $3.7 million last year. Additions principally related to manufacturing equipment purchases.

      Dividends

      For the three and nine month periods ended April 30, 2007, the Company paid a dividend of $2.1 million and $6.2 million respectively.

      Capital Resources

      Debt at the end of April 30, 2007 totaled $160.4 million which is consistent with $160.9 million at July 31, 2006, as principal repayments were offset by the translation of Canadian dollar-denominated debt. Net debt(2) decreased to $32.2 million from $63.8 million at July 31, 2006, primarily as a result of higher cash and cash equivalent balances. Debt as a percentage of capital(3) was 28% at April 30, 2007 and July 31, 2006. Net debt as a percentage of capital(3) decreased to 7% from 14% at July 31, 2006.

      At April 30, 2007, the Company had committed, but unutilized, credit facilities totaling $96.1 million.

      The Company expects to meet its operating cash requirements through fiscal 2007, 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.

      Subsequent Event

      On June 6, 2007, the Company's Board of Directors approved a dividend payment of C$0.02 per common share, for the fourth quarter. The dividend will be paid on July 31, 2007 to the shareholders of record as of July 16, 2007. The Company's intention is to continue with the regular quarterly dividend. The payment of dividends will result in a reduction of cash and cash equivalents and shareholders' equity of approximately $2.1 million.

      2007 Fourth Quarter Outlook

      For the fourth quarter, based on the strong opening backlog levels, the Company expects sales to be in line with the third quarter of fiscal 2007. However, net income is expected to be lower, principally due to unfavorable product mix and a stronger Canadian dollar.

      Forward Looking Statements

      The information in this press release contains certain forward-looking statements which reflect the Company's current view of future events, business outlook and anticipated financial performance. The material assumptions identified in the 2007 Outlook section above may be incorrect. The statements are also subject 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: a reduction in sales of beverage packaging (PET) equipment; failure of the Company's cost reduction programs to be successful; changes in macro-economic factors that affect the Company's capital equipment markets; continued strengthening of the Canadian dollar; being named as a defendant in a legal action; competitive price pressures; customer driven price concessions and cost absorption; the timing of orders booked and shipped; changes in product mix; excess or shortage of manufacturing capacity; pricing of key raw materials used by the Company's customers; supply chain disruption, including a significant increase in the cost of a key production input; changes in governmental, environmental or regulatory policies; failures of, or deficiencies in, information systems or internal business processes. These and additional factors are discussed in more detail on pages 10 and 11 under the "Forward-Looking Statements and Risks Factors" section in the Company's Annual Report 2006 - Financial Supplement for the year ended July 31, 2006. The Company assumes no obligation to update or revise any forward-looking statements, in order to reflect actual events, results or circumstances.

       

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

      (3) Debt as a percentage of capital is defined as total debt divided by
      the sum of total debt and shareholders' equity. Net debt as a
      percentage of capital is defined as net debt divided by the sum of
      net debt and shareholders' equity. Debt and net debt as a percentage
      of capital are non-GAAP measures, which do not have a standardized
      meaning prescribed by GAAP, and which may not be directly comparable
      to similar measures presented by other companies due to the nature of
      their calculation.



      HUSKY INJECTION MOLDING SYSTEMS LTD.
      CONSOLIDATED BALANCE SHEETS

      (IN THOUSANDS OF US DOLLARS, UNAUDITED)

      April 30, July 31,
      2007 2006
      -------------------------------------------------------------------------
      ASSETS
      Current
      Cash and cash equivalents 128,248 97,112
      Accounts receivable 188,063 135,381
      Income taxes receivable 12,758 2,339
      Inventories 209,468 190,128
      Prepaid expenses and other assets 14,499 9,276
      Future income tax assets 21,077 21,295
      -------------------------------------------------------------------------
      Total current assets 574,113 455,531
      Cross currency swap receivable, net 10,204 8,786
      Future income tax assets 6,167 6,134
      Capital assets, net 321,060 340,041
      -------------------------------------------------------------------------
      Total assets 911,544 810,492
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------

      LIABILITIES AND SHAREHOLDERS' EQUITY
      Current
      Accounts payable and accrued charges 222,417 175,030
      Customers' deposits 93,173 53,440
      Current portion of long-term debt 3,853 3,605
      -------------------------------------------------------------------------
      Total current liabilities 319,443 232,075
      Long-term debt 156,560 157,302
      Employee future benefits 15,100 15,037
      Future income tax liabilities 757 909
      Other long-term liabilities 614 551
      -------------------------------------------------------------------------
      Total liabilities 492,474 405,874
      -------------------------------------------------------------------------

      Shareholders' equity
      Share capital 134,602 134,403
      Retained earnings 284,468 270,215
      -------------------------------------------------------------------------
      Total shareholders' equity 419,070 404,618
      -------------------------------------------------------------------------
      Total liabilities and shareholders' equity 911,544 810,492
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------



