Tri-White Corporation announces 2007 year end results



    Stock Symbol: (TSX: TWH)

    TORONTO, March 13 /CNW/ - Tri-White Corporation announced today its
financial results for the quarter and year ending December 31, 2007.

    
    Financial Highlights

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                             Three months ended            Year ended
    (in thousands of      ---------------------------------------------------
     dollars except per    December     December     December     December
     share amounts)        31, 2007     31, 2006     31, 2007     31, 2006
    -------------------------------------------------------------------------
    Revenue                    27,364          133      168,780      40,506
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    EBITDA(1)                   1,505       (3,671)      57,319      18,589
    -------------------------------------------------------------------------
    Interest and other
     income (expense)          (8,919)         535      (16,491)        247
    -------------------------------------------------------------------------
    Equity income (loss)           82         (295)      (2,157)     11,403
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    Provision for (recovery
     of) income taxes          (7,400)      (1,246)      10,524       6,704
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    Non-controlling interest     (534)           -        3,400           -
    -------------------------------------------------------------------------
    Net earnings (loss)        (5,276)      (5,274)       8,869      18,071
    -------------------------------------------------------------------------
    Earnings (loss) per
     share - basic             ($0.23)      ($0.23)       $0.39       $0.79
    -------------------------------------------------------------------------
    Weighted average shares
     outstanding                                         22,784      22,933
    -------------------------------------------------------------------------
    (1) EBITDA is not a recognized performance measure under Canadian GAAP.
        EBITDA is defined as earnings before taxes, interest, depreciation,
        amortization, non-controlling interest and earnings from equity
        accounted investments. Management believes that in addition to net
        earnings, this measure is useful supplemental information to provide
        investors with an indication of income available prior to debt
        service, capital expenditures and income taxes. Investors should be
        cautioned, however, that this measure should not be construed as an
        alternative to net earnings determined in accordance with GAAP as an
        indicator of the Company.
    

    Net earnings for the year ended December 31, 2007 was $8,869,000 or
$0.39 per share as compared with $18,071,000 or $0.79 per share in 2006. The
variance is largely attributable to a one-time gain in 2006 on distributions,
from the investment in Renasant Financial Partners Ltd., which resulted in
income of $10,834,000 or $0.47 per share. Net loss for the quarter ended
December 31, 2007 was $5,276,000 or $0.23 per share; essentially the same as
the 2006 loss of $5,274,000.
    EBITDA for the year ended December 31, 2007 was $57,319,000 compared with
$18,589,000 for 2006. The positive variance of $38,730,000 over the same
period last year is mainly due to the acquisition of ClubLink on June 1, 2007;
and accordingly, Tri-White is consolidating the results of ClubLink for the
seven-month period from June 1, 2007.

    Operating Highlights

    The tourist operations at White Pass and Yukon Route ("White Pass") and
the golf operations of ClubLink Corporation ("ClubLink") are highly seasonal.
The majority of the revenue and earnings from these businesses occur during
the third quarter of the year. Accordingly, the earnings of the Company will
fluctuate with those of the underlying business units.
    The Company's operating income originates from White Pass and ClubLink.
White Pass is a wholly owned subsidiary. Significant revenue is generated in
the third quarter as ship arrivals peak and tourist traffic is at its high
point. EBITDA from the Alaska operations decreased from US$18,214,000 in 2006
to US$16,696,000 for 2007. Although passenger counts increased by
approximately 7.0%, White Pass incurred unusually high maintenance costs to
sustain the efficiency and safety of the operation. As well, this division
established a reserve of US$1,578,000 relating to the settlement of one of its
major labour contracts.
    The results of White Pass, which is deemed self-sustaining, are
translated into Canadian currency using average rates during the period. A
change in average exchange rates can impact the net earnings of the Company.
    On June 1, 2007, the Company acquired an additional 6,635,300 shares of
ClubLink (representing 39.0% of ClubLink's outstanding common shares) to
increase its ownership to 70.7%. The purchase price of this additional
interest, including transaction costs, was $88,018,000 and was funded through
issuance of a one year unsecured note of $35,000,000 bearing interest at the
greater of the Canadian prime lending rate and 6%, with the balance of
$53,018,000 in cash. The acquisition has been accounted for under the purchase
method of accounting. As part of the accounting treatment, the Company
allocated the purchase price on the identifiable assets and liabilities
acquired based on their estimated fair values at the time of acquisition. The
earnings of ClubLink have been accounted for under the equity method to
May 31, 2007 and subsequently have been included in the consolidated statement
of income and cash flow from June 1, 2007.
    The purchase price allocation has been adjusted in the fourth quarter to
reflect the final determination of the fair value of the assets and
liabilities acquired.
    Net income at ClubLink for the year ended December 31, 2007 was
$4,877,000 compared to $416,000 for 2006. In 2007, Tri-White recorded
$3,067,000 of net earnings relating to ClubLink compared to $122,000 in 2006.

