Central Canada Foods Corporation
TSX VENTURE : CDF.A

March 23, 2007 17:25 ET

Central Canada Foods Corporation: Record Sales in First Quarter

MISSISSAUGA, ONTARIO--(CCNMatthews - March 23, 2007) - For the first quarter ended January 31, 2007, Central Canada Foods Corporation (TSX VENTURE:CDF.A) generated its highest first quarter sales ever of 9.5 million, up more than 30% from $7.3 million in 2006 (all amounts in Canadian funds).

Earnings in the quarter were $82,000, as compared to $195,000 in the first quarter of fiscal 2006, down $113,000.

The Company's increased capacity allowed it to fill demand in Japan and domestic markets for the Company's Choice Pak brand.

An increase in the cost of raw materials due to exchange fluctuations on purchases in U.S. funds led to an increase in the cost of meat products and labour expense as a percentage of sales to 88.7% in the first quarter of fiscal 2007 as compared to 87.3% in the same period last fiscal year.

The Company's selling, general and administration expenses increased by 40% from $657,000 in the first quarter of 2006 to $921,000 in the first quarter of 2005 an increase of $264,000, as a result of the increased operating costs associated with the Timberlea plant that is more than twice as large as the facility it replaced, and increases in product output by weight and higher inventory carrying costs. As a percentage of sales, these expenses were 99.7% of sales in the first quarter of 2007 as compared to 9% in 2006.

The Company's bank indebtedness as at January 31, 2007 declined $168,000 from $1,358,000 at year-end, October 31, 2006, to $1,190,000. Bank indebtedness declined $25,000 as compared to the first quarter of 2006. The Company's operating line of credit was used to finance sales and inventory.

The Company's financial statements (in Canadian funds) are summarized as follows:



January 31, October 31,
2007 2006
C$ C$
Consolidated Balance Sheet

Current Assets $4,331,306 $4,173,845
Capital Assets 1,202,279 1,228,692
Goodwill 554,753 554,753
---------------------------------

Total Assets $6,088,338 $5,957,290
---------------------------------
---------------------------------

Liabilities and Equity
Bank indebtedness $1,189,565 1,357,854
Other current liabilities 2,402,397 2,163,056
Non-current liabilities 764,290 782,887
Share capital 1,952,369 1,952,369
Retained Earnings (Deficit) (220,283) (298,876)
---------------------------------

Total Liabilities and Equity $6,088,338 $5,957,290
---------------------------------
---------------------------------

3 months ended
January 31
2007 2006
C$ C$
Consolidated Statements of Operations

Sales $9,535,017 $7,297,704

Meat products and labour 8,456,118 6,373,448
Selling, general and administration 921,213 657,295
Other Costs 79,093 71,623

---------------------------------

Income for the period $78,593 $195,338
---------------------------------
---------------------------------

Earnings per share - basic and fully
diluted $0.01 $0.01
---------------------------------
---------------------------------

3 months ended
January 31
2007 2006
C$ C$
Consolidated Statements of Cash Flows

Cash (used in) operating activities $208,262 $ 21,202
Cash from financing activities (190,092) 9,304
Cash (used in) provided by investing
activities (18,170) (30,506)
---------------------------------
(Decrease) increase in cash and cash
equivalents - -
Cash and cash equivalents-beginning
of period - -
---------------------------------

Cash and cash equivalents-end of period - -
---------------------------------
---------------------------------


About Central Canada Foods Corporation

Central Canada Foods Corporation (CCFC) is a federally inspected, HACCP approved, meat processing company that converts wholesale cuts or "primal meat cut" and converts smaller cuts derived from the primal cuts or "sub primal meat cuts" into fresh-boxed and case ready products for shipment to its customers. CCFC's products are marketed and sold to Canadian national and regional grocery chains, as well as in the Asian-Pacific market and other international markets.

This News Release may contain certain forward-looking statements, which statements can be identified by the use of forward-looking terminology such as "may", "will", "expect", "anticipate", "estimate", "predict", "plans", or "continues" or the negative thereof or any other variations thereon or comparable terminology referring to future events or results. Forward looking statements are statements about the future and are inherently uncertain, and the Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of numerous factors, including without limitation, the need for regulatory approval, marketing/manufacturing and partnership/strategic alliance risks, the effect of competition, uncertainty of the size and existence of a market opportunity for the Company's products, as well as a description of other risks and uncertainties affecting the Company and its business, as contained in news releases and filings with the Canadian Securities Regulatory Authorities, any of which could cause actual results to vary materially from current results or the Company's anticipated future results. Forward-looking statements are based on the beliefs, opinions and expectations of the Company's management at the time they are made, and the Company does not assume any obligation to update its forward-looking statement if those beliefs, opinions or expectations, or other circumstances should change.

The Toronto Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this News Release.

Contact Information

  • Central Canada Foods Corporation
    George Michaels
    President
    (905) 272-3133