Imaflex Inc. announces results for the quarter ended June 30, 2008



    TICKER SYMBOL: IFX.A

    MONTREAL, Aug. 11 /CNW Telbec/ - Imaflex Inc. (the "Company")
(TSX Venture Exchange - IFX.A) announces results for the second quarter ended
June 30, 2008.

    
    -------------------------------------------------------------------------
    (unaudited)

    (CDN $ thousands, except
     per share amounts)                Q2 2008   Q2 2007  YTD 2008  YTD 2007
    -------------------------------------------------------------------------
    Sales                               14,014    12,089    26,128    24,117
    -------------------------------------------------------------------------
    Cost of sales                       12,100    10,655    22,337    20,844
    -------------------------------------------------------------------------
    Gross profit ($)                     1,914     1,434     3,791     3,273
    -------------------------------------------------------------------------
    Gross profit (%)                      13.7      11.9      14.5      13.6
    -------------------------------------------------------------------------
    Expenses                             2,088     1,780     4,153     3,650
    -------------------------------------------------------------------------
    FX loss (gain)                          37      (451)      137      (484)
    -------------------------------------------------------------------------
    Income (loss) before income taxes     (211)      105      (499)      107
    -------------------------------------------------------------------------
    Provision for income taxes              70         2       258        83
    -------------------------------------------------------------------------
    Net income (loss)                     (281)      103      (757)       24
    -------------------------------------------------------------------------
    Basic and diluted earnings
     per share                          (0.010)    0.003    (0.020)    0.001
    -------------------------------------------------------------------------
    EBITDA                                 777       950     1,599     1,853
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    The results include those of Imaflex Inc. ("Imaflex") located in Montréal
(Québec) and its division Canguard Packaging ("Canguard") located in
Victoriaville (Québec), and its wholly owned subsidiaries, Imaflex USA, Inc.
("Imaflex USA") located in Thomasville (North Carolina) and Canslit Inc.
("Canslit") located in Victoriaville (Québec).

    Summary - Results of Operations
    -------------------------------

    The Company's Canadian operations generated combined net income of
$114,000 for the three months ended June 30, 2008, compared with net loss
$730,000 for the same period in 2007. The consolidated net loss in the second
quarter of 2008 of $281,000 is due primarily to the loss on foreign exchange
of $488,000 and the increase in amortization of $241,000 over the same period
of 2007.
    The Company's Canadian operations generated a combined net income of
$564,000 for the six months ended June 30, 2008, compared with net loss of
$559,000 for the same period in 2007. The consolidated net loss for the period
ending June 30, 2008 of $757,000 is due primarily to the loss on foreign
exchange of $621,000 and the increase in amortization of $426,000 over the
same period of 2007.

    Sales
    -----

    Sales for the three months ended June 30, 2008 totaled $14,014,000
compared with $12,089,000 for the same period of 2007. The increase of
$1,925,000 or 15.9 % was due primarily to pricing increases as a result of
higher raw material costs.
    Sales for the six months ended June 30, 2008 totaled $26,128,000 compared
with $24,117,000 for the same period in 2007. The increase of $2,011,000 or
8.3% was due primarily to pricing increases as a result of higher raw material
costs.

    Gross profit margins
    --------------------

    The gross profit margin for the quarter increased primarily due to a
better mix of higher margin sales and the integration of our Victoriaville
facilities.

    Income taxes
    ------------

    The income tax provision reflects the taxes on the income generated by
the Company's Canadian operations. No future income tax benefits have been
recorded on Imaflex USA's operating losses.

    Outlook
    -------

    During this quarter our industry saw monthly increases in raw materials,
increased costs in transportation, and manufacturing, with many surcharges
activated at a moments notice. In spite of this, or maybe due to this, the
industry has reacted in a positive manner that actually bodes well for the
near future. Competitors, worried about market share retention, and so for
almost two years kept prices depressed, can no longer, will no longer, absorb
any increases in costs, and so costs are now being passed on to our customers.
The effect, and this mostly due to timing, has not yet trickled down to our
bottom line, but soon will.
    As to our own results and expectations, management is pleased to report
the following. Though part of Imaflex, and therefore not an entity to report
on, it is nevertheless important that the shareholder know that Canguard has
turned the corner. Management is pleased to report that whereas, for the same
six months last year Canguard had losses of $254,000, this year for the same
period it eked out a profit of $5,000.
    As for Imaflex Inc., management's priority has been to replace the
$5,000,000 of revenues which it was making to its own affiliates in 2007, but
not this year. Management is pleased to report that we have recouped most of
those revenues selling to third parties.
    Canslit's integration has begun to contribute in the manner that was
envisioned. Its results permit management to pursue those other opportunities
that it could not contemplate prior to the cost savings achieved by the
integration.
    As to Imaflex USA, losses have increased when comparing them to last
year's. Management wishes to remind the reader that these increased losses are
strictly due to the increase in depreciation costs. Also, due to timing,
revenues are flat, however, and as has been reported in past management
outlooks, management has every reason to believe that revenues will increase
in the next two quarters. The sales force that was put in place has been very
active during this quarter. This activity will increase revenues in the coming
quarters, and will, as has been stated in the prior outlook, dramatically
decrease our losses during the next two quarters.
    Lastly management wishes to state that these results, achieved in the
harshest business climate that one could imagine, coupled with the new mind
set of our industry, which has finally woken up to the fact that the strategy
of protecting market share has not worked, encourages us to believe that the
worst is over. We are of the opinion that it will take some time yet to attain
the stellar results that were attained prior to our expansion, but at last we
have reason to believe that we have finally begun a new phase which will allow
us to once again achieve results that will contribute to increase shareholder
value.

    Safe Harbor Statement
    ---------------------

    Certain statements and information included in this release constitute
"forward-looking statements". Such forward-looking statements involve known
and unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or implied in
such forward-looking statements. Additional discussion of factors that could
cause actual results to differ materially from management's projections,
estimates and expectations is contained in the Company's other public filings.
Unless otherwise required by the securities authorities, we do not undertake
to update any forward-looking statements that may be made from time to time by
us or on our behalf.

    Non-GAAP Measure
    ----------------

    The Company's management uses a non-GAAP measure in this press release,
namely EBITDA. Management wishes to specify that in the performance of the
Company's financial results, EBITDA is shown as "Earnings before interest,
taxes, non-controlling interest, depreciation and amortization". While EBITDA
is not a standard GAAP measure, management, analysts, investors and others use
it as an indicator of the Company's financial and operating management and
performance. EBITDA should not be construed as an alternative to net income
determined in accordance with GAAP as an indicator of the Company's
performance. The Company's method of calculating EBITDA may be different from
those used by other companies.

    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release.
    %SEDAR: 00011834EF




For further information:

For further information: Imaflex Inc.: Joseph Abbandonato, President and
C.E.O; Robert Nagy, CMA, CIA - Controller, (514) 935-5710, Fax: (514)
935-0264, info@imaflex.com; www.imaflex.com


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