GENIVAR Income Fund announces strong fourth quarter to close its first year-end results



    MONTREAL, March 13 /CNW Telbec/ - GENIVAR Income Fund (the "Fund")
announced sustained growth in revenues and EBITDA for its fourth quarter and
for the period from May 25, 2006 to December 31, 2006. This is the third
reporting period for the Fund since it commenced business operations on May
25, 2006. In order to provide investors with a meaningful assessment of its
performance, we have included selected financial information of the Fund, for
the 12 months ended December 31, 2006 and its predecessor company GENIVAR inc.
(the Engineering services business) for the twelve months ended December 31,
2005.

    
    Highlights

    - For the full year 2006, revenues grew from $130.0 million in 2005 to
      $176.1 million, representing a 35.5% increase. Net revenue was
      $128.0 million up 32.5% from $96.6 million in 2005. EBITDA stood at
      $26.0 million (20.2% of net revenues), up 49.4% from $17.4 million in
      2005.
    - Revenues in the fourth quarter of 2006 were $49.7 million, up 48.8% for
      the same period in 2005. Net revenues increased 30.6% to $36.7 million
      compared to $28.1 million in the fourth quarter of 2005. EBITDA reached
      $7.4 million (20.2% of net revenues) for the period from October 1 to
      December 31, 2006.
    - Distributable cash generated in the fourth quarter totalled
      $6.3 million of which $4.7 million was distributed to Unitholders,
      representing a payout ratio of 74.7%. Since the May 25, 2006 IPO,
      EBITDA totalled $17.8 million on net revenues of $84.7 million
      generating $15.7 million of distributable cash of which $11.4 million
      was distributed to Unitholders representing a payout ratio of 72.5%.
    - Since its Initial Public Offering (IPO) in May 2006, the Fund completed
      five acquisitions, adding 415 new employees across Canada.

    "We are pleased with these excellent results for our first annual
reporting period," said Pierre Shoiry, President and CEO of the GENIVAR Income
Fund. "The industry conditions are excellent in all our market segments,
backlog is strong and our staff is highly motivated by the dynamism and growth
prospects of the Fund."

    Consolidation in Quebec and Ontario and Expansion in Western Canada

    Since our IPO, the Fund actively pursued its business strategy and reached
a significant number of milestones. "We created a solid base in the Toronto
region following the acquisition of MacViro, a Toronto-based engineering firm
with 170 employees specialized in urban infrastructure, industrial, power and
environment.
    Kazmar Associates, another Toronto-based firm with 25 employees in
structural engineering, joined GENIVAR as at January 1, 2007, strengthening
our national platform in building engineering and enlarging our presence in
Ontario.
    The Martoni, Cyr & Associates acquisition, as at December 1, 2006, a
Montreal-based firm, consolidated our expertise in building engineering with
70 employees and added internationally recognized know-how in
telecommunication tower design," said Shoiry.
    On January 1, 2007, GENIVAR acquired the Western Canada-based engineering
consulting firm Cochrane Design Group (CDG) which has over 150 employees with
offices in British Columbia, Manitoba, Saskatchewan and Ontario. "The
acquisition of CDG represents a major step forward in pursuing strategic
growth opportunities. We gained an important foothold in Western Canada where
CDG is an industry leader. We also expanded our operations in Ontario," added
Shoiry.
    On February 24, 2007, GENIVAR also completed the acquisition of Groupe
G.L.D. inc. and established a presence in the Beauce Region, in the province
of Quebec and enhanced our building expertise in the greater Quebec City
Region. The firm has 50 employees.
    These acquisitions added a solid base of national repeat clients in all of
our market segments. The integration of these firms is well advanced and
cross-marketing initiatives have been initiated in Ontario, Quebec, in Western
Canada, as well as internationally.

    More acquisitions targeted

    The workforce of the GENIVAR Income Fund now totals more than 1,800
employees across Canada and internationally in more than 40 offices. "We will
pursue our business strategy and growth in the Canadian marketplace both
through organic acquisition by the cross-selling of services and through
strategic acquisitions. The Fund expects to pursue its acquisition strategy
and has, in that sense, proceeded in identifying potential acquisition targets
in all provinces," concluded Shoiry.

    GENIVAR

    GENIVAR is a leading Canadian engineering services firm providing private
and public sector clients with a full range of professional consulting
services through all execution phases of a project including planning, design,
construction and maintenance. Its clients, who are of varying sizes, fall into
various market segments such as building, industrial and power, urban
infrastructure, transportation and environment. GENIVAR is one of the largest
engineering services firm in Canada, in terms of number of employees, with
more than 1,800 managers, professionals, technicians and technologists and
support staff, in over 40 offices in Canada and abroad. The Fund's units trade
on the Toronto Stock Exchange under the symbol GNV.UN.
    The Fund's audited consolidated financial statements, as well as
management's discussion and analysis of this year-end reporting period can be
obtained via the GENIVAR website, in the Investor Relations section, at
http://www.genivar.com or at www.sedar.com.


