Atrium refocuses its operations on the health and nutrition sector and posts strong net earnings growth



    Increase of 44% in net earnings from continuing operations during Fiscal
    2007 and 74% growth for the fourth quarter of 2007

    All amounts in US dollars

    QUEBEC CITY, Feb. 29 /CNW Telbec/ -Atrium Innovations Inc. (TSX: ATB)
today discloses its annual financial results and also reconfirms the strategic
refocusing of its business operations. Atrium intends to concentrate its
operations uniquely in the health and nutrition sector (presented here as
continuing operations) and, consequently, has decided to divest its Active
Ingredients & Specialty Chemicals Division (presented as discontinued
operations). This decision, which was made in the best interest of both
divisions, follows a strategic re-evaluation process of the AI & SC Division
initiated by the Company on December 18, 2007. It became clear that focusing
on one sector would be the best option for Atrium to optimize its future
development and profitability.
    During the fiscal year ended December 31, 2007, Atrium recorded revenues
from continuing operations of US$172.8 million, which is an increase of 50.7%
compared to revenues of US$114.7 million posted for the preceding fiscal year.
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) from
continuing operations for fiscal 2007 increased by 66.1% to reach
US$46.0 million, compared to US$27.7 million for the same period in 2006. For
the year ended December 31, 2007, net earnings from continuing operations rose
by 43.8% to US$24.8 million, compared to US$17.2 million for the same period
in 2006. The Company's total net earnings were US$35.7 million, which is an
increase of 34.0% compared to net earnings of US$26.7 million for the
corresponding period in 2006. Net earnings per share on a diluted basis for
fiscal 2007 rose by 32.9% to reach US$1.09, compared to US$0.82 per share for
the preceding fiscal year.
    "We ended the year 2007 on a strong note. On one hand, we have posted
strong financial results and on the other hand, we have undertaken the
strategic refocusing of our operations to concentrate on the highly promising
health and nutrition sector. This decision should prove greatly beneficial to
the Company's future. We are confident that we will be able to complete the
divestiture of our Active Ingredients & Specialty Chemicals Division during
the second quarter at a fair price for our shareholders reflecting the full
value of this division. Furthermore, during the current fiscal year we would
like to pursue our development plan to be driven by a sustained organic growth
and new acquisitions that respect our rigorous strategic and financial
criteria," said Mr. Pierre Fitzgibbon, Atrium's President and Chief Executive
Officer.
    Cash flows from continuing operations (before changes in non-cash working
capital items) for fiscal 2007 were US$26.6 million, an increase of 31.9%
compared to US$20.1 million for the same period of the preceding year. The
Company has a revolving credit facility that provides US$350 million of
borrowing capacity under certain conditions and the possibility of increasing
this capacity to US$425 million. As at December 31, 2007, the Company had
drawn down US$265.5 million under this credit facility. In addition, the
Company has supplementary capacity, through an unsecured loan, of US$36.9
million which can be used in whole or in part from now until May 21, 2008.
    "The Company's financial situation is solid. Because of the capacity
available through our current financings and the net proceeds from the
eventual divestiture of our Active Ingredients & Specialty Chemicals Division,
we should have the financial resources required to support our future growth,"
added Mr. Fitzgibbon.

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

    Reporting now the AI & SC Division as discontinued operations has changed
the distribution of head office expenses. These expenses are now 100% absorbed
by Health & Nutrition, rather than being distributed between the two
divisions.
    For the year ended December 31, 2007, the Active Ingredients & Specialty
Chemicals Division, presented under operations to be sold, generated revenues
of US$221.6 million, which is an increase of 15.8% compared to revenues of
US$191.4 million recorded for the same period in 2006. For fiscal 2007, the
EBITDA was US$19.1 million compared to an EBITDA of US$17.1 million for the
corresponding period in 2006, an increase of 11.8 %. This growth is
attributable to strong organic growth and the acquisition of Amisol in May
2006.

