Distinction Group Inc.

Distinction Group Inc.

October 14, 2008 11:23 ET

Distinction Group Turns in a Solid Performance in the Third Quarter of 2008 on the Strength of Acquisitions

- Distinction increases net earnings by over 50% to $1.5 million - 137% growth in EBITDA to $4.1 million - Sales up 139% to $57.8 million

MONTREAL, QUEBEC, CANADA--(Marketwire - Oct. 14, 2008) - Distinction Group Inc. (the "Company") (TSX:GD) reported its results today for the third quarter and nine months ended August 31, 2008. The financial statements and management discussion and analysis are available on SEDAR at www.sedar.com.

Revenues for the third quarter ended August 31, 2008, were up 139% to $57.8 million from $24.2 million for the same period in 2007. This increase resulted primarily from the acquisition of Omni Facility Services Canada Limited ("Omni") and Service d'entretien Empro Inc. ("Empro") in June 2008. For the first nine months of the year, revenues were up 48% at $109.1 million compared to $73.5 million for the same period in 2007.

EBITDA grew by 137% to $4.1 million in the third quarter of 2008 from $1.7 million in 2007. For the first nine months of the year, EBITDA amounted to $7.1 million, up from $5.1 million a year earlier.

In the third quarter, the Company incurred non-recurring financial expenses of $583,872 in relation to the extinguishment of Omni's long-term debt to benefit from lower interest rates.

Despite these expenses, Distinction increased net earnings by more than 50% to $1.5 million or $0.044 per share, fully diluted, in the third quarter of 2008, compared to $1.0 million or $0.050 per share, fully diluted, in 2007. Net earnings for the first nine months of the year were $3.1 million or $0.123 per share, compared to $2.8 million or $0.130 per share in 2007.

"These earnings are in line with what we anticipated from the Omni and Empro acquisitions," stated Claude Bigras, President and Chief Executive Officer of Distinction Group. "We have acquired two profitable companies with excellent management teams and established reputations. These acquisitions will enable Distinction to offer a broader range of services Canada-wide and eventually generate substantial recurring economies of scale."

Distinction has a strong financial condition, with $13.4 million in working capital and credit facilities of $30 to $40 million, of which $23 million was used as at August 31, 2008.


"We have two major objectives that we pay particular attention to every quarter, namely improved profitability and revenue growth," added Mr. Bigras. "For starters, we have initiated the integration plan for our two recent acquisitions so as to benefit from operating synergies. This is a twelve-month plan that should generate substantial recurring savings."

"At the same time, we have taken certain measures to ensure continued organic growth. We feel that our new pan-Canadian platform, along with the quality of the services offered by Distinction Group and its subsidiaries, will help us reach and even exceed our objectives."

About Distinction Group Inc.

Distinction is a Canadian leader in janitorial services. Through its subsidiaries Service d'entretien Distinction Inc., Omni Facility Services Canada Limited, Service d'entretien Empro Inc., Montcalm Services Techniques Inc., Distinction Services Plus Inc. and Steamatic Canada Inc., Distinction provides a range of industrial janitorial, mechanical maintenance and other related services to various segments of the real estate industry.

Additional information on the Company can be found on the SEDAR website at www.sedar.com.

Forward-Looking Statements

This press release may contain certain "forward-looking statements", including, but not limited to, statements regarding the strategic plans, future financial results and overall outlook for the Company. Forward-looking statements express, as of the date of this press release, the Company's plans, estimates, forecasts, projections, expectations and opinions regarding future events and results. Forward-looking statements are subject to certain risks and uncertainties, many of which are beyond the Company's control. There can be no assurance that such statements will prove to be accurate. Consequently actual results and future events may differ materially from those anticipated by such statements. Risks and uncertainties that could cause actual results and future events to differ materially from the current expectations expressed or implied by such forward-looking statements include, but are not limited to, the risks described in the management discussion and analysis for the period ended May 31, 2008. Readers should not rely unduly on such forward-looking statements.

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