Canam Group posts net earnings of $40.7 million or $0.88 per share for 2006



    BOUCHERVILLE, QC, March 6 /CNW Telbec/ - For Canam Group Inc.(TSX - CAM),
specialized in the design and fabrication of construction products and
solutions, the financial period ended December 31, 2006 was another good year,
boosted by an 8.4% increase in sales to $740.6 million, from $683.4 million in
2005. Over this period, the company posted net earnings of $40.7 million, or
$0.88 per share, compared with $38.7 million, or $0.96 per share, for the same
year-earlier period.
    Most of the business units pursued their market development efforts and
improved their respective profit margins. The consolidated gross profit for
fiscal 2006 was $173.9 million and the gross margin was 23.5%. Canam Group
reduced its net debt by 22.1% such that by year's end it stood at $88 million
versus $113 million at the close of 2005. Shareholders' equity was
$343.4 million, bringing the net debt to equity ratio to 0.26, compared with
0.41 at the end of the previous year. Canam Group's return on utilized assets
was 13.1% in 2006, against 12.9% in 2005.
    Net earnings for the fourth quarter were $12.1 million, or $0.25 per
share, compared with $14.9 million, or $0.38 per share, for the corresponding
2005 quarter. Consolidated sales for the quarter rose 17% to $212 million,
from $181.2 million the year before.
    Canam Group's president and chief operating officer Marc Dutil is
satisfied that the company improved its position in the markets and moved a
number of its strategic initiatives forward. He attributes the company's
fourth-quarter results, however, to certain unusual elements totaling
$7.7 million before tax, notably losses incurred from the accounting treatment
of foreign currency contracts, expenses related to plant closings and losses
on the disposal of fixed assets.
    Closing 2006 on a bright note, Canam Group's business units reported an
order backlog of $287 million, up 37% from $210 million a year earlier.
According to industry figures, the infrastructures and non-residential sectors
are expected to grow in 2007, and Canam Group has developed strategies to take
advantage of business opportunities as they arise in the coming year.
    The board of directors approved the payment of a quarterly dividend of
$0.04 per common share payable on March 30, 2007 to shareholders of record on
March 16, 2007.

    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, Mexico,
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 media
at 8 a.m. on Wednesday, March 7, 2007. The call will be broadcast live via the
Internet at www.canamgroup.ws and www.cnw.ca. An archived conference call
recording will be available at 1-888-509-0081 (access code 639578) until
March 16, 2007.


