Junex inc.

Junex inc.

April 12, 2006 23:59 ET

Junex revenues increase by 505% in 2005

MONTREAL, April 12, 2006 - Junex is pleased to release its
financial results for the fiscal year ended December 31, 2005. The company
recorded revenue growth of 505% to reach a total of $2,857,719 and reduced
it's net loss to $143,901 compared to a net loss of $1,017,272 in 2004.

"We are extremely pleased with our financial results for 2005, and in
particular considering that Junex achieved positive net income in each of the
final two quarters of the year. During these two quarters, Junex recorded net
income of $761,839, an amount that surpassed our expectations. These financial
results demonstrate the validity of our business model. We believe that Quebec
represents an excellent potential for the discovery of oil and gas, and we
feel that Junex is well positioned in this regard with rights to over
4 million acres under exploration permit. That being said, we continue to
follow our strategy of reducing exploration risks by entering into exploration
agreements with partners, and to engage in business activities that generate
positive cash flows" stated Mr. Jean-Yves Lavoie, P. Eng., President of Junex.

Highlights for oil and gas exploration

Junex achieved a number of positive developments in 2005 in regards to
our oil and gas exploration activities, highlighted by having produced over
1,000 barrels of oil at our Galt No. 3 well.

"The partnership concluded by Junex with U.S.-based Team Energy is yet
another testimony of the growing interest of the oil and gas industry towards
Québec's sedimentary basins. It is also noteworthy that in 2005, Talisman
Energy, a Canadian leader in oil and gas, acquired numerous exploration
permits in Québec. Over the last few years, Talisman achieved world class
success in the sedimentary zones of the Trenton Black River (TBR) in the state
of New York, and their arrival in Québec is very promising for the future of
the oil and gas industry in our province. Junex is the only junior company
holding a critical mass of exploration permits in Gaspésie, as well as in the
St. Lawrence lowlands, where the majority of our permits are located next to
those held by Talisman" commented Mr. Lavoie.

Financial Highlights

In thousands $ excepted for per share results 2005 2004

Sales 2 858 472

Gross profit 940 215

Administrative expenses 1 467 1 154

Net loss 144 1 017

Net loss per share, basic and diluted 0,004 0,032

Net loss before stock-based compensation costs 8 934


The company's revenues for fiscal year 2005 reached $2,857,719,
representing growth of 505% compared to revenues in the prior year. The
increase in revenues is directly related to the acquisition of Foragaz, which
was completed in 2004 however the financial results were only consolidated
with Junex's financial statements beginning in 2005. Foragaz's drilling
revenues reached $2.3 million in 2005, while Junex did not have any drilling
revenues in 2004. Sales of natural brine grew to $515,207 in 2005 from
$358,546 in 2004, representing one-year growth of 43.7%, while sales of oil
and gas decreased from $113,000 in 2004 to $91,156 in 2005. This decline was
directly related to a decrease in consumption of natural gas by the Marinard

Net loss

The company recorded a net loss of $143,901 in 2005, a significant
improvement compared to the net loss of $1,017,274 in 2004 and $485,774 in
2003. This improvement is directly related to the growth in revenues. Junex
recorded positive net income in each of the last two quarters of 2005.

Financial position

As at December 31, 2005, working capital amounted to $3,330,123, a
significant increase compared to the working capital of $2,609,605 at the end
of 2004.

Defered exploration cost

In 2005, Junex recorded deferred exploration expenses of $2,343,696, an
increase over deferred exploration expenses of $1,426,933 in 2004. These
exploration expenses, net of tax credits and partners' contributions, are
recorded as investments and will be amortized based on developments occurring
on the various properties in the coming years.

The TSX Venture Exchange has neither approved nor disapproved the
information contained herein.
%SEDAR: 00015378EF

Contact Information

  • Junex Inc.
    Mr. Jean-Yves Lavoie, P. Eng.
    (418) 654-9661

    Junex Inc.
    Mr Dave Pépin
    Corporate affairs
    (418) 654-9661