Amisk announces its results for the 4th quarter and the fiscal year ending on December 31, 2006



    Ticker symbols
    AS.A

    SAGUENAY, QC, March 16 /CNW Telbec/ - The audited consolidated financial
statements, as of December 31, 2006, were prepared by the Company in
accordance with the generally recognized accounting principles of Canada.
These financial statements include the quota-share of the asset and debt
elements, the profits and the expenses of the Société en commandite Sodexfor
("Sodexfor") joint venture in which Amisk owns an investment. This quota-share
is entered according to the proportional consolidation method. The financial
statements also include the accounts of the Transmateria Inc. ("Transmateria")
subsidiary. The investments in which the company exercises considerable
influence without exceeding 50 % investment are entered at consolidation
value.

    
                               ECONOMIC CONTEXT

    Amisk has investments in the field of primary and secondary wood
conversion, in agricultural equipment manufacturing and in agro-food new
technology development.
    During 2006, the general economic situation in the Canadian manufacturing
industry, particularly in the forest sector, proved to be a deciding factor in
business transaction for the companies in Amisk's portfolio.
    The strength of the Canadian currency combined with the competition from
Asian products caused an unprecedented price collapse for products linked to
the forest industry. The very strong concentration of the investment portfolio
in the field of 1st and 2nd transformation of wood, has largely affected
Amisk's profitability.
    The falling price fluctuations for products in the agricultural field on
the American market lowered the purchasing capacity for fixed assets for the
producers and by the same token the demand for agricultural equipment.
    Consequently, the overall economic factors hindered the Canadian
manufacturing industry and have affected export profitability.


                SUMMARY OF THE CONSOLIDATED OPERATING RESULTS

    Amisk has an investment of 100% in Transmateria and a 50% investment in
Sodexfor, a joint venture that owns 100% of the share-capital of E. Tremblay
et Fils Ltd ("ETF"). Amisk adopted the proportional consolidation method to
enter its investment in Sodexfor.


    Selected annual financial data

    -------------------------------------------------------------------------
    Financial results                  December 31, 2006    December 31,2005
    -------------------------------------------------------------------------
                                                      ($)                 ($)
    -------------------------------------------------------------------------
    Interest income and other                    324,580             370,534
    -------------------------------------------------------------------------
    Gain on disposal investments               1,897,022                 000
    -------------------------------------------------------------------------
    Interest in earnings and loss on write-off
     of shares and advances of companies
     subject to significant influence         (1,763,296)         (4,137,028)
    -------------------------------------------------------------------------
    Decline in value of proprety, plant
     and equipment                              (164,690)                000
    -------------------------------------------------------------------------
    Loss linked to continuing operations        (466,493)         (4,264,785)
    -------------------------------------------------------------------------
    Loss linked to discontinued operations    (4,670,950)            (93,801)
    -------------------------------------------------------------------------
    Net total loss                            (5,137,443)         (4,358,586)
    -------------------------------------------------------------------------
    Net basic and diluted loss per share linked
     to continuing operations                      (0.05)              (0.51)
    -------------------------------------------------------------------------
    Net basic and diluted loss per share
     linked to discontinued operations             (0.56)              (0.01)
    -------------------------------------------------------------------------
    Net basic and diluted loss per share           (0.61)              (0.52)
    -------------------------------------------------------------------------
    Total assets                               9,205,861          16,648,639
    -------------------------------------------------------------------------
    Long-term financial liability                724,094             745,797
    -------------------------------------------------------------------------

