Cryopak Industries Inc.
TSX VENTURE : CYK

Cryopak Industries Inc.

June 16, 2005 09:00 ET

Cryopak Announces Fourth Quarter and FY2005 Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - June 16, 2005) - Cryopak Industries Inc. (TSX VENTURE:CYK) today reported its results for the fourth quarter and year ended March 31, 2005.

Mr. Martin Carsky, President and CEO of Cryopak stated, "Looking back on the year, we are proud that we achieved several milestones which are key to our long term success. First of all, we significantly grew both the revenue and the number of customers in our pharmaceutical package segment. Second, we were successful in obtaining our ISO 9001:2000 certifications in both of our manufacturing locations. Third, we were able to negotiate a financial responsible resolution with over 50% of our convertible loan note-holders. Finally, we raised the necessary capital to fund our business going forward." Mr. Carsky added, "While we were disappointed with the retail and industrial sales levels, through focused cost control, we were able to cut our overall losses in half compared to last year."

Convertible Loan Agreement

Cryopak announced on January 19, 2005 that it has reached an agreement with the holders of 40% of the Company's outstanding $3.6 million convertible loan agreement (CLA) to amend and restate the CLA.

Cryopak announced on June 13, 2005 that it had concluded an arrangement to settle approximately $575,000 of principal and accrued interest on its outstanding CLA, for payment of $218,250.

Operating Results for the Year ended March 31, 2005

The net loss for the year ended March 31, 2005 was $1.6 million as compared to a net loss of $3.0 million for the year ended March 31, 2004. Sales and gross profit for the year were $14.7 million and $4.1 million as compared to sales and gross profit of $16.9 million and $5.6 million in the year ended March 31, 2004. The reduction in gross profit was due to a number of factors. Fixed manufacturing overhead was held constant but the reduction in sales level combined with higher costs for labour, raw materials, and freight negatively impacted the sales contribution margin.

Sales and marketing expenses for the year were reduced by $1.3 million to $1.9 million, as compared to $3.2 million for the year ended March 31, 2004. General and administrative costs for the year were reduced by $0.7 million to $2.2 million, as compared to $2.9 million for the year ended March 31, 2004.

Operating Results for the Fourth Quarter ended March 31, 2005

The net loss for the quarter ended March 31, 2005 was $0.7 million as compared to a net loss of $0.2 million for the same period in the prior year. Sales for the quarter ended March 31, 2005 were $3.4 million as compared to sales of $3.9 million for the quarter ended March 31, 2004. The company continues to diligently monitor its discretionary expenditures. Sales and marketing expenses for the quarter were stabilized to $0.4 million as compared to $0.4 million for the quarter ended March 31, 2004. General and administrative costs for the quarter were $0.6 million as compared to $0.5 million for the quarter ended March 31, 2004.

About Cryopak

With ISO 9001:2000 certified facilities in Vancouver and Montreal, we are a leading provider of temperature-controlling products and solutions. Our clients include some of North America's leading retailers and consumer goods companies, as well as global pharmaceutical companies. In our retail business, we develop, manufacture and sell reusable ice substitutes, flexible hot and cold compresses, reusable gel ice and instant hot and cold packs. These products are marketed under such popular brand names as Ice-Pak™, Flexible Ice™ Blanket, Simply Cozy®, and Flex Pak™. In our pharmaceutical business, we engineer solutions and supply products that help our customers safely transport their temperature sensitive pharmaceuticals. Over the past few years we have evolved into a recognized player in this growing segment as we assist customers in optimizing their cold chain processes. Our shares are listed on the TSX Venture Exchange under the symbol CYK. For more information about Cryopak, please visit our website address at: www.cryopak.com.

ON BEHALF OF THE BOARD OF DIRECTORS

Martin Carsky, President and CEO

Certain statements contained herein are "forward-looking" statements (as such term is defined in the Private Securities Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ from those expressed or implied by such forward-looking statements.



