Richards Packaging Income Fund Announces 2008 Second Quarter Results



    TORONTO, Aug. 1 /CNW/ - Richards Packaging Income Fund (TSX: RPI.UN) (the
"Fund") announced today results for the quarter ended June 30, 2008. The Fund
owns 85% of Richards Packaging Inc. ("Richards Packaging"), the leading
packaging distributor in Canada, and third largest in North America.
    "Revenue during the second quarter reflected a one-time increase of 
$4 million over the first quarter mainly due to the successful sale of the 
$3 million inventory build up in the first quarter to capitalize on port and
plant disruptions associated with the Beijing Olympic Games. Revenue increased
23% to $48.9 million, EBITDA(1) increased 39% to $6.0 million and
distributable cash(2) increased 32% to $4.1 million from the same period in
2007. Gross profit increased 0.8% from the same period in 2007 reflecting our
continuing shift to higher margin products. EBITDA as a percent of sales
continued at 12% for the second quarter meeting our new long-term target. Net
income was $3.1 million, or 30.2cents, down $0.8 million from the same period
in 2007 which mainly reflects the difference in non-cash expense for the
foreign currency translation of our U.S. dollar denominated debt.", commented
Gerry Glynn, Chief Executive Officer.
    The Fund paid monthly distributions of 9.35 cents per Unit for January
through June, which represents an annualized yield of 13.3% on the June 30th
closing price of $8.45 per Unit. The payout ratio(3) for the second quarter
was 82% down from 96% in 2007. During the second quarter, 43,700 Units were
purchased at an average price of $8.63 per Unit representing one-half of the
available distributable cash after distributions.
    Details of the Fund's results are currently available on Richards
Packaging's website at www.richardspackaging.com and on SEDAR at
www.sedar.com.

    About Richards Packaging

    Richards Packaging is a full-service packaging distributor targeting
small- and medium-sized North American businesses. Richards Packaging has
operated for over 95 years and currently serves over 9,000 regional food, wine
and spirits, cosmetic, specialty chemical, pharmaceutical and other companies
from 19 locations throughout North America.

    
    1   Management defines EBITDA as earnings before amortization, debt
        accretion, interest, unrealized gain/loss on financial instruments
        and taxes. EBITDA is the same as income before under noted items,
        income taxes and non-controlling interests as outlined in the interim
        consolidated financial statements. Management believes that in
        addition to net income, EBITDA is a useful supplemental measure for
        investors of earnings available for distribution prior to debt
        service, capital expenditures and taxes. Management uses this measure
        as a starting point in the determination of earnings available for
        distribution to unitholders and exchangeable shareholders. In
        addition, EBITDA is intended to provide additional information on the
        Fund's operating performance. This earnings measure should not be
        construed as an alternative to net income or as an alternative to
        cash flow from operating, investing and financing activities as a
        measure of the Fund's liquidity and cash flows. EBITDA does not have
        a standardized meaning prescribed by GAAP and therefore the Fund's
        method of calculating EBITDA may not be comparable to similar
        measures presented by other companies or income trusts.

    2   Management defines distributable cash flow, in accordance with the
        Richards Packaging's credit agreement, as EBITDA less interest, cash
        income tax expense, maintenance capital expenditures and loan
        payments. The objective of presenting this measure is to calculate
        the amount which is available for distribution to unitholders and
        exchangeable shareholders. Investors are cautioned that distributable
        cash flow should not be construed as an alternative to cash flow from
        operating, investing and financing activities as a measure of the
        Fund's liquidity and cash flows. Distributable cash flow does not
        have a standardized meaning prescribed by GAAP and therefore the
        Fund's method of calculating distributable cash flow may not be
        comparable to similar measures presented by other income trusts.

    3   Management defines payout ratio as distributions and dividends
        declared over distributable cash flow(2). The objective of presenting
        this measure is to calculate the percentage of actual distributions
        in comparison to the amount available for distribution. Payout ratio
        does not have a standardized meaning prescribed by GAAP. The Fund's
        method of calculating the payout ratio may not be comparable to
        similar measures presented by other income trusts.

    4   This release contains certain forward looking statements (the
        "Statements") regarding future growth potential, results of
        operations, performance and business prospects and opportunities of
        the Fund. These Statements reflect management's current beliefs and
        are based on information currently available to the management of
        Richards Packaging. A number of factors could cause actual events or
        results to differ materially from those discussed in the forward-
        looking statements. Factors that could cause such differences
        include, among other things, changes in customer and supplier
        relationships and the impact on order volumes and pricing,
        competition in the industry, inventory obsolescence, trade risks in
        respect to foreign suppliers and fluctuations in foreign exchange and
        interest rates. Although the Statements contained in this release are
        based upon what management believes to be reasonable assumptions,
        there can be no assurance that actual results will be consistent with
        these Statements. These Statements are made as of the date of this
        release and the Fund assumes no obligation to update or revise them
        to reflect new events or circumstances.
    





For further information:

For further information: Gerry Glynn, Chief Executive Officer, Richards
Packaging Inc., (905) 624-3391, gglynn@richardspackaging.com; Enzio Di
Gennaro, Chief Financial Officer, Richards Packaging Inc., (416) 245-8230,
edigennaro@richardspackaging.com


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