Dynex Power Announces Year End Results for 2006 - Third Consecutive Year of Improvement and Encouraging Outlook for the Future



    Listing: TSX Venture Exchange
    Symbol: DNX

    LINCOLN, England, April 30 /CNW Telbec/ - Dynex Power Inc., a leading,
high power semiconductor company, today announced results for the year ended
December 31st, 2006.

    
    Summary financial information for the twelve months ended December 31st,
2006 is as follows:

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        Dollars (000's)                         Dec. 31, 2006  Dec. 31, 2005
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        Revenue                                        23,713         22,761
        Gross Margin                                    4,192          2,929
        Net Loss                                         (273)        (1,788)
        Common shares outstanding (1) -
         fully diluted                             31,257,836     26,949,650
        Earnings per share  - fully diluted            ($0.01)        ($0.07)
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        (1) Weighted average for the period

    The Company's 2006 performance was significantly better than 2005, making
this the third consecutive year of improvement. A 4.2% growth in revenue was
recorded despite a 9% fall in the average value of the Dollar against Sterling
between the two years. In Sterling terms, in which all revenues are first
recorded, revenue growth exceeded 10%.
    The 2006 gross margin of over $4.1 million represented an increase of 43%
over 2005, continuing an improving trend established in 2004. The Net Loss of
$273,000 was 85% lower than in 2005, again continuing a three year trend.
    Dr. Paul Taylor, President and Chief Executive Officer commented, "this
was a far better result than the bottom line indicates. 2006 was better than
2005 with attractive growth in revenue, particularly when measured in Sterling
terms, an increasingly robust order book and a dramatic improvement in our
gross margin and in the reduction in our net loss."
    Bob Lockwood, Chief Financial Officer commented, "there were several
pleasing aspects of our performance in 2006 that reflected our continuing
recovery and return to profitability. For the first time in three years, we
saw real growth in sales. The improvement in our gross margins continues from
a low of 3.6% in 2003 to 17.7% last year, despite large increases in energy
costs. And for the third consecutive year we have reduced our expenses, so
that they are now only 58% of what they were in 2003."
    Dr. Taylor added, "2007 has started well. We expect the size of our market
to increase by 10% in the coming year, and we expect Dynex's revenue growth to
be even greater. We have experienced a robust improvement in our order book -
the best in many years - giving us confidence that we will achieve another
healthy increase in revenue during 2007. A further improvement in gross margin
is forecast and with continuing tight control of expenses, we expect to return
to profitability in 2007."
    David Banks, Chairman concluded, "the recovery of Dynex continues apace.
Much was achieved during 2006 and our thanks are due to our excellent
management, our loyal and committed employees, our valued customers and our
reliable suppliers. We also thank our shareholders, for their patience during
the period that the Company's prospects have been turned around and for their
continuing support of the Company. We are encouraged by sustaining the
improvement in our financial performance and are looking forward to a
successful and profitable 2007."

    About the Company

    Dynex is one of the world's leading suppliers of specialist, high power
semiconductor products. Dynex Semiconductor Ltd is its main operating business
and is based in Lincoln, England in a facility housing the fully integrated
silicon wafer fabrication, assembly and test, sales, design and development
operations. Dynex designs and manufactures high power bipolar discrete
semiconductors, power modules, including insulated-gate bipolar transistors
(IGBTs), and high power electronic assemblies. Dynex products are used world
wide in power electronic applications including electric power generation,
transmission and distribution, marine and rail traction drives, aircraft,
electric vehicles, industrial automation and controls. The company continues
to produce and sell certain high reliability integrated circuits (ICs) for use
in specialist applications led by its proven radiation hard
Silicon-on-Sapphire products for space and nuclear applications.

    Press announcements and other information about Dynex are available on the
World Wide Web at http://www.dynexsemi.com.

    All monetary values expressed in this release are in Canadian Dollars
unless stated otherwise.

    The TSX Venture Exchange has neither approved nor disapproved of the
    information in this press release.


