The Consumers' Waterheater Income Fund
TSX : CWI.UN

The Consumers' Waterheater Income Fund

April 30, 2008 17:30 ET

The Consumers' Waterheater Income Fund Reports Results for the First Quarter of 2008

Revenues Increase 6.7%; Net Earnings Grow 9.8%; Distributable Cash(1) Up 12.2%

TORONTO, ONTARIO--(Marketwire - April 30, 2008) - The Consumers' Waterheater Income Fund (the "Fund"), (TSX:CWI.UN) today reported an increase in total revenue of 6.7% and an increase in distributable cash of 12.2% in the first quarter ending March 31, 2008 over the comparable period in 2007.

"Results for the first quarter of 2008 demonstrate the strength and stability of our core business together with the initial benefits from the Fund's strategic initiatives," said John Macdonald, President & CEO.

Financial and Operating Highlights

- Substantial 6.7% increase in total revenue over the first quarter of 2007 to $44.2 million

- Solid increases in EBITDA(2) (up 6.8% over the first quarter of 2007 to $37.3 million) and net earnings (up 9.8% over the 2007 quarter to $8.6 million)

- Cash flow from operating activities declined by 3.0% to $24.7 million from the first quarter of 2007 million due to lower non-cash working capital

- Distributable cash(1) increased by $2.0 million to $18.2 million in the first quarter of 2008; the payout ratio(1) improved to 87.2% in the first quarter of 2008 compared with 95.3% in the first quarter of 2007

- Drew on senior secured bridge loan facility of $310 million



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Financial Highlights Three months ended
(in thousands of dollars, except per -------------------------------
Unit information) March 31, 2008 March 31, 2007
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Total revenues $ 44,212 $ 41,442
Earnings before interest, taxes and
amortization ("EBITDA")(2) 37,269 34,905
Net earnings $ 8,583 $ 7,818
Per Unit information
Unitholder distributions declared $0.32 $0.31
Capital expenditures (net) $0.32 $0.31
Net earnings $0.17 $0.16

Distributable Cash(1) 18,165 16,183
Payout Ratio(1) 87.9% 95.6%
Total assets 1,013,411 1,058,555
Total debt 534,466 529,856
Cash flow from operating activities 24,704 25,461
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First Quarter 2008 Financial Results

Total revenues in the first quarter of 2008 were $44.2 million, an increase of $2.3 million or 6.7%, compared to the same period of 2007. The majority of the increase was due to the increase in rental rates implemented in January 2008, with the balance from the Toronto Hydro and Festival Hydro Services Inc. water heater portfolio acquisitions completed in 2007.

EBITDA in the first quarter of 2008 improved by $2.4 million to $37.3 million or 84% of revenue, compared to $34.9 million and 84%, respectively, in the same period of 2007. The improvement was achieved due to the increase in revenues and a decrease in loss on disposal of property and equipment, partially offset by increased cost of sales and G&A expenses.

Net earnings increased by 9.8% to $8.6 million from $7.8 million in the same period last year.

Cash flow from operating activities declined by $0.8 million, or 3.0%, to $24.7 million. The decrease relates to increased working capital requirements relating to the timing of the payments of interest on the Bridge financing.

Distributable cash increased by approximately $2 million or 12.2% from $16.2 million in the first quarter of 2007, largely due to the higher revenues. The Fund also increased monthly distributions in March 2007, with the result that distributions increased by 3.2% in the first quarter of 2008. Despite the increase in distributions, the payout ratio improved to 87.2% in the first quarter of 2008 from 95.3% in the 2007 first quarter due to the stronger earnings and increased non-cash earnings charges.

First Quarter 2008 Financial and Operational Initiatives

In January, the Fund utilized its senior secured bridge loan facility of $310 million and used the proceeds to repay its $275 million outstanding 4.7% Series 2003-1 A-1 Secured Notes and to repay the drawings under the $35 million revolving credit facility.

Financial Statements and MD&A

The Fund's financial statements and management's discussion and analysis for Q1 2008 are available at www.sedar.com or on the Fund's investor relations website at www.consumerswaterheaters.com.

Conference Call and Webcast

Management will host a conference call and live audio webcast to discuss the Fund's performance for the first quarter of 2008 on Thursday, May 1, 2008 at 8:15 a.m. EDT. Messrs. Macdonald and Bower will be on the call.



The call can be accessed as follows:
Calling toll free: +1-800-732-6179
Or calling: 416-644-3414
Joining by webcast: www.consumerswaterheaters.com


The audio webcast will be archived at www.consumerswaterheaters.com. A taped rebroadcast will be available until midnight on May 9, 2008. The rebroadcast can be accessed by dialing 1-877-289-8525 or 416-640-1917 and entering the pass code 21268202#.

About The Consumers' Waterheater Income Fund

The Consumers' Waterheater Income Fund owns a portfolio of approximately 1.4 million installed water heaters and other assets, rented primarily to residential customers in Ontario.

Additional information regarding the Fund, including its current Annual Information Form dated March 28, 2008 is available at www.sedar.com.

Forward-looking Information

Certain statements in this news release are forward-looking statements, which reflect management's expectation regarding the Fund's growth, results of operations, performance, business prospects and opportunities. Such forward-looking information reflects management's current beliefs and is based on information available to them and/or assumptions management believes are reasonable. Many factors could cause results to differ materially from the results discussed in the forward-looking information. Although the forward-looking information is based on what management believes to be reasonable assumptions, the Fund cannot assure investors that actual results will be consistent with this forward-looking information. Except as required by applicable securities laws, the Fund does not intend and does not assume and obligation to update or revise the forward-looking information, whether as a result of new information, future events or otherwise.

(1) Distributable cash and payout ratio are non-GAAP measures, do not have standardized meanings prescribed by GAAP and therefore, may not be comparable to similar terms and measures presented by other issuers. The Fund believes that distributable cash and payout ratio as cash flow measures are useful supplemental measures that help readers evaluate the ability of the Fund to generate cash that could be, and is, used for distributions and provides an indication of the amount of cash available for distribution to the Fund's Unitholders. Investors are cautioned, however, that distributable cash is not meant to be an alternative to using cash flows from operating, investing and financing activities as a measure of the Fund's liquidity and cash flows.

(2) EBITDA is a non-GAAP measure, and therefore has no standardized meaning prescribed by GAAP and may not be comparable so similar terms and measures presented by other issuers. This measure comprises net earnings plus income taxes, interest expenses and amortization expense, less interest income.

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