Opta Minerals Inc.
TSX : OPM

Opta Minerals Inc.

August 06, 2009 16:00 ET

Opta Minerals Inc. Reports Second Quarter Results for Fiscal 2009

WATERDOWN, ONTARIO--(Marketwire - Aug. 6, 2009) - Opta Minerals Inc. (TSX:OPM), today announced results for the three and six months ended June 30, 2009. All figures are reported in U.S. dollars and in accordance with Canadian Generally Accepted Accounting Principles (GAAP), except where otherwise noted.

Consistent with first quarter results, revenues for the three months ended June 30, 2009, decreased 43% to $14.3 million, from $25.2 million in 2008. Gross profit for the quarter decreased by 55% to $3.0 million or 20.6% of revenue, versus $6.6 million or 26.1% of revenue in 2008.

David Kruse, President and CEO of Opta Minerals, noted "Some of our customers and Opta continue to face an extremely difficult global economic environment. The order books of our steel customers remained low in the second quarter. While continued uncertainty surrounding steel and abrasive-consuming industries, such as automotive, construction, infrastructure and shipyard activity, makes it very difficult to forecast beyond a very short horizon, market conditions do seem to be improving in the steel sector. Recent announcements from large mills such as US Steel regarding the restarting of blast furnaces seem to indicate an end to the inventory de-stocking that has occurred in the steel industry since the fourth quarter of 2008. The de-stocking has led to extremely low levels of inventory, particularly in the United States, where inventories hit their lowest levels since 1983. In addition, the return of some stability in the domestic auto industry is encouraging, and Chinese demand for steel is now forecasting growth this year rather than the previously expected decline.

During 2008, and particularly as the economy deteriorated in the fourth quarter, we implemented cost-saving measures to realign operations with current customer demand. Included in these measures was a workforce reduction, as well as an adjustment to the cost sharing of employee health benefits. In addition to previously announced restructuring efforts, further cost-saving measures have been implemented during the past quarter and in total all restructuring efforts to date are expected to reduce annual operating costs by $4.5 million compared to the beginning of 2008. During the year we discontinued operations in Attica, New York, and sold assets from the operation in exchange for a release of the Company's obligations under an existing lease and service agreement. We consolidated the operations in Quebec into one facility and after June 30, 2009, sold one of the warehouses owned by the Company and commenced negotiating a lease termination agreement for another.

Opta Minerals has generated significant cash flow from working capital reductions in the last six months, including a substantial reduction in inventory and accounts receivable. We expect continued cash flow from further inventory reductions over the balance of 2009." For the three months ended June 30, 2009, cash flow from operating activities generated $1.6 million, versus a use of $2.8 million in the second quarter of 2008. On a year to date basis, cash flows from operations generated $4.3 million versus $1.8 million for the six months ended June 30, 2008.

Selling, general and administrative expenses decreased $0.4 million during the second quarter, from $2.8 million or 11.1% of revenues for the second quarter of 2008 to $2.4 million or 16.9% of revenues in the second quarter of 2009. The increase relating to costs incurred by MCP, acquired in the third quarter of 2008, of $0.2 million were largely offset by a $0.6 million decrease in overall administrative expenses. Most of the decrease related to reduced professional fees incurred and reduced employee costs resulting from cost reduction measures put in place by management during the past six months. Year to date, excluding MCP, these cost reduction measures have contributed to a $1.4 million decrease in selling, general and administrative expenses from $5.7 million incurred in the first six months of 2008 to $4.7 million for the six months ended June 30, 2009.

EBITDA for the quarter decreased 78%, from $4.3 million in 2008 to $0.9 million for the three months ended June 30, 2009. This result reflects the impact of a dramatic slowdown in the steel industry that began in the fourth quarter of 2008. Year to date, the economic slowdown has resulted in a decrease in EBITDA from $7.3 million for the six months ended June 30, 2008 to $1.7 million. Included in EBITDA are non-recurring other income and expenses items totaling $0.5 million for the three months ended June 30, 2009. This amount is substantially composed of $0.4 million in restructuring severance costs and $0.1 million in lease termination costs related to the consolidation of the operations in Quebec. For the six months ended June 30, 2009, other income and expenses totaled $0.3 million comprising $0.3 million in restructuring severance costs and $0.2 million in lease termination disposal costs related to the consolidation of the operations in Quebec, partially offset by a gain on sale of fixed assets in our Attica facility in the amount of $0.2 million.