      HUSKY INJECTION MOLDING SYSTEMS LTD.
      CONSOLIDATED STATEMENTS OF OPERATIONS

      (IN THOUSANDS OF US DOLLARS, EXCEPT SHARE DATA, UNAUDITED)

      Three Months Ended Nine Months Ended
      April 30, April 30, April 30, April 30,
      2007 2006 2007 2006
      -------------------------------------------------------------------------

      Sales 303,862 279,570 755,394 687,076
      Cost of sales 229,042 211,174 594,317 537,156
      -------------------------------------------------------------------------
      Gross profit 74,820 68,396 161,077 149,920
      -------------------------------------------------------------------------

      Other expenses
      Selling and
      administration 45,924 37,926 125,325 110,170
      Restructuring charge 4,415 - 4,415 -
      Interest - current, net (921) (462) (2,606) (957)
      - long-term 2,522 2,309 7,556 7,578
      -------------------------------------------------------------------------
      Total other expenses 51,940 39,773 134,690 116,791
      -------------------------------------------------------------------------

      Income before income
      taxes 22,880 28,623 26,387 33,129
      Provision for (recovery
      of) income taxes
      Current (572) 7,355 (2,717) 9,198
      Future 5,821 521 8,658 486
      -------------------------------------------------------------------------
      5,249 7,876 5,941 9,684
      -------------------------------------------------------------------------
      Net Income 17,631 20,747 20,446 23,445
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------

      Basic and diluted
      earnings per share 0.15 0.18 0.17 0.20
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------

      Weighted average
      number of common
      shares outstanding 117,220,962 117,157,831 117,204,072 117,118,784
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------



      HUSKY INJECTION MOLDING SYSTEMS LTD.
      CONSOLIDATED STATEMENTS OF RETAINED EARNINGS

      (IN THOUSANDS OF US DOLLARS, UNAUDITED)

      Three Months Ended Nine Months Ended
      April 30, April 30, April 30, April 30,
      2007 2006 2007 2006
      -------------------------------------------------------------------------

      Retained earnings, beginning
      of period 268,919 247,243 270,215 244,545
      Net Income 17,631 20,747 20,446 23,445
      Dividends (2,082) - (6,193) -
      -------------------------------------------------------------------------
      Retained earnings,
      end of period 284,468 267,990 284,468 267,990
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------



      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,
      2007 2006 2007 2006
      -------------------------------------------------------------------------

      OPERATING ACTIVITIES
      Net Income 17,631 20,747 20,446 23,445
      Add (deduct) items not
      affecting cash
      Depreciation 12,576 13,638 37,969 39,287
      Amortization 91 103 272 277
      Loss on disposal of
      capital assets 21 174 25 621
      Employee future benefits 877 223 63 1,290
      Future income taxes (657) 92 33 (788)
      Other (1,451) 575 (896) (21)
      -------------------------------------------------------------------------
      29,088 35,552 57,912 64,111
      Net decrease (increase) in
      non-cash working capital
      balances related to
      operations 5,116 (25,784) 1,886 19,906
      -------------------------------------------------------------------------
      Cash provided by
      operating activities 34,204 9,768 59,798 84,017
      -------------------------------------------------------------------------

      INVESTING ACTIVITIES
      Additions to capital assets (9,196) (3,681) (19,326) (20,155)
      Net decrease in accounts
      payable and accrued charges
      related to capital asset
      additions (31) (876) (2,702) (1,950)
      -------------------------------------------------------------------------
      Cash used for capital
      asset additions (9,227) (4,557) (22,028) (22,105)
      Proceeds from sale of
      capital assets 149 51 327 7,607
      -------------------------------------------------------------------------
      Cash used in investing
      activities (9,078) (4,506) (21,701) (14,498)
      -------------------------------------------------------------------------

      Dividends (2,082) - (6,193) -
      Repayment of long-term debt (940) (856) (2,765) (9,943)
      Issuance of common shares 58 57 199 350
      -------------------------------------------------------------------------
      Cash used in financing
      activities (2,964) (799) (8,759) (9,593)
      -------------------------------------------------------------------------

      -------------------------------------------------------------------------
      Effect of exchange rate
      changes on cash and
      cash equivalents 2,100 (25) 1,798 449
      -------------------------------------------------------------------------

      Net increase in cash and
      cash equivalents during
      the period 24,262 4,438 31,136 60,375
      Cash and cash equivalents,
      beginning of period 103,986 75,086 97,112 19,149
      -------------------------------------------------------------------------
      Cash and cash equivalents,
      end of period 128,248 79,524 128,248 79,524
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------

      Supplementary cash flow
      information
      Cash income taxes paid, net 608 5,441 7,811 8,193
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Cash interest paid
      (received), net (805) (370) 2,697 4,167
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------



      HUSKY INJECTION MOLDING SYSTEMS LTD.
      SEGMENTED INFORMATION

      (IN THOUSANDS OF US DOLLARS, UNAUDITED)

