Pacific Safety Products Inc.

Pacific Safety Products Inc.

October 26, 2009 06:00 ET

Pacific Safety Products Inc. Announces Revised Revenue Guidance

KANATA, ONTARIO--(Marketwire - Oct. 26, 2009) - Pacific Safety Products Inc. (TSX VENTURE:PSP) ("PSP" or "the Company"), a leader in the field of protective body armour and soldier systems equipment, today announced revised revenue guidance for fiscal year 2010, which ends on June 30th, 2010.

Mr. David Scott, Chief Executive Officer, commented, "The Company has reviewed its current sales opportunities and as a result is revising its projection for revenue in fiscal year 2010. A trend has emerged of reduced core sales in Canada which management now believes will impact the full year. Many of our major customers are government departments and agencies at the federal, provincial and municipal levels. These organizations are increasingly coming under budget pressures as governments attempt to reduce spending in light of the current economic environment. This is being translated into lower sales volume and a reduced number of larger one off opportunities for PSP. This is a trend which began in the U.S. market last year but was for the most part offset by an increase in international orders serviced out of our U.S. operation. Although the U.S. market is slowly showing signs of recovery, we do not expect a recurrence of large international orders to offset the reduction of our core product sales in Canada as international customers are also struggling with budget constraints. Core product sales are substantially down from our plan and our revised revenue projections assumes that the current trends will not improve during the balance of this fiscal year. Accordingly PSP is now projecting revenue for fiscal year 2010 of between $25 and $30 million."

Mr. Scott also added, "The Company is taking immediate action to address this shortfall both through expense reductions in Corporate, Operations and Administration as well as tightly focused sales initiatives associated with our newly certified NIJ06 products. Management believes that these actions will buffer the Company from the worst effects of this downturn and also position it well when markets recover."

About PSP

The mission statement of Pacific Safety Products Inc. is ...we bring everyday heroes home safely(TM). PSP is an established industry leader in the production, distribution and sale of high-performance and high-quality safety products for the defence and security markets. These products include body armour to protect against ballistic, stab and fragmentation threats, ballistic blankets to reduce blast effects, and protective products against chemical and biological hazards. PSP is the largest armour manufacturer in Canada, directly supplying the Canadian Department of Defence, Federal Government Agencies and major Canadian law enforcement organizations. The Company also provides specialized law enforcement and safety products through APS Distributors, a division of PSP that services law enforcement and public safety agencies across the country. The Company, through its U.S. subsidiary Sentry Armor Systems Inc., provides body armour products to U.S. based law enforcement and private security firms. The Company also produces tactical clothing and emergency medical kits. Pacific Safety Products is a reporting issuer in British Columbia, Alberta and Ontario, Canada and publicly trades under the symbol PSP on the TSX Venture Exchange.

Forward Looking Statements: This media release may contain forward looking statements based on expectations, estimates and projections of the management of Pacific Safety Products Inc. (the "Company"). All statements that address expectations or projections about the future, including statements about the Company's strategy for growth, product development, market position, expected expenditures, results of cost reduction initiatives and financial results are forward looking statements. Some of the forward looking statements may be identified by words like "expects", "anticipates", "plans", "intends", "projects", "indicates", and similar expressions. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, including those discussed more fully elsewhere in this media release and in documents filed with the British Columbia Securities Commission, the Alberta Securities Commission, the Ontario Securities Commission, the TSX Venture Exchange, as well as others, could cause results to differ materially from those anticipated. These factors include, but are not limited to the potential impact of the current economic downturn on the Company's business, the unpredictability of purchasing patterns by governmental agencies, the possibility of a deterioration in the Company's working capital position, the impact on the Company's liquidity if it were to go offside of the covenants in its debt facilities, the impact that changes in supplier payment terms or slow payment of accounts receivable could have on the Company's liquidity, the unavailability of or increase in the price of external capital to finance the Company's research, development and growth initiatives, changes in the laws, regulations, policies and economic conditions, including inflation, interest and foreign currency exchange rates fluctuations of countries in which the Company does business, competitive pressures, successful integration of structural changes or downsizing initiatives, including restructuring plans, acquisitions, divestitures and alliances, cost of raw material, the uncertainty associated with the outcome of research and development of new products, including regulatory approval and market acceptance, and seasonality of sales in some products.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Pacific Safety Products Inc.
    David Scott
    Chief Executive Officer
    (613) 254-9488 ext. 322