Circa Reports a Strong Improvement in Profitability in the Second Quarter
Ended June 30, 2010 and Common Shares Issued Under Share Acquisition Plan

CALGARY, Aug. 11 /CNW/ - Circa Enterprises Inc. (CTO-TSXV) (the "Company" or "Circa"), a manufacturer of equipment for the telecommunication, electrical utility, and construction industries, reports results of operations for the second quarter ended June 30, 2010 and the issuance of common shares under a share acquisition plan.

    
    SECOND QUARTER RESULTS
    ----------------------

        Summary of second quarter operating results:

        -  Consolidated sales of $6.8 million were 1% less than the second
           quarter 2009 sales of $6.9 million

        -  Adjusted EBITDA of $0.8 million for the quarter compared to $0.5
           million in the second quarter of 2009 (see below for calculation
           of Adjusted EBITDA)

        -  Net income of $0.5 million or $0.05 per share, as compared to a
           net loss of $0.3 million or $0.04 per share in the second quarter
           of 2009

        -  Operating cash flow increased $0.5 million to $0.2 million
           compared to the second quarter of 2009

        Summary of year-to-date operating results:

        -  Consolidated sales of $12.1 million for the six-month period ended
           June 30, 2010, which were 6% lower than the six-month period ended
           June 30, 2009, sales of $12.9 million

        -  Adjusted EBITDA of $1.0 million for the six-month period ended
           June 30, 2010 compared to negative $0.2 million for the six-month
           period ended June 30, 2009 (see below for calculation of Adjusted
           EBITDA)

        -  Net income of $0.6 million or $0.06 per share as compared to a net
           loss of $1.0 million or $0.10 per share for the first six months
           of 2009

        -  Debt reduction of over $0.6 million during the six month period
           ended June 30, 2010
    

Adjusted EBITDA is earnings before interest, taxes, depreciation and amortization and is adjusted for other non-recurring items and non-cash items, including asset impairment charges and restructuring costs. Adjusted EBITDA is a non-GAAP financial measure and does not have any standardized meaning prescribed by Canadian generally accepted accounting principles and is, therefore, unlikely to be comparable to similar measures presented by other issuers. Management believes that EBITDA is a useful supplemental measure, which provides an indication of the results generated by Circa's primary business activities prior to consideration of how those activities are financed, amortized or taxed. Readers are cautioned, however, that EBITDA should not be construed as an alternative to net earnings (loss) determined in accordance with GAAP as an indicator of the Company's financial performance. Adjusted EBITDA is calculated by the Company as follows:

    
    -------------------------------------------------------------------------
                           (unaudited)  (unaudited)  (unaudited)  (unaudited)
                                Three        Three          Six          Six
                               months       months       months       months
                                ended        ended        ended        ended
                              June 30,     June 30,     June 30,     June 30,
                                 2010         2009         2010         2009

                                    $            $            $            $
    -------------------------------------------------------------------------

    Net earnings (loss) and
     comprehensive
     earnings (loss)              502         (338)         574         (985)
    Provision for (recovery of)
     income taxes                 151           82          217         (151)
    Interest                       27           28           45           58
    Depreciation and
     amortization                 104          103          199          209
    Foreign currency
     translation loss (gain)      (14)         244          (49)         203
    Restructuring costs             -          392            -          450
    -------------------------------------------------------------------------
                                  770          511          986         (216)
    -------------------------------------------------------------------------
    

Circa's consolidated sales in the second quarter of 2010 were $6.8 million -- a $0.1 million or 1% less than over the same period in 2009 -- the decline in sales were attributable to a decrease in the surge protection division. The decrease in the quarter was largely driven by the exchange rate as the bulk of this division's sales are denominated in US dollars and the US dollar weakened compared to the Canadian dollar when compared to the prior year. Sales in the Circa Metals business increased in the quarter compared to the prior year.

The Company's gross profit, defined as sales less cost of sales, was consistent in the second quarter of 2010 at $1.7 million compared to the prior year. Both sales and margins were relatively consistent, despite a slightly different product mix compared to the prior year.

The cost reductions in 2009 from the Company's restructuring efforts, which involved streamlining operations, reductions in the cost of certain raw materials, moving product manufacturing offshore and the consolidating operations have allowed the Company to achieve positive earnings from operations for the second straight quarter. These restructuring changes helped improve net earnings from a loss of $0.3 million in Q2 2009 to net earnings of $0.5 million in Q2 2010. The Company was able to boost Adjusted EBITDA from $0.5 million in Q2 2009 to $0.8 million in Q2 2010.

    
    CIRCA ENTERPRISES INC.
    Consolidated Balance Sheets
    (000's of Canadian dollars)

    Unaudited
    -------------------------------------------------------------------------
     As at                                              June 30, December 31,
                                                           2010         2009

                                                              $            $
    -------------------------------------------------------------------------
    ASSETS
    Current
      Cash                                                  153          350
      Accounts receivable                                 4,017        3,588
      Income taxes recoverable                                -           58
      Inventory                                           5,605        5,842
      Prepaid expenses                                      263          295
    -------------------------------------------------------------------------
                                                         10,038       10,133
    Property, plant and equipment                           990        1,086
    Assets held for sale                                    105          105
    Deferred charges                                        224          286
    Intangible assets                                        19           17
    Future income taxes                                     616          782
    -------------------------------------------------------------------------
                                                         11,992       12,409
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES
    Current
      Bank indebtedness                                   2,749        3,391
      Accounts payable and accrued liabilities            2,093        2,476
      Current income taxes                                   60            -
    -------------------------------------------------------------------------
                                                          4,902        5,867
    Future income taxes                                      12           38
    -------------------------------------------------------------------------
                                                          4,914        5,905
    -------------------------------------------------------------------------
    SHAREHOLDERS' EQUITY
      Share capital                                       2,710        2,710
      Contributed surplus                                     2            2
      Retained earnings                                   4,366        3,792
    -------------------------------------------------------------------------
                                                          7,078        6,504
    -------------------------------------------------------------------------
                                                         11,992       12,409
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CIRCA ENTERPRISES INC.
    Consolidated Statements Operations and Retained Earnings
    (000's of Canadian dollars, except per share amounts)