Net loss for the three months ended June 30, 2009, was $(0.1 million) or $(0.00) per diluted common share, versus net earnings of $1.9 million or $0.11 per diluted common share for the three months ended June 30, 2008. Year to date, net loss for the six months ended June 30, 2009, was $(0.4 million) or ($0.02) per diluted common share, versus net earnings of $3.0 million or $0.17 per diluted common share.

The Company's working capital at June 30, 2009 stood at $11.8 million and total assets were $98.6 million. The debt-to-equity ratio at June 30, 2009 was 0.69 to 1.00.

Opta Minerals President and CEO, David Kruse, plans to host a conference call at 2:00PM Eastern Standard Time on Friday August 7th, 2009 to discuss second quarter 2009 results and recent corporate developments. After opening remarks, there will be a question and answer period. This conference call can be accessed with the toll free dial-in number 1-(866) 321-6651 or 1-(416) 642-5212; quote confirmation code 9967413. If you are unable to listen live, the conference call will be archived and can be accessed between August 8th, 2009 and August 14th, 2009, with the toll free dial-in number 1-(888) 203-1112 or (647) 436-0148 followed by pass code 9967413.

Opta Minerals is a vertically integrated provider of custom process solutions and industrial mineral products used primarily in the steel, foundry, loose abrasive cleaning, water-jet cutting and municipal water filtration industries. The Company has production and distribution facilities in Ontario, Quebec, Louisiana, South Carolina, Virginia, Maryland, Indiana, Michigan, New York, Texas, Florida, France and Slovakia. Opta has one of the broadest product lines in the industry.

FOOTNOTES:

Earnings before income taxes and interest ("EBIT"); and earnings before interest, income taxes, depreciation and amortization ("EBITDA") as defined below, are both non-GAAP earnings measures that do not have standardized measures prescribed by GAAP, and therefore may not be comparable to similar measures presented by other publicly traded companies.



For the three For the six
Months Ended Months Ended
June 30 June 30
---------------- ----------------
---------------- ----------------
2009 2008 2009 2008
$ $ $ $

Net (Loss) Earnings for the Period (79) 1,930 (405) 3,029
Interest Expense 393 494 817 1,060
Provision for (recovery of) Income Taxes (229) 853 (538) 1,191
Depreciation and Amortization 850 1,001 1,838 1,984
----------------------------------
EBITDA(1) 935 4,278 1,712 7,264
Add (subtract):
Depreciation and Amortization (850) (1,001) (1,838) (1,984)
----------------------------------
Earnings before income taxes and
interest(2) 85 3,277 (126) 5,280


Notes

1) The term "EBITDA" refers to earnings before deducting interest expense, provision for income taxes, depreciation and amortization. The Company believes that EBITDA is useful supplemental information as it provides an indication of the results generated by the Company's main business activities prior to taking into consideration how those activities are financed and taxed and also prior to taking into consideration asset depreciation. EBITDA is not a recognized measure under Canadian GAAP, and accordingly, investors are cautioned that EBITDA should not be construed as an alternative to net earnings or loss determined in accordance with Canadian GAAP as an indicator of the financial performance of the Company or as a measure of the Company's liquidity and cash flows. The Company's method of calculating EBITDA may differ from other issuers and accordingly, EBITDA may not be comparable to similar measures presented by other issuers.

2) The term "EBIT" refers to earnings before income taxes and interest expense. The Company believes that EBIT is useful supplemental information as it provides an indication of the results generated by the Company's main business activities prior to taking into consideration how those activities are financed or taxed. EBIT is a non-GAAP earnings measure that does not have standardized measures prescribed by GAAP, and therefore may not be comparable to similar measures presented by other publicly traded companies.

