Logistec Corporation
TSX : LGT.A
TSX : LGT.B

Logistec Corporation

July 28, 2006 12:15 ET

Logistec: Results for the Second Quarter and First Half of 2006

MONTREAL, QUEBEC--(CCNMatthews - July 28, 2006) - Logistec Corporation (TSX:LGT.A)(TSX:LGT.B),



- Consolidated revenue during the second quarter up 18.4% to $54.4
million and 14.4% to $96.7 million for the first six months of
2006;

- Net income during the second quarter up 155% to $2.8 million and
104% to $3.5 million or $0.52 per share for the first six months of
2006;

- 12% increase in the dividends on all share classes paid to
shareholders.


Logistec Corporation, a diversified cargo handler in Eastern Canadian and U.S. ports, today announced its financial results for the second quarter and first six months ended June 24, 2006.

Consolidated revenue amounted to $54.4 million for the second quarter of fiscal 2006, up 18.4% over the same period in 2005. The marine sector's revenue rose 17.1% to $46.8 million, whereas the environmental sector achieved revenue of $7.6 million, an increase of 27.3% . Net income for the second quarter of 2006 grew by $1.7 million to $2.8 million or $0.41 per share, compared with $1.1 million or $0.16 per share for the equivalent period last year.

Consolidated revenue totalled $96.7 million for the first six months of 2006, compared with $84.5 million a year earlier, an increase of $12.2 million or 14.4% . Since the beginning of fiscal 2006, net income has doubled to total $3.5 million or $0.52 per share, up from $1.7 million or $0.26 per share for the first half of 2005. All business sectors contributed to this enhanced performance.

"Our cargo handling services notably benefited from new container business at Termont Montreal Inc. ("Termont") as well as increased break-bulk cargo volumes, driven by the growth in aluminum handling in Sept-Iles (QC) and Trois-Rivieres (QC). Considering the Termont terminal was idle from the spring to the fall of 2005, we are very pleased with the speed at which we were able to build up volume through our new relationship with Mediterranean Shipping Company, S.A. ("MSC"). MSC's services consist of vessels serving the Caribbean, plus the "New Canada Service" which started up in mid-March 2006 and includes three ships serving Europe. For its part, our subsidiary, Sanexen Environmental Services Inc. ("Sanexen"), built upon further demand for its site remediation services to improve its contribution to our consolidated results," said Madeleine Paquin, President and Chief Executive Officer of Logistec Corporation. Ms. Paquin added: "We also enhanced our profitability by tightly controlling operating costs, especially in the few facilities where cargo volumes were down."

On July 27, 2006, the Company's Board of Directors approved an increase in the dividends on all share classes. Quarterly dividends of $0.07 per share on all outstanding Class A Common Shares and $0.077 per share on all outstanding Class B subordinate Voting Shares will be paid on October 18, 2006, to all Logistec Corporation shareholders of record at the close of business on October 4, 2006. This represents a 12% increase compared to the dividends declared in the first quarter of 2006.

Outlook

"The outlook for the balance of the year is equally positive. Cargo-handling volumes should remain solid and results from cost reduction initiatives are expected to contribute to our profitability. Sanexen is carrying on its efforts to expand its U.S. Aqua-Pipe technology business while also benefiting from greater demand for its traditional services," concluded Ms. Paquin.

About Logistec

Logistec Corporation is based in Montreal (QC) and provides specialized services to the marine community and industrial companies in the areas of container, break-bulk and bulk cargo handling at 24 ports in Eastern Canada, the Great Lakes and the U.S. East Coast; agency services to foreign shipowners and operators serving the Canadian market; marine transportation services geared primarily to the Arctic coastal trade; and management of toxic waste, site remediation, risk assessment, and rehabilitation of underground water pipes and aqueducts. The Company has been profitable each year since 1969 and has more than doubled its revenue since 1995 through internal growth and strategic acquisitions. The Company has paid a dividend regularly since 1969 and payments have grown steadily over the years.

A public company since 1969, Logistec's shares are listed on the Toronto Stock Exchange under the ticker symbols LGT.A and LGT.B. More information can be obtained at the Company's website at www.logistec.com.

Forward-Looking Statements

This news release may contain certain forward-looking information and statements concerning the Company's operations, performance and financial condition, including, in particular, the likelihood of its success in developing and expanding its business. These statements are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of the Company. Examples include the performance of domestic and international economies and the effects of these on shipping, weather conditions, labour relations, and pricing, and other marketing activities by competitors. Actual results may differ materially from those expressed or implied by such forward-looking statements.