    Financial results for the fourth quarter of 2007

    For the three month period ended December 31, 2007, the Company recorded
revenues under continuing operations of US$57.9 million, compared to revenues
of US$28.9 million for the same period of the preceding fiscal year, for an
increase of 100.5 %. The EBITDA rose by 114.8% to reach US$13.7 million,
compared to US$6.4 million for the same period in 2006. Net earnings from
continuing operations in the fourth quarter of 2007 were US$8.1 million, for
an increase of 73.9% compared to net earnings from continuing operations of
$4.6 million for the corresponding quarter in 2006. This growth is mainly
attributable to Mucos acquisition in July 2007 and strong organic growth. The
weighted average number of shares outstanding was in the fourth quarter of
2007 was 31.1 million compared to 30.6 million for the same period in 2006.
    For the three month period ended December 31, 2007, the Active
Ingredients & Specialty Chemicals Division, presented as discontinued
operations, generated revenues of US$64.5 million, for an increase of 20.2%
compared to revenues of US$53.7 million recorded for the same period in 2006.
For fiscal 2007, the EBITDA was US$4.5 million compared to an EBITDA of
US$4.4 million for the corresponding period in 2006, an increase of 3.9%. This
increase is attributable to organic growth and the acquisition of Amisol in
May 2006.
    Overall, for the three-month period ended December 31, 2007, the
Company's net earnings were US$10.7 million, or US$0.34 per share, which is an
increase of 52.4% compared to net earnings of US$7.0 million, or US$0.23 per
share, for the corresponding period in 2006.

    About Atrium

    Atrium Innovations Inc. is a recognized leading developer, manufacturer
and marketer of science-based products for the cosmetics, pharmaceutical,
chemical and nutrition industries. The Company focuses primarily on growing
segments of the health and personal care markets which are benefiting from the
trends towards healthy living and the ageing of the population. Atrium markets
a broad portfolio of active ingredients, specialty chemicals and health and
nutrition finished products through its highly specialized sales and marketing
network in more than 50 countries, primarily in North America, Europe and
Asia. Atrium has over 700 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
fourth quarter and full year 2007 on Friday February 29, 2008 at 1:30 p.m.
Eastern time. Participants may access the call by using the following numbers:
416-644-3420, 514-807-8791 or 1-800-731-5774. 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 is
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 Consolidated Financial Statements
             (in millions of US dollars except per share amounts)

    Consolidated Results from continuing operations for the year ended
    December 31
    (unaudited)
                                            2007          2006        Change

    Revenues                               172.8         114.7          50.7%
    Gross Margin(1)                         90.2          51.0          76.7%
                                            52.2%         44.5%
    EBITDA(2)(3)                            46.0          27.7          66.1%
                                            26.6%         24.1%
    Net Earnings from continuing
     operations                             24.8          17.2          43.8%
    Cash flow from continuing
     operating activities before
     changes in non-cash operating
     working capital items                  26.6          20.1          31.9%


    Results - Other information
                                            2007          2006        Change

    Net Earnings from discontinued
     operations                             10.9           9.4          16.1%
    Net Earnings                            35.7          26.7          34.0%

    Net earnings per share
      Basic                                 1.16          0.88
      Diluted                               1.09          0.82


    Consolidated Results from continuing operations for the 3-month periods
    ended December 31
    (unaudited)
                                            2007          2006        Change

    Revenues                                57.9          28.9        100.5%
    Gross Margin(1)                         30.9          13.2        134.8%
                                            53.4%         45.6%
    EBITDA(2)(3)                            13.7           6.4        114.9%
                                            23.7%         22.1%
    Net Earnings from continuing
     operations                              8.1           4.6         73.9%
    Cash flow from continuing operating
     activities before changes in non-cash
     operating working capital items         7.1           4.6         55.5%


    Results - Other information
                                            2007          2006        Change

    Net Earnings from discontinued
     operations                              2.7           2.4          10.8%
    Net Earnings                            10.7           7.0          52.4%
    Net earnings per share
      Basic                                 0.34          0.23
      Diluted                               0.33          0.22


    Consolidated Results from operations to be sold for the year ended
    December 31
    (unaudited)
                                            2007          2006        Change

    Active Ingredients & Speciality
     Chemicals

    Revenues                               221.6         191.4          15.8%
    EBITDA(2)(3)                            19.1          17.1          11.8%
                                            8.6%          8.9%


    Consolidated Results from operations to be sold for the 3-month periods
    ended December 31
    (unaudited)
                                            2007          2006        Change

    Active Ingredients & Speciality
    Chemicals

    Revenues                                64.5          53.7          20.2%
    EBITDA(2)(3)                             4.5           4.4           3.9%
                                             7.0%          8.1%


    Consolidated Balance Sheet                           As at          As at
    (unaudited)                                  Dec. 31, 2007  Dec. 31, 2006

    Cash and Cash Equivalents and Short-term
     Investments                                          27.4           13.0
    Current assets                                       189.6          121.7
    Goodwill                                             168.8           63.1
    Intangible assets and deferred charges               177.9           65.6
    Total assets                                         625.2          324.5
    Total debt                                           279.1           92.2
    Shareholders' equity                                 210.9          159.0
    

    (1) Gross margin means sales less cost of goods sold.

    (2) EBITDA means earnings before interest, income taxes, depreciation and
    amortization.

    (3) Continuing operations, H&N division, supports now 100% of the Head
    Office fees which is comparable to 2006




For further information:

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

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