BIOREM Technologies Inc.

BIOREM Technologies Inc.

May 01, 2007 16:30 ET

Biorem Reports First Quarter Results, a New Order in Nevada and Improved Order Backlog

GUELPH, ONTARIO--(CCNMatthews - May 1, 2007) - Biorem Inc. (TSX VENTURE:BRM) announced today its results for the first quarter ended March 31, 2007, which are summarized in the following table:

First quarter ended March 31,
Information in table is in thousands
except per share data 2007 2006
REVENUE $1,770 $3,244
EBITDA (1) (336) (179)
NET EARNINGS (375) (200)

Consolidated Revenue in Q1 was $1,770,000, which is down $1,474,000 or 45% over the prior year. The decrease reflects the anticipated impact of lower orders in the second half of 2006. BIOREM believes that its business growth trend is best measured by orders and order backlog. New orders in the quarter were $1,900,000, which includes the $1,600,000 order at Honouliuli, Hawaii. Subsequent to the end of the quarter, the Company has also announced $850,000 of new orders in Ontario and today is pleased to announce a $750,000 order for Coyote Springs, Nevada. The order backlog, which was $7,500,000 at December 31, 2006 increases to over $9,000,000 reflecting the impact of these orders received soon after the end of the quarter. Two thirds of the order backlog is scheduled for completion by December 31, 2007.

The order for Coyote Springs is part of a new waster water treatment plant that will service a new 43,000 acre, 65 square mile community. Reuse water from the plant will be utilized for irrigation for landscaping and golf courses within the community. When finished, Coyote Springs will bring over 150,000 thousand homes and nearly a half-million jobs to one of the fastest growing regions in America.

Commenting on the 1st quarter operating results, Peter Bruijns, President and CEO said, "We are pleased to see an increase in the momentum on our orders, which should have a positive impact on revenue in the last half of this fiscal year. Operating revenues in the first half of the year are expected to remain lower than targeted levels due to lower bookings in 2006."

The gross margin of 35% is up from the gross margin reported in 2006 of 26%. Gross profit in the quarter of $618,000 is down $226,000 from 2006 due to the decrease in revenue. 2006 gross margin was negatively impacted by two large municipal projects that were sold at less than normally achieved margins due to sub-contracted flow through costs.

The decline in gross profit was partially offset by a $69,000 or 7% reduction in total operating expenses compared to the prior year. The decrease is mainly attributable to reduced selling expenses. Variable selling expenses are lower due to the decrease in revenue. Discretionary travel and marketing expenses are also lower this year compared to 2006.

BIOREM cash position and working capital position at March 31, 2007 remains strong at $3,950,000 and $5,448,000 respectively.


BIOREM® manufactures BIOSORBENS® biofilter media and is a leading supplier of biofilters for air pollution control in municipal and industrial applications, including BIOCUBE® modular units and the recently introduced MYTILUS® biotrickling filters. With over 400 installed systems and over a decade of experience, the Company's products are the technology of choice for odor control at Wastewater Treatment Plants across North America.

(1) EBITDA is a non-GAAP earnings measure, therefore, it does not have any standardized meaning prescribed by Canadian generally accepted accounting principles and may not be similar to measures presented by other companies. EBITDA represents earnings before interest, income taxes, depreciation and amortization. This measure is important to management since it is used by potential investors and lenders to evaluate the ongoing cash generating capability of the Company and thus the amounts they are willing to invest in the Company.

Forward-Looking Statements

This press release contains forward-looking statements based on current expectations. These forward-looking statements contain various risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Risks and uncertainties about the Company's business are more fully discussed in the disclosure materials, financial statements and MD&A filed with the securities regulatory authorities in Canada on

The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved of the contents of this release.

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