Annual Meeting of Shareholders and First-Quarter Results of GBO Inc.



    
    -------------------------------------------------------------------------
    - The growth in Canadian sales compensates for the weakness of the U.S.
      real estate market and the unfavourable impact of exchange rate
      fluctuations.

    - GBO further lowers its breakeven point, ending the first quarter of
      fiscal 2009 with a net loss of $0.5 million or $0.02 per share,
      compared with a net loss of $0.7 million or $0.02 per share last year.

    - For the upcoming quarters, GBO's principal objectives remain to
      increase its sales and reduce its exposure to seasonal cycles through
      the launch of new products and the expansion of its representation and
      distribution network toward the Southeastern United States.
    -------------------------------------------------------------------------
    

    MONTREAL, July 9 /CNW Telbec/ - (Note: All amounts are in Canadian
dollars.) At the Annual Meeting of Shareholders held today in Montreal,
management of GBO INC. ("GBO" or "the Company"; ticker symbol GBO/TSX Venture)
disclosed the Company's financial results for the first quarter of fiscal
2009, ended May 31, 2008. For the three-month period, the window and door
manufacturer's sales amounted to $12.2 million, compared with $12.3 million
during the same quarter of the previous year. This slight decline is partly
attributable to the unfavourable impact of the increase in the Canadian dollar
in relation to the U.S. dollar as at constant exchange rates, GBO would have
posted a 2% sales increase despite the harsh weather conditions that prevailed
in March 2008. (It should be pointed out that the window and door industry in
Northeastern North America is subject to a seasonal sales cycle such that the
period corresponding to GBO's first quarter is generally weaker than the
second and third quarters.) The Company's Canadian sales posted a solid 6.6%
growth, mostly attributable to an increase in GBO's market share in Quebec.
Management attributes this performance to the restoration of GBO's leadership
reputation in the Eastern Canadian window and door market, the launch of
several new products during the previous quarters, the strengthening of the
Company's sales and marketing organization and improved customer service.
However, exports to the United States declined by 20.2% (10.0% decrease at
constant exchange rates) due to the slowdown in the U.S. economy and, more
particularly, the crisis currently affecting the American real estate market.
Interim President and Chief Executive Officer Dennis Wood pointed out that
GBO's sales decrease in the United States strictly reflects the business
environment, as the Company maintained and even increased its customer base in
its targeted territories.
    GBO closed the first quarter with a net loss of $0.5 million or $0.02 per
share, compared with a net loss of $0.7 million or $0.02 per share in the same
quarter last year. According to Dennis Wood, these results again attest to the
improved operational efficiency of the Company, which has significantly
lowered its breakeven point in recent years thanks to the general optimization
of its operations, an overhaul of its selling price structure, targeted
investments in its production facilities and improved customer service.

    Outlook
    -------

    GBO's management remains cautious as to the Company's outlook for fiscal
2008-2009, given current economic conditions. The effects of the U.S. real
estate crisis, in particular, will take another few quarters to abate. In
addition the Company has observed a certain market slowdown in Ontario since
the beginning of the current fiscal year. However, demand remains strong in
Quebec and the Maritimes.
    Furthermore, GBO is currently engaged in an active product and market
development phase, the primary objectives of which are to resume its sales
growth and alleviate the seasonal cycle of its business by diversifying its
geographic markets and by further broadening its product selection in the home
improvement segment. To that end, GBO launched a hurricane-resistant casement
window at the beginning of the current fiscal year, being the first product of
its new "Impact" line, with a view mostly to extending its presence into the
Southern States along the U.S. East Coast. An "Impact" hung window model will
be introduced shortly. Last June, the "Impact" line of products was also
integrated into the new "Bonquote" electronic specification and product
configuration system, which will facilitate market development. In addition,
GBO has recruited close to 40 new customers since the beginning of the current
fiscal year, several of which in the United States. "This broader base will
support our future development in the U.S. market as the current crisis
gradually abates and consumer spending in home purchases and improvements
resumes. To prepare for this market recovery, we are also working on expanding
our representation in the Southeastern United States," indicated Dennis Wood.
"In these territories, we will gradually introduce the full range of
"Bonneville" high-end products, especially aluminum-covered wooden windows
which are perfectly adapted to these markets. In 2008-2009, while pursuing our
innovation and market development efforts, we will also continue to improve
our business processes and to reduce our costs in order to optimize our
profitability," concluded Dennis Wood.

    Profile
    -------

    Founded in 1946, GBO Inc. is one of the leading window and door
manufacturers in Eastern Canada. The Company, which employs approximately
500 people, designs, develops, manufactures, markets and distributes an
extensive selection of high-end energy-efficient window arrangements sold
primarily under the "Bonneville" and "Polar" brands. This selection includes
wooden and polyvinyl chloride (PVC) windows, as well as hybrid models made of
wood or PVC and aluminum. Recently, GBO launched a line of innovative
fenestration products resistant to hurricanes and other impacts. GBO also
offers exterior doors, primarily for high-end market niches. The Company sells
its windows and doors to the home improvement and construction markets in
Quebec, Ontario, the Maritimes and the Eastern United States. GBO mainly
serves independent building material distributors, distributors specializing
in windows, doors and millwork, certain retailers, as well as construction and
renovation contractors.