    
                     Consolidated Statements of Earnings

    Periods ended December 31
    (in thousands of dollars,
     except per share amounts)           3 months               12 months
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                    2006        2005        2006        2005
                                           (restated)              (restated)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Sales                      $ 212,016   $ 181,175   $ 740,649   $ 683,393
    -------------------------------------------------------------------------
    Cost of sales                160,325     127,582     566,729     508,639
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Gross profit                  51,691      53,593     173,920     174,754
    -------------------------------------------------------------------------
    Selling and
     administrative expenses      20,392      17,420      74,910      70,838
    -------------------------------------------------------------------------
    Profit sharing and
     continuous improvement
     programs                      4,093       4,629       9,968      10,616
    -------------------------------------------------------------------------
    Exchange loss                  2,382         505       1,961         100
    -------------------------------------------------------------------------
    Interest income                 (505)       (620)     (2,336)     (1,542)
    -------------------------------------------------------------------------
    Increase in the fair value
     of an investment from a
     related party                  (475)       (470)     (1,885)     (2,066)
    -------------------------------------------------------------------------
                              -----------------------------------------------
                                  25,804      32,129      91,302      96,808
    -------------------------------------------------------------------------
    Depreciation of property,
     plant and equipment           4,016       4,054      14,970      16,432
    -------------------------------------------------------------------------
    Amortization of intangible
     assets                          253         175         940         700
    -------------------------------------------------------------------------
    Financial expenses             2,868       2,985      10,901      16,648
    -------------------------------------------------------------------------
    Penalty for early payment
     on notes                          -           -           -       2,815
    -------------------------------------------------------------------------
    Loss on disposal of
     property, plant and
     equipment                       497         158         670         262
    -------------------------------------------------------------------------
    Gain on disposal of
     investments                    (170)       (441)       (848)       (441)
    -------------------------------------------------------------------------
    Expenses related to plant
     closings                        916          74       2,104         990
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Earnings before income
     tax expense and
     undermentioned items         17,424      25,124      62,565      59,402
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Income tax expense
      Current                      8,312       8,879      25,501      13,207
      Future                      (2,539)      1,339      (4,208)      7,482
    -------------------------------------------------------------------------
                              -----------------------------------------------
                                   5,773      10,218      21,293      20,689
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Earnings before
     undermentioned items         11,651      14,906      41,272      38,713
    -------------------------------------------------------------------------
    Share in earnings of
     companies subject to
     significant influence            64         607         236       1,122
    -------------------------------------------------------------------------
    Non-controlling interest         265           -         265           -
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Net earnings from
     continuing operations        11,980      15,513      41,773      39,835
    -------------------------------------------------------------------------
    Net earnings (net loss)
     from discontinued
     operations                      168        (571)     (1,033)     (1,166)
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Net earnings               $  12,148   $  14,942   $  40,740   $  38,669
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net earnings (net loss)
     per share
    -------------------------------------------------------------------------
    Basic:
      From continuing
       operations              $    0.25   $    0.39   $    0.90   $    0.99
      From discontinued
       operations                      -       (0.01)      (0.02)      (0.03)
                              -----------------------------------------------
                              -----------------------------------------------
      Total                    $    0.25   $    0.38   $    0.88   $    0.96
    Diluted:
      From continuing
       operations              $    0.24   $    0.36   $    0.89   $    0.95
      From discontinued
       operations                      -       (0.01)      (0.02)      (0.03)
                              -----------------------------------------------
                              -----------------------------------------------
      Total                    $    0.24   $    0.35   $    0.87   $    0.92
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average number
     of shares (in thousands
     of shares)
      Basic                       48,896      39,630      46,211      40,298
      Diluted                     49,255      44,132      46,617      44,760
    -------------------------------------------------------------------------
    Number of common shares                               48,888      42,302
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                Consolidated Statements of Retained Earnings

    Periods ended December 31
    (in thousands of dollars)            3 months               12 months
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                    2006        2005        2006        2005
                                           (restated)              (restated)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Opening balance            $ 150,653   $ 111,758   $ 127,633   $  90,957
    -------------------------------------------------------------------------
    Net earnings                  12,148      14,942      40,740      38,669
    -------------------------------------------------------------------------
    Share issue expenses,
     net of income taxes               -         933         (27)     (1,993)
    -------------------------------------------------------------------------
    Dividends                     (1,961)          -      (7,506)          -
    -------------------------------------------------------------------------
    Closing balance            $ 160,840   $ 127,633   $ 160,840   $ 127,633
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                         Consolidated Balance Sheets

