Synergex Corporation
TSX : SYX

Synergex Corporation

August 13, 2008 09:00 ET

Synergex Reports Record Sales and Profitability in Q2 2008

MISSISSAUGA, ONTARIO--(Marketwire - Aug. 13, 2008) - Synergex Corporation (TSX:SYX), a leading provider of integrated logistics and distribution services, today announced its financial results for the second quarter ended June 30, 2008. Results were characterized by record sales and profitability. All were driven by continuing growth of the Company's customer network, product line expansion and penetration of new markets in Latin America.

Sales for Q2-08 were a record $37.0 million, up 40% from $26.5 million for the same period a year ago.

Q2-08 gross profit increased 47% to $5.6 million from $3.8 million for the comparable period in 2007. In spite of pricing pressures from a rising Canadian dollar, gross margin percentages grew to 15.0% from 14.3% in the same quarter of 2007. Margin growth continued to reflect increased demand for game software following last year's strong sales of next generation game consoles.

The Company reported a Q2-08 net income of $3.4 million compared to $96,000 for the comparable period a year ago. This includes the impact of the divesture of the technology & collection agency businesses which did not perform in line with the Company's top and bottom line expectations. These discontinued operations generated a loss of $222,000 in Q2. Synergex reported net income from continuing operations of $134,000 in Q2-08, a decrease from the $416,333 for Q2-07. This is due to an increase in operating expenses to support continued growth in Latin American, as well as deferred Latin American start-up costs from 2007.

"Earlier in the year, we outlined our plans to focus on building our core business while, at the same time, to simplify our business and streamline our operations in order to maximize profitability," said David Aiello, President and CEO of Synergex Corporation. "Clearly, our successful execution of that strategy has begun to bear fruit."

Synergex has also announced that the Company's Chief Communications Officer, Kevin Daniels, will assume management of the investor relations function. Mr. Daniels will work closely with the President in daily management of investor relations.

"We believe that it is in Synergex' best interest to manage our investor relations responsibilities internally. I am pleased that Kevin will provide the management and leadership required to grow the Company's exposure and engagement with our shareholders." Aiello said.

Conference Call

Synergex is pleased to invite all interested parties to participate in a conference call at 11:00 a.m. Eastern Time today, August 13, during which these results, and management's outlook for future periods, will be discussed.

To access the conference call, please dial 416-695-7806 or 1-888-789-9572, pass code 3268192#.

The call will also be webcast live and archived on the Investor Relations section of the Company's website, www.syx.ca.

About Synergex Corporation

Synergex is a Canadian-based international integrated logistics company providing distribution, freight forwarding and logistic services under its Commercial Gateway business group. It is among the largest distributors of video games, game consoles, and accessories in Canada.

Forward Looking Statements

Some of the statements contained in this news release may be forward-looking statements such as the Company's future plans, objectives and goals. The statements that are not historical facts are forward-looking statements involving known and unknown risks and uncertainties, which could cause actual results to vary considerably from these statements.

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