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Latest Headlines
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Nov 17, 2009 9:53:00 AM MST
Avcorp warns it will be in default of financial covenants; Q3 loss widens (Avcorp)
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VANCOUVER _ Avcorp (TSX:AVP) has warned it expects to default on one or more of its loans over the next year after reporting a wider loss in the third quarter.
The Vancouver-based maker of aircraft components said that at the end of September it was not in compliance with financial covenants relating to its operating line of credit.
It also didn´t have any cash and equivalents at either the beginning or end of the period.
"The company is forecasting that it will be in default of one or more of its financial covenants in the next 12 months," the company stated in a news release.
Avcorp blamed "significantly reduced customer demand," which resulted to idle plant capacity, for its wider loss for the third quarter.
For the quarter ended Sept. 30, its net and comprehensive loss jumped to $2.6 million or six cents a share compared to a year-earlier loss of $220,000 or a penny a share. Revenues were cut in half to $14.3 million from $30.9 million.
Avcorp said it also incurred $371,000 in fees for negotiating its financial restructuring in the recently concluded quarter.
Avcorp designs and builds airframe structures for Boeing, Bombardier and Cessna. It has 483 employees.
During Tuesday noon trading at the Toronto Stock Exchange, shares of the company were unchanged at 65 cents.
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