Atrium generates strong growth during the second quarter



    Significant increase in revenues and net earnings from continued
    operations of 165% and 157% respectively

    All amounts are in US dollars.

    QUEBEC CITY, Aug. 7 /CNW Telbec/ - Atrium Innovations Inc. (TSX: ATB), a
recognized leading developer, manufacturer and marketer of science-based and
professionally endorsed products for the health and nutrition industries,
disclosed today its financial results for the second quarter of 2008.

    
    Quarterly highlights:

    - Sale of AI&SC Division completed, allowing to focus activities in the
      promising health and nutrition sector;
    - Strong organic growth in sales and earnings;
    - Strong growth also contributed by the two recent acquisitions, Mucos
      and MCO. Integrations are proceeding smoothly;
    - Strong financial position and well positioned to pursue the acquisition
      strategy;
    - Favorable short-term outlook.
    

    During the quarter ended June 30, 2008, Atrium recorded revenues from
continuing operations of $74.5 million, which represents an increase of 165%
compared to revenues of $28.2 million for the corresponding quarter in 2007.
Earnings before interest, taxes, depreciation and amortization (EBITDA) from
continuing operations for the second quarter of 2008 increased by 128% to
$18.2 million compared to $8.0 million for the same period in 2007. For the
quarter ended June 30, 2008, net earnings from continuing operations were
$10.7 million compared to $4.2 million for the same period in 2007, an
increase of 157%.
    The Company's total net earnings were $43.9 million compared to net
earnings of $6.6 million for the corresponding period in 2007. For the second
quarter of 2008, net earnings per share on a diluted basis rose to $1.33 per
share, compared to $0.20 per share for the same period in 2007. Net earnings
and net earnings per share in 2008 include a net gain of $30.9 million on the
sale of the AI&SC Division.
    For the six-month period ended June 30, 2008, revenues from continuing
operations were $140.3 million, up 119% from $64.1 million for the
corresponding period in 2007. EBITDA from continuing operations for the first
half of 2008 was $36.6 million, an increase of 108% compared to $17.6 million
for the same period last year. For the first half of 2008, total net earnings
increased by 284% to $58.6 million generating fully diluted earnings per share
of $1.77, compared to $15.2 million and $0.47 per share for the first six
months of 2007.
    "We are extremely satisfied with our results for the second quarter,
confirming the soundness of our strategic development plan. Strong organic
growth exceeding our target, combined with the benefits of our recent
acquisitions, allows us to be optimistic for the remainder of 2008. Moreover,
completing the sale of our Active Ingredients and Specialty Chemicals Division
is providing us all the financial flexibility required to pursue our growth
strategy through acquisitions in the promising sector of specialties health
and nutrition products," said Mr. Pierre Fitzgibbon, Atrium's President and
Chief Executive Officer.
    For the second quarter of 2008, cash flows from continuing operating
activities, before changes in non-cash working capital items, were
$12.2 million, an increase of 149% compared to $4.9 million for the same
period of the preceding year. For the six-month period ended June 30, 2008,
cash flows from continuing operating activities, before changes in non-cash
working capital items, were $23.9 million, an increase of 115% compared to
$11.1 million for the same period in 2007. As at June 30, 2008, the Company
had a total debt amounting to $144 million as the Company has a revolving
credit facility that provides $300 million of borrowing capacity. In addition,
through an unsecured loan, the Company has additional capacity of
$35.9 million that can be used in whole or in part by December 31, 2008
according to the amendment signed on May 21, 2008.

    Discontinued Operations - Active Ingredients and Specialty Chemicals
    (AI&SC) Division

    On May 22, 2008, Atrium completed the sale of its Active Ingredients and
Specialty Chemicals Division for total proceeds of $166.4 million in cash,
subject to a post-closing working capital adjustment. Atrium has become a
health and nutrition pure play and the net proceeds from the transaction will
provide the Company with increased financial flexibility to pursue its
development strategy.
    The AI&SC Division's operations from April 1, 2008 to May 21, 2008, which
are included in the second quarter of 2008 and presented as discontinued
operations, generated revenues of $34.3 million, compared to revenues of
$48.3 million for the complete quarter of 2007. For the same periods, EBITDA
was $3.4 million in 2008 compared to $4.7 million in 2007.
    For the period between January 1, 2008 and May 21, 2008, revenues from
discontinued operations were $102.3 million compared to $107.0 million for the
six-month period ended June 30, 2007. For the same periods, EBITDA from
discontinued operations was $9.8 million in 2008 compared to $10.0 million in
2007.

    About Atrium

    Atrium Innovations Inc. is a recognized leading developer, manufacturer
and marketer of science-based and professionally endorsed products for the
health and nutrition industries. The Company focuses primarily on growing
segments of the health and nutrition markets which are benefiting from the
trends towards healthy living and the ageing of the population. Atrium markets
a broad portfolio of finished products through its highly specialized sales
and marketing network in more than 35 countries, primarily in North America
and Europe. Atrium has over 575 employees and operates five manufacturing
facilities. Additional information about Atrium is available on its Web site
at www.atrium-innov.com.

