McCoy Corporation
TSX : MCB

McCoy Corporation

March 12, 2007 15:32 ET

McCoy Corporation Announces Record Fourth Quarter and Year End Results- Doubles Quarterly Dividend

EDMONTON, ALBERTA--(CCNMatthews - March 12, 2007) - McCoy Corporation ("McCoy" or the "Corporation") (TSX:MCB) today announced the Company's fourth quarter and year end results for 2006 and an increase in the quarterly dividend.



Fourth Quarter 2006
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2006($) 2005($)
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Revenue 43,142,581 29,804,657
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Net earnings for the quarter 2,252,284 1,066,935
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Basic earnings per share 0.12 0.06
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Diluted earnings per share 0.11 0.05
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Cash flow from operations before change
in net non-cash working capital items 3,009,884 2,073,454
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Cash flow per share from operations
before net change in non-cash working
capital items 0.16 0.12
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EBITDA(1) per share 0.29 0.16
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Year ended December 31, 2006
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2006($) 2005($)
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Revenue 147,950,782 107,083,753
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Net earnings for the year 7,864,857 5,890,476
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Basic earnings per share 0.42 0.33
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Diluted earnings per share 0.40 0.31
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Cash flow from operations before net
change in non-cash working capital
items 11,791,878 8,884,770
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Cash flow per share from operations
before net change in non-cash working
capital items 0.63 0.50
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EBITDA(1) per share 0.89 0.64
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(1) EBITDA is a non-GAAP measurement, defined by the Corporation as
"Earnings before interest, taxes, depreciation, amortization and
stock-based compensation".


Dividend Increase

The Corporation announced today that the quarterly dividend of $0.01 per common share would be increased to $0.02 per common share. The Board of Directors declared a dividend of $0.02 per common share payable on March 30, 2007 to shareholders of record on March 21, 2007.

Financial Highlights of 2006

The Corporation achieved another record year in 2006 as oil and gas activity, both in Western Canada and around the globe intensified. All three of McCoy's business segments contributed to the 38% increase in revenues over 2005. Gross profit also increased by 38% over 2005 while gross margin remained steady at 30.1%.

Operations expenses increased 36% to $8,958,827 compared to $6,591,058 in 2005. Roughly half of this increase relates to Rebel Metal Fabricators Ltd. ("Rebel") and Inotec Coatings and Hydraulics Inc. (Inotec") which McCoy acquired in May, 2005 and July, 2006 respectively. Equipment repairs and higher utility costs resulting from increased production account for the balance of the increase. Amortization expense increased by 69% to $2,525,604 over 2005, 26% of which relates to Rebel and Inotec with the remainder attributable to the purchase of capital assets for the Trailer Manufacturing and Oilfield Products & Services segments. Interest on debt increased by 76% to $1,298,413 from $738,616 in 2005, a result of new debt used to assist with the purchase of Inotec.

Financial Highlights of Fourth Quarter 2006

Fourth quarter revenues increased by $13,337,924 over the same period in 2005. Inotec contributed approximately 38% of the increase. The remainder is a result of greater throughput in the Trailer Manufacturing and Oilfield Products & Services segments and strong sales in the Truck & Trailer Products & Services segment.

Mr. Rakievich, McCoy's President and Chief Executive Officer, remarked that 2006 was an eventful year in several respects. "With the acquisition of Inotec, we established our presence in the non-conventional oil and gas market, specifically the oil sands in Northern Alberta where we foresee opportunities for growth with modest investments in people and capital. Efficiencies became increasingly evident in several of our manufacturing facilities with the implementation of lean manufacturing processes. And we are well on our way to becoming a global organization as many of our energy-related products are shipped to end-users working in on-shore and off-shore oil and gas activities throughout the world". McCoy Corporation will showcase Farr Canada, Inotec, Rebel, Scona and Peerless at the 9th Moscow International Oil & Gas Exhibition scheduled for June 2007.

Mr. Rakievich added that the end of 2006 showed some contraction of the Western Canadian oil and gas industry with rig counts down considerably, a situation that has carried over into early 2007. The Trailer Manufacturing segment and Rebel will be directly affected by the reduced drilling activity which may cause the Corporation's consolidated rate of growth to taper somewhat. "We expect to see continued revenue growth in our businesses that compete in international markets and also anticipate stable performance from our Truck & Trailer Products & Services segment. With our diversified markets, diligent cost controls and continuous improvement in manufacturing processes, we look forward to a solid year overall".

About McCoy Corporation

The Corporation has three operating segments and employs approximately 800 individuals in Alberta and British Columbia. The Corporation's shares are traded on the TSX under the symbol "MCB".



Truck & Trailer Products & Services

The Real McCoy Service Centres (a)
Peerless Limited
Prairie Truck Ltd. (50%)

Specializes in equipment installation, suspension work, welding, safety
inspections, brake service, alignments, frame straightening, axles and
hydraulics for heavy-duty and some light-duty trucks.


Trailer Manufacturing

Scona Trailer Manufacturing (a)
Peerless Limited

Scona produces lowboys, flat decks, step decks, oilfield floats and
specialty trailers.

Peerless is a market leader in the development of quality oilfield and
logging trailers for Western Canada.


Oilfield Products & Services

Farr Canada (a)
Inotec Coatings and Hydraulics Inc.
Rebel Metal Fabricators Ltd.

Manufacture and service products for conventional and non-conventional oil
and gas industry: hydraulic power tongs, tong trucks, trailer mounted
hydrovac and vacuum tanks, computerized torque turn monitoring system,
wear and corrosion resistant coatings and specialized hydraulic services.

(a) divisions of McCoy Corporation.


This release may contain forward looking statements within the meaning of the "safe harbor" provisions of U.S. and other applicable laws. These statements are based on Management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward looking statements. The Corporation does not assume any obligation to update any forward looking information contained in this news release.

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