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Raymor Industries Inc. (TSX VENTURE:RAR), a leading developer and producer of single-walled carbon nanotubes, nanomaterials and advanced materials, today released its third quarter 2008 unaudited financial statements, along with the company's Management Discussion and Analysis (MD&A). Raymor posted quarterly revenues of $1,294,887 a 14.5% increase as compared to the same period in 2007 and a cumulative increase of 121% for the nine month period ending September 30, 2008. The Company presents a net loss after depreciation and amortization of $978,854 or ($0.010) per share, as compared to a net loss after depreciation and amortization of $424,743 or ($0.004) per share for the corresponding period in 2007. When excluding depreciation and amortization, the Company is presenting a net loss of $701,707 for its third quarter 2008 as compared to net loss of $261,718 in 2007. For its third quarter 2008, the Company delivered a negative EBITDA of $641,171 as compared to a negative EBITDA of $209,179 for the same period in 2007. At the end of its third quarter 2008, the Company delivered during a nine month period a negative EBITDA of $571,335 as compared to a negative EBITDA of $1,018,267 for the same period in 2007.
Selling expenses decreased by 49% compared to the same period in 2007. In particular, selling expenses amounted to $174,057 as compared to $344,396 for the same quarterly period in 2007. During this quarter, the Company mainly focused on cutting costs and sales fulfillment.
In the third quarter, administrative expenses amounted to $523,529 as compared to $426,750 for the quarter in 2007. Items included under administrative expenses are: rent (which accounted for a large part of the increase), property taxes, salaries as well as professional expenses such as accounting fees.
The Company's total assets amounted to $20,051,170 as at September 30, 2008, as compared to $18,627,505 for the same period ending September 30, 2007 and $16,592,018 at the end of December 31, 2007. The increase in assets is mainly related to the Company's acquisition of SE Techno Plus Inc. and financing activities which include private and institutional funding received during the first quarter.
Fixed assets amounted to $6,058,318 as of September 30, 2008 as compared to $5,039,554 for the same period ending September 30, 2007 and $5,189,769 as of December 31, 2007. This variation is explained by the acquisition of SE Techno Plus Inc. An amount of $1,539,800 was recorded towards fixed assets in the first quarter of 2008.
Following the acquisition of SE Techno Plus Inc., the Company accounted in the first quarter an amount of $864,762 in Goodwill representing the actual plus value realized between the amount paid for the acquisition and the established value of all purchased assets.
Deferred development costs related to its nanotechnology project amounted to $7,958,321 as at September 30, 2008, as compared to $6,064,544 for the same period ending September 30, 2007 and $6,682,522 at the end of December 31, 2007. Deferred development costs are composed of related development salaries, additional equipment and legal fees for the maintenance and protection of the Company's intellectual property.
During the third quarter 2008, the Company proceeded with the repayment of its long term debt for an amount of $38,358 as compared to $4,758 for the same period ending June 30, 2007. The Company added a bridge loan of $200,000 during the quarter, which was repaid in the following quarter.
The Company also started seeking alternate financing opportunities, including the announcement of a private placement of $819,200 during the fourth quarter subject to the approval of the regulatory authorities having jurisdiction over the securities of the Company. It is also considering the sale, in whole or in part, of one of its subsidiaries so as to increase liquidities. The Company continues to actively pursue various financing opportunities to support operations and backlog. Nevertheless, the Company has currently a backlog of $2,871,400 of orders in hand.
PRIVATE PLACEMENT OF $819,199.80:
The Company is also pleased to announce that it intends to close a private placement consisting of 4,551,110 units (the "Units") at a price of $0.18 per Unit for gross proceeds of $819,199.80, once the approval of the TSX Venture Exchange has been obtained. The private placement had been previously announced in the November 3 and November 21, 2008 press releases.
Each Unit is comprised of one common share of the Corporation at a price of $0.175 per common share, one half (1/2) of one Series "A" share purchase warrant (a "Series "A" Warrant") at a price of $0.0025 per Series "A" Warrant and one half (1/2) of one Series "B" share purchase warrant (a "Series "B" Warrant") at a price of $0.0025 per Series "B" Warrant. Each whole Series "A" Warrant entitle its holder to purchase one (1) additional common share of the share capital of the Corporation at a price of $0.25 for a period of twelve (12) months from the closing date. Each whole Series "B" Warrant entitle its holder to purchase one (1) additional common share of the share capital of the Corporation at a price of $0.55 for the period which is between the twelfth (12th) and eighteenth (18th) month following the closing date.
The securities issued in virtue of the placement will be subject to certain resale restrictions imposed under the applicable securities laws.
Stephane Robert, President and CEO of Raymor Industries had the following to say:
"Our third quarter was mainly affected by restricted liquidities, which affected the Company ability to produce and deliver the Company's orders. The needed cashflow for the Company's 2008 operations was covered in a financing agreement signed with a financial institution, which did not materialize due to the market conditions during the third quarter 2008. Hence, management took immediate action: a restructuring comprised of a reduction in personnel, reduction of expenses and production slow down. We started seeking alternate financing opportunities, including the announcement of a private placement of $819,200 during the fourth quarter. The Company continues to actively pursue various financing opportunities such as: the financing of its purchase orders and other possible private placements. The Company has also entered into a stand-still agreement with its bankers and has used a term deposit of $500,000 to reduce its debt to a Banker of its subsidiary SE Techno Plus from 1.8M$ to 1.3M$ as part of the stand-still agreement. The Company is even seeking the possible sale in part or as a whole of one of its subsidiaries in order to increase its liquidities. If it wasn't for such difficult market conditions in financing its current orders, with a backlog of $2,871,400, the Company would have continued to grow its revenues during the third quarter. The Company is drastically working in financing its operations and orders and to fulfill the current client demand."
The complete 2008 third quarter results, along with the MD&A are available at www.sedar.com.
About Raymor Industries Inc.
RAYMOR INDUSTRIES INC. (TSX VENTURE:RAR) has as its mission to become a leading developer of high technology for the production of single-walled carbon nanotubes, nanomaterials and other advanced materials for high value-added applications. Raymor Industries operates three wholly-owned, industrial subsidiaries, Raymor Nanotech, Raymor Aerospace and AP&C Advanced Powders and Coatings, specializing in nanotechnology and advanced materials, and comprising four divisions: (1) nanotechnology products, including nano-powders, nano-coatings, and single-walled carbon nanotubes (C-SWNT) for "the applications of tomorrow"; (2) thermal spray coatings, which largely targets military, aeronautical, aerospace, specialized industrial, and mining applications; (3) spherical metallic powders, primarily used for biomedical and aerospace applications; and (4) net-shape forming, a component manufacturing technique used for ballistic protection and other aerospace and military applications. Raymor holds the exclusive rights to more than 20 patents throughout the world, with other patents pending.
ON BEHALF OF THE BOARD OF DIRECTORS
Stephane Robert, President.
(VERSION FRANCAISE SERA DISPONIBLE SUR LE SITE WEB DE RAYMOR)
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release
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