OPTION-NFA INC.
TSX VENTURE : OPN

OPTION-NFA INC.

November 17, 2005 16:38 ET

Option-NFA Inc. Reports Third Quarter and Nine Month 2005 Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Nov. 17, 2005) - Option-NFA Inc. (TSX VENTURE:OPN) -

The third quarter was profitable as was the year-to-date but both were behind last year's results. Sales in the third quarter were slightly behind the year ago period as some deliveries to distributors were delayed awaiting prepayment.

While overhead was reduced by $270,000, net profit for the year-to-date period was down from 2004.

We expect to catch up on some sales in October but it will be difficult to achieve full year sales equal to those of 2004.

The focus is on growing sales by improving the effectiveness of the company's marketing programs and upgrading the sales team. A complete review of the company's sales management, sales agents and international distributors has resulted in a number of changes and more are anticipated.

In an effort to stimulate demand, the company's marketing programs have been refocused and revitalized. New managers have been hired and new professional team riders have been signed.

Net profit for the quarter was $804,000 compared to $995,000 for Q3 2004.

Fully diluted earnings per share for the quarter were $0.07 versus $0.09 for Q3 2004.

About Option-NFA Inc.

Option-NFA is a Vancouver based manufacturer and designer of hard goods and clothing for the snowboard, freeski and skateboard markets. The Company has sales offices in Europe, Asia, Australia and North America and its products are endorsed by an elite team of high profile professional athletes from around the world. The Company went public in 1999 and trades on the TSX Venture Exchange (TSX-V) under the symbol OPN.



OPTION-NFA INC.
BALANCE SHEET
AS AT SEPTEMBER 30, 2005 and DECEMBER 31, 2004

--------------------------------------------------------------------
--------------------------------------------------------------------
Sep-05 Dec-04
--------------------------------------------------------------------
ASSETS

Current Assets
A/R $ 6,649,505 $ 4,399,266
Inventory $ 2,871,188 $ 3,629,344
Prepaid Expenses $ 303,875 $ 422,632
-------------------------------------------------------------------
Total Current Assets $ 9,824,568 $ 8,451,242

Long-Term Receivable $ 52,602 $ 53,602

Equipment and Leasehold Improvements
Leasehold Improvements $ 305,961 $ 300,143
Shop Equipment $ 866,606 $ 788,992
Office Furniture & Equipment $ 101,995 $ 99,438
Computer Equipment $ 224,599 $ 215,891
Computer Software $ 55,718 $ 51,227
Trade Show Equipment $ 60,161 $ 60,161
-------------------------------------------------------------------
$ 1,615,040 $ 1,515,852
LESS: Accumulated Depreciation
& Amortization $ (1,174,341) $ (1,096,274)
-------------------------------------------------------------------
$ 440,699 $ 419,578
--------------------------------------------------------------------
$ 10,317,869 $ 8,924,422

Deferred Development Costs $ 235,277 $ 256,063

Goodwill & Other Intangibles $ 144,335 $ 144,335

--------------------------------------------------------------------

TOTAL ASSETS $ 10,697,481 $ 9,324,820
--------------------------------------------------------------------
--------------------------------------------------------------------

--------------------------------------------------------------------
--------------------------------------------------------------------
LIABILITIES & SHAREHOLDERS' EQUITY

Current Liabilities
Bank Indebtedness $ 5,729,175 $ 4,769,507
Accounts Payable and
Accrued Liabilities $ 1,723,799 $ 1,380,105
-------------------------------------------------------------------
$ 7,452,974 $ 6,149,612

Future Income Tax Liability $ 13,650 $ 13,650

Payable to Shareholders $ 200,000 $ 200,000

Shareholders' Equity
Share Capital $ 2,598,939 $ 2,598,939
Retained Earnings $ 362,619 $ 331,217
Profit (Loss) for the Period $ 69,299 $ 31,402
--------------------------------------------------------------------

TOTAL LIABILITIES & EQUITY $ 10,697,481 $ 9,324,820
--------------------------------------------------------------------
--------------------------------------------------------------------

These financial statements have not been reviewed by the
company's auditor.
Approved by Directors:

"Blair Murdoch" "Geoff Power"
--------------- -------------
Blair Murdoch Geoff Power


