AZCAR Technologies Incorporated
TSX : AZZ

AZCAR Technologies Incorporated

August 04, 2006 16:48 ET

AZCAR Announces Results for the Second Quarter of 2006

MARKHAM, ONTARIO--(CCNMatthews - Aug. 4, 2006) - Stephen F. Pumple, President & CEO of AZCAR (TSX:AZZ), announced second quarter revenues of C$17.5 million, compared to C$16.1 million in Q2 2005. AZCAR announced several major contracts in Q2, the most notable of which were with NFL Films, Fox Sports and Cox Broadcasting. These projects will continue throughout 2006 and into 2007. Procom, the group acquired in May, 2005, continues to grow and expand its business. The stronger Canadian dollar and the greater proportion of lower margin equipment sales to higher margin services continue to adversely affect the Company's income.



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2006 2005 2006 2005
Three Months Ended Six Months Ended
June 30 June 30
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(CDN $000) (unaudited) (unaudited) (unaudited) (unaudited)

Revenues 17,489 16,157 32,258 32,964
Cost of goods sold 14,093 13,457 26,326 28,408
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Gross Margin 3,396 2,700 5,932 4,556
Gross Margin % 19.4% 16.7% 18.4% 13.8%
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Operating expenses 2,571 2,039 5,031 3,689
Stock-based
compensation 9 15 17 22
Amortization 74 66 146 128
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2,654 2,120 5,194 3,839
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Income before income
taxes and Minority
Interest 742 580 738 717
% of revenues 4.2% 3.6% 2.3% 2.2%
Income tax expense 270 232 262 281
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Income before Minority
Interest 472 348 476 436
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Minority Interest 10 (32) 8 (66)

Net Income 462 380 468 502
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Earnings per share
Basic (cents) 3.0 2.5 3.0 3.3
Fully Diluted (cents) 2.8 2.3 2.8 3.1
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Cash dividends per
share (cents) 0.0 0.0 0.0 0.0
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The higher operating expenses reflect the impact of the Procom acquisition and the addition of staff for the Atlanta office and sales representatives in Seattle, Los Angeles and Chicago.

AZCAR is an independent technology integration company providing high definition digital media technology solutions for the broadcast and telecommunications industries, broadcast ministries, higher education institutions, and multi-purpose sports and entertainment venues. AZCAR provides consulting, engineering, systems design, integration, project management and the supply of related materials, equipment and software. The Company's business operates through the parent company and its subsidiaries. The stock trades on the Toronto Stock Exchange under the symbol: AZZ.

This review contains Management's discussion of the AZCAR's operational results and financial condition, and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2005, and the related "Management's Discussion and Analysis" (MD&A).

The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.

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