                                   As at December 31,      As at December 31,
                                                2005                    2004
    (in thousands of dollars)                                      (restated)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Assets
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Current assets
      Cash                                 $   8,977               $   5,279
      Accounts receivable                    149,291                 150,882
      Unrealized asset on foreign
       currency forward contracts                  -                     349
      Inventories                            126,149                 100,803
      Income taxes recoverable                   209                       -
      Future income tax assets                 6,380                   4,814
      Prepaid expenses and other
       assets                                  6,510                   4,028
      Current assets held for sale                 -                   9,922
      Current assets of
       discontinued operations                12,618                  22,479
                              -----------------------------------------------
                              -----------------------------------------------
      Total current assets                   310,134                 298,556
    -------------------------------------------------------------------------
    Investments                               72,270                  70,244
    -------------------------------------------------------------------------
    Property, plant and equipment            172,025                 159,892
    -------------------------------------------------------------------------
    Property, plant and equipment
     held for sale                             6,782                  12,992
    -------------------------------------------------------------------------
    Future income tax assets                   3,487                   2,146
    -------------------------------------------------------------------------
    Intangible assets                          2,713                   1,411
    -------------------------------------------------------------------------
    Goodwill                                     160                    - -
    -------------------------------------------------------------------------
    Other assets                               8,704                  17,418
    -------------------------------------------------------------------------
    Long-term assets of
     discontinued operations                  23,917                  19,526
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                           $ 600,192               $ 582,185
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Liabilities
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Current liabilities
      Bank loans                           $  10,363               $     609
      Accounts payable and accrued
       liabilities                           129,083                 113,511
      Unrealized liability on
       foreign currency forward                1,450                       -
       contracts
      Income taxes payable                     4,246                   5,634
      Future income tax liabilities               37                      37
      Current liabilities held
       for sale                                    -                   6,586
    Current portion of long-term debt          1,240                  26,277
    Current liabilities of discontinued
     operations                                4,356                   8,452
                              -----------------------------------------------
                              -----------------------------------------------
      Total current liabilities              150,775                 161,106
    -------------------------------------------------------------------------
    Long-term debt                            85,384                  91,490
    -------------------------------------------------------------------------
    Convertible debentures                         -                  25,548
    -------------------------------------------------------------------------
    Deferred credits                           5,287                   5,398
    -------------------------------------------------------------------------
    Future income tax liabilities              9,556                  11,039
    -------------------------------------------------------------------------
    Class "C" shares                               -                   3,776
    -------------------------------------------------------------------------
    Long-term liabilities of
     discontinued operations                   5,830                   7,457
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                           $ 256,832               $ 305,814
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Shareholders' Equity
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Share capital                            195,822                 161,204
    -------------------------------------------------------------------------
    Debenture conversion options                   -                   3,112
    -------------------------------------------------------------------------
    Retained earnings                        160,840                 127,633
    -------------------------------------------------------------------------
    Contributed surplus                        2,020                   1,658
    -------------------------------------------------------------------------
    Cumulative translation
     adjustments                             (15,322)                (17,236)
    -------------------------------------------------------------------------
                              -----------------------------------------------
                                             343,360                 276,371
    -------------------------------------------------------------------------
                              -----------------------------------------------
                                           $ 600,192               $ 582,185
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                    Consolidated Statements of Cash Flows

    Periods ended December 31
    (in thousands of dollars)            3 months               12 months
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                    2006        2005        2006        2005
                                           (restated)              (restated)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Cash flows from the following
     activities:
    Operating activities
    -------------------------------------------------------------------------
    Net earnings from
     continuing operations     $  11,980   $  15,513   $  41,773   $  39,835
    -------------------------------------------------------------------------
    Items not affecting cash
      Depreciation of property,
       plant and equipment         4,016       4,054      14,970      16,432
      Amortization of
       intangible assets             253         175         940         700
      Amortization of deferred
       financing expenses
       related to long-term debt     864         191       1,810       1,330

      Amortization of deferred
       issue expenses related
       to convertible debentures       -          55          74         222

      Future income tax expense   (2,539)      1,339      (4,208)      7,482
      Loss disposal of property,
       plant and equipment           497         158         670         262
      Unrealized loss (earnings)
       on foreign currency
       forward contracts           2,264         155       1,799        (349)
      Gain on disposal of an
       investment                   (170)       (441)       (848)       (441)
      Impairment of property,
       plant and equipment
       held for sale                 972           -       1,772         918
      Pension expense             (1,534)     (1,238)       (475)       (478)
      Compensation cost
       related to stock options       17          39         (58)        155
    Amortization of compensation
     cost related to employee
     share purchase plan on the
     open market                     105           -         420           -
      Increase in the fair value
       of the convertible
       debentures                      -         156         207         623
      Increase in the fair value
       of an investment from a
       related party                (475)       (470)     (1,885)     (2,066)
      Share in earnings of
       companies subject to
       significant influence         (64)       (607)       (236)     (1,122)