OPTION-NFA INC.
CONSOLIDATED INCOME STATEMENTS
For The Fiscal Quarter and Year-to-Date Ended: September 30

--------------------------------------------------------------------
--------------------------------------------------------------------
2005 2004 2005 2004
3rd Quarter 3rd Quarter YTD YTD
--------------------------------------------------------------------

SALES $ 7,304,789 $ 7,655,436 $ 9,849,894 $10,483,840
COST OF SALES $ 5,259,995 $ 5,235,810 $ 7,363,450 $ 7,512,813
--------------------------------------------------------------------
$ 2,044,794 $ 2,419,626 $ 2,486,444 $ 2,971,027

OVERHEAD
Advertising
& promotion $ 223,519 $ 239,866 $ 673,497 $ 835,262
Bad debt $ 48,790 $ 50,776 $ 86,022 $ 89,617
Bank charges $ 24,080 $ 25,636 $ 60,841 $ 55,801
Commissions $ 231,561 $ 301,689 $ 289,710 $ 364,484
Insurance $ 15,321 $ 18,039 $ 49,496 $ 55,096
Office
expense $ 23,932 $ 23,316 $ 77,602 $ 66,754
Professional
fees $ 21,329 $ 16,706 $ 60,335 $ 59,742
Salaries $ 244,207 $ 238,227 $ 759,900 $ 794,551
Telephone $ 6,779 $ 10,980 $ 26,121 $ 32,840
Travel &
entertainment $ 1,799 $ 1,536 $ 5,630 $ 4,583
--------------------------------------------------------------------
Total Overhead $ 841,317 $ 926,771 $ 2,089,154 $ 2,358,730

EARNINGS (LOSS)
BEFORE
UNDERNOTED $ 1,203,477 $ 1,492,855 $ 397,290 $ 612,297

Interest $ 80,922 $ 82,450 $ 225,949 $ 215,530
Other (income)
loss $ - $ (8,514) $ - $ (2)
Depreciation and
amortization $ 24,628 $ 28,380 $ 70,524 $ 83,107
--------------------------------------------------------------------
EARNINGS (LOSS)
BEFORE INCOME
TAXES $ 1,097,927 $ 1,390,539 $ 100,817 $ 313,662

PROVISION FOR
INCOME TAX $ 293,486 $ 395,745 $ 31,518 $ 98,060
--------------------------------------------------------------------

NET EARNINGS
(LOSS) $ 804,441 $ 994,794 $ 69,299 $ 215,602


OPTION-NFA INC.
Consolidated Statements of Cash flows

--------------------------------------------------------------------
--------------------------------------------------------------------
For the 9 months For the 9 months
ended ended
September 30, September 30,
2005 2004
--------------------------------------------------------------------

Cash provided by (used in)

Operations:
Net earnings $ 69,299 $ 215,602
Items not involving cash:
Depreciation and amortization $ 78,067 $ 94,387
-------------------------------------------------------------------
$ 147,366 $ 309,989
Changes in non-cash operating
working capital:
Accounts receivable $ (2,249,239) $ (1,931,846)
Inventories $ 758,156 $ (344,344)
Prepaid expenses and deposits $ 118,757 $ (2,859)
Deferred development costs $ 20,786 $ 7,414
Income taxes payable $ - $ 98,060
Accounts payable and
accrued liabilities $ 343,694 $ 254,171
Interest payable on
convertible debentures $ - $ (3,740)
-------------------------------------------------------------------
$ (860,480) $ (1,613,155)
Investments:
Expenditures on equipment $ (93,370) $ (93,124)
Expenditures on leasehold
improvements $ (5,818) $ (6,778)
-------------------------------------------------------------------
$ (99,188) $ (99,902)
Financing:
Long-term debt $ - $ -
Loans from shareholders $ - $ -
Convertible debenture $ - $ -
Increase in Common Shares $ - $ -
Bank indebtedness $ 959,668 $ 1,713,057
-------------------------------------------------------------------
$ 959,668 $ 1,713,057
--------------------------------------------------------------------

Cash, beginning and end of period $ - $ -
--------------------------------------------------------------------
--------------------------------------------------------------------



The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

Contact Information