OTTAWA, Nov. 22 /CNW Telbec/ - Clearford Industries Inc. ("Clearford" or "the Company", TSX-V: CLI) today announced financial results for the third quarter of 2007, which ended September 30, 2007 (all figures in Canadian dollars and in accordance with Canadian GAAP). Revenue of $8.3 million was the highest in the history of the Company.
Clearford's revenue arises primarily from the Brooklin Concrete Division, which operations are seasonally affected by construction weather conditions. Revenue for the third quarter was $8,300,000 compared to $7,662,000 for the same period of the prior year and $8,001,000 of revenue for the second quarter of 2007. Gross margin was $3,566,000 compared to $3,634,000 for the same period of the prior year and $3,490,000 for the second quarter of 2007. Operating income for the quarter was $1,238,000 compared to an operating income of $1,381,000 for the same period of the prior year and an operating income of $1,198,000 for the second quarter of 2007. Net income for the third quarter was $185,000 or $0.01 per share compared to a net income of $432,000 or $0.02 per share for the same period of the prior year and a net income of $132,000 or $0.01 per share for the second quarter of 2007. The decrease in net income as compared to the prior year's same quarter was due to a combination of the gross margin effect of the change in sales product mix and customer price incentives at the Brooklin Concrete Division, and higher depreciation expense due to an increase in value of certain fixed assets following a financial asset valuation in late 2006 and interest expense.
Revenue for the nine months ended September 30, 2007 was $17,937,000 compared to $16,806,000 for the same period of the prior year. Gross margin was $7,198,000 compared to $7,181,000 for the same period of the prior year. The operating income for the nine months was $444,000 compared to an operating income of $855,000 for the same period of the prior year. The nine months period for the current year is not fully comparable to the prior year because the prior year's operating income does not include $484,000 of losses during January 2006 associated with the pre-acquisition period of Brooklin and does not reflect the additional depreciation charges incurred in the current year in excess of $300,000 relating to the increase in value of certain fixed assets following a financial asset valuation in late 2006. The net loss for the nine months was $2,673,000 or $0.11 per share compared to a net loss of $1,724,000 or $0.07 per share for the same period of the prior year.
For the third quarter of 2007 cash flow from operations was $1,310,000 compared to cash flow from operations of $1,538,000 for the same period of the prior year and $869,000 for the second quarter of this year. For the nine month period cash flow from operations was $182,000 compared to cash flow from operations of $65,000 for the same period of the prior year.
The Wastewater Division recorded no revenues during the third quarter of 2007 though revenue is expected in the fourth quarter of this year. The Brooklin Concrete Division continues to increase sales and market share. This performance is expected to continue on a seasonally adjusted basis into the fourth quarter. Seasonal factors are expected to result in a loss for the fourth quarter.
"The third quarter was marked by continued strong channel and direct distribution sales of the Brooklin product offering," stated Bruce Linton, President and CEO of Clearford. "We have a strong pipeline of sales opportunities for our Wastewater Division and expect revenue and contribution from that Division in the fourth quarter and in 2008. The market for infrastructure remains strong and we remain confident that this segment of the market will provide both of our operating divisions with significant growth potential."
Any forward looking statements made in this press release involve risks and uncertainties, and actual results could differ materially from those expressed or implied in such statements. However, we disclaim any intention and assume no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release. More detailed information of the matters
described herein is included in the public documents Clearford files from
time to time with Canadian securities regulatory authorities.
About Clearford Industries Inc.
Clearford Industries Inc. is comprised of two divisions: the Wastewater Systems Division and the Brooklin Concrete Division. The Wastewater Systems Division designs and implements the patented Small Bore Sewer(TM) (SBS(TM)), a watertight small diameter wastewater collection system for developers, municipalities and First Nations communities who need to create, expand or upgrade their sewage systems. This solution provides servicing with superior operational and environmental performance at a significantly lower cost when compared to historic gravity sewers. With its first installation in 1989, the SBS(TM) has since had several installations within Canada and the U.S. The Brooklin Concrete Division has been in operation since 1952, with 4 locations in Ontario, including: Brooklin, Newmarket, Huntsville and Haliburton. A leading producer of septic tanks in Ontario, Brooklin manufactures precast concrete products ranging from interlocking pavers and patio slabs, to retaining walls and storage structures. For more information on Clearford Industries Inc., please visit www.clearford.com.