Sugar Land, Texas-based Imperial Sugar Company (ISC), the largest processor and marketer of refined sugar in the US, reported a Q3 net loss of US$1.1m before gains on asset sales, as compared to a loss of US$15.6m in the year-ago period.
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Net sales in the Q3 2002 were US$319.9m, compared to US$372.3m a year ago. Of this US$52.4m reduction in revenue, US$47.3m was attributable to the sale of certain businesses during this FY.
Including gains of US$3.9m from non-strategic assets sales, Q3 2002 net income was US$2.8m, US$0.28/common share, compared to a net loss of US$14.1m, or US$0.43/common share, year on year. Imperial and substantially all of its subsidiaries emerged from Chapter 11 bankruptcy protection at the end of August 2001 and applied fresh start accounting principles resulting in a new reporting entity whose results are not fully comparable to periods prior to emergence.
For the year to date, ISC reported net income of US$16.2m, or US$1.62 per share, on sales of US$948.5m, including gains on asset sales of US$21.8m. The prior FY’s nine months results were a net loss before accounting changes of US$41.9m, or US$1.29 per share, on revenues of US$1,173m.
ISC continued to reduce debt from the proceeds of asset sales. During the Q3, it completed the sale of it Worland, Wyoming factory and sold surplus land and other non-operating assets for proceeds aggregating US$7m. For the first nine months of the fiscal year, Imperial has realised US$59m from asset sales, including the sale of its Michigan Sugar subsidiary in February and its King Packaging operation in December. ISC has reduced its term debt and revolving credit commitment by US$58.3m so far this FY.
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By GlobalDataAdditionally, ISC and its bank group amended the financial covenants of its senior credit agreement for the Q3 and Q4. The amended agreement requires Imperial to continue its efforts to refinance the facility through a combination of asset sales, new borrowings and other forms of capital, and establishes a timetable for certain actions which must be taken in that regard.
Robert Peiser, president and CEO, said: “While we are pleased with the year on year improvement in operating results, we are not satisfied with our level of profitability. As a result, we continue to pursue a series of initiatives in operations, marketing and administration whose objective is to improve our results.
“We are also continuing our efforts to sell non-strategic assets such as surplus real estate, and we expect to complete further sales, and further debt reductions from such activities, in the current quarter.”