    RESULTS OF OPERATIONS
                                  -------------------------------------------
                                                                        2006
                                  -------------------------------------------
                                       PRE-IPO       POST-IPO          TOTAL
                                  -------------------------------------------
                                       FOR THE        FOR THE        FOR THE
                                   PERIOD FROM    PERIOD FROM         TWELVE
                                     JANUARY 1    FROM MAY 25   MONTHS ENDED
                                     TO MAY 24             TO    DECEMBER 31
                                     (COMBINED    DECEMBER 31      (COMBINED
    IN THOUSANDS OF DOLLARS          UNAUDITED)      (AUDITED)     UNAUDITED)
    EXCEPT PER UNIT DATA                    (5)                           (4)
                                  -------------------------------------------
    Revenues                       $    66,332    $   109,781    $   176,113
    Deduct: Subconsultants and
     other direct expenses         $    23,035    $    25,099    $    48,134
                                  -------------------------------------------
    Net revenues (1)               $    43,297    $    84,682    $   127,979
    Direct project costs           $    21,346    $    43,777    $    65,123
                                  -------------------------------------------
    Gross margin                   $    21,951    $    40,905    $    62,856
    Marketing, general and
     administrative expenses       $    13,778    $    23,089    $    36,867
                                  -------------------------------------------
    EBITDA (2)                     $     8,173    $    17,816    $    25,989
    Interest                       $       132    $       476    $       608
    Depreciation of property,
     plant and equipment           $       622    $     1,245    $     1,867
    Amortization of intangible
     assets                        $     1,661    $     5,391    $     7,052
                                  -------------------------------------------
    Earnings before income taxes
    and non-controlling interest   $     5,758    $    10,704    $    16,462
    Income tax (recovery) (3)                     $      (211)
                                  -------------------------------------------
    Earnings before non-controlling
     interest                                     $    10,915
    Non-controlling interest (3)                  $     4,571
                                  -------------------------------------------
    Net earnings (3)                              $     6,344

    Basic net earnings per unit                   $      0.58
    Weighted average number of
     Units (6)                                     11,000,000
    Diluted net earnings per Unit                 $      0.58
    Diluted weighted average
     number of Units (6)                           18,927,381
    -------------------------------------------------------------------------


                                  -------------------------------------------
                                          2005           2006           2005
                                  -------------------------------------------
                                         TOTAL             Q4             Q4
                                  -------------------------------------------
                                       FOR THE                       FOR THE
                                        TWELVE        FOR THE    PERIOD FROM
                                  MONTHS ENDED    PERIOD FROM   OCTOBER 1 TO
                                   DECEMBER 31   OCTOBER 1 TO    DECEMBER 31
                                     (COMBINED    DECEMBER 31      (COMBINED
                                     UNAUDITED)    (UNAUDITED)     UNAUDITED)
                                            (5)                           (5)
    -------------------------------------------------------------------------
    Revenues                       $   129,997    $    49,703    $    33,447
    Deduct: Subconsultants and
     other direct expenses         $    33,446    $    12,970    $     5,343
                                  -------------------------------------------
    Net revenues (1)               $    96,551    $    36,733    $    28,104
    Direct project costs           $    50,942    $    19,200    $    14,313
                                  -------------------------------------------
    Gross margin                   $    45,609    $    17,533    $    13,791
    Marketing, general and
     administrative expenses       $    28,169    $    10,096    $     7,698
                                  -------------------------------------------
    EBITDA (2)                     $    17,440    $     7,437    $     6,093
    Interest                       $       488    $       195    $       158
    Depreciation of property,
     plant and equipment           $     1,449    $       534    $       424
    Amortization of intangible
     assets                        $     2,173    $     2,130    $       547
                                  -------------------------------------------
    Earnings before income taxes
    and non-controlling interest   $    13,330    $     4,578    $     4,964
    Income tax (recovery) (3)                     $       144
                                  -------------------------------------------
    Earnings before non-controlling
     interest                                     $     4,434
    Non-controlling interest (3)                  $     1,857
                                  -------------------------------------------
    Net earnings (3)                              $     2,577

    Basic net earnings per unit                   $      0.24
    Weighted average number
     of Units (6)                                  11,000,000
    Diluted net earnings per Unit                 $      0.24
    Diluted weighted average
     number of Units (6)                           18,927,381
    -------------------------------------------------------------------------

