IBC Advanced Alloys posts 37% higher 2011 sales, increased gross profit

IBC Advanced Alloys Corp. (CVE:IB) released Monday results from its fiscal 2011 fiscal year ending June 30, announcing an 87 percent increase in gross profit and a 37 percent boost in sales from the prior year.

The vertically integrated rare metals-based alloys and advanced cast product maker said that sales for the year came in at $20.46 million, versus $14.93 million a year earlier.

IBC makes and distributes rare metal alloys that are used in a variety of industries, including nuclear energy, automotive, telecommunications, and a range of industrial application. It has 80 employees, with production facilities in Indiana, Massachusetts, Pennsylvania and Missouri.

"Over the last four years, IBC has developed and implemented an advanced alloys business to support its mine-to-market business strategy," said CFO, Simon Anderson.

"Our fiscal 2011 revenue growth is clear proof that IBC's vertically integrated model is sound and that the business has a strong foundation. We have successfully integrated our operating facilities, introduced a range of new high performance alloys and begun business development efforts into several new markets."

Indeed, gross profit for the year jumped a whopping 87 percent to $3.93 million, from $2.10 million, in fiscal 2010, on increased sales and improved operating practices, the company said.

Losses for 2011 were wider, however, at $4.66 million, or $0.02 per share, up 13 percent from the previous year, reflecting both business expansion and one-time expenses related to plant re-location.

"While the company as a whole is not yet profitable, we were very encouraged by our 2011 financial performance and expected the increased costs in fiscal 2011, which relate to the expansion and upgrading of our manufacturing base to support future revenue growth," added Anderson.

Operationally, IBC made significant progress during the year, including the construction of a new factory in Massachusetts, and the closing of an $8.2 million financing to fund a mineral exploration program at its beryllium properties in Utah, as well as other new business development initiatives.

In May, IBC opened a new 63,000 square foot manufacturing facility in Wilmington, MA to support the growth of the company's Engineered Materials division and its ultra-lightweight cast alloys.

A month later, the company also inked a memorandum of understanding with its Kazakh suppliers, Ulba Metallurgical Plant, to further advance the company's relationship and to continue to target emerging opportunities in the global beryllium and rare metals market.

Earlier in the year, the alloys manufacturer also renewed its collaborative research agreement with Purdue and Texas Engineering Experiment Station, a member institution of the Texas A&M University, with regards to their commitment to develop a beryllium-enhanced nucleur fuel.

Moreover, IBC said last Thursday that it signed a preliminary agreement with Ceramic Tubular Products to jointly develop their respective nuclear fuel technologies. The two technologies, which will be advanced to address operational and performance issues with light water reactor fuel systems, are complementary, the companies said, and have the ability to deliver "significant" fuel performance improvements and safety benefits.

Aside from its alloys manufacturing facilities, and nuclear fuels initiative, Vancouver-based IBC owns prospective beryllium properties that consist of 371 claims, totalling about 7,630 acres, and are adjacent to the large Spor Mountain beryllium mine.

The first phase drill campaign at its Juab County project in western Utah will consist of up to 35 holes, totalling 5,250 metres of reverse circulation drilling to test target zones in the volcanic tuff and in the underlying Bell Hill Dolomite unit, in the claim area south of the Starvation Canyon Wash.

The company ended the year with cash and equivalents of $7.51 million.