This press release may contain "forward-looking statements" which reflect the current expectations of management of the Company regarding the Company's future growth, results of operations, performance, business prospects and opportunities. Wherever possible, words such as "may", 'would", "could", "should", "will", "anticipate", "believe", "plan", "expect", "intend", "estimate", "aim", "endeavour", "seek", "predict", "potential" and similar expressions have been used to identify these forward-looking statements. These statements reflect management's current beliefs with respect to future events and are based on information currently available to management of the Company. Forward-looking statements involve significant risks, uncertainties and assumptions. Many factors could cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, without limitation, cancellations of or the failure to renew purchase orders; production and delivery issues; quality, pricing and availability of raw materials; compliance with environmental regulations; exchange rate fluctuations as well as the other risks identified in the "Risk Factors" section of the Company's Annual Information Form and other public filings (copies of which may be obtained at www.sedar.com). Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements may vary materially from those expressed or implied by this press release. These factors should be considered carefully and reader should not place undue reliance on the forward-looking statements. Although any forward-looking statements contained in this press release are based upon what management currently believes to be reasonable assumptions, the Company cannot assure readers that actual results, performance or achievements will be consistent with these forward-looking statements, and management's assumptions may prove to be incorrect. These forward-looking statements are made as of the date of this press release and, other than as required by law, the Company does not intend, and does not assume any obligation, to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.



Opta Minerals Inc.
Consolidated Statements of Earnings (Loss)
For the three month periods ended June 30, 2009 and 2008
(Expressed in thousands of U.S. dollars, except per share amounts)


2009 2008
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Revenue $ 14,339 $ 25,248

Cost of Goods Sold 11,381 18,650
---------------------------------------------------------------------------
Gross Profit 2,958 6,598
---------------------------------------------------------------------------

Selling, General and Administrative Expenses 2,426 2,824
---------------------------------------------------------------------------
Earnings Before Undernoted Items, and
Non-controlling Interest 532 3,774
---------------------------------------------------------------------------

Interest expense on long-term debt 288 381
Interest expense 105 113
Amortization of intangible assets 461 437
Stock compensation expense 68 56
Other (income) expense 455 -
Foreign exchange (gain) loss (464) 4
---------------------------------------------------------------------------
913 991
---------------------------------------------------------------------------
Earnings (Loss) Before Income Taxes and
Non-controlling Interest (381) 2,783

Provision for (recovery of) income taxes (229) 853
---------------------------------------------------------------------------
Net Earnings (Loss) Before Non-Controlling Interest $ (152) $ 1,930
---------------------------------------------------------------------------

Non-controlling interest share of net earnings (loss) (73) -
---------------------------------------------------------------------------
Net Earnings (Loss) (79) 1,930
---------------------------------------------------------------------------

Earnings per share for the year
- Basic and diluted $ - $ 0.11
---------------------------------------------------------------------------
---------------------------------------------------------------------------



Opta Minerals Inc.
Consolidated Statements of Earnings (Loss)
For the six month periods ended June 30, 2009 and 2008
(Expressed in thousands of U.S. dollars, except per share amounts)


2009 2008
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Revenue $ 29,065 $ 46,618

Cost of Goods Sold 23,649 34,465
---------------------------------------------------------------------------
Gross Profit 5,416 12,153
---------------------------------------------------------------------------

Selling, General and Administrative Expenses 4,692 5,732
---------------------------------------------------------------------------
Earnings Before Undernoted Items, and
Non-controlling Interest 724 6,421
---------------------------------------------------------------------------

Interest expense on long-term debt 555 769
Interest expense 262 291
Amortization of intangible assets 898 865
Stock compensation expense 138 113
Other (income) expense 284 -
Foreign exchange (gain) loss (265) 163
---------------------------------------------------------------------------
1,872 2,201
---------------------------------------------------------------------------
Earnings (Loss) Before Income Taxes and
Non-controlling Interest (1,148) 4,220

Provision for (recovery of) income taxes (538) 1,191
---------------------------------------------------------------------------
Net Earnings (Loss) Before Non-Controlling Interest $ (610) $ 3,029
---------------------------------------------------------------------------

Non-controlling interest share of net earnings (loss) (205) -
---------------------------------------------------------------------------
Net Earnings (Loss) (405) 3,029
---------------------------------------------------------------------------

