Davie Yards Inc.

Davie Yards Inc.

May 15, 2008 11:09 ET

Davie Yards Inc. Releases First Quarter 2008 Results: Q1 2008-Continued Ramp Up of the Yard

LEVIS, QUEBEC--(Marketwire - May 15, 2008) - Davie Yards Inc. ("Davie" or the "Company") (TSX:DAV)(TSX:DAV.WT) today released its financial and operating results for the three month period ended March 31, 2008.

Revenue for the three months ended March 31, 2008 was US$10.15 million. EBITDA for the first quarter was negative US$8.7 million, and the Company recorded a net loss of US$8.7 million. Due to the loss provision taken by the Company in Q4 2007, Davie did not record a gross profit during Q1 2008. The loss of US$8.7 million in Q1 consisted of general overhead expenses and value adjustments in relation to currency options.

Davie currently enjoys an order backlog of US$581 million end of March 2008, consisting of three Offshore Construction Vessels and two Multipurpose Accommodation Vessels. The Company continued the ramp-up of the yard during the first quarter of 2008. As of May 12th Davie had 895 employees at the yard, up from 503 employees at year end 2007. The number of employees is expected to increase further during the coming months as work continues on the completion of vessels already under construction and construction begins on other vessels in the order book.

In February, Davie completed an initial public offering of CDN$47.3 million, strengthening the Company's financial position.

Davie has appointed Mr. Steinar Kulen as the new CEO, he joined the company March 1st 2008, bringing significant shipbuilding/maritime experience to the Company.

"Since I joined the Company, I have undertaken a thorough analysis of the processes and the projects at Davie. These efforts, coupled with a strategic business analysis, will enable us to finalize an updated version of the company's business plan this summer. I am pleased with what I have learned so far", Mr. Kulen said.

While recent reports state that the current challenging conditions in the credit markets are having an effect on the order book of shipyards, the market for large complex offshore vessels is strong, and Davie anticipates additional construction contracts in fiscal 2008.

For a complete copy of the Financial Statements and the Management's Discussion and Analysis please visit www.sedar.com or www.davie.ca.

About Davie Yards Inc.

Davie Yards Inc. owns and operates the Davie Shipyard. With over 180 years of operating experience, the Davie Shipyard is the largest in Canada and among the most sophisticated shipbuilding facilities in North America. The company has a primary focus on building complex and technologically advanced vessels for the offshore oil exploration and production services sector. Its shares are traded on the Toronto Stock Exchange (DAV). News and information are available at www.davie.ca.


This news release contains forward-looking information within the meaning of applicable Canadian securities legislation. These statements include those relating to the expectations of the Company regarding additional contracts in fiscal 2008 and other statements that are not historical facts, and reflect the current intentions, plans, expectations and beliefs of Davie's management ("Management"). Such forward-looking statements reflect Management's current beliefs and are based on information currently available to Management. Forward-looking statements involve known and unknown risks, uncertainties and other factors outside Management's control. A number of factors could cause actual results of Davie to differ materially from the results predicted in the forward-looking statements, including, but not limited to, risks associated with a downturn in economic conditions, competition and sensitivity to the oil and gas industry and other factors.

Although the forward-looking statements contained herein are based upon what Management believes to be reasonable assumptions, Management cannot assure investors that actual results will be consistent with these forward-looking statements. Certain assumptions underlying the forward-looking statements contained in this news release include Management's assumptions regarding market outlook for the construction of complex offshore vessels as well as the assumptions that new vessels will be delivered on schedule and that the Company will attract and retain key personnel in key positions. These forward-looking statements are made as of the date of this release, and Management assumes no obligation to update or revise them to reflect new events or circumstances, except as required pursuant to applicable securities laws. Readers are cautioned not to place undue reliance on these forward-looking statements. For additional information with respect to certain of these and other assumptions and risks, please refer to the Company's Management's Discussion and Analysis for Q1 2008 and the year ended December 31, 2007 as well as the Annual Financial Statements for the year 2007, and the Company's Annual Information Form dated March 25, 2008.

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