    Corporate Development

    The Company has been approved by the Toronto Stock Exchange to make a
normal course issuer bid to purchase up to 1,136,828 common shares. No
purchases have been made under this bid. The program expires September 19,
2008. During the year ended December 31, 2007 the Company purchased 204,700
shares under a previous bid.
    The Company continued with its regular quarterly dividend program and
paid an eligible dividend of $0.06 per share, or $1,354,000 on December 31,
2007. The dividend for the first quarter will be paid on March 31, 2008 to
shareholders of record on March 14, 2008.

    Outlook

    For 2008, the Company believes it is well positioned to capitalize on its
unique assets and their competitive strengths. It is unclear whether golf club
operations and the rail, tourism and port operations would be impacted by a
potential downturn in the economy. Tri-White anticipates that opportunities
will arise to add quality assets in this environment. With the strength of the
existing brands, experienced management, and a focus on cost control, stable
returns are expected.

    Financial statements are attached.

    Statements contained herein that are not based on historical or current
fact, including without limitation statements containing the words
"anticipates," "believes," "may," "continue," "estimate," "expects," and
"will" and words of similar import, constitute "forward-looking statements".
Such forward-looking statements involve known and unknown risks, uncertainties
and other factors that may cause the actual results, events or developments to
be materially different from any future results, events or developments
expressed or implied by such forward-looking statements. Such factors include,
among others, the following: general economic and business conditions, both
nationally and in the regions in which the Company operates; changes in
business strategy or development/acquisition plans; environmental exposures,
financing risk; existing governmental regulations and changes in, or the
failure to comply with, governmental regulations; liability and other claims
asserted against the Company; and other factors referenced in the Company's
filings with Canadian securities regulators. Given these uncertainties,
readers are cautioned not to place undue reliance on such forward-looking
statements. The Company does not assume the obligation to update or revise any
forward-looking statements.
    Management's discussion and analysis, financial statements and other
disclosure information relating to the Company is available through SEDAR and
at www.sedar.com and on the Company website at www.tri-white.com.



    
                            TRI-WHITE CORPORATION
                         CONSOLIDATED BALANCE SHEETS

                                                   December 31,  December 31,
    (in thousands of dollars)                             2007          2006
    -------------------------------------------------------------------------
    ASSETS
    Current
      Cash and cash equivalents                    $     6,177   $    21,853
      Accounts receivable                                2,675           543
      Mortgages and loans receivable                       763        16,892
      Inventories and prepaid expenses                   7,561         4,939
      Other assets                                       3,230             -
    -------------------------------------------------------------------------
                                                        20,406        44,227
    Mortgages and loans receivable                       6,306             -
    Long-term investments                                6,267        36,554
    Capital assets                                     556,609        73,957
    Intangible assets                                   10,488             -
    Goodwill                                            26,689             -
    -------------------------------------------------------------------------
    Total assets                                   $   626,765   $   154,738
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current
      Bank indebtedness                            $    31,629   $    21,706
      Long-term debt                                    12,820             -
      Capital lease obligations                          4,269             -
      Note payable                                      35,000             -
      Accounts payable and accrued liabilities          18,823         1,915
      Income and other taxes payable                     2,783         1,655
      Prepaid annual dues and deposits                   5,021             -
    -------------------------------------------------------------------------
                                                       110,345        25,276

    Long-term debt                                     284,127             -
    Capital lease obligations                            9,082             -
    Deferred membership fees                            57,025             -
    Future income tax liabilities                       11,991        17,055
    -------------------------------------------------------------------------
    Total liabilities                                  472,570        42,331
    -------------------------------------------------------------------------
    Non-controlling interest                            50,007             -
    -------------------------------------------------------------------------
    Shareholders' equity
    Share capital                                       60,775        61,278
    Contributed surplus                                    253           191
    Retained earnings                                   67,249        65,205
    Accumulated other comprehensive loss               (24,089)      (14,267)
    -------------------------------------------------------------------------
    Total shareholders' equity                         104,188       112,407
    -------------------------------------------------------------------------
    Total liabilities and shareholders' equity     $   626,765   $   154,738
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                            TRI-WHITE CORPORATION
       CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE EARNINGS

                                                        For the Year Ended

                                                   December 31,  December 31,
                                                          2007          2006