    The statements set forth in this press release that describe GBO's
objectives, projections, estimates, expectations or forecasts may constitute
forward-looking statements within the meaning of securities legislation. GBO
would like to point out that, by their very nature, forward-looking statements
involve a number of risks and uncertainties such that actual results or the
measures it adopts could therefore differ materially from those indicated or
underlying these forward-looking statements, or could have an impact on the
degree of realization of a particular projection. There can be no assurance as
to the materialization of the results, performance or achievements as
expressed or implied by the forward-looking statements. Unless required to do
so pursuant to applicable securities legislation, GBO's management assumes no
obligation as to the updating or revision of the forward-looking statements as
a result of new information, future events or other changes.


    
    CONSOLIDATED EARNINGS AND COMPREHENSIVE INCOME
    Period ended May 31
    (unaudited)(in thousands of dollars, except per share amounts)


                                                             Three months
                                                   --------------------------
                                                          2008          2007
                                                   ------------  ------------
                                                             $             $

    Sales                                               12,234        12,327

    Cost of sales and operating expenses                12,544        12,754

                                                   ------------  ------------

    Operating loss before the following items             (310)         (427)

                                                    - - - - - -   - - - - - -


    Depreciation of fixed assets                           377           378
    Amortization of intangible assets                       37            28
    Amortization of deferred charges                         -            16
    Interest on long-term debt                               2             3
    Other financial expenses                                74           236
                                                   ------------  ------------

                                                           490           661

                                                    - - - - - -   - - - - - -

    Loss before income taxes                              (800)       (1,088)
                                                   ------------  ------------

    Future income taxes                                   (257)         (348)
                                                   ------------  ------------

    Net loss and comprehensive income                     (543)         (740)
                                                   ------------  ------------
                                                   ------------  ------------

    Loss per share and
     diluted loss per share                              (0.02)        (0.02)
                                                   ------------  ------------
                                                   ------------  ------------

    Weighted average number of common shares
     outstanding                                    32,676,569    32,676,569



    CONSOLIDATED CASH FLOWS
    Period ended May 31
    (unaudited)(in thousands of dollars)

                                                             Three months
                                                   --------------------------
                                                          2008          2007
                                                   ------------  ------------
                                                             $             $
    OPERATING ACTIVITIES
    Net loss                                              (543)         (740)
      Non-cash items
        Depreciation of fixed assets                       377           378
        Amortization of intangible assets and
         deferred charges                                   37            44
        Stock-based compensation expense                     3             6
        Future income taxes                               (257)         (348)
        Changes in working capital items                (2,697)       (1,677)
                                                   ------------  ------------

    Cash flows from operating activities                (3,080)       (2,337)

                                                    - - - - - -   - - - - - -
    INVESTING ACTIVITIES
      Fixed assets                                        (230)         (651)
      Note receivable                                       50            45
      Intangible assets & deferred charges                  (5)            -
                                                   ------------  ------------

    Cash flows from investing activities                  (185)         (606)

                                                    - - - - - -   - - - - - -
    FINANCING ACTIVITIES
      Bank loan                                          3,422         2,461
      Repayment of long-term debt                          (13)          (27)
                                                   ------------  ------------

    Cash flows from financing activities                 3,409         2,434

                                                   ------------  ------------

    Net change in cash                                     144          (509)
    Cash at the beginning of period                        287         1,120
                                                   ------------  ------------
    Cash at the end of period                              431           611
                                                   ------------  ------------
                                                   ------------  ------------



    CONSOLIDATED BALANCE SHEET
    (in thousands of dollars)
                                                                 February 29,
                                                  May 31, 2008          2008
                                                  -------------  ------------
                                                             $             $
    ASSETS                                          (unaudited)

    Current assets
      Cash                                                 431           287
      Accounts receivable                                7,559         3,456
      Income taxes receivable                              103           103
      Inventories                                        4,845         3,665
      Prepaid expenses and other                           499           405
      Current portion of note receivable                   356           356
                                                  -------------  ------------
                                                        13,793         8,272

    Note receivable                                      1,836         1,886
    Fixed assets                                        14,680        14,817
    Fixed assets held for sale                             860           870
    Intangible assets                                      579           611
    Deferred charges                                       158           158
    Future income taxes                                  3,521         3,263
                                                  -------------  ------------
                                                        35,427        29,877
                                                  -------------  ------------
                                                  -------------  ------------
    LIABILITIES
    Current liabilities
      Bank loans                                         6,526         3,104
      Accounts payable                                   7,947         5,266
      Instalments on long-term debt                         70            77
                                                  -------------  ------------
                                                        14,543         8,447

    Long-term debt                                           5            11
                                                  -------------  ------------

                                                        14,548         8,458
                                                  - - - - - - -   - - - - - -

    SHAREHOLDER'S EQUITY
    Capital stock                                       44,526        44,526
    Contributed surplus                                    438           435
    Deficit                                            (24,085)      (23,542)
                                                  -------------  ------------

                                                        20,879        21,419
                                                  -------------  ------------

                                                        35,427        29,877
                                                  -------------  ------------
                                                  -------------  ------------
    




For further information:

For further information: Dennis Wood, Interim President and Chief
Executive Officer, (418) 387-7723; Source: GBO Inc.

Organization Profile

GBO INC.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890