Distinction Group Inc.

Distinction Group Inc.

July 15, 2011 06:00 ET

GDI Posts Record Sales in Q2 2011

- Record sales of $68.8 million, up 7.9%

- Net earnings up 10.0% to $1.5 million or $0.050 per share, fully diluted

- Strong balance sheet, with working capital of $15.2 million

- Debt-to-equity ratio of 0.25 in Q2 2011 versus 0.29 in Q4 2010

MONTREAL, QUEBEC--(Marketwire - July 15, 2011) - Distinction Group Inc. ("GDI" or the "Company") (TSX:GD) reported its results today for the second quarter and six-month period ended May 31, 2011. The financial statements and management discussion and analysis can be found on SEDAR at www.sedar.com.

GDI posted record revenues of $68.8 million for the second quarter of 2011, up 7.9% from $63.8 million in 2010. Organic growth was 5.1% for the quarter. EBITDA amounted to $3.0 million, compared to $3.2 million in 2010. Net earnings for 2011 were $1.5 million or $0.050 per share, fully diluted, up 10.0% from $1.4 million or $0.046 per share, fully diluted, in 2010.

For the six-month period ended May 31, 2011, revenues amounted to $133.9 million, compared to $128.0 million in 2010. Organic growth for the first six months was 2.2%. EBITDA totalled $7.3 million in 2011 compared to $6.8 million a year earlier. Net earnings were $3.7 million or $0.118 per share, fully diluted, in 2011, compared to $3.1 million or $0.102 per share, fully diluted, in 2010.

Claude Bigras, President and Chief Executive Officer of GDI, said: "As noted last quarter, we have put a lot of effort into improving our organic growth, which rose from -0.8% in the first quarter to 5.1% in the second quarter of 2011. The improvement enabled us to achieve record sales, strengthen our balance sheet and reduce our long-term debt. This performance stems from effective execution of management's strategy of prioritizing profitable growth of the Company's operating activities and sound management of its financial position. We also finished integrating SOS Janitorial Ltd. during the period, which had a positive impact on our second quarter results."

GDI enjoys a strong financial position, with $15.2 million in working capital, $6.5 million in cash and up to $50 million in credit facilities. In the second quarter, the Company reduced its long-term debt and redeemable preferred shares, from $15.0 million at November 30, 2010, to $13.7 million at May 31, 2011, for a debt-to-equity ratio of 0.25 (0.29 at November 30, 2010).


"The future is looking good for GDI. We are confident that the sustained sales efforts to increase the organic growth of our operating activities will translate into steady sales growth and enhanced profitability in the coming quarters. We are also working to identify acquisition targets, which is progressing well. We expect to be in a position to make another acquisition like SOS Janitorial Ltd. by year-end," Mr. Bigras concluded.

About GDI (Distinction Group Inc.)

GDI is a Canadian leader in the facility services industry. Through its subsidiaries, GDI provides a range of industrial janitorial, mechanical maintenance and other related services to various segments of the real estate industry across Canada.

Additional information on the Company can be found on the GDI website at www.gdiservices.ca and on the SEDAR website at www.sedar.com.

Forward-Looking Statements

This press release may contain certain "forward-looking statements". 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. Readers should not rely unduly on such forward-looking statements.

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