    REVENUE
      Operating revenue                            $   168,780   $    40,506
    EXPENSES
      Operating expenses                               111,461        21,917
    -------------------------------------------------------------------------
    Earnings before other items, income taxes
     and non-controlling interest                       57,319        18,589
    -------------------------------------------------------------------------
    OTHER ITEMS
      Amortization of capital assets                    13,085         3,195
      Amortization of  intangible assets                   312             -
      Land lease rent                                    2,481             -
      Investment and other income                          (96)       (2,276)
      Interest expense                                  16,587         2,029
      Loss (income) on equity accounted investments
        - ClubLink Corporation                           2,096          (122)
        - Renasant Financial Partners Ltd.                  61       (11,281)
      Provision on long-term investment                      -         2,269
    -------------------------------------------------------------------------
                                                        34,526        (6,186)
    -------------------------------------------------------------------------
    Earnings before income taxes and
     non-controlling interest                           22,793        24,775
    -------------------------------------------------------------------------
    Provision for income taxes (recovery)
      Current                                            5,267         6,920
      Future                                             5,257          (216)
    -------------------------------------------------------------------------
                                                        10,524         6,704
    -------------------------------------------------------------------------
    Net earnings before non-controlling interest        12,269        18,071
    Non-controlling interest                             3,400             -
    -------------------------------------------------------------------------
    Net earnings                                         8,869        18,071
    Unrealized foreign currency translation loss
     on self-sustaining foreign operations              (9,822)         (579)
    -------------------------------------------------------------------------
    Total comprehensive earnings (loss)            $      (953)  $    17,492
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Earnings per share
    Basic                                         $       0.39   $      0.79
    Diluted                                       $       0.39   $      0.78
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                            TRI-WHITE CORPORATION
                     CONSOLIDATED STATEMENTS OF CASH FLOW

                                                       For the Year Ended
                                                   December 31,  December 31,
    (in thousands of dollars)                          2007          2006
    -------------------------------------------------------------------------
    OPERATING ACTIVITIES
    Net earnings for the year                      $     8,869   $    18,071
    Items not affecting cash
      Amortization of capital assets                    13,085         3,195
      Amortization of intangible assets                    312             -
      Amortization of deferred finance charges             590             -
      Future income taxes (recovery)                     5,257          (216)
      Amortization of membership fees                   (8,070)            -
      Loss on sale of investments and assets               953             3
      Loss (income) of equity accounted investments      2,157       (11,403)
      Non controlling interest - ClubLink                3,400             -
      Net unrealized foreign exchange loss                   -          (442)
      Stock compensation expense                            62            61
      Provision on long-term investment                      -         2,269
    Distributions from equity accounted investments        664        13,800
    Collection of membership fee instalments            13,594             -
    Net change in operating assets and liabilities     (30,351)         (662)
    -------------------------------------------------------------------------
    Cash provided by operating activities               10,522        24,676
    -------------------------------------------------------------------------
    FINANCING ACTIVIITES
    Repayment of promissory notes                            -       (17,935)
    Proceeds on issue of subsidiary common shares           50             -
    Shares purchased for cancellation                   (1,906)            -
    Dividends paid                                      (5,421)       (5,442)
    Dividends paid - non controlling interest             (602)            -
    Capital lease obligations                             (314)            -
    Deferred financing charges                            (995)            -
    Bank indebtedness                                    9,923         6,567
    Long-term debt                                      10,898             -
    Convertible debentures                             (10,092)            -
    -------------------------------------------------------------------------
    Cash provided by (used in) investing activities      1,541       (16,810)
    -------------------------------------------------------------------------
    INVESTING ACTIVITIES
    Purchase of capital assets                         (21,827)       (3,761)
    Proceeds from real estate sales and deposits        16,900             -
    Acquisition of ClubLink                            (52,918)            -
    Long-term investments                                    -          (762)
    Return of capital                                    9,480        10,073
    Cash acquired by increasing interest in ClubLink     1,603             -
    Advances of loan receivable                         (4,834)      (23,149)
    Repayment of loans receivable                       25,573        11,257
    -------------------------------------------------------------------------
    Cash used in investing activities                  (26,023)       (6,342)
    -------------------------------------------------------------------------
    Net effect of currency translation adjustment
    on cash and cash equivalents                        (1,716)         (140)
    -------------------------------------------------------------------------
    Net increase (decrease) in cash and cash
    equivalents during the year                        (15,676)        1,384
    Cash and cash equivalents, beginning of year        21,853        20,469
    -------------------------------------------------------------------------
    Cash and cash equivalents, end of year         $     6,177   $    21,853
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Represented by
      Cash                                         $     6,177   $    14,353
      Cash equivalents                                       -         7,500
    -------------------------------------------------------------------------
                                                   $     6,177   $    21,853
    -------------------------------------------------------------------------
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For further information:

For further information: Mr. Robert Wright, Chief Financial Officer, 55
City Centre Drive, Suite 1000, Phone: (905) 281-5897, Fax: (905) 281-5890,
bwright@morguard.com

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TRI-WHITE CORPORATION

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