AlarmForce Revenue posts record earnings in First Quarter

    Common shares traded on the Toronto Stock Exchange
    Trading symbol: AF

    TORONTO, March 9 /CNW/ -  Joel Matlin, President and CEO, is pleased to
    announce results for the first quarter ended January 31, 2007:

                                   January          January
                                   31, 2007         31, 2006    Change (over
                               (3 months ended) (3 months ended) same period)
                                --------------   -------------  -------------
    Revenue                        $5,847,920     $5,049,295      16%
    Income before income taxes     $901,101       $458,534        97%
    Net income                     $566,101       $281,140        101%

    Cash flow form operations
     excluding working capital     $1,195,437     $878,343        36%

    EBITDA                         $1,559,170     $1,137,282      37%
    EBITDA/share                   $0.13          $0.09

    EBITDA before marketing
     expenditure                   $3,176,617     $2,534,762      25%

    Basic Net income/share         $0.05          $0.02
    Diluted Net income/share       $0.05          $0.02
    (*) EBITDA (Earnings Before Interest, Income Taxes, Depreciation, and
        Amortization) is a key measure in the security industry and should
        not be interpreted as GAAP)

    Mr. Matlin said that: "AlarmForce closed the first quarter of 2007 with a
total subscriber base of 68,800 accounts, posting new record-setting levels
for revenue and earnings. Total revenues for the three months ended
January 31, 2007 increased to $5,847,920, a 16% increase from the comparative
three-month period in 2006, while net income increased to $566,101
representing a 101% increase. The Company is continuing to see increases over
past performance as we continue to expand our brand recognition and increase
operating margins through gains in efficiency."
    EBITDA increased to $1,559,170, up by 37% from the same quarter last
year, which is calculated after expensing our marketing costs. Because the
Company's subscriber growth is internally generated rather than based on
acquisition, our policy is to account for marketing costs as period expenses.
Therefore the costs are not capitalized in the cost of new subscriber accounts
created through direct-response marketing. The Company's total selling
expenses, which increased by 25% from the same three-month period in 2006,
reflects the increase in direct-response marketing, which generates new
subscriber accounts in Canada and the United States."
    Cash flows from operations have increased in line with the increase in
recurring revenues from subscriber accounts. Excluding working capital and
investment in growth, operating cash flow increased to $1,195,437, a 36%
increase from the same three-month period in 2006. While revenues and
subscriber volumes increased, the Company's general and administrative
expenses decreased 9%. Thanks to the dedicated AlarmForce team and a
streamlined organization structure, the Company continues to control costs by
minimizing reliance on outsourcing and subcontracting.
    "As a result of our U.S. expansion, we are looking ahead with great
optimism to the significant opportunity that access to this huge market
offers. Our recently announced plan to open in Atlanta, Georgia means that
AlarmForce will now be servicing seven major centers in three States.
Therefore, the total AlarmForce footprint in North America will increase to
approximately double that of Canada, offering much greater potential for
subscriber growth."
    AlarmForce is Canada's largest manufacturer and installer of two-way
voice home alarms systems and line-cut protection. The Company has offices
serving all major markets in Canada and selected markets in the United States.

For further information:

For further information: Investor Relations Dept., Tel: (416) 445-2001
ext No. 225, Fax: (416) 445-9381, E-mail:

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AlarmForce Industries Inc.

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