Westaim announces 2008 second quarter results



    CALGARY, Aug. 13 /CNW/ - The Westaim Corporation announced today that for
the second quarter ended June 30, 2008, it recorded a consolidated net loss of
$3.0 million or 3 cents per share, on revenues of $4.8 million. In the same
quarter last year, the Company recorded a consolidated net loss of
$7.4 million, or 8 cents per share, on revenues of $6.7 million.
    The loss from continuing operations was $1.9 million for the quarter
compared to income of $2.9 million in the same period last year. Included in
2007 income from continuing operations was an $8.6 million gain on the sale of
the Company's real estate assets in Fort Saskatchewan, Alberta. The loss from
discontinued operations, which includes windup and operating costs at the
Company's wholly owned subsidiary iFire Technology Ltd., declined
significantly to $1.1 million compared to $10.3 million in the second quarter
of 2007.
    For the six months ended June 30, 2008, the Company posted revenues of
$10.0 million and a consolidated net loss of $9.9 million or 10 cents per
share. For the same period in 2007, Westaim reported revenues of $12.8 million
and a net loss of $14.1 million or 15 cents per share.
    Income from continuing operations for the six months ended June 30, 2008
was $1.3 million compared to income of $4.8 million in the same period last
year. Results from continuing operating in 2008 benefited from a dilution gain
of $6.0 million relating to the sale of a non-core subsidiary and in 2007
benefited from the $8.6 million gain on sale of the real estate and a dilution
gain of $4.5 million. The loss from discontinued operations for the six months
was $11.2 million, reflecting a write-down of capital assets of $7.1 million
as well as severance and other windup costs at iFire, compared to a loss of
$18.9 million for the first six months of 2007.
    At June 30, 2008, Westaim had $40.1 million in consolidated cash and cash
equivalents compared to $38.2 million at March 31, 2008. Westaim's cash
position, excluding cash and cash equivalents held by its 74.5 per cent owned
affiliate NUCRYST Pharmaceuticals Corp., was $12.6 million compared to
$14.2 million at March 31, 2008. In addition, Westaim held asset-backed
commercial paper (ABCP) with an estimated fair value of $6.0 million.
    "The Board of Directors is continuing to assess strategic alternatives
for the Company," said Drew Fitch, President & CEO of The Westaim Corporation.
"Our focus during the quarter has been on the divestiture of iFire's assets.
At the same time, we have been considering all possible options for the
longer-term structure of the corporate organization moving forward."

    The Westaim Corporation's investments include iFire Technology Ltd., and
a 74.5 per cent interest in NUCRYST Pharmaceuticals Corp. (NASDAQ:   NCST; TSX:
NCS). Westaim's common shares are listed on The Toronto Stock Exchange under
the trading symbol WED.
    A more detailed discussion of Westaim's 2008 second quarter results can
be found at www.westaim.com and www.sedar.com.

    This news release contains forward-looking statements. These statements
are based on current expectations that are subject to risks and uncertainties,
and Westaim can give no assurance that these expectations are correct. Various
factors could cause actual results to differ materially from those projected
in such statements, including but not limited to statements regarding
assessment of strategic alternatives for the Company, expectations regarding
value to be realized from the sale of assets, and consideration of possible
options for the longer-term structure of the corporate organization. Westaim
disclaims any intention or obligation to revise forward-looking statements
whether as a result of new information, future developments or otherwise.
Accordingly, readers are advised not to place undue reliance on
forward-looking statements, and should not rely on this information at any
date other than the date of this news release. All forward-looking statements
are expressly qualified in their entirety by this cautionary statement.


    
    THE WESTAIM CORPORATION
    Financial Highlights
    (unaudited)
    (thousands of dollars except per share data)

    -------------------------------------------------------------------------

                                      Three Months Ended    Six Months Ended
                                                 June 30             June 30
    Consolidated Statements           ------------------- -------------------
     of Operations                        2008      2007      2008      2007
    -------------------------------------------------------------------------

    Revenue                           $  4,754  $  6,686  $  9,962  $ 12,817
    (Loss) income from continuing
     operations                         (1,887)    2,875     1,340     4,774
    Net loss                            (3,002)   (7,388)   (9,859)  (14,088)
    Net (loss) income per common
     share - basic and diluted
      Continuing operations              (0.02)     0.03      0.01      0.05
      Net loss                           (0.03)    (0.08)    (0.10)    (0.15)
    Weighted average number of common
     shares outstanding (thousands)     94,215    94,051    94,200    94,021

    -------------------------------------------------------------------------


                                      Three Months Ended    Six Months Ended
                                                 June 30             June 30
                                      ------------------- -------------------
    Segmented Information                 2008      2007      2008      2007
    -------------------------------------------------------------------------

    Revenue from continuing
     operations
      Nucryst Pharmaceuticals         $  4,754  $  6,686  $  9,962  $ 12,817
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    (Loss) income from continuing
     operations
      Nucryst Pharmaceuticals         $ (1,781) $ (3,322) $ (4,019) $ (5,501)
      Other (including corporate
       costs)                             (106)    6,197     5,359    10,275
    -------------------------------------------------------------------------
    (Loss) income from continuing
     operations                       $ (1,887) $  2,875  $  1,340  $  4,774
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                                          June  December
    Consolidated Balance Sheets       30, 2008  31, 2007
    -----------------------------------------------------

    Cash and cash equivalents         $ 40,121  $ 30,993
    Current assets                      48,350    51,561
    Other assets                        24,324    31,826
    Current liabilities                  7,992     8,461
    Shareholders' equity                47,330    56,371
    

    %SEDAR: 00002793E




For further information:

For further information: Gillian McArdle, Investor Relations, (416)
504-8464, info@westaim.com, www.westaim.com


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