    Unaudited
    -------------------------------------------------------------------------
                                Three        Three          Six          Six
                               months       months       months       months
                                ended        ended        ended        ended
                              June 30,     June 30,     June 30,     June 30,
                                 2010         2009         2010         2009

                                    $            $            $            $
    -------------------------------------------------------------------------

    SALES                       6,817        6,885       12,088       12,904
    COST OF SALES
      Direct costs              5,128        5,160        9,210       10,396
      Depreciation and
       amortization                37           45           75           90
    -------------------------------------------------------------------------
                                1,652        1,680        2,803        2,418
    -------------------------------------------------------------------------
    EXPENSES
      Selling, general and
       administrative             909        1,211        1,882        2,723
      Depreciation and
       amortization                67           58          124          119
      Restructuring costs           -          392            -          450
      Interest                     27           28           45           58
      Loss on disposal of assets   10            3           10            1
      Foreign currency
       translation (gain) loss    (14)         244          (49)         203
    -------------------------------------------------------------------------
                                  999        1,936        2,012        3,554
    -------------------------------------------------------------------------
    EARNINGS (LOSS) BEFORE
     INCOME TAXES                 653         (256)         791       (1,136)
    -------------------------------------------------------------------------
    PROVISION FOR (RECOVERY OF)
     INCOME TAXES
      Current                      30         (232)          77         (192)
      Future                      121          314          140           41
    -------------------------------------------------------------------------
                                  151           82          217         (151)
    -------------------------------------------------------------------------
    NET EARNINGS (LOSS) AND
     COMPREHENSIVE
     EARNINGS (LOSS)              502         (338)         574         (985)
    RETAINED EARNINGS,
     BEGINNING OF PERIOD        3,864        4,376        3,792        5,023
    -------------------------------------------------------------------------
    RETAINED EARNINGS,
     END OF PERIOD              4,366        4,038        4,366        4,038
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    EARNINGS (LOSS) PER SHARE
    Basic and diluted            0.05        (0.04)        0.06        (0.10)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CIRCA ENTERPRISES INC.
    Consolidated Statements of Cash Flows
    (000's of Canadian dollars)

    Unaudited
    -------------------------------------------------------------------------
                                Three        Three          Six          Six
                               months       months       months       months
                                ended        ended        ended        ended
                              June 30,     June 30,     June 30,     June 30,
                                 2010         2009         2010         2009

                                    $            $            $            $
    -------------------------------------------------------------------------

    CASH FLOWS RELATED TO THE
     FOLLOWING ACTIVITIES:
    OPERATING
      Net earnings (loss)         502         (338)         574         (985)
      Adjustments for:
        Depreciation and
         amortization             104          103          199          209
        Loss on disposal
         of assets                 10            3           10            1
        Stock compensation
         expense                    -            5            -            5
        Future income taxes       121          314          140           41
    -------------------------------------------------------------------------
                                  737           87          923         (729)
      Changes in non-cash
       working capital           (491)        (330)        (444)         390
    -------------------------------------------------------------------------
                                  246         (243)         479         (339)
    -------------------------------------------------------------------------
    FINANCING
      (Decrease) increase in
        bank indebtedness        (374)         676         (642)         791
    -------------------------------------------------------------------------
    INVESTING
      Purchase of property,
       plant and equipment        (36)          (7)         (50)         (32)
      Proceeds from sale of
       property, plant and
       equipment                    -            -            -            6
      Additions to deferred
       charges                      -           (9)           -          (41)
      Additions to intangible
       assets                       -           (1)          (3)          (6)
      Changes in non-cash
       working capital              5           (2)          19          (24)
    -------------------------------------------------------------------------
                                  (31)         (19)         (34)         (97)
    -------------------------------------------------------------------------

    NET (DECREASE) INCREASE
     IN CASH                     (159)         414         (197)         355
    CASH, BEGINNING OF PERIOD     312          196          350          255
    -------------------------------------------------------------------------
    CASH, END OF PERIOD           153          610          153          610
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    COMMON SHARES ISSUED UNDER ACQUISITION PLAN
    -------------------------------------------
    

On August 11, 2010 the Company issued an aggregate of 62,500 common shares to its directors pursuant to the Company's share acquisition plan at a deemed price of $0.40 per share in lieu of the cash annual retainer otherwise payable to such directors.

Circa Enterprises Inc. is a public company with offices in Alberta, Ontario and Florida. The outstanding common shares of Circa Enterprises Inc. are listed and trade on the TSX Venture Exchange under the trading symbol CTO. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

The Company's first quarter financial statements and related management's discussion and analysis have been filed with certain securities regulatory authorities in Canada and may be accessed electronically through the SEDAR website at www.sedar.com and the Company's website at www.circaent.com.

%SEDAR: 00002951E

SOURCE Circa Enterprises Inc.

For further information: For further information: Mr. Ivan Smith, President and CEO, Circa Enterprises Inc., (403) 258-2011; Mr. Cory Tamagi, VP Finance and CFO, Circa Enterprises Inc., (403) 258-2011; E-Mail: investor@circaent.com, Website: www.circaent.com


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