Heroux-Devtek Inc.
TSX : HRX

Heroux-Devtek Inc.

October 27, 2005 16:39 ET

CORRECTION FROM SOURCE: Heroux-Devtek Announces Treasury Issue Of Common Shares

LONGUEUIL, QUEBEC--(CCNMatthews - Oct. 27, 2005) -

NOT FOR DISTRIBUTION IN THE US NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

The following corrects and replaces the release that was sent today, October 27, 2005 at 0803 am ET. In the Second Quarter Update paragraph, you should read that the teleconference will take place on November 3, 2005, at 10 am, Eastern Time and not on November 2nd.

Heroux-Devtek Inc. (TSX:HRX) ("Heroux-Devtek" or the "Company") announced today that it has entered into an underwriting agreement with a syndicate of dealers led by National Bank Financial Inc. and GMP Securities Ltd. and including Raymond James Ltd. and Versant Partners Inc. for the purchase, on a bought deal basis, of an aggregate of 4,500,000 common shares (the "Shares") at a price of $3.75 per Share, issued and sold by Heroux-Devtek from treasury. The offering will result in total gross proceeds of $16,875,000. The Company also granted to the underwriters of the offering an over-allotment option, exercisable within 30 days of closing, to acquire an additional 250,000 shares.

Closing of the transaction is expected to occur on or about November 10, 2005 and is subject to certain conditions, including the approval of the Canadian securities regulatory authorities.

The net proceeds from the sale of the Shares will be used by the Company for working capital, capital expenditures and other general corporate purposes and, until such use, to reduce its revolving lines of credit, but not as a permanent reduction thereof.

A preliminary short form prospectus will be filed in all provinces of Canada today.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction. The Company's shares being offered have not been and will not be registered under the U.S. Securities Act of 1993 and States' securities laws. Accordingly, the Company's shares may not be offered or sold to U.S. persons except pursuant to applicable exemptions from registration.

Second Quarter Update

The Company also wishes to give notice that the release of its results and related conference call for the second quarter ended September 30, 2005 will take place on November 2 at 4 :30 p.m. Eastern Time. Although the finalization of these results has not been completed, the Company anticipates that the results will be on track with its most recent guidance previously provided and is confident that these results will show an improvement compared to the results of the first quarter ended June 30, 2005, with an increase in sales, improvement of its EBITDA (Earnings before interest, taxes, depreciation and amortization) margin and a reduction in net loss from continuing operations.

Profile

Heroux-Devtek (TSX:HRX), a Canadian company, serves two main market segments: Aerospace and Industrial Products, specializing in the design, development, manufacture and repair of related systems and components. Heroux-Devtek supplies both the commercial and military sectors of the Aerospace segment with landing gear (including spare parts, repair and overhaul services), airframe structural components and aircraft engine components. The Company also supplies the Industrial segment with large components for electricity - generating gas turbines and precision components for other industrial applications. Over 70% of the Company's sales are outside Canada, mainly in the United States. The Company's head office is located in Longueuil, Quebec with facilities in the Greater Montreal area (Longueuil, Dorval and Laval); Kitchener and Scarborough, Ontario; Arlington, Texas and Cincinnati, Ohio.

Forward-Looking Statements

Except for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of the Company. These statements are based on suppositions and uncertainties as well as on management's best possible evaluation of future events. Such factors may include, without excluding other considerations, fluctuations in quarterly results, evolution in customer demand for the Company's products and services, the impact of price pressures exerted by competitors, and general market trends or economic changes. As a result, readers are advised that actual results may differ from expected results.

Contact Information

  • Heroux-Devtek Inc.
    Gilles Labbe
    President and Chief Executive Officer
    (450) 679-3330
    or
    Heroux-Devtek Inc.
    Real Belanger
    Executive Vice-President and Chief Financial Officer
    (450) 679-3330
    or
    Maison Brison
    Jean-Francois Piche
    (514) 731-0000