    For the financial year ending on December 31, 2006, the loss linked to
continuing operations is $466,493, the loss linked to discontinued operations
is $4,670,950, for a total loss per share of $0.61 on a non-diluted and fully
diluted basis, compared to the same period the previous year, with a loss
linked to continuing operations of $4,264,785 and a loss linked to
discontinued operations of $93,801, or a total loss per share of $0.52 on a
non-diluted and fully diluted basis.
    The loss linked to continuing operations is primarily caused by an
increase in the administrative expenses linked to the takeover bid filed by
Pan-O-Lac ltée in May 2006. As for the loss linked to discontinued operations,
it is attributable to the investment held in ETF and its subsidiary company,
and it has a major effect on the total assets of the Company.
    Amisk operations mainly consist in making investments and collecting
income from them by way of interest or dividends. The Company also provides
some management services that are remunerated by its partner companies.
    Amisk also enters the decrease in value of its fixed assets in its
financial results. The entry of this item in its financial statements results
from the application, by Amisk in 2004, of the business withdrawal clause of a
shareholder in an associated undertaking that resulted in the Company holding
100% of the share capital, under the terms of an existing agreement between
shareholders. The impact of the consolidation on the Company financial
statements resulted in not entering a bill receivable of $307,597 but entering
out of service non-amortized equipment for the same amount. During the
financial year, a loss of $164,690 on its fixed assets was entered. The
financial results of 2005 were restated to take into account this
modification.
    With the results of the financial year ending on December 31, 2006, the
book value of the Class "A" and Class "B" shares decreased from $1.35 to $0.74
relative to December 31, 2005.
    Following the decision by ETF, on May 15, 2006, to cease the operations of
the sawmill and the plant for the second transformation of broadleaved trees,
the management considers that all the criteria of section 3475 of the CICA
Handbook are met. Consequently, the Company enters the investment in ETF, its
subsidiary company, as discontinued operations.
    To reduce the book value of the production goods to their fair value and
decreased by their sales expenses, a loss on devaluation of $2,446,566 on the
long-term assets was entered with the consolidated results of the financial
year in the discontinued operations.
    The sales of the subsidiary company amount to $3,209,777 ($5,020,232 in
2005) and the operations loss amounts to $2,224,384 ($93,801 in 2005).
    When a component is written off by sale or discontinuation, or when it is
considered as intended to be ceded and that the conditions for the elimination
and the withdrawal of business are met, the proceeds, expenses, profits and
losses related to this component are eliminated from the items corresponding
to the state of the results of the current financial year and of all the
financial years presented comparatively. Consequently, Amisk no longer enters
sales income in its results and the financial results of 2005 were restated.
    Facing a market collapse in the industry of broadleaved tree second
transformation, ETF had no more leeway and financial restructuring was
required. This situation forced ETF to ask the Cour Supérieure protection
granted by the Loi sur les arrangements avec les créanciers des compagnies
(LAAC) (Companies Creditors Arrangement Act) on May 15, 2006, that ended on
June 13, 2006 and whose prorogation order was extended until October 10, 2006.
In the opinion of the ETF managers, this decision had become inevitable for
the purposes of continuing the operations until that date, and to allow
analysing all the possible scenarios that could lead to relaunching this
company. Presently, there are ongoing negotiations with a potential buyer and
the management hopes that a transaction may be concluded by April 2007.
    To this end, ETF filed a notice of intention on October 11, 2006 to make a
proposal with its creditors in accordance with the Loi sur la faillite et
l'insolvabilité (Bankruptcy and Insolvency Act), in collaboration with the
secured creditors who assume, jointly with the potential buyer, all the
expenses related to preserving the assets from November 1, 2006 up to the
conclusion of the transaction. Since then, requests for deadline extensions
were filed with the objective of filing a proposal with all the creditors, and
they were accepted, thereby extending the deadline up to April 14, 2007. This
extension was requested to try to achieve the conditions stated in the
agreement, which conditions would allow to sell all the movable and fixed
assets of ETF and of its subsidiary company.
    To enable the shareholders to properly measure the impact of the ETF
accounting in Amisk's financial statements, we must consider that when the
assets and liabilities linked to discontinued operations are cancelled,
whether by conclusion of the planned transaction or by the bankruptcy of ETF,
the result will be a gain equal to the difference between the amount of the
assets and the liabilities that will be entered in the financial year during
which the transaction will occur.
    Consequently, the negative effect of ETF on Amisk's financial results will
be eliminated and will improve its financial results over the medium term. ETF
has had significant losses for several years and this directly affects the
financial results of the Company.

    Income variation between financial years 2005 and 2006

    By accounting Amisk's investment in ETF as discontinued operations, the
accounting for the sales no longer appears in the income statement and the
results for financial year 2005 were restated for that purpose.
    During financial year 2006, Amisk cashed in interest income and other
income of approximately $324,580 compared to $370,534 the previous year. The
noted drop in income is due to less interest income cashed in by the Company
because of lower interest rates. A gain on investment disposal of $2,159,500
was recorded during the 1st quarter with the cession of the securities held by
Sodexfor in the MDF La Baie associated undertaking. The Company also recorded
a loss on cession of investments of $262,478 attributable to the sale of its
shares in the Soccrent limited partnerships and the provision of an advance
granted to Soccrent.


