Canam Group earnings up 17.1% and sales up 8.3% in first quarter



    VILLE DE ST. GEORGES, QC, April 25 /CNW Telbec/ - Construction product
manufacturer Canam Group Inc. (TSX: CAM) today reported net earnings of
$6.4 million, or $0.13 per share, for the first quarter ended March 31, 2007,
up 17.1% from $5.4 million, or $0.13 per share, for the corresponding period
in 2006. Consolidated sales rose 8.3% to $161.1 million, compared with
$148.8 million last year.
    President and chief operating officer Marc Dutil is delighted with these
results and with such an excellent start to the year, considering that
traditionally the first quarter is the least profitable three-month period. He
noted that the company turned in a good performance due to a high level of
activity on Canadian and U.S. markets. Mr. Dutil also underscored the positive
impact of its heavy steel construction activities, pointing out that
deliveries for the New York Mets' stadium project began over the first
quarter.
    According to Mr. Dutil, these results will allow Canam Group to continue
to improve its balance sheet. The net debt decreased to $83.9 million, while
shareholders' equity climbed to $345.9 million, reflecting a ratio of only
0.24.
    The gross margin for the first quarter of 2007 represented 22.5% of
sales, compared with 23.6% for the same period last year. The order backlog
for all business units stood at $411 million, compared with $223 million in
2006, representing an 84% increase year-over-year.
    The board of directors has approved a quarterly dividend of $0.04 per
share payable on June 29, 2007 to shareholders of record on June 15, 2007.
There were 48.8 million outstanding shares on March 31, 2007, as opposed to
42.3 million on March 25, 2006.

    Canam Group Inc. is an industrial company operating 11 plants specialized
in the design and fabrication of construction products and solutions. The
company employs close to 3,000 people in Canada, the United States, Romania
and India, and has partnerships with companies in Mexico, France, Saudi
Arabia, the United Arab Emirates and Russia.

    Conference call
    ----------------

    Canam Group will hold a conference call with financial analysts and the
media on Wednesday, April 25, 2007 at 1:30 p.m. The conference call will be
webcast live at www.canamgroup.ws and www.cnw.ca. The call will be available
by phone at 1-888-509-0081 (access code 642584) until May 6, 2007.

    
                     Consolidated Statements of Earnings

    Periods ended March 31, 2007 and March 25, 2006
    (in thousands of dollars, except per share amounts) (unaudited)

                                                                    3 months
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                          2007          2006
                                                                   (restated)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Sales                                           $  161,107    $  148,758
    -------------------------------------------------------------------------
    Cost of sales                                      124,797       113,623
    -------------------------------------------------------------------------
                                                   --------------------------
    Gross profit                                        36,310        35,135
    -------------------------------------------------------------------------
    Selling and administrative expenses                 19,926        17,523
    -------------------------------------------------------------------------
    Profit sharing and continuous
     improvement programs                                  468         1,362
    -------------------------------------------------------------------------
    Exchange loss (gain)                                  (487)           23
    -------------------------------------------------------------------------
    Interest income                                       (379)         (557)
    -------------------------------------------------------------------------
    Increase in the redemption value of an
     investment from a related company                    (465)         (434)
    -------------------------------------------------------------------------
                                                   --------------------------
                                                        17,247        17,218
    -------------------------------------------------------------------------
    Depreciation of property, plant and
     equipment                                           3,704         3,528
    -------------------------------------------------------------------------
    Amortization of intangible assets                      454           234
    -------------------------------------------------------------------------
    Financial expenses                                   1,686         2,938
    -------------------------------------------------------------------------
    Loss on disposal of property, plant and
     equipment                                               7            10
    -------------------------------------------------------------------------
    Gain on disposal of investments                        (44)            -
    -------------------------------------------------------------------------
    Expenses related to plant closings                       -           383
    -------------------------------------------------------------------------
                                                   --------------------------
    Earnings before income tax expense and
     undermentioned items                               11,440        10,125
    -------------------------------------------------------------------------
                                                   --------------------------
    Income tax expense
      Current                                            4,622         3,865
      Future                                               311           364
    -------------------------------------------------------------------------
                                                   --------------------------
                                                         4,933         4,229
    -------------------------------------------------------------------------
                                                   --------------------------
    Earnings before undermentioned items                 6,507         5,896
    -------------------------------------------------------------------------
    Share in earnings (loss) of companies subject
     to significant influence                               (4)          148
    -------------------------------------------------------------------------
                                                   --------------------------
    Net earnings from continuing operations              6,503         6,044
    -------------------------------------------------------------------------
    Net loss from discontinued operations                 (149)         (618)
    -------------------------------------------------------------------------
                                                   --------------------------
    Net earnings                                    $    6,354    $    5,426
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net earnings (net loss) per share
    Basic:
      From continuing operations                    $     0.13    $     0.14
      From discontinued operations                           -         (0.01)
                                                   --------------------------
                                                   --------------------------
      Total                                         $     0.13    $     0.13
    Diluted:
      From continuing operations                    $     0.13    $     0.14
      From discontinued operations                           -         (0.01)
                                                   --------------------------
                                                   --------------------------
      Total                                         $     0.13    $     0.13
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average number of shares
     (in thousands of shares)
      Basic                                             48,841        42,332
      Diluted                                           49,343        47,047
    -------------------------------------------------------------------------
    Number of common shares outstanding                 48,784        42,402
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