    DYNEX POWER INC.
    Consolidated Balance Sheets
    Years Ended December 31st, 2006 and 2005
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                                                     Dec 31st       Dec 31st
                                                         2006           2005
                                               ------------------------------

    CURRENT ASSETS
    Cash and cash equivalents                   $     357,042  $     331,897
    Accounts receivable                             4,936,028      5,484,910
    Inventories                                     7,198,306      5,951,526
    Prepaid expenses and deposits                     715,935        551,135
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                                                   13,207,311     12,319,468

    CAPITAL ASSETS                                    444,715        478,938
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                                                $  13,652,026  $  12,798,406
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    CURRENT LIABILITIES
    Accounts payable and accrued liabilities    $   4,592,004  $   5,125,882
    Short-term loan                                 3,013,654      2,607,515
    Current portion of long-term debt               1,269,994      1,396,219
    Current portion of deferred revenue               175,832        155,515
    -------------------------------------------------------------------------
                                                    9,051,484      9,285,131

    LONG-TERM DEBT                                  3,570,847      3,048,252
    LONG-TERM DEFERRED REVENUE                      1,802,283      1,749,547
    -------------------------------------------------------------------------
                                                   14,424,614     14,082,930

    CONTINGENCIES                                           -              -

    SHAREHOLDERS' DEFICIENCY
    Share capital                                  13,888,690     12,955,163
    Deficit                                       (14,098,044)   (13,824,595)
    Cumulative translation adjustment                (563,234)      (415,092)
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                                                     (772,588)    (1,284,524)
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                                                $  13,652,026  $  12,798,406
    -------------------------------------------------------------------------
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    DYNEX POWER INC.
    Consolidated Statements of Losses and Deficits
    Years Ended December 31st, 2006 and 2005
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                         2006           2005
                                               ------------------------------

    Revenue                                     $  23,713,165  $  22,760,665

    Cost of sales                                  19,521,431     19,832,108
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    Gross margin                                    4,191,734      2,928,557
    -------------------------------------------------------------------------

    Expenses
    General and administration                      2,241,500      2,553,822
    Sales and marketing                               952,583      1,085,270
    Research and development                          697,604        538,903
    Interest expense                                  834,669        635,488
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                                                    4,726,356      4,813,483
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    Loss before other income
    (expenses) and income taxes                      (534,622)    (1,884,926)
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    Other income (expenses)
    Interest and other income                         245,171        237,329
    Foreign exchange gain (loss)                       16,002       (140,663)
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                                                      261,173         96,666
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    Income taxes                                            -              -

    NET LOSS                                         (273,449)    (1,788,260)


    DEFICIT, BEGINNING OF YEAR                    (13,824,595)   (12,036,335)
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    DEFICIT, END OF YEAR                        $ (14,098,044) $ (13,824,595)
    -------------------------------------------------------------------------
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    Loss per share
    Basic                                       $       (0.01) $       (0.07)
    Diluted                                     $       (0.01) $       (0.07)
    -------------------------------------------------------------------------
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    Weighted average number of shares
    Basic                                          31,257,836     26,949,650
    Diluted                                        31,257,836     26,949,650
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    DYNEX POWER INC.
    Consolidated Statements of Cash Flows
    Years Ended December 31st, 2006 and 2005
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                         2006           2005
                                               ------------------------------
    OPERATING
    Net loss                                    $    (273,449) $  (1,788,260)
    Items not affecting cash
    ------------------------
      Amortization                                    255,465        227,019
      Gain on disposal of capital assets             (163,179)      (172,909)
      Shares and options issued for services          383,527        400,164
    Changes in non-cash operating working capital    (411,071)    (1,124,674)
    -------------------------------------------------------------------------
                                                     (208,707)    (2,458,660)
    -------------------------------------------------------------------------

    FINANCING
    Shares issued for cash                            550,000         80,000
    Increase (decrease) in short-term debt             60,048        (29,991)
    (Decrease) increase in long-term debt            (168,987)     2,608,556
    -------------------------------------------------------------------------
                                                      441,061      2,658,565
    -------------------------------------------------------------------------

    INVESTING
    Proceeds of disposal of capital assets              2,085          2,207
    Purchase of capital assets                       (167,626)      (118,242)
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                                                     (165,541)      (116,035)
    -------------------------------------------------------------------------


    NET INCREASE IN CASH                               66,813         83,870

    Effect of foreign currency translation
     on cash flow                                     (41,668)        (2,348)

    Cash and cash equivalents,
     beginning of period                              331,897        250,375
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    CASH AND CASH EQUIVALENTS, END OF YEAR       $    357,042  $     331,897
    -------------------------------------------------------------------------
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    Supplementary Information:
    Interest paid during year                    $    653,938  $     337,052
    Income taxes paid during year                           -              -
    
    %SEDAR: 00010667E




For further information:

For further information: Dr. Paul Taylor, President and Chief Executive
Officer; Bob Lockwood, Finance Director and Chief Financial Officer, Dynex
Power Inc., +44 1522 500 500, paul_taylor@dynexsemi.com


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