    Quarterly financial data
    -------------------------------------------------------------------------
                                       For the 3     For the 3    Variation
                                    month period  month period     Increase
                                       ending on     ending on    (Decrease)
    -------------------------------------------------------------------------
    Financial results                   31-12-06      31-12-05
                                              ($)           ($)          ($)
    -------------------------------------------------------------------------
    Income total                         102,519       170,943       (68,424)
    -------------------------------------------------------------------------
    Net loss                            (728,547)   (1,518,288)      789,741
    -------------------------------------------------------------------------
    Net basic loss per share               (0.08)        (0.18)         0.10
    -------------------------------------------------------------------------
    Total assets                       9,205,861    16,648,639    (7,442,778)
    -------------------------------------------------------------------------
    Long-term financial liability        724,094       745,797       (21,703)
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
                                      For the 12    For the 12     Variation
                                    month period  month period      Increase
                                       ending on     ending on     (Decrease)
    -------------------------------------------------------------------------
    Financial results                   31-12-06      31-12-05
                                              ($)           ($)           ($)
    -------------------------------------------------------------------------
    Income total                       2,221,602       370,534     1,851,068
    -------------------------------------------------------------------------
    Net loss                          (5,137,443)   (4,358,586)     (778,857)
    -------------------------------------------------------------------------
    Net basic loss per share               (0.61)        (0.52)        (0.09)
    -------------------------------------------------------------------------
    Total assets                       9,205,861    16,648,639    (7,442,778)
    -------------------------------------------------------------------------
    Long-term financial liability        724,094       745,797       (21,703)
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
    Results               31-12-06      30-09-06      30-06-06      31-03-06
                                ($)           ($)           ($)           ($)
    -------------------------------------------------------------------------
    Interest and
     other income          102,519        77,814        77,251        66,996
    -------------------------------------------------------------------------
    Gain (loss) on
     investment cession   (262,478)          N/A           N/A     2,159,500
    -------------------------------------------------------------------------
    Total net loss        (728,547)   (1,058,993)   (2,444,997)     (904,906)
    -------------------------------------------------------------------------
    Net loss per share       (0.08)        (0.13)        (0.29)        (0.11)
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Results               31-12-05      30-09-05      30-06-05      31-03-05
                                ($)           ($)           ($)           ($)
    -------------------------------------------------------------------------
    Interest and
     other income          170,943        51,903        76,492        71,196
    -------------------------------------------------------------------------
    Gain (loss) on
     investment cession        N/A           N/A           N/A           N/A
    -------------------------------------------------------------------------
    Total net loss      (1,518,288)   (2,466,551)       (4,442)     (369,305)
    -------------------------------------------------------------------------
    Net loss per share       (0.18)         (0.3)       (0.001)        (0.04)
    -------------------------------------------------------------------------
    

    Significant variation during the quarters

    A marked increase in interest and other income may be noted between the
3rd and 4th quarters of financial years 2005 and 2006. This positive variation
results mostly from the increase of the value in Amisk's bond portfolio.
During 2006, Amisk ceded its shares in the Soccrent companies and cashed in an
advance that had been granted to Sodexfor.
    As for the interest income for the 4th quarter of 2005, there was a
marked increase relative to the average of the first three (3) quarters of
2005. It is attributable to interests that were accounted for in the
Technologie Biolactis Inc. associated undertaking.
    The significant variations in the losses for the quarters may be
explained mainly by the entering of the quota-share of the companies in which
Amisk has investments. Please refer to the progress report of the general
manager that states the changes in each investment during financial year 2006.

    Amisk is a public owned venture capital company whose objective is to
make high potential investments in Quebec with strategic partners,
particularly in the sectors of high added-value products or those using new
technologies.
    For further information on the Company results for fiscal year 2006 and
for any other information on the Company, please refer to the annual financial
statements in our annual report and in the Management Report found on SEDAR
site : www.sedar.com These documents will be filed no later than March 19,
2007.




For further information:

For further information: Ms. Colette Gauthier, Charwoman, Audit
Committee, (418) 545-5011 (ext. 5328)

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AMISK INC.

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