    (1) Net revenues are not a measure in accordance with GAAP and do not
        have standardized meaning prescribed by GAAP. Therefore, net revenues
        may not be comparable to similar measures presented by other issuers.
        Investors are cautioned that net revenues should not be construed as
        an alternative to revenues for the period (as determined in
        accordance with GAAP), as an indicator of the Fund's performance.
    (2) EBITDA is defined as earnings before interest, tax, depreciation and
        amortization. EBITDA is not an earnings measure in accordance with
        GAAP and does not have a standardized meaning prescribed by GAAP.
        Therefore, EBITDA may not be comparable to similar measures presented
        by other issuers.
    (3) Income taxes, non-controlling interest and net earnings have not been
        presented on a comparative basis due to the changes in the capital
        structure of the preceding entities and the Fund in connection with
        the IPO on May 25, 2006.
    (4) Supplementary Non-GAAP Combined Information for the twelve-month
        period ended December 31, 2006 is the combination of financial
        results of GENIVAR Engineering Services Business PRE-IPO and
        financial results of the Fund POST-IPO. Such combination is for
        illustrative purposes only. As a result of this combined
        presentation, the POST-IPO earnings have been affected by the
        additional amortization and depreciation of intangible assets and
        property, plant and equipment assets considering that these assets
        are recorded at fair value at the acquisition date.
    (5) This combined financial information was carved out from GENIVAR
        Engineering Services Business regrouping all of the engineering
        activities of GENIVAR Inc., the Non-controlling Unitholder.
    (6) As at March 12, 2007, the number of Units is the same as it was as at
        December 31, 2006.


     DISTRIBUTABLE CASH
                                ---------------------------------------------
                                                                        2006
                                ---------------------------------------------
                                            POST-IPO                      Q4
                                ---------------------------------------------
                                 FOR THE         PER     FOR THE         PER
                                  PERIOD        UNIT      PERIOD        UNIT
                                  MAY 25               OCTOBER 1
                                      TO                      TO
    IN THOUSANDS OF DOLLARS  DECEMBER 31             DECEMBER 31
    EXCEPT PER UNIT DATA        (AUDITED)             (UNAUDITED)
    -------------------------------------------------------------------------
    Cash flows
    Cash flows from operating
     activities                 $ 13,333                $  8,833
    Change in non-cash
     working capital items         3,886                  (1,648)
    Current income tax expense       121                      57
    Income taxes paid               (327)                    (70)
    Capital expenditures paid     (1,583)                   (915)
    Interest unpaid                  282                      72
    -------------------------------------------------------------------------
    Distributable cash (1)(2)   $ 15,712    $ 0.8301    $  6,329    $ 0.3344
    Actual payout ratio (3)         72.5%                   74.7%
    Fund's Units distributions     6,622    $ 0.6022       2,749    $ 0.2500
    Class B Non-subordinated
     Exchangeable LP Units
     distributions                 1,924    $ 0.6022         799    $ 0.2500
    Class C Subordinated
     Exchangeable LP Units
     distributions                 2,848    $ 0.6022       1,182    $ 0.2500
                                ---------------------------------------------
    Aggregate distributions,
     all Units (1)                11,394      0.6022       4,730      0.2500
    -------------------------------------------------------------------------
    Distributable cash (1)      $ 15,712    $ 0.8301    $  6,329    $ 0.3344
    Capital expenditures paid      1,583                     915
    Interest paid                    194                     123
    Income taxes paid                327                      70
    -------------------------------------------------------------------------
    EBITDA (4)                    17,816                   7,437
    -------------------------------------------------------------------------

    (1) Distributable cash does not have standardized meaning prescribed by
        GAAP, but is a measure generally used by Canadian open-ended income
        funds as an indicator of financial performance. The Fund defines
        distributable cash as cash flows from operating activities adjusted
        for change in non-cash working capital items, income taxes paid,
        capital expenditures paid, current income tax expense and interest
        unpaid. The Fund's method of calculating distributable cash may
        differ from similar computations as reported by other similar
        entities and, accordingly, may not be comparable to distributable
        cash as reported by such entities. The Fund believes that its
        distributable cash is a useful supplemental measure that may assist
        investors in assessing the return on their investment in Units.
    (2) Distributable cash and distributable cash per Unit amounts are
        calculated for the combined interest of the Fund's Units and
        Non-subordinated Exchangeable LP Units and Subordinated LP Units,
        which total 18,927,381.
    (3) Payout ratio is defined as aggregate distributions divided by
        distributable cash.
    (4) EBITDA is defined as earnings before interest, tax, depreciation and
        amortization. EBITDA is not an earnings measure in accordance with
        GAAP and does not have a standardized meaning prescribed by GAAP.
        Therefore, EBITDA may not be comparable to similar measures presented
        by other issuers
    




For further information:

For further information: Pierre Shoiry, President and CEO, GENIVAR,
(514) 340-0046, ext. 5104; For media inquiries: Marlene Casciaro, Director of
Communications, GENIVAR, (514) 340-0046, ext. 5184

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