Reko Announces Fiscal 2015 Results, Shares Climb On News

Reko Announces Fiscal 2015 Results, Shares Climb On News

By: Dylan Sikes - AllPennyStocks.com News

Tuesday, October 13, 2015

Last month, the Organization for Economic Co-operation and Development (OECD) lowered its forecast for Canada’s GDP growth for 2015. The OECD now forecasts Canada’s GDP to grow 1.1% in 2015, down from the previous forecast of 1.5%. The OECD also lowered its GDP growth projection for 2016 to 2.1% from 2.3%. The reason for the OECD’s downward revision is Canada’s reliance on the commodities sector. The slump in commodity prices has led to miners and oil & gas companies slashing their capital spending. The downward revision by the OECD reflects this.


However, there are some positives. According to the Globe and Mail, Canada has seen an upturn in non-energy sectors. The Globe and Mail especially notes about the manufacturing and export sectors. In June, manufacturing sales rose 1.7% on a seasonally adjusted basis, according to data from Statistics Canada. The increase was driven by rising sales volumes rather than price, which is always a healthy sign.

The improvement in the manufacturing sector is a positive for Reko International Group Inc. (TSX-Venture:REK), a Southwestern, Ontario-based manufacturing company. REK is a value-added designer and manufacturer of customized machining and engineering solutions to OEMs and their Tier 1 suppliers in a range of sectors, including automotive, rail equipment, oil & gas, capital equipment, mining and military.

This morning Reko International announced its financial results for the fourth quarter and full-year ended July 31, 2015. For the fourth quarter, REK’s consolidated sales totaled $10.9 million, compared to $10.6 million reported for the same period in the previous year. The company’s consolidated sales for the full year were $48.3 million, compared to $38.9 million reported in the previous year. The increase in sales over the previous year was due to favorable exchange rate, increased demand for REK’s precision machined products during the year and increased demand for the company’s automotive products in the second and third quarters of the year.

REK’s net income for the quarter was $2.3 million, or $0.36 per share, compared to $2.1 million, or $0.32 per share reported for the same period in the previous year. Net income for the full year was $4.1 million or $0.64 per share, compared to net income of $2.3 million, or $0.36 per share reported in the previous fiscal year.

Diane Reko, CEO at Reko International, said that the company is pleased to report its third highest annual earnings per share since becoming a public company. Reko further said that the results reflect a combination of strong operational performance in all business areas and non-operational factors such as the sustained strength of the U.S. dollar and the reversal of previously written off tax losses.

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