Gienow Windows & Doors Income Fund
TSX : GIF.UN

Gienow Windows & Doors Income Fund

August 09, 2007 16:01 ET

Gienow Windows & Doors Income Fund Announces the Results of Operations for the Quarter Ended June 30, 2007

CALGARY, ALBERTA--(Marketwire - Aug. 9, 2007) -

NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO U.S. CITIZENS

Gienow Windows & Doors Income Fund (the "Fund") (TSX:GIF.UN) is pleased to provide the results of operations for the three and six months ended June 30, 2007 and 2006. The Fund's unaudited consolidated financial statements and Management's Discussion and Analysis ("MD&A") for the three and six months ended June 30, 2007 and 2006 are available on the Fund's website at www.gienowincomefund.ca. All numbers are expressed in thousands of dollars except per unit information.

Financial Highlights for the Quarter

- The Fund's backlog, defined as committed orders and signed contracts expected to be delivered within the next 12 months, remains near $40 million, confirming the continued strong demand for the Fund's products and services for the new home construction and high rise buildings.

- Total sales from continuing operations for the quarter ended June 30, 2007, were $55,221 equal to $55,378 in the previous comparable period and YTD were $96,872 equal to $96,629 in the first six months of 2006.

- EBITA for the quarter ended June 30, 2007 was $9,128 compared to $10,513 in the previous comparable period. YTD EBITA was $12,903 compared to $14,704 in the first six months of 2006. Both amounts for 2007 were in line with management expectations with the decrease on a year over basis related to increased selling, general & administrative ("SG&A") expenses.

- Gross profit for the quarter ended June 30, 2007 was $17,627, or 31.9% of sales, relatively unchanged from $17,536, or 31.7% of sales in the previous comparable period and reflects an expected stabilization in the gross profit of the Fund.

- SG&A expenses YTD were $15,596 or 16.1% of sales, as compared to $13,346 or 13.8% of sales in the previous comparable period. The increase reflects the Fund's investment in the new Farley product launch, an increase in input costs in its Western Canadian operations and costs associated with the strategic review process.

Strategic Review Update

On November 8, 2006 the Fund announced that it formed a special committee composed of independent members of the Board of Trustees to identify, examine and consider strategic alternatives to maximize unitholder value. The special committee has engaged RBC Capital Markets as its exclusive financial advisor in this regard and the process is underway.

As part of this review process, the Fund concluded that the operations of the Chantecler Windows & Doors Limited Partnership ("Chantecler Partnership") no longer met the strategic objectives of the Fund. Accordingly, in December 2006 the Fund agreed to dispose of certain assets of the Chantecler Partnership.

The Fund is continuing to evaluate other strategic and financial alternatives and will provide further details as they become available.

Outlook

"We continue to experience strong sales demands within our core new construction and renovation markets as evidenced by our solid and consistent year over year sales figures for the first six months of the year" said Mike Lefroy President and Chief Executive Officer.

"Our backlog remains at nearly $40 million and our gross margin has stabilized on a year over year basis positioning us to build upon our base 2006 sales, gross profit and EBITA levels. The strength and continuity of our backlog is a positive indication that the core markets for our products and services remain very healthy."

Conclusion

Mr. Lefroy concluded that "we are seeing consistent year over year trends in our sales and gross profit levels and that consistency is positioning us well to duplicate our previous year's key financial results. We remain focused on improving the operations of our current business units, maximizing the returns of cost reduction programs and increasing sales. Our business operations and business model remain sound and our management team is committed to achieving continued growth from our current business operations."

Management will host a conference call today at 3:30 PM (MDT) to discuss the Fund's financial results for the three and six months ended June 30, 2007 and 2006. The conference call dial-in number is 1-800-926-7748. A replay of the conference call will be available by dialing either 1-416-626-4100 or 1-800-558-5253, pass-code 21345397#, until 5:00 p.m. (MST) on Friday August 17, 2007 or by listening to it at the Fund's website www.gienowincomefund.ca.

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