Lonestar Reports Third Quarter Financial Results and Change in Yearend



    
    Third Quarter 2009 Highlights:

    -  generated revenue of $ 1.4 million in the nine months ended April 30,
       2009, a 135% increase over the comparable prior year period,
    -  our fleet now consists of 14 HVAC trucks. From our first truck in
       May, 2008 we now have capital leases on 6 units, rent to own and
       monthly rental agreements on 4 units and an additional 4 lease
       operator units.
    

    SYLVAN LAKE, AB, June 29 /CNW/ - Lonestar West Inc. (TSX(V):LSI) today
announced its business performance for the third quarter of fiscal 2009.
    President and CEO James Horvath commented, "The quarter saw lower than
anticipated revenue for Lonestar as completions of key projects and seasonal
shutdowns of other projects combined with the downturn in the oil and gas
industry led to lower utilization rates. However, we see better things on the
horizon as late in April and into the current quarter we have had improved
utilization. We have grown our customer base and continue to be a favoured
supplier of our customers. We are confident our focus on customer service will
provide us the basis to keep the equipment working and move us towards our
goal of becoming a major national competitor in the HVAC services business. We
have the employees, equipment and management team that can contribute to
achieving our growth plans."
    For the nine months ended April 30, 2009, Lonestar showed significant
growth in Earnings Before Interest, Taxes, Depreciation and Amortization and
Stock Based Compensation ("EBITDAC")((1)) to $278,000 from $166,000 in the
comparable prior year period. For the 3rd quarter, EBITDAC was a negative
$56,000 as compared to a positive $74,000 in the prior year. Losses in the
quarter of $373,000 were primarily a result of the reduced utilization and
compared to losses of $32,000 in the prior year. These quarterly amounts
brought the year-to-date losses to $351,000 and $153,000 in 2009 and 2008,
respectively.

    
    CONSOLIDATED RESULTS

    Financial Results (000's except per share amounts)

    -------------------------------------------------------------------------
                                      3 months ended        9 months ended
                                         April 30              April 30
    -------------------------------------------------------------------------
                                       2009       2008       2009       2008
    -------------------------------------------------------------------------
    Revenue                         $ 1,372    $   584    $ 4,314    $ 1,592
    -------------------------------------------------------------------------
    Operating expenses                1,226        439      3,475      1,233
    -------------------------------------------------------------------------
    Gross margin                        146        145        839        359
    -------------------------------------------------------------------------
    Net income (loss)                  (373)       (32)      (351)      (153)
    -------------------------------------------------------------------------
    EBITDAC(1)                          (56)        74        278        166
    -------------------------------------------------------------------------
    Earnings per share - basic        (0.03)    (32.08)     (0.04)   (152.70)
    -------------------------------------------------------------------------
    (1) EBITDAC means earnings before interest, taxes, depreciation and
        amortization and stock based compensation and is equal to earnings
        before income taxes plus interest on long-term debt plus amortization
        plus stock based compensation. EBITDAC is not a recognized measure
        under Canadian generally accepted accounting principles ("GAAP").
        Management believes that in addition to net earnings, EBITDAC is a
        useful supplemental measure as it provides an indication of the
        results generated by the Company's primary business activities prior
        to consideration of how those activities are financed, amortized or
        how the results are taxed in various jurisdictions as well as the
        cash generated by the Company's primary business activities. Readers
        should be cautioned, however, that EBITDAC should not be construed as
        an alternative to net earnings determined in accordance with GAAP as
        an indicator of Lonestar's performance. Lonestar's method of
        calculating EBITDAC may differ from other organizations and,
        accordingly, EBITDAC may not be comparable to measures used by other
        organizations.
    

    The complete MD&A and interim financial statements for the Third Quarter,
as well as Lonestar's November 27, 2008 Prospectus, are available on SEDAR at
www.sedar.com.

    Change in Yearend

    The Company is also announcing that it will be changing its yearend from
July 31 to June 30 effective for its 2009 yearend. The purpose of this change
is to provide quarterly results on consistent periods with most other publicly
traded services companies. Lonestar's reporting periods, and the related
comparative prior year periods, will be as follows for the next year:

    
    -------------------------------------------------------------------------
                          Reporting Period       Prior Year Comparatives
    -------------------------------------------------------------------------
    2009 Quarter 4         2 months ended              3 months ended
                            June 30, 2009               July 31, 2008
    -------------------------------------------------------------------------
    2009 Yearend          11 months ended             12 months ended
                            June 30, 2009               July 31, 2008
    -------------------------------------------------------------------------
    2010 Quarter 1         3 months ended              3 months ended
                       September 30, 2009            October 31, 2008
    -------------------------------------------------------------------------
    2010 Quarter 2         3 months ended              3 months ended
                        December 31, 2009            January 31, 2009
    -------------------------------------------------------------------------
    2010 Quarter 3         3 months ended              3 months ended
                           March 31, 2010              April 30, 2009
    -------------------------------------------------------------------------
    2010 Quarter 4         3 months ended              2 months ended
                            June 30, 2010               June 30, 2009
    -------------------------------------------------------------------------
    2010 Yearend          12 months ended             11 months ended
                            June 30, 2010               June 30, 2009
    -------------------------------------------------------------------------
    

    Business Description

    Lonestar West Inc. currently operates 14 HVAC trucks and 6 vacuum trucks
throughout Western Canada and Ontario from its base in Sylvan Lake, Alberta.
It is focussed on profitably growing its HVAC services to become a major
national competitor in the market area.

    Lonestar's shares trade on the TSX(Venture) Exchange under the symbol
LSI.

    Certain information and statements contained herein constitute
forward-looking information, including the anticipated costs associated with
the purchase of capital equipment, expectations concerning the nature and
timing of growth within the business operated by Lonestar, expectations
respecting the competitive position of such business, expectations concerning
the financing of future business activities and statements as to future
economic and operating conditions. Readers should review the cautionary
statement respecting forward-looking information that appears in Lonestar's
complete MD&A.


    %SEDAR: 00027328E




For further information:

For further information: James Horvath, President and CEO, (403)
887-2074; Randy Nicholls, CA, Chief Financial Officer, (403) 887-2074

Organization Profile

Lonestar West Inc.

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