Sigma Industries reports its fiscal 2008 third quarter results



    QUEBEC CITY, March 25 /CNW Telbec/ - Sigma Industries Inc. (TSX Venture
Exchange: SIC), a leading composite and metal products manufacturer, today
announced results for the third quarter of its 2008 year ended January 26,
2008. A stronger Canadian dollar, a substantial decline in the heavy truck
market over the last twelve months following the introduction of new
environmental regulations regarding greenhouse gas emissions in January 2007
and the economic slowdown offset the contribution from the acquisitions of the
Acton Vale plant and of Groupe Synergy Composites Inc. (GSC), respectively
completed on January 27, 2007, and February 1, 2007.

    THIRD QUARTER RESULTS

    For the third quarter ended January 26, 2008, sales reached
$14.8 million, down from $19.0 million in the second quarter and from
$22.9 million in the quarter ended January 31, 2007. This decline is
essentially attributable to the decline in the heavy truck market, the
economic slowdown as well as the strength of the Canadian currency.
    Despite sequentially-lower sales, third-quarter earnings before interest,
taxes, depreciation and amortization (EBITDA), excluding the non-recurring
gain on insurance settlement, of $0.4 million was at the same level than
during the second quarter. As a percentage of sales, third-quarter EBITDA was
2.8% of sales, up from 2.3% in the second quarter, an improvement resulting
from the Company's significant investments in automation and robotization in
order to enhance its productivity and further reduce operating costs. The
strength of the Canadian dollar reduced EBITDA by $0.5 million in the third
quarter. Given greater business activity, the third quarter of fiscal 2007 had
yielded an EBITDA of $2.8 million.
    Because of a $1.4-million gain before taxes related to an insurance
settlement, the Company posted net earnings of $0.4 million, or $0.009 per
diluted share, for the third quarter of fiscal 2008, compared with
$1.0 million, or $0.029 per diluted share, for the same period a year earlier.
    For the third quarter ended January 26, 2008, cash flows from operating
activities before changes in non-cash working capital items stood at
$0.7 million, versus $1.6 million last year. As at January 26, 2008, Sigma's
balance sheet remained solid with total net debt of $20.6 million and
shareholders' equity of $19.7 million.
    "We are pleased with our improving operating profitability despite the
substantial decline in the heavy truck market," mentioned Denis Bertrand,
President and Chief Executive Officer. "We are actively pursuing various cost
reduction initiatives, such as the merger of our metal component manufacturing
operations at our facility in St-Agapit. In addition, we are further
developing our growth sectors as evidenced by the completion of a
20,000-square-foot expansion of the Faroex facility in Manitoba. This new
production capacity will enable us to meet an increasingly greater demand for
components destined to the wind energy market".

    NINE MONTHS RESULTS

    For the first nine months of fiscal 2008, sales reached $52.6 million,
13.5% lower than sales of $60.8 million recorded during the first nine months
of fiscal 2007. Reflecting lower activity in the heavy truck market as well as
a $1.0-million negative impact from the stronger Canadian dollar, EBITDA for
the nine-month period ended January 26, 2008 stood at $0.7 million compared
with $7.7 million one year earlier. The Company's net loss for the first nine
months of the current fiscal year amounted to $1.2 million, or $0.027 per
diluted share, as opposed to net earnings of $3.1 million, or $0.089 per
diluted share, in the previous fiscal year.

    ACQUISITION OF PICKENS OFFERS SUSTAINED GROWTH POTENTIAL

    On March 4, 2008, Sigma announced the acquisition of Pickens Plastics, a
company owning two production facilities in north-eastern Ohio. Well
established for over 30 years and ISO 9002 certified, Pickens is in perfect
harmony with Sigma's growth strategy which consists of consolidating its
strong business relationships with its clients, adding complementary
technologies in order to become a one-stop-shop solution for technological
expertise and manufacturing processes and providing a better match-up between
cash inflow and outflow in foreign currency. Moreover, Pickens' strategic
location in close proximity to Sigma's target markets will facilitate its
integration as well as future growth of the entire organization.
    This first acquisition in the United States enhances Sigma's
technological portfolio through the high-tonnage Sheet Moulding Compound (SMC)
manufacturing process. In addition, Pickens also possesses two painting lines
for assembled components, one of which is entirely robotized, as well as two
robotized jet trimmers. These assets yield a competitive edge that will enable
Sigma to offer more complete business solutions to its current and future
customers. Pickens' sales currently reach $7.5 million and essentially reflect
the production of industrial components, thus providing further sectorial
diversification.
    "The business volume generated by Pickens' clientele holds significant
growth prospects. More importantly, we perceive a strong cross-selling
potential resulting from the offer of Pickens' technological expertise to our
current customer base, as well as that of our manufacturing processes to
Pickens' clients. Given the latter's available production capacity, we foresee
a sustained growth avenue," concluded Mr. Bertrand.

