TSX Symbol: ORI
WOODBRIDGE, ON, Sept. 27 /CNW/ - Organic Resource Management Inc.
("ORMI") is pleased to announce that for the year ended June 30, 2007, it has
increased its operating cash flow and improved its gross margins.
Cash flows from operating activities increased by $259,000 or 35% from
739,000 for 2006 to $998,000 for 2007. In addition, the total gross margin
continued to improve in 2007 increasing $600,000 or 15% from $4,050,000 in
2006 to $4,650,000 in 2007. As a percentage of revenue, gross margin also
increased to 30.2% in 2007 compared to 25.3% in 2006.
The Company reduced its single largest operating expense, residuals
management, by 23% in 2007. This resulted from a reduction in the volume of
waste collected because of the loss of two major industrial accounts, and the
Company's ability to take more residuals to third-party recycling sites in
Ontario instead of transporting them out of province.
The Company's core business, grease interceptor servicing, recorded an
increase in revenue of 10% during 2007 as a result of both volume and price
increases. However, this was offset by lost revenue from two high volume low
margin industrial accounts. The net result was a reduction in revenue of 4% or
$614,000 from $16,032,000 for fiscal 2006 to $15,418,000 for 2007.
Selling, general and administrative expenses were up $719,000 or 25%,
from $2,933,000 in 2006 to $3,652,000 in 2007. The majority of the increase
pertains to severance expense for two long term employees and legal and
accounting fees related to the multi-step restructuring program the Company
Preferred share dividends and intangible asset amortization, including
the write-down of patents, accounted for $2,216,000 of the non-cash expenses
in 2007 compared to $1,280,000 in 2006. These expenses are not tax deductible.
These expenses will not reoccur in 2008 because the preferred shares have been
converted into common shares, and the write-down of the intangibles, related
to the 2002 purchase of Organic Resource Management Inc. and A&A Anderson Tank
Services (Vancouver) Ltd., is now complete.
The future income tax recovery increased by $1,131,000, from $4,000 in
2006 to $1,135,000 in 2007. The increase is the result of future tax assets in
the Company that management has assessed are now more likely than not to be
realized, on the basis that the Company has generated a taxable income in 2006
and 2007 and the probability that it will continue to have taxable income in
The net loss for the year was $1,244,000, an increase of $48,000 from
$1,196,000 in 2006.
The Company will be holding its annual general meeting on October 24,
2007, at 4:00 pm at Suite 4400, BCE Place, Bay Wellington Tower, 181 Bay
Street, Toronto, Ontario.
This press release is available on the Company's official on-line
investor relations site for investor commentary, feedback and questions.
Investors are asked to visit the investor relations section of the Company's
website at http://www.ormi.com/ORMI_Investor.asp. Alternatively, investors are
asked to e-mail all questions and correspondence to email@example.com where they
can also request addition to the Organic Resource investor e-mail list to
receive all future press releases and updates directly.
About Organic Resource Management Inc.
Organic Resource is Canada's largest provider of vacuum truck services
for the collection, treatment and disposal of organic and other non-hazardous
liquid waste. ORMI services in excess of 8,000 commercial, industrial,
institutional and residential customers in Ontario, Quebec, and British
Columbia. Further information about ORMI may be obtained at the Company's web
site at www.ormi.com.
Note: Certain information contained in this press release may be
forward-looking and therefore subject to unknown risks or uncertainties. The
actual results, performance or achievements of Organic Resource Management
Inc. may differ materially from the results, performance or achievements of
the Company expressed or implied by such forward-looking statements.
For further information:
For further information: Corporate Inquiries: Charles H. Buehler,
Chairman & Chief Executive Officer, firstname.lastname@example.org