      Non-controlling interest      (265)          -        (265)          -
                              -----------------------------------------------
                              -----------------------------------------------
                                  15,921      19,079      56,490      63,503
    -------------------------------------------------------------------------
    Net change in non-cash
     operating working capital
     items
      Decrease (increase) in
       accounts receivable        24,786       3,074       9,223     (14,307)
      Increase (decrease) in
       inventories                11,983      (3,064)    (19,830)     (3,872)
      Decrease (increase) in
       income taxes recoverable      (89)        648        (209)          -
      Decrease (increase) in
       prepaid expenses and
       other assets               (4,351)     (1,055)     (2,458)      6,667
      Increase (decrease) in
       accounts payable and
       accrued liabilities       (19,240)     (5,592)      9,816      13,994
      Increase (decrease) in
       interest payable             (516)        193          86        (541)
      Increase (decrease) in
       income taxes payable        3,580       5,881      (4,994)      4,768
                              -----------------------------------------------
                              -----------------------------------------------
                                  16,153          85      (4,994)      6,709
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Cash flows from continuing
     operating activities         32,074      19,164      51,466      70,212
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Financing activities
    -------------------------------------------------------------------------
    Shares purchased in
     employee's name on the
     open market                       -      (1,047)       (214)     (1,047)
    -------------------------------------------------------------------------
    Proceeds from issuance
     of shares                       365         469       1,450      48,966
    -------------------------------------------------------------------------
    Issue expenses related
     to issuance of shares             -         (51)        (27)     (2,977)
    -------------------------------------------------------------------------
    Dividends                     (1,961)          -      (7,506)          -
    -------------------------------------------------------------------------
    Increase in long-term
     debt and bank loans          76,453           -     102,011     188,777
    -------------------------------------------------------------------------
    Repayment of long-term
     debt and bank loans         (95,260)    (12,872)   (123,641)   (288,550)
    -------------------------------------------------------------------------
    Issue expenses related
     to long-term debt                 6          45        (646)     (2,281)
    -------------------------------------------------------------------------
    Deferred credits                (418)       (192)        187         (93)
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Cash flows from continuing
     financing activities        (20,815)    (13,648)    (28,386)    (57,205)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Investing activities
    Proceeds from sale of
     property, plant and
     equipment                     2,539         287       2,923       1,134
    -------------------------------------------------------------------------
    Additions to property,
     plant and equipment          (8,629)     (5,830)    (25,112)    (10,076)
    -------------------------------------------------------------------------
    Additions to intangible
     assets                         (343)       (392)     (1,570)       (679)
    -------------------------------------------------------------------------
    Acquisition of investments         -           -        (150)          -
    -------------------------------------------------------------------------
    Proceeds from disposal
     of an investment                720         441       1,844      10,520
    -------------------------------------------------------------------------
    Distribution from a
     limited liability
     partnership                       -           -           -          32
    -------------------------------------------------------------------------
    Decrease (increase)
     in long-term receivables      7,583        (704)      6,363     (12,784)
    -------------------------------------------------------------------------
    Acquisition of business
     assets                       (3,061)          -      (3,061)          -
    -------------------------------------------------------------------------
    Assets held for sale          (3,529         274           -        (415)
    -------------------------------------------------------------------------
    Other assets                     (12)        136           -         (60)
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Cash flows from continuing
     investing activities         (4,732)     (5,788)    (18,763)    (12,328)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Effect of changes in
     foreign exchange rate
     on cash                         208          17          20        (163)
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Net change in cash from
     continuing operations         6,735        (255)      4,337         516
    -------------------------------------------------------------------------
    Net cash flows from
     discontinued operations         978      (2,845)       (639)       (987)
    -------------------------------------------------------------------------
    Cash, beginning of year        1,264       8,379       5,279       5,750
    -------------------------------------------------------------------------
                              -----------------------------------------------
    Cash, end of year          $   8,977   $   5,279   $   8,977   $   5,279
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Supplementary information
      Interest paid            $   1,682   $   2,673   $   9,068   $  15,481
      Income taxes paid net    $   4,734   $   1,623   $  22,788   $   6,507
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    




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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