Earnings (loss) per share for the year
- Basic and diluted $ (0.02) $ 0.17
---------------------------------------------------------------------------
---------------------------------------------------------------------------



Opta Minerals Inc.
Consolidated Balance Sheets
(Expressed in thousands of U.S. dollars)


June 30, December 31, June 30,
2009 2008 2008
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Assets

Current

Cash and cash equivalents $ 1,872 $ 1,377 $ 2,832
Accounts receivable 8,753 9,133 13,576
Inventories 18,057 22,223 21,303
Prepaid expenses and other
current assets 1,885 1,793 971
Assets held for sale 680 664 -
Income taxes recoverable 735 362 -
---------------------------------------------------------------------------
31,982 35,552 38,682
---------------------------------------------------------------------------
Property, Plant and Equipment 17,177 16,664 18,607
---------------------------------------------------------------------------
Intangible and Other Assets 32,215 32,464 34,648
---------------------------------------------------------------------------
Goodwill 14,007 14,160 10,541
---------------------------------------------------------------------------
Future Income Taxes 3,224 2,406 1,625
---------------------------------------------------------------------------
$ 98,605 $ 101,246 $ 104,103
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Liabilities

Current

Bank indebtedness 7,965 7,797 7,843
Accounts payable and
accrued liabilities 7,270 7,788 7,378
Income taxes payable - - 93
Current portion of long-term debt 4,899 4,097 4,050
Current portion of preference shares 40 38 45
---------------------------------------------------------------------------
20,174 19,720 19,409
---------------------------------------------------------------------------
Long-term Debt 18,658 20,594 22,764
---------------------------------------------------------------------------
Other Long-term Liabilities 2,636 3,095 1,624
---------------------------------------------------------------------------
Future Income Taxes 3,378 2,849 2,726
---------------------------------------------------------------------------
Future Income Taxes on
Intangible Assets 9,417 9,695 10,211
---------------------------------------------------------------------------
54,263 55,953 56,734
---------------------------------------------------------------------------

Shareholders' Equity

Capital Stock

Authorized unlimited number of
common shares and preference
shares without par value

Issued -

18,014,536 (December 31, 2008 -
18,003,459; June 30, 2008 -
17,992,752) common shares 17,601 17,587 17,558

Contributed Surplus 1,803 1,665 1,477

Accumulated Other
Comprehensive Income 3,886 4,379 6,121

Retained Earnings 21,257 21,662 22,213
---------------------------------------------------------------------------
44,547 45,293 47,369
---------------------------------------------------------------------------
Non-controlling Interest (205) - -
---------------------------------------------------------------------------
$ 98,605 $ 101,246 $ 104,103
---------------------------------------------------------------------------
---------------------------------------------------------------------------



Opta Minerals Inc.
Consolidated Statements of Cash Flows
For the three month periods ended June 30, 2009 and 2008
(Expressed in thousands of U.S. dollars)

2009 2008
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Cash Provided By (Used in) -

Operating Activities

Net earnings (loss) for the period $ (79) $ 1,930
Items not affecting cash
Amortization of property, plant and equipment 389 564
Amortization of intangible assets 461 437
Non-controlling interest (73) -
Other (income) expenses 116 -
Stock compensation expense 68 56
Future income taxes (169) 53
Unrealized foreign exchange loss on long-term debt - (8)
Realized foreign exchange gain on foreign operations (237) -
Net loss on disposal of property, plant and equipment - 2
---------------------------------------------------------------------------
476 3,034
Changes in non-cash working capital
Accounts receivable (578) (2,864)
Inventories 1,470 (5,158)
Prepaid expenses and other current assets 19 445
Accounts payable and accrued liabilities 452 1,711
Income taxes recoverable (286) 55
---------------------------------------------------------------------------
1,553 (2,777)
---------------------------------------------------------------------------

Financing Activities

Proceeds from issuance of common shares
- net of issuance costs 7 18
Increase in bank indebtedness 176 2,363
Proceeds from long-term debt 31 -
Repayment of long-term debt (651) (577)
---------------------------------------------------------------------------
(437) 1,804
---------------------------------------------------------------------------