CRYOPAK INDUSTRIES INC.
Consolidated Balance Sheets
(Expressed in Canadian dollars)

March 31, 2005 and 2004

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2005 2004
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(Restated)

Assets

Current assets:
Accounts receivable $ 2,237,834 $ 2,833,627
Advances to related company - 48,371
Inventory 1,670,503 1,762,476
Prepaid expenses 65,265 163,566
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3,973,602 4,808,040

Property, plant and equipment 877,846 1,490,577

Long-term deposits 116,335 112,285

Deferred financing costs 81,801 -

Intangible assets 791,663 1,113,949

Goodwill 6,453,268 6,453,268
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$ 12,294,515 $ 13,978,119
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Liabilities and Shareholders' Equity

Current liabilities:
Bank indebtedness $ 1,999,297 $ 1,870,959
Accounts payable and accrued
liabilities 3,555,659 3,182,632
Current portion of notes payable
to related parties 333,333 500,000
Current portion of obligations
under capital lease 153,225 261,789
Convertible loan 2,182,500 3,637,500
Deferred revenue - 105,448
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8,224,014 9,558,328

Notes payable to related parties - 333,333

Promissory notes 1,547,029 -

Obligations under capital lease 217,764 318,862
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Shareholders' equity:
Share capital 9,393,383 9,393,383
Share purchase loan (394,000) (394,000)
Warrants - 225,610
Contributed surplus 1,409,116 1,035,631
Deficit (8,102,791) (6,493,028)
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2,305,708 3,767,596
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$ 12,294,515 $ 13,978,119
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CRYOPAK INDUSTRIES INC.
Consolidated Statements of Operations and Deficit
(Expressed in Canadian dollars)

Years ended March 31, 2005 and 2004

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2005 2004
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(Restated)

Sales $ 14,699,576 $ 16,919,583
Cost of sales 10,593,639 11,339,528
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Gross profit 4,105,937 5,580,055

Expenses:
Sales and marketing 1,918,522 3,200,178
Administration 2,194,477 2,903,056
Amortization 1,062,600 1,058,945
Interest on bank operating line 215,590 171,336
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5,391,189 7,333,515
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Loss from operations 1,285,252 (1,753,460)

Other income (expense):
Other income (expense) 107,870 (584,700)
Interest on long-term debt and
other finance costs (432,381) (651,606)
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(324,511) (1,236,306)
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Loss for the year (1,609,763) (2,989,766)

Deficit, beginning of year (6,493,028) (3,503,262)
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Deficit, end of year $ (8,102,791) $ (6,493,028)
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Loss per share, basic and diluted $ (0.24) $ (0.51)

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CRYOPAK INDUSTRIES INC.
Consolidated Statements of Cash Flows
(Expressed in Canadian dollars)

Years ended March 31, 2005 and 2004

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2005 2004
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(Restated)

Cash provided by (used in):

Operations:
Loss for the year $ (1,609,763) $ (2,989,766)
Items not involving cash:
Amortization 1,062,600 1,058,945
Dispute settlement - 125,000
Accretion of convertible loan - 27,320
Stock-based compensation 147,875 176,847
Amortization of deferred financing - 67,125
Write-off of property, plant and
equipment - 5,475
Interest on exchanged convertible
loan capitalized 92,029 -
Forgiveness of interest (302,000) -
Changes in non-cash operating
working capital:
Accounts receivable 595,793 1,166,071
Advances to related company 48,371 40,219
Inventory 91,973 401,525
Prepaid expenses 98,301 117,581
Accounts payable and accrued
liabilities 675,027 (476,265)
Deferred revenue (105,448) (17,960)
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794,758 (297,883)

Investments:
Long-term deposits (4,050) -
Purchase of property, plant and
equipment (95,159) (134,663)
Proceeds from sale of short-term
investments - 6,133
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(99,209) (128,530)

Financing:
Repayment of bank indebtedness (201,662) (750,969)
Increase in bank indebtedness 330,000 -
Repayment of obligations under
capital lease (242,086) (248,811)
Issuance of shares for cash - 1,654,179
Deferred financing costs (81,801) -
Share issue costs - (61,319)
Repayment of notes payable (500,000) (166,667)
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(695,549) 426,413
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Increase in cash and cash
equivalents - -

Cash and cash equivalents,
beginning of year - -
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Cash and cash equivalents,
end of year $ - $ -
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Contact Information

  • Cryopak Industries Inc.
    Martin Carsky
    President and CEO
    1-800-667-2532
    www.cryopak.com