    Conference Call and Webcast

    Atrium will hold its quarterly conference call and webcast to discuss its
second quarter 2008 on Thursday, August 7, 2008 at 10:00 a.m. Eastern time.
Participants may access the call by using the following numbers: 416-644-3418,
514-807-8791 or 1-800-732-0232. A live webcast is also available via the
Company's website at www.atrium-innov.com in the "Investors" section. A replay
of the webcast will also be available on our website for a period of 30 days.
A copy of Atrium's interim unaudited financial statements will also be
available on the Company's website.

    Caution Regarding Non-GAAP Measures

    This press release is based on reported earnings in accordance with
Canadian generally accepted accounting principles (GAAP). It is also based on
earnings before interest, income taxes, depreciation and amortization (EBITDA)
and gross margin. These measures do not have a standardized meaning prescribed
by GAAP; therefore, other issuers using these terms may calculate them
differently. Management believes that a significant portion of the users of
its Consolidated Financial Statements and MD&A analyze the Company's results
based on these performance measures.

    Cautionary Note and Forward-Looking Statements

    This press release contains certain forward-looking statements with
respect to the Company. These forward-looking statements, by their nature,
necessarily involve risks and uncertainties that could cause actual results to
differ materially from those contemplated by these forward-looking statements.
The Company considers the assumptions on which these forward-looking
statements are based to be reasonable, but cautions the reader that these
assumptions regarding future events, many of which are beyond its control, may
ultimately prove to be incorrect since they are subject to risks and
uncertainties that affect the Company. For additional information with respect
to these and other factors, see the Company's quarterly and annual filings
with the Canadian securities commissions. The Company disclaims any intention
or obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, other than as required
by law.

    Attachment: Financial summary

    
                           Atrium Innovations Inc.
             Summary of Interim Consolidated Financial Statements
             (in millions of US dollars except per share amounts)

    Consolidated Results for the 3-month
     periods ended June 30
    (unaudited)
                                                   2008     2007     Change
                                                --------  -------  ---------
    Revenues                                       74.5     28.2      164.7%
    Gross Margin(1)                                37.2     15.0      148.2%
                                                   49.8%    53.1%

    EBITDA(2)                                      18.2      8.0      128.0%
                                                   24.4%    28.3%

    Net earnings from continuing operations        10.7      4.2      157.1%

    Net earnings from discontinued operations      33.2      2.4
                                                --------  -------
    Net earnings                                   43.9      6.6
                                                --------  -------
    Net earnings per share from continuing
     operations
      Basic                                        0.33     0.14
      Diluted                                      0.32     0.13

    Net earnings per share
      Basic                                        1.36     0.22
      Diluted                                      1.33     0.20

    Cash flow from continuing operating
     activities before changes in non-cash
     operating working capital items               12.2      4.9      148.7%

    (1) Gross margin means sales less cost of goods sold.
    (2) EBITDA means earnings before interest, income taxes, depreciation and
        amortization.



    Consolidated Results for the 6-month
     periods ended June 30
    (unaudited)
                                                   2008     2007     Change
                                                --------  -------  ---------

    Revenues                                      140.3     64.1      119.0%
    Gross Margin(1)                                72.7     32.1      126.5%
                                                   51.8%    50.1%

    EBITDA(2)                                      36.6     17.6      107.7%
                                                   26.1%    27.5%

    Net earnings from continuing operations        21.2      9.5      123.8%

    Net earnings from discontinued operations      37.4      5.7
                                                --------  -------

    Net earnings                                   58.6     15.2
                                                --------  -------
    Net earnings per share from continuing
     operations
      Basic                                        0.66     0.31
      Diluted                                      0.64     0.29

    Net earnings per share
      Basic                                        1.81     0.50
      Diluted                                      1.77     0.47

    Cash flow from continuing operating
     activities before changes in non-cash
     operating working capital items               23.9     11.1      114.5%



    Consolidated Balance Sheet
    (unaudited)
                                                           As at      As at
                                                            June   December
                                                        30, 2008   31, 2007
                                                      ----------- ----------

    Cash and cash equivalents                               20.0       27.4
    Other current assets                                    96.7      162.2
    Goodwill                                               194.8      168.8
    Other long-term assets                                 217.0      266.8
                                                      ----------- ----------
    Total assets                                           528.5      625.2
                                                      ----------- ----------

    Short-term liabilities                                  39.2       79.7
    Long-term debt                                         143.9      279.0
    Other long-term liabilities                             62.6       55.6
    Shareholders' equity                                   282.8      210.9
                                                      ----------- -----------
    Total liabilities and shareholders' equity             528.5      625.2
                                                      ----------- -----------


    (1) Gross margin means sales less cost of goods sold.
    (2) EBITDA means earnings before interest, income taxes, depreciation and
        amortization.
    




For further information:

For further information: Investor Relations: Mario Paradis,
Vice-President and Chief Financial Officer, (418) 652-1116,
mparadis@atrium-innov.com; Media Relations: Frédéric Tremblay, HKDP, (514)
395-0375, ext. 234, ftremblay@hkdp.qc.ca

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