    
    SELECTED FINANCIAL INFORMATION

                          -------------------------  ------------------------
    Consolidated results
     of operations        Three-month periods ended  Nine-month periods ended
                          -------------------------  ------------------------
    (unaudited, in '000s
     of Cdn$, except per   January 26,  January 31,  January 26,  January 31,
     share amounts)              2008         2007         2008         2007

                                    $            $            $            $
    Sales                      14,769       22,895       52,583       60,764
    EBITDA                        414        2,754          733        7,702
    Earnings (loss)
     before income taxes          551        1,642       (1,600)       4,905
    Net earnings (loss)           365        1,033       (1,153)       3,119
    Net earnings (loss)
     per share
      Basic                     0.009        0.030       (0.027)       0.093
      Diluted                   0.009        0.029       (0.027)       0.089
    -------------------------------------------------------------------------


                          -------------------------  ------------------------
    Reconciliation of
     EBITDA, EBITDAG and
     Net earnings         Three-month periods ended  Nine-month periods ended
                          -------------------------  ------------------------
    (unaudited, in '000s   January 26,  January 31,  January 26,  January 31,
     of Cdn $)                   2008         2007         2008         2007

                                    $            $            $            $
    Net earnings (loss)           365        1,033       (1,153)       3,119
    PLUS:
    Income tax
     expense (recovery)           186          609         (447)       1,787
    Gain on insurance
     settlement                (1,436)           0       (1,436)           0
    Depreciation and
     amortization                 814          608        2,524        1,533
    Financial expenses            485          504        1,245        1,263
                                  ---          ---        -----        -----
    EBITDA                        414        2,754          733        7,702
    Foreign exchange
     loss (gain)                   34          (79)         268         (229)
                                   --          ----         ---         -----
    EBITDAG                       448        2,675        1,001        7,473
    -------------------------------------------------------------------------


                                                     ------------------------
    Consolidated balance sheet data                            As at
                                                     ------------------------
    (in '000s of Canadian dollars)                   January 26,    April 30,
                                                           2008         2007
                                                              $            $
    Total assets                                         56,029       59,381
    Total liabilities                                    36,336       38,617
    Shareholders' equity                                 19,693       20,764
    -------------------------------------------------------------------------
    


    NON-GAAP FINANCIAL MEASURES

    The information included in this press release contains certain
information which are not financial measures prescribed under GAAP. Sigma
Industries uses earnings before interest, taxes, depreciation and amortization
("EBITDA"), excluding the non-recurring gain on insurance settlement, in the
assessment of its financial performance. As there is no generally accepted
method of calculating this financial measure, it may not be comparable to
similar measures reported by other companies. EBITDA refers to earnings before
interest, income taxes, depreciation, amortization and other non-operating
expenses and revenues. This measure does not represent the cash flow for the
repayment of long-term debt, the payment of dividends, reinvestment or other
discretionary uses, and should not be considered in isolation or as a
substitute of other measures of performance calculated according to GAAP.

    ABOUT SIGMA INDUSTRIES

    Sigma Industries Inc. (TSX-V: SIC), a leading composite and metal
products manufacturer, has six operating subsidiaries and employs close to
550 people. The Company is active in the growing heavy-duty truck, coach,
transit and bus, train and subway, machinery, agriculture, light forestry, and
wind energy market segments. Sigma sells its products to original equipment
manufacturers and distributors in the United States, Canada and Europe.
    Sigma has had a recent history of steady growth and accretive
acquisitions. Its recent and planned growth initiatives are expected to
continue to raise Sigma's profile with investors.

    FORWARD-LOOKING STATEMENTS

    This press release contains certain forward-looking statements with
respect to the Company. Such forward-looking statements are dependent upon a
certain number of factors and are subject to risks and uncertainties. Actual
results may differ from those expected. The information contained in this
press release is dated March 20, 2008, the date on which the Directors
approved the press release. Management does not assume any obligation to
update or revise any forward-looking statements, whether as a result of new
information or future events, except when required by the regulatory
authorities.

    Note to readers: Complete unaudited interim consolidated financial
statements and Management's Discussion & Analysis of Financial Position and
Operating Results were posted on SEDAR and are available at www.sedar.com.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.




For further information:

For further information: Denis Bertrand, Chief Executive Officer, Sigma
Industries Inc., (418) 780-3902, denis.bertrand@sigmaventures.ca; Bertrand
Côté, Chief Financial Officer, Sigma Industries Inc., (418) 780-3903,
bertrand.cote@sigmaventures.ca

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