Norwall Group Inc. reports second quarter end results



    BRAMPTON, ON, Aug. 15 /CNW/ - Mr. Jim Patton, President and C.E.O. of
Norwall Group Inc., one of North America's largest manufacturers and
distributors of residential wallcovering, announced today its financial
results for the quarter ended and six months ended June 30, 2008.
    The second quarter results reflect the impact of the ongoing external
challenges faced by the Company. During the first half, the Canadian dollar
strengthened, the US housing market remained weak and North American consumer
markets continued in decline. Although the Company has made significant
efforts to restructure and cut costs, the reduced expenditures have failed to
keep pace with declining revenues. The Company is undertaking a strategic
review of its alternatives in light of the continued downturn in the wallpaper
industry.
    The net loss, for the six months ended June 30, 2008 was $1,170,000 or
0.16 per common share on net sales of $16,761,000, compared to a net loss of
$918,000 or 0.14 per common share on net sales of $20,927,000 in the prior
year.

    Norwall Group (TSX:NGI) manufactures quality residential wallpapers and
borders and distributes them to thousands of home centres, specialty stores
and mass merchants in Canada and through its wholly-owned operating
subsidiary, Patton Wallcoverings, in the United States.

    This Press Release contains forward-looking statements reflecting
management's current expectations regarding future results of operations,
economic performance, financial conditions, and achievements of the Company.
Actual results may differ materially from those in such statements. The
Company wishes to caution the reader that those important factors described
elsewhere in the management's discussion and analysis of operations could
affect the Company's actual results and could cause such results to materially
differ from those expressed in any forward-looking statement made by, or on
behalf of, the Company.

    
                             NORWALL GROUP INC.
                    Consolidated Statements of Operations
         (In thousands of Canadian dollars, except per share amounts)

                                  FOR THE THREE MONTHS    FOR THE SIX MONTHS
                                          ENDED                  ENDED
                                  --------------------- ---------------------
                                    June 30,   June 29,   June 30,   June 29,
                                      2008       2007       2008       2007
                                   unaudited  unaudited  unaudited  unaudited
                                  --------------------- ---------------------
    Sales                             7,787      9,389     16,761     20,927
    Cost of goods sold                6,333      7,154     12,893     15,185
                                  --------------------- ---------------------
    Gross profit                      1,454      2,235      3,868      5,742
    Selling, general and
     administrative expenses          2,468      3,005      5,334      6,203
                                  --------------------- ---------------------
    Loss before the undernoted       (1,014)      (770)    (1,466)      (461)
    Severance and termination
     costs                               66         33         66         33
                                  --------------------- ---------------------
    Loss from operations before
     the following items             (1,080)      (803)    (1,532)      (494)
    Foreign exchange (gain) loss         (9)       468       (268)       570
    Interest expense                     52         88        111        189
                                  --------------------- ---------------------
    Loss before income taxes         (1,123)    (1,359)    (1,375)    (1,253)
    Recovery of income taxes            (52)      (362)      (205)      (335)
                                  --------------------- ---------------------
    Net loss for the period          (1,071)      (997)    (1,170)      (918)
                                  --------------------- ---------------------
    Basic and diluted loss per
     common share                     (0.15)     (0.15)     (0.16)     (0.14)
                                  --------------------- ---------------------
                                  --------------------- ---------------------
    Weighted and average number
     of common shares outstanding 7,135,032  6,486,393  7,135,032  6,486,393
                                  --------------------- ---------------------
                                  --------------------- ---------------------
    

    %SEDAR: 00002584E




For further information:

For further information: (905) 791-2700, James J. Patton, President and
Chief Executive Officer, jpatton@norwallgroup.com; Edward Diochon, Vice
President of Finance, ediochon@norwallgroup.com

Organization Profile

NORWALL GROUP INC.

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