Dominion Citrus Income Fund
TSX : DOM.UN

Dominion Citrus Income Fund

July 31, 2009 15:18 ET

Dominion Citrus Income Fund: Second Quarter 2009 Report to Unitholders

Three months ended June 20, 2009 and June 21, 2008

TORONTO, ONTARIO--(Marketwire - July 31, 2009) - Dominion Citrus Income Fund ("Dominion", the "Fund") (TSX:DOM.UN) reports a net loss from continuing operations of $734,000 or ($0.04) per unit for the three months ended June 20, 2009 compared to a net loss of $331,000 or ($0.02) per unit for the same period in 2008. The net earnings from discontinued operations for the same periods were a net loss of $276,000 or ($0.01) per unit versus a net loss of $69,000 or ($0.00) per unit in 2008.

Second quarter revenue from continuing operations, was lower by 9.7% due primarily to the discontinuance of less profitable commodities in the wholesale operation. The increased focus contributed to gross margin improvement of $304,000 or 7.6% for the quarter with a concentration on selling margins, reduced waste and overall inventory control. Total operating expenses increased by $980,000 or 21.6%, primarily due to $1,279,000 of consulting, legal, severance and general restructuring costs, partially offset by reduced operating cost at Kelfield.

The quarterly results are summarized below (all figures in $000's except per unit):



Three months ended
June 20, 2009 June 21, 2008
-----------------------------
Revenue, continuing operations 20,182 22,344
Revenue, discontinued operations 1,226 3,280
Loss before other income (expense), continuing
operations (1,230) (554)
Loss before other income (expense),
discontinued operations (413) (489)
Net loss, continuing operations (734) (331)
Net loss, discontinued operations (276) (69)
EBITDA, continuing operations (1,093) (388)
EBITDA, discontinued operations (407) (387)
Basic and diluted loss, continuing operations ($0.04) ($0.02)
Basic and diluted loss, discontinued
operations ($0.01) ($0.00)



Six months ended
June 20, 2009 June 21, 2008
-----------------------------
Revenue, continuing operations 39,228 43,135
Revenue, discontinued operations 2,896 8,128
Loss before other income (expense), continuing
operations (1,073) (273)
Loss before other income (expense),
discontinued operations (359) (912)
Net loss, continuing operations (469) (37)
Net loss, discontinued operations (240) (355)
EBITDA, continuing operations (796) 73
EBITDA, discontinued operations (347) (744)
Basic and diluted loss, continuing operations ($0.02) ($0.00)
Basic and diluted loss, discontinued
operations ($0.01) ($0.02)


Fiscal 2009 Outlook

The highly competitive nature of the segments of the food industry in which the Fund participates will result in continuing volume and margin pressures. The fluctuations of the Canadian dollar as against the US dollar will impact the Fund's revenues and margins.

The Fund is continuing its restructuring which will include further operating cost reductions and restructuring charges in the second half of 2009. The combination of improved gross margins and a right sized overhead structure has overall profitability trending positively. The Fund completed the sale of its Apple Valley Juice assets on June 22, 2009 for gross proceeds of $1.536 million and will continue to market the sale of its Brockville facilities which consist of two buildings totaling approximately 44,000 square feet. Most recently the Fund entered into a sale agreement on June 24, 2009 for two of its four type "A" stalls at the Ontario Food Terminal for gross proceeds of $3.5 million. This transaction will further increase focus and operating efficiency in the wholesale business. The sale is scheduled to close in the third quarter subject to certain closing conditions.

Caution regarding Forward-Looking Statements

This release contains statements, which, to the extent that they are not a recitation of historical fact, may constitute "forward-looking statements". Forward-looking statements may include financial and other projections, as well as statements regarding our future plans, objectives or performance, or our underlying assumptions. The words "estimate", "anticipate", "believe", "expect", "intend" or other similar expressions of future or conditional verbs such as "will", "should", "would" and "could" are intended to identify forward-looking statements. Persons reading this press release are cautioned that such statements are only expectations, and that our actual results or performance may be materially different.

Forward-looking information involves certain risks, assumptions, uncertainties and other factors which may cause actual future results to differ materially from those expressed or implied in any forward-looking statements.

Readers should not place undue reliance on these forward-looking statements when making decisions, and should consider the date onto which the statements were made. Except as required by applicable security law, management disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About Dominion

The Fund is a publicly traded, unincorporated, open-ended limited purpose income trust. On January 1, 2006, all of the common shares of Dominion Citrus Limited ("DCL") were exchanged for trust units of the Fund. The trust units are listed on the TSX under the symbol DOM.UN. The Series A preference shares of DCL continue to be listed on the TSX under the symbol DMN.PR.A.

Dominion is a diversified food company supplying fresh produce to a wide variety of customers in retail, foodservice and food distribution businesses. The Fund provides procurement, processing, repacking, sorting, grading, warehousing and distribution services to its major domestic markets being Ontario and Quebec. The Fund also supplies products to customers in the United States. The website may be accessed at www.dominioncitrus.com.

Contact Information

  • Investors:
    Dominion Citrus Income Fund
    Jason Fielden
    VP Finance, CFO & Corporate Secretary
    416-242-8341
    or
    Media:
    Dominion Citrus Income Fund
    Winston R. Ash
    President & CEO
    416-242-8341