AEP Industries Inc. (NASDAQ:AEPI) filed Quarterly Report for the period ended 2011-01-31.
Aep Industries Inc. has a market cap of $169.21 million; its shares were traded at around $27.55 with and P/S ratio of 0.21. Aep Industries Inc. had an annual average earning growth of 0.6% over the past 10 years.
Highlight of Business Operations:Net sales for the first quarter of fiscal 2011 increased $60.5 million, or 38.5%, to $217.7 million from $157.2 million for the first quarter of fiscal 2010. The increase was the result of a 9% increase in average selling prices primarily attributable to higher resin costs during the comparable periods, positively affecting net sales by $13.7 million, combined with a 27% increase in sales volume positively affecting net sales by $46.1 million. The first quarter of fiscal 2011 also included a $0.7 million positive impact of foreign exchange relating to our Canadian operations.
Gross profit for the first quarter of 2011 increased $11.5 million, or 63.5%, to $29.5 million from $18.0 million in the same quarter of the prior fiscal year. There was a $4.1 million increase in the LIFO reserve during the first quarter of fiscal 2011 versus a $2.1 million increase in the LIFO reserve during the first quarter of fiscal 2010, representing an increase of $2.0 million year-over-year. Excluding the effects of the LIFO reserve increase, gross profit increased $13.5 million primarily due to increased sales volumes and improved plant utilization, partially offset by a lag in selling price increases during the period. The first quarter of fiscal 2011 also included a $0.2 million positive impact of foreign exchange relating to our Canadian operations and a $0.3 million decrease of consulting costs associated with the implementation of our new operating system.
Operating expenses for the first quarter of fiscal 2011 increased $2.1 million, or 9.6%, to $24.5 million from the comparable period in the prior fiscal year. The increase in operating expenses is primarily due to increased volumes sold in the current period increasing delivery and selling expenses by $2.8 million, partially offset by a decrease of $0.3 million related to share-based compensation costs
Despite the challenging financial markets and economic conditions in recent years, we continue to maintain a strong balance sheet and sufficient liquidity to provide us with financial flexibility. Availability under our Credit Facility and credit lines available to our Canadian subsidiary for local currency borrowings was an aggregate of $103.2 million at January 31, 2011. We have no significant debt maturities until the first half of fiscal 2013. We ended the first three months of fiscal 2011 with a net debt position (current bank borrowings plus long term debt less cash and cash equivalents) of $196.1 million, compared with $184.7 million at the end of fiscal 2010. Our working capital amounted to $83.9 million at January 31, 2011 compared to $70.5 million at October 31, 2010. The increase in working capital of $13.4 million was primarily due to an increase in our investment in inventories, excluding the non-cash effects of LIFO, of $20.5 million due to increased volumes and increased average resin costs, partially offset by a decrease in accounts receivable of $5.3 million as a result of improved collections and lower dollar sales in the first quarter of fiscal 2011 as compared to the fourth quarter of fiscal 2010. Generally, our need to access the capital markets is limited to refinancing debt obligations and funding significant acquisitions. We have begun to see positive signs of stabilization in the capital markets although the impacts of the recent environment continue to impact the cost of capital. As market conditions change, we continue to monitor our liquidity position.
Our cash and cash equivalents were $1.0 million at January 31, 2011, as compared to $1.1 million at October 31, 2010. Net cash used in operating activities during the three months ended January 31, 2011 was $7.1 million, which includes net income of $1.1 million adjusted for non-cash operating income totaling $10.5 million primarily related to depreciation and amortization and change in LIFO reserve. Cash used by operating activities also includes a $20.5 million increase in inventories excluding the non-cash effects of LIFO and a $3.4 million decrease in accounts payable and accrued expenses as a result of timing of payments, partially offset by a $5.3 million decrease in accounts receivable resulting primarily from improved collections and a decrease in dollar sales in the first quarter of fiscal 2011 as compared to the fourth quarter of fiscal 2010.
Net cash provided by financing activities during the three months ended January 31, 2011 was $10.8 million, resulting primarily from $11.5 million in borrowings under our Credit Facility, partially offset by repurchases of our common stock totaling $0.2 million, $0.3 million of capital lease payments and $0.1 million of repayments of our Pennsylvania loans.
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