March 30, 2007 13:20 ET

Granby Industries Income Fund Announces Amendment to Credit Agreement

GRANBY, QUEBEC--(CCNMatthews - March 30, 2007) - Granby Industries Income Fund (TSX:GBY.UN) ("the Fund") announced today that Granby Industries Limited Partnership ("Granby LP" or "Granby") has reached an agreement with its lenders to amend its existing credit facilities. The Fund holds an indirect eighty percent (80%) interest in Granby LP. The amendment provides for a number of key revisions to the credit facilities, including:

- Cash distributions to unitholders are subject to the consent of the lenders

- A reduction in the borrowing limit on the revolving credit facility from $10 million to $9 million

- The addition of new interest rate pricing levels in the event Total Funded Debt to EBITDA(i) exceeds 3.00:1

- An amendment to the Total Funded Debt to EBITDA ratio covenant from a limit of 3.00:1 to the following:

a. 3.50:1 for the first quarter of 2007

b. 4.25:1 for the second quarter of 2007

c. 4.75:1 for the third quarter of 2007

d. 2.75:1 for the fourth quarter of 2007

Granby has agreed to pay a one-time administration fee of $94,500 plus out-of-pocket expenses to its lenders in consideration for the amendment due on closing.

Granby was in compliance with the requirements of its credit facilities as at December 31, 2006. Management believes that these amendments to its credit facilities will provide Granby with flexibility in 2007 in meeting its covenants during what it expects to be a challenging period without inhibiting the operation of its business.

A copy of the amendment to the credit agreement will be available on

About Granby Industries Income Fund

Granby Industries Income Fund is a trust established under the laws of the Province of Ontario, which indirectly holds an 80% interest in Granby LP. Granby LP is a leading North American manufacturer of high quality tanks for the residential and light commercial storage of heating oil and other petroleum-based products and is also a leading manufacturer of coated copper tubing. Granby has been operating in the heating oil storage tank industry for more than 50 years and its primary business is manufacturing replacement residential tanks with operations in Granby, Quebec and Oakville, Ontario.

(i)Non-GAAP Measure

References in this press release to the term "EBITDA" are to earnings before non-controlling interest, amortization, interest expense, goodwill and intangible assets impairment charges and restructuring costs. EBITDA is not a recognized measure under GAAP in Canada and may not be comparable to similar measures used by other companies. The Fund believes that EBITDA is a useful supplementary measure of operating performance as it provides investors with an indication of cash available for distributions prior to debt service and capital expenditures. Investors are cautioned, however, that EBITDA should not replace net earnings or loss as an indicator of the Fund's performance, or cash flows from operating, investing and financing activities as a measure of the Fund's liquidity and cash flows. It is not intended to be representative of cash flow from operating activities or results from operations determined in accordance with GAAP or cash available for distribution.

Forward-Looking Statements

This press release may contain forward-looking statements, which reflect management's expectations regarding the Fund's results of operations, performance, business prospects and opportunities. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. Forward-looking statements are based on certain factors and assumptions regarding, among other things, expected storage tank unit volumes, the price of raw materials and the average U.S./Canadian dollar exchange rate during the year. While Granby considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Many factors could cause results to differ materially from the results discussed in the forward-looking statements, including, among other things, risks relating to economic conditions, the seasonality of demand for Granby's products, the risk of increased heating oil costs, which could depress demand for heating oil storage tanks, commodity pricing volatility and foreign exchange risk, regulatory change, interest rate fluctuation, a decline in the housing and major consumer products markets, dependence on key suppliers, reliance on major customers and the risk of increased competition in the coated copper tubing market and the storage tank market. Although the forward-looking statements are based on what management believes to be reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this press release and accordingly, the Fund assumes no obligation to update or revise them to reflect new events or circumstances.

Contact Information

  • Granby Industries Income Fund
    Mr. Paul Antoniadis CA
    Vice President, Finance & CFO
    450-378-2334 ext. 225