GDG Environment Group Ltd.
TSX VENTURE : GDG

GDG Environment Group Ltd.

August 25, 2010 12:00 ET

GDG ENVIRONMENT GROUP Announces Its 2010 Second Quarter Financial Results, Presents a Growth in Revenues of 31 % and Improve Its Net Earnings

TROIS-RIVIÈRES, QUEBEC--(Marketwire - Aug. 25, 2010) - GDG ENVIRONMENT GROUP (TSX VENTURE:GDG) today announced its financial and operating results for the three-and-six month period ended June 30, 2010 ("the quarter"). A Canadian recognized leader, GDG Environment Group offers a broad range of environmental services targeting the improvement of quality of life and the protection of public health. The Group is also a dominant business in the integrated control of biting flies in Canada. All dollars are expressed in Canadian dollars , unless otherwise specified.

"The Company reports a 31% sales increase and the integration of contracts obtained by its new subsidiary (Groupe Bio Services) shows a positive synergy with our current operations" said Isabelle Martin, president and Chief Executive Officer. "We are proud of having succeeded in this first stage of integration, and the last quarter results demonstrate that GDG was well prepared for growth", added Mrs. Martin.

QUARTERLY HIGHLIGTHS

  • Increase of 32% in sales for second quarter and increase of 31 % in sales for the six-month period ended June 30, 2010, compared to the same period in 2009.

  • Increase of 110 % in net income for the quarter resulting to a positive cumulated net income of $169,881 for the six-month period ended June 30, 2010, compared to a net loss of $86,672 for the same period in 2009.

  • The Company came to an agreement representing a non-reimbursable financial contribution of $350,000 from the National Research Council of Canada Industrial Research Assistance Program (NRC-IRAP) for a project aiming at developing a new technology for the rapid detection and quantification of cyanobacterial toxins. Moreover, its subsidiary, GDG Environnement, will benefit from technical and business advisory services.

  • The Company came to an agreement representing a financial assistance obtained from Canada Economic Development in the form of a repayable contribution of $450,000 bearing no interest.

FINANCIAL RESULTS- THREE-AND-SIX MONTH PERIOD ENDED JUNE 30 2010

The Company generated revenue in the amount of $5,085,991 for the six-month period ended June 30, 2010 compared to $3,882,448 for the six-month period ended June 30, 2009, being an increase of 31 %. The increase in sales is mainly attributable to the acquisition of GBS in March 2010.

  GDG ENVIRONMENT GROUP LTD. DATA EXTRACTED FROM CONSOLIDATED FINANCIAL STATEMENTS – EARNINGS 
(In thousands of dollars ) For the three-month period ended  For the six-month period ended 
  June 30, 2010
(unaudited)
June 30, 2009
(unaudited)
June 30, 2010
(unaudited)
June 30 ,2009
(unaudited)
   $    $    $    $  
Sales 4,300   3,259   5,086   3,882  
                 
Gross margin 1,548   1,098   1,826   1,308  
  36 %  33.7 %  35.9 %  33.7 % 
EBITDA 983   584   791   321  
                 
Net income (loss) 478   227   170   (87 ) 

GDG Environment Group continues to put the emphasis on building a recurring revenue business. Recurring revenues now represent an increasing percentage of its total sales that will benefit investors, while allowing us to maintain our close relationship with our customers.

The current Company's financial statements and management's discussion and analysis will be available on www.sedar.com and www.groupegdg.ca.

Non GAAP-financial measures

The Company uses only one financial measure that is not consistent with Canadian GAAP, namely earnings before interest, income taxes, depreciation and amortization (EBITDA). Such a measure is used because management believes that it provides meaningful information about the Company's performance and operating results. Such a non-GAAP measure has no standardized meaning as prescribed by GAAP and is not necessarily comparable to similarly titled measures presented by other companies. Accordingly, it should not be considered independently of other figures.

About GDG Environment Group (www.groupegdg.com)

Since 1980, GDG Environment Group, a recognized Canadian leader in the integrated control of biting flies, offers a broad range of environmental services targeting the improvement of quality of life and the protection of public health, mainly through the biological control of biting flies, vector control and the surveillance and prevention of West Nile Virus in Canada.

GDG Environment Group operates 4 divisions: GDG Environment, front-runner in the biological control of biting flies and vector control, GDG Aviation which manages all aerial operations for the Group Diamond Sylvico, a Northern Quebec subsidiary, firmly established in the Cree Community of Quebec and Groupe Bio Services which services are a great complement to the ones offered by GDG Environment Group.

The Group markets its expertise throughout the country and has a strong team of scientists and managers plus a team of nearly 200 professionals and technicians in the summer. The Group is established as the most important player in Canada, after more than 600 successful mandates, in the field of biological control of biting flies and in the management of disease vectors.

GDG Environment Group is listed on the TSX Venture Exchange under the ticker "GDG" - (TSX VENTURE:GDG).

The TSX Venture Exchange Inc. does not accept responsibility for the adequacy or accuracy of this press release.

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