Tree Island Wire Income Fund

Tree Island Wire Income Fund

November 30, 2007 08:00 ET

Tree Island Announces Reduction of Salaried Workforce

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 30, 2007) - Tree Island Wire Income Fund ("The Fund") (TSX:TIL.UN) today announced additional restructuring measures that will extend cost savings from the previously announced consolidation of its US operations. The current action impacts 10% of Tree Island's salaried employees. When combined with workforce reductions related to the Baoan acquisition and the subsequent consolidation of US facilities, the total restructuring represents an overall reduction of 22% of the company's US workforce and 6% of its Canadian workforce since July.

"These actions, while difficult, are essential to realizing the full synergies from our Baoan acquisition and our efforts to control overhead costs," said Daniel McAtee, President and CEO of Tree Island Industries and a trustee of the Fund. "While we have achieved solid top-line growth as a result of our strategic initiatives, extremely challenging market conditions demand prudent cost control measures. We will continue to monitor our costs closely."

The workforce reductions, together with the previously announced closure of Tree Island's Covina office and Ferndale and Corona manufacturing facilities in the US, are expected to generate savings of approximately $2.5 million annually. The Fund anticipates related one-time cash costs of approximately $1.2 million, a portion of which will reduce distributable cash and net income in 2007 and a portion of which will be allocated to the purchase price of Baoan.

About the Fund

The Fund was launched on November 12, 2002, with the completion of an Initial Public Offering. There are 21,918,400 units of the Fund outstanding, representing a 100% ownership interest in Tree Island.

The Fund's performance depends entirely on the performance of Tree Island.

Tree Island Profile

Headquartered in Richmond, British Columbia, Tree Island Industries produces wire products for a diverse range of construction, agricultural, manufacturing and industrial applications. Its products include bright wire, stainless steel wire and galvanized wire; a broad array of fasteners, including packaged, collated and bulk nails; stucco reinforcing products, engineered structural mesh, fencing and other fabricated wire products. The company markets these products under the Tree Island, K-Lath, Halsteel, Tree Island Wire, Industrial Alloys and USA-Wire brand names. Tree Island also owns and operates a Hong Kong-based trading company that provides internationally sourced products to Tree Island and its customers worldwide.

Forward-Looking Statements

This press release contains forward-looking statements based on assumptions considered reasonable at the time they were prepared. Any statements that are contained herein that are not statements of historical fact may be deemed to be forward-looking statements. These statements speak only to the conditions in existence as of the date of this press release, and the Fund maintains no obligation to update such statements.

Forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the statements. Such risks and uncertainties include, but are not limited to, risks associated with operations such as competition, dependence on the construction industry, supplies of raw materials, dependence on key personnel, labour relations, regulatory matters, environmental risks, the successful execution of acquisition and integration strategies, foreign exchange fluctuations, the effect of leverage and restrictive covenants in financing arrangements, product liability, the ability to obtain insurance, energy cost increases, the ability to fund necessary future capital investments, and changes in tax legislation.

Contact Information