ExelTech announces second quarter results and provides a financing update

MONTREAL, Nov. 26 /CNW Telbec/ - ExelTech Aerospace Inc. ("ExelTech" or the "Company") (TSX Venture: XLT), a leading aircraft maintenance, repair and overhaul provider with operations in Montreal and Quebec City, today announced its financial results for the second fiscal quarter ended September 30, 2009. All amounts are in Canadian dollars unless otherwise indicated.

    - The Company's revenues increased by 36.5% to $12.3 million in the
      quarter ended September 30, 2009, compared to $9.0 million during the
      quarter ended September 30, 2008. This increase is consistent with the
      increase the company has seen over the past four quarters;
    - The Company's gross margin increased to 18.7% in the quarter ended
      September 30, 2009, compared to 5.9% during the quarter ended
      September 30, 2008;
    - The Company's Earnings before amortization, financial expenses and
      income taxes (EBITDA), a measure of operating performance used by
      management and certain users of our financial statements, improved to
      $168,174 in the quarter ended September 30, 2009, compared to a
      negative $2,757,508 in the quarter ended September 30, 2008. EBITDA has
      now been positive for the past four quarters;
    - The Company's net loss was $252,781 in the quarter ended September 30,
      2009, compared to a net loss of $16.7 million during the quarter ended
      September 30, 2008; this includes a gain on foreign currency exchange
      of $566,919 in the quarter ended September 30, 2009, compared to a loss
      of $783,608 in the quarter ended September 30, 2008;
    - The Company completed 29 major maintenance checks in the quarter ended
      September 30, 2009, compared to 25 in the quarter ended September 30,

"These results, greatly improved compared to last year, are below ExelTech's sales growth plan and profitability improvement plan. Although summer is very often a challenging quarter in our industry, we also have seen the contraction effect of the recession. We have managed our cost very well but the top line was very disappointing," stated Sylvain Duval, President and CEO of ExelTech. "We have made great strive on our operational efficiencies and have seen a 36.5% sales growth compared to our second quarter in 2008. However, we need to work harder at building a stronger top line in an environment that has been affected by the recession. We will continue cutting our cost until we are successful at growing our business; our objective is nothing less than making consistent profits in every quarter," added Mr. Duval.

Financing and Debentures Update

Although the process is not what the Company expected, the financing opportunities announced previously with Banque de développement du Canada (BDC) and the Société générale de financement du Québec (SGF) are still alive but are requiring more time to be completed. The current economic situation is generating additional conditions in the due diligence process. The Company is working diligently to comply with these conditions. No definitive agreements have been reached yet and there can be no assurance that such agreements will be reached. The Company also continues to work on other financing alternatives.

In parallel to this, as the maturity date of the debentures is currently scheduled for November 30, 2009 and the Company does not expect its financing activities to be completed by then, ExelTech will therefore not be in a position to retire the debentures and has initiated discussion with the debenture holders in order to determine a suitable solution.

Non-GAAP Measure

The reader should note that the Company reports its financial results in accordance with GAAP. However, in this press release, the following non-GAAP financial measure is used:

    - Earnings before amortization, financial (income) expenses and income
      taxes (recovery) ("EBITDA").

Management believes that this non-GAAP measure provides useful information to investors regarding the Company's financial condition and results of operations as they provide additional measures of its performance. The non-GAAP measure does not have any standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other issuers. This measure should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with GAAP.

About ExelTech Aerospace

The third-largest commercial airframe Maintenance, Repair, and Overhaul (MRO) vendor in Canada, ExelTech Aerospace is listed on the TSX Venture Exchange and trades under the symbol XLT. The Company holds Transport Canada, US Federal Aviation Administration (FAA), European Aviation Safety Agency (EASA) and Bermuda Department of Civil Aviation (BDCA) approvals to maintain a range of aircraft and associated structures, components and systems. Aircraft models serviced by ExelTech Aerospace include Embraer ERJ135/145 family, EJet 170/190 family, and Bombardier CRJ regional jets; ATR-42 and 72, Bombardier Dash-8 and Saab 340 regional turboprops; and Boeing 737 narrow bodies. ExelTech is also a member of the SuperJet International Sukhoi MRO Service Centers Network.

With 310,000 square feet of hangar, shop and office space in three facilities in Montreal and Quebec City, ExelTech Aerospace Inc. provides maintenance repair and overhaul services to airlines in Canada, the USA and 25 other countries around the world.

To learn more about ExelTech Aerospace Inc. (TSX-V: XLT), please visit our website at www.exeltech-aerospace.com.

    The TSX Venture Exchange Inc. has not reviewed and does not accept
    responsibility for the adequacy of this release.


     statements of
     operations and            For the                     For the
     comprehensive       three-month periods          six-month periods
     loss                 ended September 30          ended September 30

                              2009          2008          2009          2008
                                 $             $             $             $
    Revenue             12,252,576     8,975,768    30,691,583    24,232,668
    Cost of sales        9,960,247     8,443,867    25,042,801    22,674,707
                         2,292,329       531,901     5,648,782     1,557,961
    Operating expenses   2,124,155     3,289,409     5,006,455     5,874,091
    Earnings (loss)
     before the
     following             168,174    (2,757,508)      642,327    (4,316,130)
    Amortization           541,104       441,680     1,069,708       776,927
    Goodwill impairment        ---    13,241,506           ---    13,241,506
     expenses (income)      21,029     1,317,750      (406,865)    1,492,908
    Loss before
     income taxes         (393,959)  (17,758,444)      (20,516)  (19,827,471)
    Income taxes
      Future              (141,178)   (1,054,929)      (16,479)   (1,608,194)
    Net loss and
     comprehensive loss   (252,781)  (16,703,515)       (4,037)  (18,219,277)
    Net loss per share
      Basic and diluted      (0.00)        (0.11)        (0.00)        (0.11)

    Consolidated balance sheets                          As at         As at
                                                  September 30      March 31
                                                          2009          2009
                                                             $             $

    Current assets                                  16,912,538    21,682,497
    Capital assets                                  26,133,541    26,620,903
    Intangible assets                                   62,336       139,836
    Future income taxes                              5,555,820     5,539,341
    --------------------------------------------  ------------  ------------

    TOTAL ASSETS                                    48,664,235    53,982,577

    Current liabilities                             19,848,120    24,969,224
    Long-term debt                                  16,599,198    16,967,507
    Other                                              406,599       333,158
    SHAREHOLDERS' EQUITY                            11,810,318    11,712,688
    --------------------------------------------  ------------  ------------

    TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY      48,664,235    53,982,577

%SEDAR: 00020968EF


For further information: For further information: Gérard Moretti, Chief Financial Officer, (514) 631-8999 ext. 2406, gmoretti@exeltech-aerospace.com

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