Pacific Safety Products Inc.

Pacific Safety Products Inc.

January 30, 2008 17:49 ET

PSP Finalizes Relocation Plan and Revises Guidance for Fiscal Year 2008

KELOWNA, BRITISH COLUMBIA--(Marketwire - Jan. 30, 2008) - Pacific Safety Products Inc. (TSX VENTURE:PSP) -

The Company today issued a revised forecast for its fiscal year 2008 ending June 30, 2008. As a result of finalizing its relocation plans and factoring in lowered revenue expectations, year-end revenues are now forecast to be between $37 million and $40 million with a resulting loss of up to ($0.5 million) for the year. This includes extraordinary one time expenses of $1.0 million for the relocation of the company's operations to Ottawa and a one time gain of $0.9 million from the sale of its property in Kelowna. Accruals for the relocation will be reflected in the Company's second quarter results which are to be released next month.

The Company also announced that it would close all remaining operations in Kelowna at the end of June 2008 aside from its ballistic test lab which would be transferred to the Arnprior, ON facility in the fall of 2008.

"Lowered revenue is a result of delays in contract awards and an overall reduction in domestic sales due to fluctuations in annual buying patterns. The one time expenses noted for relocation of the Company are expected to be offset in future years with increased efficiencies which will result in better gross margins and more effective market penetration," commented David Scott, CEO.

"As stated in previous releases, the Company is in the midst of transforming itself from a limited product line manufacturer with economic dependence on the Canadian government to a diverse systems solutions provider, including value added technology, to an array of international customers and as such, is continuing to make investments in new products and technologies. Management believes that with a headquarters in Eastern Canada, close to the majority of its customers, a single manufacturing location in both Canada and the US, and the recent additions to the management team, the business is poised to pursue expanded sales opportunities in the US and other defense markets," continued Scott.

About PSP

The mission statement of Pacific Safety Products Inc. is ...we bring everyday heroes home safely™. PSP is an established industry leader in the production, distribution and sale of high-performance and high-quality safety products for the defence and security market. These products include body armor to protect against ballistic, stab and fragmentation threats, ballistic blankets to reduce blast effects, and protective products against chemical and biological hazards. PSP is the largest armor manufacturer in Canada, directly supplying the Canadian Department of Defence, Federal Government Agencies and major Canadian law enforcement organizations. The Company also provides specialized law enforcement and safety products through APS Distributors, a wholly-owned subsidiary that services law enforcement and public safety agencies across the country. The Company, through its U.S. subsidiary Sentry Armor Systems Inc., provides body armor products to U.S. based law enforcement and private security firms. The Company also produces tactical clothing and emergency medical kits. Pacific Safety Products is a reporting issuer in British Columbia, Alberta and Ontario, Canada and publicly trades under the symbol PSP on the TSX Venture Exchange.

Forward-Looking Statements: This release may contain forward-looking statements based on management's expectations, estimates and projections. All statements that address expectations or projections about the future, including statements about the Company's strategy for growth, product development, market position, expected expenditures and financial results are forward-looking statements. Some of the forward-looking statements may be identified by words like "expects", "anticipates", "plans", "intends", "projects", "indicates", and similar expressions. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, including those discussed more fully elsewhere in this release and in documents which may be filed with the British Columbia Securities Commission, the Alberta Securities Commission, the Ontario Securities Commission, the TSX Venture Exchange, as well as others, could cause results to differ materially from those stated. These factors include, but are not limited to changes in the laws, regulations, policies and economic conditions, including inflation, interest and foreign currency exchange rates, of countries in which the Company does business; competitive pressures; successful integration of structural changes, including restructuring plans, acquisitions, divestitures and alliances; cost of raw material, research and development of new products, including regulatory approval and market acceptance; and seasonality of sales in some products.

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

Contact Information

  • Pacific Safety Products Inc.
    David Scott
    Chief Executive Officer
    (250) 491-0911
    Pacific Safety Products Inc.
    Jacques Bonaventure
    VP Corporate Development
    (613) 623-6001 x. 226