Foremost Income Fund
TSX : FMO.UN

Foremost Income Fund

March 31, 2006 17:00 ET

Foremost Income Fund Announces Record Earnings for Fourth Quarter and Fiscal 2005

CALGARY, ALBERTA--(CCNMatthews - March 31, 2006) - Foremost Income Fund (TSX:FMO.UN) announces financial results for the fourth quarter and year ended December 31, 2005.



For the fourth quarter ending December 31, 2005 2004
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Revenue $ 67,598,000 $ 55,400,000
Cost of Sales 51,688,000 45,712,000
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15,910,000 9,688,000
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Selling, general and administrative 4,946,000 3,636,000
Interest 236,000 363,000
Amortization 636,000 546,000
Foreign exchange (gain) loss (226,000) 120,000
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5,592,000 4,665,000
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Income from operations 10,318,000 5,023,000
Gain (loss) on disposal of property,
plant and equipment (65,000) 118,000
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Net income $ 10,253,000 $ 5,141,000
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For the years ended December 31, 2005 2004
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Revenue $ 207,504,000 $ 160,752,000
Cost of sales 160,642,000 125,248,000
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46,862,000 35,504,000
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Selling, general and administrative 15,045,000 12,191,000
Interest 1,204,000 755,000
Amortization 2,649,000 2,105,000
Foreign exchange (gain) loss (51,000) 262,000
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18,847,000 15,313,000
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Income from operations 28,015,000 20,191,000
Gain (loss) on disposal of property,
plant and equipment (36,000) 105,000
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Net income $ 27,979,000 $ 20,296,000
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Earnings per trust unit
Basic $ 1.49 $ 1.09
Diluted $ 1.45 $ 1.05
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Distributable Cash
For the years ended December 31, 2005 2004
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Net Income $ 27,979,000 $ 20,296,000
Amortization 2,649,000 2,105,000
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30,628,000 22,401,000
Less: sustaining capital expenditures 1,400,000 1,100,000
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Distributable cash $ 29,228,000 $ 21,301,000
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Cash distributions paid $ 10,813,000 $ 8,381,000
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Distributable cash flow per trust unit $ 1.55 $ 1.14
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Actual cash distribution paid
per trust unit $ 0.57 $ 0.45
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Distributable cash and cash flow per trust unit are not defined terms under Canadian generally accepted accounting principles.

Distributable cash is determined as net income for the period, with amortization, which is a non-cash expense added back. An estimate of normalized sustaining capital expenditures is then deducted.

Management believes that distributable cash is a useful supplemental measure of performance as it is used by other income funds. It provides investors with an indication of the amount of cash the business has generated during that period which could be available for distribution to Unitholders. Investors are cautioned, however, that distributable cash should not be construed as an alternative to using net earnings as a measure of profitability or the statement of cash flows. Further, the Fund's method of calculating distributable cash may not be comparable to similarly titled amounts reported by other issuers.

The Fund is an unincorporated open end mutual fund trust conducting its business through Foremost Universal LP ("Universal") and Foremost Industries LP ("Foremost"). The Fund derives its operational income from both Universal and Foremost. Universal's overall business is focused on the oil and gas industry and contains the business units of: Universal Industries ("Universal Industries"), a manufacturer of oil treating systems, shop and field storage tanks; Stettler Oil and Gas Equipment, a gas separator manufacturer; Wilco Industries; Corlac Industries ("Corlac"); Peace Land Fabricating and Supply Ltd. ("Peace Land") and De-In Industries Ltd. ("De-In") all shop tank manufacturers. Foremost is comprised of the business units of Foremost Industries, a manufacturer of custom equipment used for the oil and gas, construction, water-well and mining industries; and Mobile Drilling, a U.S. based business which manufactures and sells rigs and parts for the geotechnical industry.

On behalf of the Trustees

Foremost Income Fund

(signed: J.T. Grenon)

James T. Grenon, Trustee

Note: A complete financial breakdown can be found on www.sedar.com.

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