Investing Activities

Acquisition of property, plant and equipment (660) (196)
Additional consideration paid on acquisitions - (4)
---------------------------------------------------------------------------
(660) (200)
---------------------------------------------------------------------------

Foreign Exchange Gain on Cash Held in Foreign Currency 42 101
---------------------------------------------------------------------------
Increase (Decrease) in Cash and Cash Equivalents 498 (1,072)

Cash and Cash Equivalents
Beginning of Period 1,374 3,904
---------------------------------------------------------------------------
End of Period $ 1,872 $ 2,832
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Additional Cash Flows Information:
Interest paid $ 378 $ 451
Income taxes paid 231 719
---------------------------------------------------------------------------
---------------------------------------------------------------------------



Opta Minerals Inc.
Consolidated Statements of Cash Flows
For the six month periods ended June 30, 2009 and 2008
(Expressed in thousands of U.S. dollars)


2009 2008
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Cash Provided By (Used in) -

Operating Activities

Net earnings (loss) for the period $ (405) $ 3,029
Items not affecting cash
Amortization of property, plant and equipment 940 1,119
Amortization of intangible assets 898 865
Non-controlling interest (205) -
Other (income) expenses (55) -
Stock compensation expense 138 113
Future income taxes (615) (407)
Unrealized foreign exchange loss on long-term debt - 144
Realized foreign exchange gain on foreign operations (461) (75)
Net loss on disposal of property, plant and equipment - (4)
---------------------------------------------------------------------------
235 4,784
Changes in non-cash working capital
Accounts receivable 543 (2,885)
Inventories 4,607 (2,249)
Prepaid expenses and other current assets (59) 576
Accounts payable and accrued liabilities (672) 1,335
Income taxes recoverable (368) 247
---------------------------------------------------------------------------
4,286 1,808
---------------------------------------------------------------------------

Financing Activities

Proceeds from issuance of common shares
- net of issuance costs 14 30
Decrease (increase) in bank indebtedness (306) 2,037
Proceeds from long-term debt 764 3,075
Repayment of long-term debt (2,689) (6,301)
---------------------------------------------------------------------------
(2,217) (1,159)
---------------------------------------------------------------------------

Investing Activities

Acquisition of property, plant and equipment (1,580) (315)
Proceeds on disposal of property, plant and equipment - 18
Additional consideration paid on acquisitions - (11)
---------------------------------------------------------------------------
(1,580) (308)
---------------------------------------------------------------------------

Foreign Exchange Gain on Cash Held in Foreign Currency 6 155
---------------------------------------------------------------------------
Increase (Decrease) in Cash and Cash Equivalents 495 496

Cash and Cash Equivalents
Beginning of Period 1,377 2,336
---------------------------------------------------------------------------
End of Period $ 1,872 $ 2,832
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Additional Cash Flows Information:

Interest paid $ 936 $ 1,212
Income taxes paid 427 1,368



Opta Minerals Inc.
Segmented Information
For the three months ended June 30, 2009
(Expressed in thousands of U.S. dollars)


Three Month Period Ended June 30, 2009
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Abrasive
Products Manu-
Mill and Foundry facturing and
Products and Distribution
Services Operations Unallocated Total
---------------------------------------------------------------------------
---------------------------------------------------------------------------

External
revenue
by market
Canada $ 1,660 $ 1,516 $ - $ 3,176
U.S 4,669 4,472 - 9,141
Europe 1,953 - - 1,953
Other 23 46 - 69
---------------------------------------------------------------------------
Total revenue
from external
customers 8,305 6,034 - 14,339
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Segment earnings
(loss) before
interest
expense,
income taxes
and non-controlling
interest 117 (23) (82) 12
Interest
expense on
long-term debt (288)
Interest expense (105)
Recovery of
income taxes 229
Non-controlling
interest share
of net loss 73 - - 73
-------------
Net loss for
the period (79)
-------------
Total assets as
at June 30, 2009 66,272 29,025 3,308 98,605
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Amortization of
property, plant
and equipment 173 199 17 389
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Amortization of
intangible assets 455 6 - 461
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Goodwill and
intangible assets
as at June 30, 2009 39,689 6,533 - 46,222
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Expenditures on
property, plant
and equipment $ 64 $ 572 $ 24 $ 660
---------------------------------------------------------------------------
---------------------------------------------------------------------------