               Consolidated Statements of Comprehensive Income

    Periods ended March 31, 2007 and March 25, 2006
    (in thousands of dollars) (unaudited)                           3 months
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                          2007          2006
                                                                   (restated)
    -------------------------------------------------------------------------
    Net earnings                                    $    6,354    $    5,426
    -------------------------------------------------------------------------
                                                   --------------------------
    Other comprehensive income, net of income
     taxes:
      Unrealized gains (losses) on translating
       financing statements of self-sustaining
       foreign operations                           $   (1,516)   $      584
      Reclassification adjustment related to the
       reduction in the net investment in a
       self-sustaining foreign operation                   144             -
    -------------------------------------------------------------------------
                                                   --------------------------
    Unrealized gains (losses) on translating
     foreign currency of self-sustaining foreign
     operations                                     $   (1,372)   $      584
    -------------------------------------------------------------------------
                                                   --------------------------
    Unrealized losses on available-for-sale
     financial assets arising during the period     $      (47)   $        -
    Reclassification adjustment for gains                  (64)            -
    -------------------------------------------------------------------------
                                                   --------------------------
    Unrealized losses on available-for-sale
     financial assets                               $     (111)   $        -
    -------------------------------------------------------------------------
                                                   --------------------------
    Gains on derivatives designated as cash
     flow hedges                                    $      123    $        -
    -------------------------------------------------------------------------
                                                   --------------------------
    Other comprehensive income                      $   (1,360)   $      584
    -------------------------------------------------------------------------
                                                   --------------------------
    Comprehensive income                            $    4,994    $    6,010
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                 Consolidated Statements of Retained Earnings

    Periods ended March 31, 2007 and March 25, 2006
    (in thousands of dollars) (unaudited)                           3 months
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                          2007          2006
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Opening balance                                 $  160,840    $  127,633
    -------------------------------------------------------------------------
    Net earnings                                         6,354         5,426
    -------------------------------------------------------------------------
    Dividends                                           (1,963)       (1,701)
    -------------------------------------------------------------------------
                                                   --------------------------
    Closing balance                                 $  165,231    $  131,358
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                         Consolidated Balance Sheets

                                                         As at         As at
                                                      March 31,  December 31,
                                                          2007          2006
    (in thousands of dollars)                       (unaudited)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Assets
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Current assets
      Cash                                          $    5,280    $    8,977
      Accounts receivable                              136,928       149,291
      Inventories                                      146,343       126,149
      Income taxes recoverable                             217           209
      Future income tax assets                           6,012         6,380
      Prepaid expenses and other assets                  4,525         6,510
      Current assets of discontinued operations          8,822        12,618
                                                   --------------------------
                                                   --------------------------
      Total current assets                             308,127       310,134
    -------------------------------------------------------------------------
                                                   --------------------------
    Investments                                         75,798        72,270
    -------------------------------------------------------------------------
    Property, plant and equipment                      170,419       172,025
    -------------------------------------------------------------------------
    Property, plant and equipment held for sale          6,710         6,782
    -------------------------------------------------------------------------
    Future income tax assets                             3,432         3,487
    -------------------------------------------------------------------------
    Intangible assets                                    2,651         2,713
    -------------------------------------------------------------------------
    Goodwill                                               312           160
    -------------------------------------------------------------------------
    Unrealized asset on foreign currency
     forward contracts                                     245             -
    -------------------------------------------------------------------------
    Other assets                                         8,229         8,704
    -------------------------------------------------------------------------
    Long-term assets of discontinued operations         22,923        23,917
    -------------------------------------------------------------------------
                                                   --------------------------
                                                    $  598,846    $  600,192
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Liabilities
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Current liabilities
      Bank loans                                    $    2,069   $    10,363
      Accounts payable and accrued liabilities         135,707       129,083
      Unrealized liability on foreign currency
       forward contracts                                   586         1,450
      Income taxes payable                               4,214         4,246
      Future income tax liabilities                         37            37
      Current portion of long-term debt                  1,897         1,240
      Current liabilities of discontinued
       operations                                        3,030         4,356
                                                   --------------------------
                                                   --------------------------
      Total current liabilities                        147,540       150,775
    -------------------------------------------------------------------------
                                                   --------------------------
    Long-term debt                                      85,255        85,384
    -------------------------------------------------------------------------
    Deferred credits                                     5,135         5,287
    -------------------------------------------------------------------------
    Future income tax liabilities                        9,663         9,556
    -------------------------------------------------------------------------
    Long-term liabilities of discontinued
     operations                                          5,336         5,830
    -------------------------------------------------------------------------
                                                   --------------------------
                                                    $  252,929    $  256,832
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Shareholders' Equity
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Share capital                                      194,568       195,822
    -------------------------------------------------------------------------
    Retained earnings                                  165,231       160,840
    -------------------------------------------------------------------------
    Contributed surplus                                  2,255         2,020
    -------------------------------------------------------------------------
    Accumulated other comprehensive income             (16,137)      (15,322)
    -------------------------------------------------------------------------
                                                   --------------------------
                                                       345,917       343,360
    -------------------------------------------------------------------------
                                                   --------------------------
                                                    $  598,846    $  600,192
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                    Consolidated Statements of Cash Flows

