Circa Reports Sales and Operating Results for the Second Quarter Ended June 30, 2009



    CALGARY, Aug. 6 /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 and six month period ended June 30, 2009.

    
    Summary of second quarter operating results:

    -  Consolidated sales of $6.9 million, representing a 21.8% decrease from
       the second quarter 2008 sales of $8.8 million
    -  Net loss of $0.3 million or $0.04 per share, as compared to a net loss
       of $0.2 million or $0.02 per share in the second quarter of 2008
    -  Pre-tax income of $0.4 million, excluding one-time restructuring costs
       and non-cash foreign currency translation loss

    Summary of year-to-date operating results:

    -  Consolidated sales of $12.9 million for the six month period ended
       June 30, 2009, representing a 26.2% decrease from the six month period
       ended June 30, 2008, sales of $17.5 million
    -  Net loss of $1.0 million or $0.10 per share as compared to a loss of
       $0.1 million or $0.01 per share for the first six months of 2008
    

    Consolidated sales for the second quarter of 2009 were $6.9 million; a
$1.9 million or 21.8% decrease over the same period in 2008. This decrease can
be attributed to lower sales across the surge protection and Hydel division
businesses. Sales from these divisions were down considerably when compared to
the same quarter in the prior year as weaker demand, driven by the slower
North American economy, had a negative impact on sales.
    Circa's gross profit for Q2 2009 was higher than the corresponding
quarter in 2008 and is the result of higher selling prices and lower labour
and overhead costs. The Company's gross profit, defined as sales less cost of
sales, increased from $1.4 million in the second quarter of 2008 to $1.7
million in the second quarter of 2009. The main reason for the increase in
gross profit is due to the Company increasing its prices, combined with
ongoing efforts to reduce costs. The Company has taken steps to reduce its
labour, material and overhead costs as a component of cost of sales and
outsourcing the production of low margin products to offshore suppliers,
particularly in the Circa Metals business.
    Circa's Interim President and Chief Executive Officer, Ivan Smith stated:
    "Consolidated results for the quarter ended June 30, 2009, include
restructuring costs of $0.4 million. The restructuring costs relate to the
changes made to the business in order to cut costs and consolidate the
operations of business for future profitability. Management believes these
efforts will better position the Company and that the changes to date have
already had a positive impact on earnings. Excluding these restructuring costs
and a foreign currency translation loss of $0.2 million, the Company posted
pre-tax income of $0.4 million in the quarter."
    At June 30, 2009, the Company's working capital was $4.0 million,
including $0.6 million in cash. Circa ended the second quarter with current
bank indebtedness of $4.5 million. The Company had total shareholders' equity
of $6.9 million and 9.5 million shares outstanding at June 30, 2009.

    
    CIRCA ENTERPRISES INC.
    Consolidated Balance Sheets
    Unaudited (Thousands of Canadian dollars)

    -------------------------------------------------------------------------
                                                       June 30,  December 31,
                                                          2009          2008
                                                             $             $
    -------------------------------------------------------------------------
    ASSETS
    Current
      Cash                                                 610           255
      Accounts receivable                                4,058         3,874
      Income taxes recoverable                             211           176
      Inventory                                          5,877         7,413
      Prepaid expenses                                     327           280
    -------------------------------------------------------------------------
                                                        11,083        11,998
    Property, plant and equipment                        1,388         1,545
    Deferred charges                                       349           334
    Intangible assets                                       10             5
    Future income taxes                                  1,392         1,402
    -------------------------------------------------------------------------
                                                        14,222        15,284
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES
    Current
      Bank indebtedness                                  4,456         3,665
      Accounts payable and accrued liabilities           2,841         3,745
    -------------------------------------------------------------------------
                                                         7,297         7,410
    Future income taxes                                    181           150
    -------------------------------------------------------------------------
                                                         7,478         7,560
    -------------------------------------------------------------------------

    SHAREHOLDERS' EQUITY
      Share capital                                      2,704         2,699
      Contributed surplus                                    2             2
      Retained earnings                                  4,038         5,023
    -------------------------------------------------------------------------
                                                         6,744         7,724
    -------------------------------------------------------------------------
                                                        14,222        15,284
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CIRCA ENTERPRISES INC.
    Consolidated Statements of Loss and Comprehensive Loss and Retained
     Earnings
    Unaudited (Thousands of Canadian dollars, except per share amounts)

    -------------------------------------------------------------------------
                       Three months   Three months   Six months   Six months
                              ended          ended        ended        ended
                            June 30,       June 30,     June 30,     June 30,
                               2009           2008         2009         2008
                                  $              $            $            $
    -------------------------------------------------------------------------
    SALES                     6,885          8,805       12,904       17,480

    COST OF SALES
      Direct costs            5,160          7,318       10,396       14,172
      Depreciation and
       amortization              45            132           90          265
    -------------------------------------------------------------------------
                              1,680          1,355        2,418        3,043
    -------------------------------------------------------------------------
    EXPENSES
      General and
       administrative           793            831        1,600        1,688
      Marketing and selling     369            624        1,010        1,241
      Engineering                52            108          114          196
      Restructuring costs       392              -          450            -
      Depreciation and
       amortization              58             84          119          171
      Interest - current         28             42           58           79
      Foreign currency
       translation loss (gain)  244           (106)         203         (141)
    -------------------------------------------------------------------------
                              1,936          1,583        3,554        3,234
    -------------------------------------------------------------------------
    LOSS BEFORE INCOME TAXES   (256)          (228)      (1,136)        (191)
    -------------------------------------------------------------------------
    PROVISION FOR INCOME TAXES
      Current                  (232)            80         (192)         143
      Future                    314           (151)          41         (252)
    -------------------------------------------------------------------------
                                 82            (71)        (151)        (109)
    -------------------------------------------------------------------------
    NET LOSS AND
     COMPREHENSIVE LOSS        (338)          (157)        (985)         (82)
    RETAINED EARNINGS,
     BEGINNING OF PERIOD      4,376          7,014        5,023        6,939
    -------------------------------------------------------------------------
    RETAINED EARNINGS,
     END OF PERIOD            4,038          6,857        4,038        6,857
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    LOSS EARNINGS PER SHARE
    Basic and diluted         (0.04)         (0.02)       (0.10)       (0.01)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    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 ticker symbol CTO.
Neither 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.





For further information:

For further information: Mr. Ivan Smith, Interim 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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