Opta Minerals Inc.
Segmented Information
For the six months ended June 30, 2009
(Expressed in thousands of U.S. dollars)


Six Month Period Ended June 30, 2009
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Abrasive
Products Manu-
Mill and Foundry facturing and
Products and Distribution
Services Operations Unallocated Total
---------------------------------------------------------------------------
---------------------------------------------------------------------------

External
revenue
by market
Canada $ 3,852 $ 2,316 $ - $ 6,168
U.S 11,029 7,793 - 18,822
Europe 3,871 - - 3,871
Other 148 56 - 204
---------------------------------------------------------------------------
Total revenue
from external
customers 18,900 10,165 - 29,065
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Segment earnings
(loss) before
interest
expense, income
taxes and
non-controlling
interest (247) 49 (133) (331)
Interest
expense on
long-term debt (555)
Interest expense (262)
Recovery of
income taxes 538
Non-controlling
interest share
of net loss 205 - - 205
-------------
Net loss for
the period (405)
-------------
Amortization of
property, plant
and equipment 509 399 32 940
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Amortization of
intangible assets 885 13 - 898
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Expenditures on
property, plant
and equipment $ 152 $ 1,394 $ 34 $ 1,580
---------------------------------------------------------------------------
---------------------------------------------------------------------------



Opta Minerals Inc.
Segmented Information
For the three months ended June 30, 2008
(Expressed in thousands of U.S. dollars)


Three Months Ended June 30, 2008
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Abrasive
Products Manu-
Mill and Foundry facturing and
Products and Distribution
Services Operations Unallocated Total
---------------------------------------------------------------------------
---------------------------------------------------------------------------

External
revenue
by market
Canada $ 4,302 $ 1,605 $ - $ 5,907
U.S 12,107 4,669 - 16,776
Europe 2,554 - - 2,554
Other - 11 - 11
---------------------------------------------------------------------------
Total
revenue from
external
customers 18,963 6,285 - 25,248
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Segment
earnings
(loss)
before
interest
expense and
income taxes 3,289 652 (664) 3,277
Interest
expense on
long-term debt 381
Interest expense 113
Provision
for income
taxes 853
-------------
Net
earnings
for the
period 1,930
--------------
Total
assets as at
December 31,
2008 70,806 27,198 3,242 101,246
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Amortization
of property,
plant and
equipment 271 258 35 564
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Amortization
of intangible
assets 425 12 - 437
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Goodwill and
intangible
assets as at
December 31, 2008 39,859 6,765 - 46,624
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Expenditures on
property,
plant and
equipment $ 6 $ 169 $ 21 $ 196
---------------------------------------------------------------------------
---------------------------------------------------------------------------



Opta Minerals Inc.
Segmented Information
For the six months ended June 30, 2008
(Expressed in thousands of U.S. dollars)


Six Months Ended June 30, 2008
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Abrasive
Products Manu-
Mill and Foundry facturing and
Products and Distribution
Services Operations Unallocated Total
--------------------------------------------------------------------------
--------------------------------------------------------------------------

External
revenue
by market
Canada $ 7,427 $ 2,877 $ - $ 10,304
U.S 23,106 8,498 - 31,604
Europe 4,662 - - 4,662
Other 30 18 - 48
--------------------------------------------------------------------------
Total
revenue
from external
customers 35,225 11,393 - 46,618
--------------------------------------------------------------------------
--------------------------------------------------------------------------

Segment earnings
(loss) before
interest expense
and income taxes 5,679 1,388 (1,787) 5,280
Interest expense
on long-term debt 769
Interest expense 291
Provision
for income taxes 1,191
------------
Net earnings
for the period 3,029
------------
Amortization
of property,
plant and
equipment 544 507 68 1,119
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Amortization
of intangible
assets 840 25 - 865
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Expenditures
on property,
plant and
equipment $ 11 $ 248 $ 56 $ 315
--------------------------------------------------------------------------
--------------------------------------------------------------------------


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