      Three Months Ended April 30, 2007
      --------------------------------------------------------------
      Service and Sales territories
      --------------------------------
      Manu- Elimi-
      North Latin Asia facturing nations
      America America Europe Pacific operations & other(i) Total
      -------------------------------------------------------------------------

      External
      sales 93,767 14,958 144,152 50,985 - - 303,862
      Intersegment
      sales - - - - 267,377 (267,377) -
      -------------------------------------------------------------------------
      Total
      sales 93,767 14,958 144,152 50,985 267,377 (267,377) 303,862
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Gross
      profit 15,887 2,560 10,642 5,538 41,777 (1,584) 74,820
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Depreciation
      and amorti-
      zation 768 215 292 617 9,402 1,373 12,667
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Capital asset
      additions 154 159 285 367 8,189 42 9,196
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Total
      assets 93,591 24,006 136,957 104,413 365,722 186,855 911,544
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------


      Three Months Ended April 30, 2006
      --------------------------------------------------------------
      Service and Sales territories
      --------------------------------
      Manu- Elimi-
      North Latin Asia facturing nations
      America America Europe Pacific operations & other(i) Total
      -------------------------------------------------------------------------

      External
      sales 103,302 27,862 104,168 44,238 - - 279,570
      Intersegment
      sales - - - - 240,090 (240,090) -
      -------------------------------------------------------------------------
      Total
      sales 103,302 27,862 104,168 44,238 240,090 (240,090) 279,570
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Gross
      profit 17,334 3,762 11,247 7,308 31,628 (2,883) 68,396
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Depreciation
      and amorti-
      zation 827 205 820 754 9,785 1,350 13,741
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Capital asset
      additions 43 156 23 1,126 2,243 90 3,681
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Total
      assets 101,038 29,455 114,704 98,506 359,584 126,224 829,511
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------


      Nine Months Ended April 30, 2007
      --------------------------------------------------------------
      Service and Sales territories
      --------------------------------
      Manu- Elimi-
      North Latin Asia facturing nations
      America America Europe Pacific operations & other(i) Total
      -------------------------------------------------------------------------

      External
      sales 267,118 56,589 277,012 154,675 - - 755,394
      Intersegment
      sales - - - - 639,180 (639,180) -
      -------------------------------------------------------------------------
      Total
      sales 267,118 56,589 277,012 154,675 639,180 (639,180) 755,394
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Gross
      profit 44,751 8,968 26,989 18,431 59,115 2,823 161,077
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Depreciation
      and amorti-
      zation 2,328 638 1,149 1,577 28,556 3,993 38,241
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Capital asset
      additions 269 387 861 1,105 15,360 1,344 19,326
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Total
      assets 93,591 24,006 136,957 104,413 365,722 186,855 911,544
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------


      Nine Months Ended April 30, 2006
      --------------------------------------------------------------
      Service and Sales territories
      --------------------------------
      Manu- Elimi-
      North Latin Asia facturing nations
      America America Europe Pacific operations & other(i) Total
      -------------------------------------------------------------------------

      External
      sales 274,463 72,776 220,834 119,003 - - 687,076
      Intersegment
      sales - - - - 586,291 (586,291) -
      -------------------------------------------------------------------------
      Total
      sales 274,463 72,776 220,834 119,003 586,291 (586,291) 687,076
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Gross
      profit 46,427 11,171 24,749 19,622 49,435 (1,484) 149,920
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Depreciation
      and amorti-
      zation 2,500 611 1,855 1,354 29,358 3,886 39,564
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Capital asset
      additions 138 225 301 1,857 16,315 1,319 20,155
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      Total
      assets 101,038 29,455 114,704 98,506 359,584 126,224 829,511
      -------------------------------------------------------------------------
      -------------------------------------------------------------------------
      (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 month period ended April 30, 2007 were $7,426 (2006 - $7,016) and
      $86,341 (2006 - $96,286), respectively. External sales to customers in
      Canada and the United States for the nine month period ended April 30,
      2007 were $13,239 (2006 - $17,823) and $253,879 (2006 - $256,640),
      respectively.

      Capital assets in Canada, the United States and Luxembourg as at
      April 30, 2007 were $99,829 (2006 - $115,366), $73,199 (2006 - $86,399)
      and $94,369 (2006 - $98,953), respectively.

      SUBSEQUENT EVENT

      On June 6, 2007, the Company's Board of Directors approved a dividend
      payment of C$0.02 per common share, for the fourth quarter. The dividend
      will be paid on July 31, 2007 to the shareholders of record as of
      July 16, 2007. The Company's intention is to continue with the regular
      quarterly dividend. The payment of dividends will result in a reduction
      of cash and cash equivalents and shareholders' equity of approximately
      $2.1 million.


      For further information: Daniel Gagnon, Vice President, Finance & CFO, (905) 951-5000

      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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