    Periods ended March 31, 2007 and March 25, 2006
    (in thousands of dollars) (unaudited)                           3 months
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                          2007          2006
                                                                   (restated)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Cash flows from the following activities:
    Operating activities
    -------------------------------------------------------------------------
    Net earnings from continuing operations         $    6,503    $    6,044
    -------------------------------------------------------------------------
    Items not affecting cash
      Depreciation of property, plant and equipment      3,704         3,528
      Amortization of intangible assets                    454           234
      Amortization of deferred financing expenses          106           525
      Amortization of deferred issue expenses
       related to convertible debentures                     -            56
      Future income tax expense                            311           364
      Loss disposal of property, plant and
       equipment                                             7            10
      Unrealized loss (earnings) on foreign
       currency forward contracts                         (928)          128
      Gain on disposal of an investment                    (44)            -
      Pension expense                                     (156)          353
      Compensation cost related to stock options            10           (84)
      Amortization of compensation cost related
       to the employee share purchase plan on
       the open market                                     225           105
      Increase in the fair value of the
       convertible debentures                                -           156
      Increase in the redemption value of an
       investment from a related company                  (465)         (434)
      Share in loss (earnings) of companies
       subject to significant influence                      4          (148)
                                                   --------------------------
                                                   --------------------------
                                                         9,731        10,837
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net change in non-cash operating working
     capital items
      Decrease in accounts receivable                   13,169        15,633
      Increase in inventories                          (21,196)       (6,148)
      Increase in income taxes recoverable                  (8)       (1,405)
      Decrease in prepaid expenses and
       other assets                                      1,903           832
      Increase (decrease) in accounts payable and
       accrued liabilities                               5,474        (8,841)
      Increase (decrease) in interest payable                6          (297)
      Decrease in income taxes payable                     (64)       (2,791)
                                                   --------------------------
                                                   --------------------------
                                                          (716)       (3,017)
    -------------------------------------------------------------------------
                                                   --------------------------
    Cash flows from continuing operating
     activities                                          9,015         7,820
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Financing activities
    -------------------------------------------------------------------------
    Shares purchased in employee's name on the
     open market                                        (1,445)         (214)
    -------------------------------------------------------------------------
    Proceeds from issuance of shares                       191           461
    -------------------------------------------------------------------------
    Dividends                                           (1,963)            -
    -------------------------------------------------------------------------
    Increase in long-term debt and bank loans            1,587             -
    -------------------------------------------------------------------------
    Repayment of long-term debt and bank loans          (8,401)       (4,874)
    -------------------------------------------------------------------------
    Issue expenses related to long-term debt               (18)         (114)
    -------------------------------------------------------------------------
    Deferred credits                                         7          (254)
    -------------------------------------------------------------------------
                                                   --------------------------
    Cash flows from continuing financing
     activities                                        (10,042)       (4,995)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Investing activities
    -------------------------------------------------------------------------
    Proceeds from sale of property, plant and
     equipment                                               7            25
    -------------------------------------------------------------------------
    Additions to property, plant and equipment          (2,724)       (3,272)
    -------------------------------------------------------------------------
    Additions to intangible assets                        (378)         (831)
    -------------------------------------------------------------------------
    Acquisition of investments                          (2,306)            -
    -------------------------------------------------------------------------
    Proceeds from disposal of an investment                168             -
    -------------------------------------------------------------------------
    Decrease (increase) in long-term receivables           216          (699)
    -------------------------------------------------------------------------
    Acquisition of business assets                        (100)            -
    -------------------------------------------------------------------------
    Assets held for sale                                     -          (471)
    -------------------------------------------------------------------------
    Other assets                                             -             7
    -------------------------------------------------------------------------
                                                   --------------------------
    Cash flows from continuing investing
     activities                                         (5,117)       (5,241)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Effect of changes in foreign exchange
     rate on cash                                          (33)            6
    -------------------------------------------------------------------------
                                                   --------------------------
    Net change in cash from continuing operations       (6,177)       (2,410)
    -------------------------------------------------------------------------
    Net cash flows from discontinued operations          2,480           402
    -------------------------------------------------------------------------
    Cash, beginning of year                              8,977         5,279
    -------------------------------------------------------------------------
                                                   --------------------------
    Cash, end of year                               $    5,280    $    3,271
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Supplementary information
      Interest paid                                 $    1,557    $    2,150
      Income taxes paid, net                        $    4,623    $    7,948
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    




For further information:

For further information: Jasmin Gosselin, Vice President,
Communications, (450) 641-4000, jasmin.gosselin@canamgroup.ws,
www.canamgroup.ws


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