Mr. Denis Bertrand reports

SIGMA INDUSTRIES REPORTS STRONG FISCAL 2018 FIRST QUARTER RESULTS

Sigma Industries Inc. has released the results for the first quarter of its 2018 fiscal year ended July 29, 2017.

"Sigma Industries achieved a strong performance in the first quarter of its 2018 fiscal year. Revenues were up nearly 15 per cent, and we recorded higher year-over-year sales in most of our principal markets. Operating profitability also significantly improved during the period, as EBITDA more than doubled to reach $2.2-million," said Denis Bertrand, president and chief executive officer of Sigma Industries.

"To ensure Sigma Industries remains at the forefront of business opportunities that may arise, we are proceeding with capital investments as part of a modernization program of our facilities and equipment. Following investments of $420,000 in the first quarter, we expect to accelerate the pace over the remainder of the fiscal year. These investments include a greater automation of our activities, which will partially alleviate the labour shortage we are facing, while further strengthening our reputation as an innovative manufacturer of high-quality composite products," added Mr. Bertrand.

First quarter results

Revenues for the first quarter of fiscal 2018 amounted to $15.4-million, up $2.0-million, or 14.7 per cent, from $13.4-million in the previous year. This solid increase essentially reflects higher revenues from the heavy-duty truck industry resulting from improving market conditions, as well as higher sales to the bus and wind energy industries due to higher customer orders.

Earnings before interest, taxes, depreciation and amortization (EBITDA) totalled $2.2-million, representing 14.3 per cent of revenues, versus $1.0-million, or 7.4 per cent of revenues, a year earlier. The increase, both in dollars and as a percentage of sales, is attributable to greater business activity, a more favourable year-over-year product mix and a foreign exchange gain in the first quarter of fiscal 2018, as opposed to a foreign exchange loss in the first quarter of fiscal 2017.

Sigma Industries concluded the first quarter of fiscal 2018 with net income of $1.4-million, or 12 cents per basic share (five cents per diluted share), versus net income of $287,000, or two cents per basic share (one cent per diluted share), in the first quarter of fiscal 2017.

Outlook

"Looking ahead, we believe that market conditions will continue to improve in the heavy-duty truck industry, which should progressively translate into a higher business volume. We also expect demand to remain solid in our other market niches. In addition, our participation in the Quebec government's accelerated growth centre program, which assists companies in developing their activities in the United States, should provide us with new growth vectors. The resources at our disposal under this program will allow Sigma Industries to assess every opportunity to increase its reach in the United States and to align its business strategy with the evolution of the American market. This includes finding an optimal location to set up a manufacturing facility in the United States in order to benefit from a closer proximity with our U.S.-based clients and better labour availability. Finally, over the longer term, we could also benefit from the free trade agreement between Canada and the European Union, and further expand our presence abroad," concluded Mr. Bertrand.

                             CONSOLIDATED RESULTS OF OPERATIONS 
             (unaudited, in thousands of Canadian dollars except per-share amounts)
                                                                                      Three months ended
                                                                           July 29, 2017   July 30, 2016

Revenues                                                                        $ 15,382        $ 13,411
EBITDA                                                                             2,207             990
Net income                                                                         1,445             287
Per share (basic)                                                               $   0.12        $   0.02
Per share (diluted)                                                             $   0.05        $   0.01

Non-IFRS (international financial reporting standards) financial measures

The information in this press release includes certain measures that are not financial measures prescribed under IFRS. Sigma Industries uses EBITDA and adjusted EBITDA in assessing its financial performance. As there is no generally accepted method of calculating these financial measures, they may not be comparable with similar measures reported by other companies. EBITDA is obtained by adding net income (loss) plus income taxes, financial expenses, as well as depreciation and amortization. Adjusted EBITDA consists of EBITDA plus (minus) items not related to current operations. These measures do not represent cash flow available for repayment of debt, payment of dividends, reinvestment or other discretionary uses, and should not be considered in isolation or as a substitute for other measures of performance calculated according to IFRS.

About Sigma Industries Inc.

Sigma Industries, a manufacturing company specializing in the production of composite components, has two operating subsidiaries and employs 275 people. The company is active in the heavy-duty truck, coach, transit, machinery and wind energy markets. Sigma Industries sells its products to original equipment manufacturers and distributors in the United States, Canada and Europe.

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