ExelTech announces first quarter results



    MONTREAL, Aug. 26 /CNW Telbec/ - ExelTech Aerospace Inc. ("ExelTech" or
the "Company") (TSX Venture: XLT), a leading aircraft maintenance, repair and
overhaul ("MRO") provider with operations in Montreal and Quebec City, today
announced its financial results for the first fiscal quarter ended June 30,
2008. All amounts are in Canadian dollars unless otherwise indicated.
    Revenues for the quarter ended June 30, 2008 totalled $15.3 million
compared to $13.7 million for the quarter ended June 30, 2007, an increase of
11%. This increase was driven by continued growth in ATR, Dash-8 and Saab
regional turboprop heavy maintenance and in Montreal and Québec line
maintenance services, which increased 28% and 83% respectively over the same
period in the prior year, offset by reduced demand for regional jet
maintenance, which declined 15%, primarily as a result of delays in leasing
company contracts and changes in US regional airline flight schedules. The
increase in regional turboprop heavy maintenance revenue reflects recognition
of the revenue from a substantial aircraft refurbishment project, for which
much of the work was accomplished in prior periods, and increased revenue from
the Saab 340 maintenance line, which operated at full capacity throughout the
quarter.
    Despite this increase in revenue, Net Income declined to a loss of
$1.3 million, compared to a profit of $18,791 in the same period in the prior
year. This reflects in part lower margins caused by the change in value of the
US dollar, the general market conditions in the MRO industry; and one-time
training costs to meet the requirements of regulatory agencies; further
training to expand our capabilities to meet increased demand for Embraer
ERJ145, ATR 42/72 and Saab 340 heavy maintenance.
    "We are disappointed to announce this loss", stated Derek Nice,
ExelTech's Chairman and Chief Executive Officer. "Seasonally, our first
quarter is always one of our weakest, but we are nonetheless not happy with
these results. We are making strong advances in our plan to return to
profitability."

    Highlights of the quarter ended June 30, 2008 include:

    
    - The company's ERJ145 heavy maintenance line operated at full capacity
      throughout the quarter, making the ERJ145 ExelTech's most successful
      product launch ever. Nonetheless, this was not enough to offset
      declines in the Bombardier CRJ maintenance business caused by delays in
      leasing company contracts and flight schedule adjustments by US
      regional airlines that have reduced their flying in response to the US
      airline industry slowdown. As a result, even though regional jet
      maintenance revenues were 11% higher than in the previous quarter, they
      declined 15% over the prior year period.
    - Line maintenance revenue increased 70% over the previous quarter and
      83% over the quarter ended June 30, 2007.
    - ExelTech made substantial progress in implementing its business
      re-engineering plan, driving higher efficiencies in all aspects of its
      operations. During the quarter, the company appointed Mr. Sylvain Duval
      as new President and Chief Operating Officer, with the mandate to
      concentrate on internal operating efficiencies. Organizational changes,
      investments in tooling and equipment, new training and other
      initiatives are all making a contribution toward driving down the
      company's costs while increasing service levels for all customers.

    On August 21, 2008 the company officially opened its new Montreal heavy
maintenance facility, which is a major milestone in its plans for
industry-leading profitability.

    About ExelTech Aerospace

    The third-largest commercial airframe Maintenance, Repair, and overhaul
(MRO) vendor in Canada, ExelTech Aerospace is listed on the TSX Venture
Exchange and trades under the symbol XLT. The company holds Transport Canada,
US Federal Aviation Administration (FAA), European Aviation Safety Agency
(EASA) and Bermuda Department of Civil Aviation (BDCA) approvals to maintain a
range of aircraft and associated structures, components and systems. Aircraft
models serviced by ExelTech Aerospace include Bombardier CRJ and Embraer ERJ
regional jets, ATR42/72, Bombardier Dash 8 and Saab 340 family regional
turboprops and Boeing 737 narrow bodies.
    With close to 310,000 square feet of hangar, shop and office space in
three facilities at Montreal and Quebec City, and with marketing offices in
the US and Europe, ExelTech Aerospace provides maintenance repair and overhaul
services to airlines in Canada, the US and 24 other countries around the
world.
    To learn more about ExelTech Aerospace Inc. (TSX-V: XLT), please visit our
website at www.exeltech-aerospace.com.

    The TSX Venture Exchange Inc. has not reviewed and does not accept
    responsibility for the adequacy of this release.


    SELECTED FINANCIAL INFORMATION OF EXELTECH AEROSPACE INC.

    Consolidated statements of operations and
     comprehensive (loss) income
    Three-month period ended June 30                     2008           2007
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Revenue                                      $ 15,256,900   $ 13,702,948
    Cost of sales                                  13,986,252     10,752,082
    -------------------------------------------------------------------------
                                                    1,270,648      2,950,866
    Operating expenses                              2,584,682      2,294,932
    -------------------------------------------------------------------------
    (Loss) Earnings before the following           (1,314,034)       655,934
    Amortization                                      335,247        303,998
    Financial expenses                                175,158        281,512
    -------------------------------------------------------------------------
    (Loss) Earnings before income taxes            (1,824,439)        70,424
    -------------------------------------------------------------------------
    Income taxes                                     (487,471)        51,633
    -------------------------------------------------------------------------
    Net (loss) earnings and comprehensive
     (loss) income                                 (1,336,968)        18,791
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net (loss) earnings per share
     basic and diluted                                  (0.01)          0.00


    Consolidated balance sheet
                                                        As at          As at
                                                      June 30,      March 31,
                                                         2008           2008
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                            $              $
    ASSETS
    Current assets                                 28,866,160     37,433,052
    Capital assets                                 25,309,020     15,439,687
    Intangible assets                                 256,086        294,836
    Future income taxes                             4,173,719      3,812,655
    Goodwill                                       13,241,506     13,241,506
    -------------------------------------------------------------------------
                                                   71,846,491     70,221,736
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    LIABILITIES
    Current liabilities                            21,573,493     18,788,155
    Long-term debt and liability component of
     convertible debentures                        18,072,451     18,339,121
    Other                                             544,449        457,083
    SHAREHOLDERS' EQUITY                           31,656,098     32,637,377
    -------------------------------------------------------------------------
                                                   71,846,491     70,221,736
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
    %SEDAR: 00020968EF




For further information:

For further information: Roland Blais, Chief Financial Officer, (514)
631-8999 ext 2400, rblais@exeltech-aerospace.com; Derek Nice, Chief Executive
Officer, (514) 631-3884, dnice@exeltech-aerospace.com

Organization Profile

EXELTECH AEROSPACE INC.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890