Consolidated Statements of Earnings

(in thousands of dollars, except for number of shares
and per share amounts)

FOR THE THREE FOR THE SIX
MONTHS ENDED MONTHS ENDED

June 24, June 25, June 24, June 25,
2006 2005 2006 2005
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $
Revenue 54,387 45,918 96,700 84,493
Operating expenses 47,694 41,584 87,318 77,347
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6,693 4,334 9,382 7,146
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Amortization of
property, plant
and equipment 2,069 2,300 4,053 4,440
Amortization of
other assets 19 21 38 41
Interest on long-
term debt 135 196 270 387
Other interest
expenses (revenue) 24 (5) 41 9
Interest revenue
from investment
in a service contract (246) (275) (499) (561)
Exchange loss (gain) 368 (32) 327 (88)
Loss (gain) on
disposal of property,
plant and equipment (39) 87 (31) 88
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2,330 2,292 4,199 4,316
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Income from operations 4,363 2,042 5,183 2,830
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Share in the results
of companies subject
to significant
influence 312 (104) 466 (127)
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Income before income
taxes and non-
controlling
interests 4,675 1,938 5,649 2,703

Income taxes 1,567 808 1,895 1,005
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Income before non-
controlling interests 3,108 1,130 3,754 1,698

Non-controlling
interests 329 41 252 (16)
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Net income 2,779 1,089 3,502 1,714
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Basic and diluted
earnings per share 0.41 0.16 0.52 0.26
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Weighted average
number of shares
outstanding 6,694,661 6,681,494 6,700,561 6,679,328



Consolidated Statements of Retained Earnings

(in thousands of dollars) FOR THE SIX MONTHS ENDED
June 24, June 25,
2006 2005
(Unaudited) (Unaudited)
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $
Balance, beginning of period 68,251 62,084
Net income 3,502 1,714
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71,753 63,798
Excess on par value of Class A Common
Shares repurchased 26 --
Excess on par value of Class B
Subordinate Voting Shares repurchased 715 --
Dividends 874 766
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Balance, end of period 70,138 63,032
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Consolidated Balance Sheets

(in thousands of dollars)
As at As at
June 24, December 31,
2006 2005
(Unaudited) (Audited)
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $
Assets
Current assets
Cash 13,679 14,143
Accounts receivable 36,665 32,534
Income taxes receivable 1,866 879
Future income taxes 827 590
Prepaid expenses 5,103 3,239
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58,140 51,385
Investments 21,321 21,579
Property, plant and equipment 40,450 41,928
Goodwill 2,441 2,441
Other assets 5,175 4,819
Future income taxes 1,350 1,355
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128,877 123,507
---------------------------------------------------------------------
---------------------------------------------------------------------
Liabilities
Current liabilities
Short-term bank loans 1,317 62
Accounts payable and accrued liabilities 23,416 23,190
Deferred revenue 1,697 1,212
Income taxes payable 896 374
Dividends payable 435 436
Future income taxes 251 251
Current portion of long-term debt 1,140 1,765
Current portion of asset retirement
obligations 97 97
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29,249 27,387
Long-term debt 7,842 8,326
Provision for inspection of vessels 229 128
Asset retirement obligations 412 400
Future income taxes 5,177 5,198
Non-controlling interests 2,624 1,360
Other 1,907 1,227
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47,440 44,026
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Commitments

Shareholders' equity
Capital stock 14,523 14,219
Retained earnings 70,138 68,251
Foreign currency translation adjustment (3,224) (2,989)
---------------------------------------------------------------------
81,437 79,481
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128,877 123,507
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Consolidated Statements of Cash Flows

(in thousands of dollars) FOR THE THREE FOR THE SIX
MONTHS ENDED MONTHS ENDED
June 24, June 25, June 24, June 25,
2006 2005 2006 2005
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $
Operating activities
Net Income 2,779 1,089 3,502 1,714
Items not affecting
cash 2,369 2,344 4,901 4,754
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Cash provided from
operations 5,148 3,433 8,403 6,468
Dividends received
from companies
subject to
significant influence 20 16 20 16
Contributions to
defined benefit
pension plans (334) (307) (657) (541)
Changes in non-
cash working
capital items 499 (1,776) (6,060) (2,685)
---------------------------------------------------------------------
5,333 1,366 1,706 3,258
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Financing activities
Net change in
short-term bank
loans 47 4,837 1,255 4,714
Repayment of long-
term debt (535) (430) (1,132) (1,041)
Proceeds from
issuance of shares
to non-controlling
interests 26 -- 1,012 --
Issuance of Class B
Subordinate
Voting Shares, net
of related costs 101 76 506 76
Repurchase of Class A
common Shares (19) -- (29) --
Repurchase of Class B
Subordinate Voting
Shares (901) -- (914) --
Dividends paid (439) (383) (875) (765)
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(1,720) 4,100 (177) 2,984
---------------------------------------------------------------------
Investing activities
Investment in a
service contract -- (62) (2) (78)
Customer repayment
of investment
in a service
contract 357 327 707 645
Acquisition of3
property, plant
and equipment
(net of government
subsidy of $251,000,
nil in 2005) (1,429) (4,437) (2,852) (6,004)
Proceeds from disposal
of property, plant
and equipment 49 82 72 83
Acquisition of
other assets -- -- -- (188)
Decrease in
other assets -- 67 28 143
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(1,023) (4,023) (2,047) (5,399)
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Foreign exchange gain
on cash held in
foreign currencies of
self-sustaining
subsidiaries 48 117 54 164
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Net change in cash 2,638 1,560 (464) 1,007
Cash, beginning
of period 11,041 12,403 14,143 12,956
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Cash, end of period 13,679 13,963 13,679 13,963
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Contact Information

  • Logistec Corporation
    Jean-Claude Dugas CA
    Vice-President, Finance
    (514) 985-2345
    jdugas@logistec.com