Franchise Services of North America Inc.
TSX VENTURE : FSN

Franchise Services of North America Inc.

December 29, 2010 17:20 ET

Franchise Services of North America Inc. Announces Financial Results for the Fiscal Year Ended September 30, 2010, Announces New Franchise Locations

CALGARY, ALBERTA--(Marketwire - Dec. 29, 2010) - FRANCHISE SERVICES OF NORTH AMERICA INC. ("FSNA" or the "Company") (TSX VENTURE:FSN) announced today its financial results for the fiscal year ended September 30, 2010 and new franchise locations. Revenue for the year ended September 30, 2010 was $16,212,522 with a reported net loss of $732,595, as compared to revenue of $14,743,616 and a net loss of $6,866,994 for the year ended September 30, 2009.

During the period, the Company reported an insurance underwriting loss of $495,000 in its Canadian insurance program. This Canadian insurance program has now triggered the provision of the stop-loss coverage, eliminating the possibility of any future underwriting losses in this program.

Bob Barton, the Company's President and Chief Operating Officer, stated, "The company has now moved all of the Association business to a dollar one coverage, eliminating any loss risk associated with the program for future claims. This is trending very well with positive variances reported in the fourth fiscal quarter. The Canadian Program is now also fully reserved and cannot experience further underwriting losses. We are optimistic as the performance of the insurance portfolio in Q4 was positive. The company continues to sell franchises aggressively in an effort to grow the system. We are also pleased to announce the sale of three new PractiCar franchises in Red Deer and Grande Cache, Alberta and in the Greater Toronto Area at Bathurst & Steeles. Additionally, the Company is pleased to announce the sale of U-Save franchises in Columbus, MS and Ruston, LA. All five sales took place in December, thus the financial impact of these transactions will be reflected in the first quarter of fiscal year ending September 30, 2011."

About FSNA

FSNA is a publicly traded company listed on the TSX Venture Exchange. The Company and its subsidiaries own the following brands: U-Save Car & Truck Rental, U-Save Car Sales, Rent-A-Wreck of Canada, PractiCar, Auto Rental Resource Center ("ARRC"), Xpress Rent A Car and Peakstone Financial Services.

U-Save, together with its subsidiary ARRC, has over 1,100 locations throughout the United States and is one of North America's largest franchise car rental companies. Having primarily serviced the local market for the past 30 years, the Company is expanding into the airport market with plans for the opening of airport locations in the top 30 markets in the United States and the major airports in Canada. U-Save currently services 34 airport markets in 13 different states and 7 countries. U-Save Car Sales is an expansion of the U-Save brand into the car sales market, and provides goods and services to car sales operators looking to affiliate with a national brand.

Practicar Systems Inc. (a wholly owned subsidiary of FSNA) owns the rights to the Rent-A-Wreck® trademark for all of Canada. The Rent-A-Wreck® system operates a network of 58 franchises from coast- to-coast in Canada, providing a range of vehicle rental, leasing and sales options to its customers. The Rent-A-Wreck® system has been in continuous operation in Canada since 1976.

Forward-Looking Information

Certain statements made in this news release are forward looking in nature. The words "may," "could," "should," "would," "expect," "intend," "estimate," "anticipate," "believe," or "outlook" and similar expressions often identify forward-looking information. By their nature, forward-looking statements require FSNA to make assumptions and are subject to inherent risks and uncertainties. There is significant risk that predictions, forecasts, conclusions and projections will not prove to be accurate, that FSNA's assumptions may not be correct and that actual results may differ materially from such predictions, forecasts, conclusions or projections. FSNA's forward-looking statements are qualified in their entirety by these cautionary statements. In addition, the forward-looking statements are made only as of the date of this news release, and except as required by applicable law, FSNA undertakes no obligation to publicly update these forward-looking statements to reflect new information, subsequent events or otherwise.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Franchise Services of North America Inc.
    Robert M. Barton
    (601) 713-4333 x 116
    bob.barton@usave.com