Foremost Income Fund
TSX : FMO.UN

Foremost Income Fund

March 24, 2005 06:00 ET

Foremost Industries Income Fund Announces Earnings for 2004


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: FOREMOST INDUSTRIES INCOME FUND

TSX SYMBOL: FMO.UN

MARCH 24, 2005 - 06:00 ET

Foremost Industries Income Fund Announces Earnings for
2004

CALGARY, ALBERTA--(CCNMatthews - March 24, 2005) - Foremost Industries
Income Fund (TSX:FMO.UN) (the "Fund") of Calgary today announces
financial results for the year ended December 31, 2004.



For the year ended December 31 2004 2003

Revenue $ 160,752,000 $ 70,679,000
Net income 20,296,000 6,619,000
Per trust unit 3.27 1.18
Cash flow from operations 22,412,000 7,983,000
Per trust unit 3.61 1.43
Property, plant and equipment expenditures 2,120,000 923,000
Working capital 17,995,000 14,270,000
Total assets 108,040,000 58,221,000
Long-term debt - 3,098,000
Unitholders' equity $ 49,715,000 $ 36,293,000
------------------------------------------------------------------------

Distributable cash:
Net income $ 20,296,000 $ 6,619,000
Amortization 2,105,000 1,315,000
------------------------------------------------------------------------
22,401,000 7,934,000
Less: sustaining capital expenditures 1,100,000 700,000
------------------------------------------------------------------------
Distributable cash $ 21,301,000 $ 7,234,000
------------------------------------------------------------------------
Cash distributions paid $ 8,381,000 $ 4,533,000
------------------------------------------------------------------------
Distributable cash flow per trust unit $ 3.43 $ 1.29
------------------------------------------------------------------------
Actual cash distribution paid
per trust unit $ 1.35 $ 0.80
------------------------------------------------------------------------
------------------------------------------------------------------------


Distributable cash is not a defined term under Canadian generally
accepted accounting principles. This amount is determined as net income
for the year, 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.

In the case of the Fund, the level of distribution is set periodically
with no direct relationship to the distributable cash during the period.

The Canadian taxable income allocated to Unitholders for 2004 was $3.75
per trust unit consisting of $1.35 distributed in cash throughout the
year, plus $2.40 distributed in the form of a unit distribution to
Unitholders of record on December 22, 2004. The distributed units were
consolidated contemporaneously so that Unitholders ended up with the
same number of units after as before the unit distribution. For Canadian
tax purposes, this transaction increases the Adjusted Cost Base by $2.40
per trust unit. Accounting and Canadian taxable income will differ each
year due to many timing differences in the respective recognition of
revenue, expenses and capital in determining income.

The Fund's business operations are conducted through Foremost and
Universal. Foremost designs and fabricates drilling equipment, heavy
all-terrain vehicles and related parts and tooling for the oil and gas,
mining, waterwell and construction industries. Universal designs and
fabricates oil and gas treating equipment, including pressure vessels,
petroleum storage tanks and large scale steam generators.

On behalf of the Trustees

FOREMOST INDUSTRIES INCOME FUND

James T. Grenon, Trustee

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Foremost Industries Income Fund
    Glen E. Swail
    Investor Relations
    (403) 571-4453 or Toll Free 1 800 661-9190 (Canada/USA)
    (403) 571-4444 (FAX)
    Email: investorrelations@foremost.ca
    Website: www.foremost.ca