Consolidated Envirowaste Industries Inc.
TSX VENTURE : CWD

Consolidated Envirowaste Industries Inc.

August 15, 2008 17:18 ET

Consolidated Envirowaste Reports 2008 3rd Quarter Results

ABBOTSFORD, BRITISH COLUMBIA--(Marketwire - Aug. 15, 2008) - Consolidated Envirowaste Industries Inc. (TSX VENTURE:CWD) announced today its results for the nine months ended June 30, 2008. A complete copy of the Company's unaudited interim financial statements and accompanying management's discussion and analysis is available on SEDAR at www.sedar.com. Excerpts from the third quarter unaudited financial statements are as follows:



Quarters Ended Nine Months Ended
----------------------- ------------------------
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
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Revenue $6,618,014 $7,124,603 $15,010,593 $17,661,101

Income (loss) before
income tax recovery $86,418 $148,447 ($952,039) ($791,757)
Income (loss) after
income tax recovery $240,285 $250,209 ($548,736) ($431,089)

Earnings (loss) per
share-basic $0.02 $0.02 ($0.05) ($0.04)
Earnings (loss) per
share-diluted $0.02 $0.02 ($0.05) ($0.04)

Weighted average
common shares
outstanding-basic 10,414,699 10,414,699 10,414,699 10,414,699
Weighted average
common shares
outstanding-diluted 10,414,699 10,438,032 10,414,699 10,438,032

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The Company recorded third quarter net income of $240,285 or $0.02 per share (0.02 per share diluted) for the three months ended June 30, 2008 which included a one time charge of approximately $135,000 after tax related to the refinancing of all of the Company's Florida subsidiary's long-term debt and capital lease obligations with a new five-year, fixed rate term loan. This compared to net income of $250,209 or $0.02 per share ($0.02 per share diluted) for the quarter ended June 30, 2007. Revenue declined $506,589 or 7% to $6,618,014 for the third quarter of 2008 compared to $7,124,603 for the third quarter of 2007 of which approximately $373,000 of the decline related to reductions due to the continued appreciation of the Canadian Dollar. As in previous quarters of the current fiscal year, revenues continued to reflect the poor economic conditions in the Florida region. Rising fuel prices pressured operating margins during the quarter, continuing a trend over the past several months, while the Company made pricing and operational adjustments to meet the challenging economic conditions.

Overall results for the first nine months of fiscal 2008 continue to reflect the poor results in the first two quarters as the net loss for the nine months ended June 30, 2008 was $548,736 compared to a net loss of $431,089 for the same period in 2007. The Company experienced a 15% drop in revenue to $15,010,593 for the nine months ended June 30, 2008 from $17,661,101 for the nine months ended June 30, 2007. Revenue declines in the Florida based operation, affected by the U.S. economic slowdown, were responsible for this decline as the Company also experienced a loss in comparable revenue of approximately $1,544,000 in the translation of that operation's U.S. dollar denominated revenue for the first nine months of 2008 compared to 2007. Rising fuel costs, 28% higher during the first nine months of 2008 compared to the first nine months of 2007, continued to exert pressure on operating margins as the Company made pricing and operational adjustments to moderate the effects of these costs increases. Improvements in third quarter cash flows and receipt of an income tax refund from the U.S. operation's prior year loss brought cash flows from operating activities after changes in working capital items to $472,168 for the nine months ended June 30, 2008 compared to the $171,469 provided by operating activities for the same nine month period last year.

The Company expects the remaining quarter in the current fiscal year to reflect seasonal operating patters. As in the first nine months, results for the final quarter will continue to be tempered by the challenging Florida economic environment and record fuel prices. The Company expects continued pressure on its operating margins, particularly in its U.S. operations. The Company will continue to adjust pricing and operations to meet these higher costs and lower demand for its services throughout the remainder of the 2008 fiscal year. While there appears to be some improvement on the horizon for the Company's U.S. operations, it appears that conditions may not improve until well into the 2009 fiscal year.

Consolidated Envirowaste Industries Inc. is a leading processor of wood and other organic wastes in Western Canada and Florida. The Company markets and supplies biomass boiler fuel for electric generation facilities, charcoal manufacturers and pulp and paper mills in the U.S., bulk landscaping products in both of these regions, and packaged soil products to major Western Canadian retailers.

Forward-Looking Statements - This report contains statements that are forward-looking in nature. Readers are cautioned that such forward-looking statements are not guarantees and may involve known and unknown risks and uncertainties that could cause the actual results of the Company to be materially different from those expressed or implied by those forward-looking statements. Such risks include, among others: general economic and business conditions, weather factors, competition, product selling prices, the cost and availability of raw materials, operating costs, changes in foreign currency exchange rates, dependence on contracts, the regulatory environment, seasonality, risk of liability for environmental damage, risks associated with litigation, and concentration of shareholder control. For a fuller description of those risks, please see the sections headed "Critical Accounting Estimates" and "Risk Factors" in management's discussion and analysis for the year ended September 30, 2007, a copy of which is available under the Company's name on SEDAR at www.sedar.com.

Consolidated Envirowaste Industries Inc.

Douglas R. Halward, President

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

Contact Information

  • Consolidated Envirowaste Industries Inc.
    Douglas R. Halward
    President
    (604) 856-6836
    (604) 856-5644 (FAX)