Kelman Announces Q2-2007 Operating Results



    Stock Symbol: KTI.TSX

    
    -------------------------------------------------------------------------
                                              Three Months Ended
    -------------------------------------------------------------------------
                                       June 30,       June 30,             %
                                          2007           2006         Change
    -------------------------------------------------------------------------
    Operating Revenue             $  6,304,131   $  6,789,286             (7)
    Operating Expenses            $  5,543,585   $  5,556,441              0
    -------------------------------------------------------------------------
    EBITDA                        $    760,546   $  1,232,845            (38)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net Earnings (Loss)
      Before Taxes                $   (502,470)  $    181,638            N/A
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Per Share
      (basic and diluted)         $      (0.01)  $       0.00            N/A
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                                               Six Months Ended
    -------------------------------------------------------------------------
                                       June 30,       June 30,             %
                                          2007           2006         Change
    -------------------------------------------------------------------------
    Operating Revenue             $ 12,942,076   $ 13,247,446             (2)
    Operating Expenses            $ 11,124,354   $ 11,046,850              1
    -------------------------------------------------------------------------
    EBITDA                        $  1,817,722   $  2,200,596            (17)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net Earnings (Loss)
      Before Taxes                $   (420,255)  $    282,840            N/A
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Per Share
      (basic and diluted)         $      (0.01)  $       0.01            N/A
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    CALGARY, Aug. 10 /CNW/ - Kelman Technologies Inc ("KTI") today announced
a net loss of $502 thousand, $0.01 per share, for the second quarter of 2007
and a net loss of $420 thousand, $0.01 per share, for the first half. The loss
in the quarter and the first half includes foreign currency translation losses
of $363 thousand and $452 thousand, respectively, compared to $130 thousand
and $100 thousand in the comparable periods in 2006. In addition, the loss in
the second quarter includes a provision for an accounts receivable account
that may be uncollectible in the amount of $145 thousand. Capital expenditures
were $887 thousand, of which $487 thousand was acquired by means of capital
leases, in the second quarter, and $1.8 million, of which $487 thousand was
acquired by means of capital leases, in the first half. The Company ended the
quarter and the first half with working capital of $7.2 million, an increase
of 9 percent compared to Q2 2006.

    
                   (*)   (*)   (*)   (*)   (*)   (*)   (*)
    

    Kelman Technologies Inc. is a publicly traded Canadian company listed on
the Toronto Stock Exchange under the trading symbol "KTI". With offices in
Calgary and Toronto, Canada, Denver, Houston, and Oklahoma City, United
States, London, United Kingdom and Tripoli, Libya KTI services oil and gas
exploration companies with a full suite of seismic data processing and on-line
data management and data archival services.


    To the extent this press release includes forecasts or forward looking
    statements about future performance of the company such forecasts or
    statements are believed to be reasonable by the company but are based
    upon assumptions in respect of commodity pricing and oil and gas
    exploration activity levels over the next couple of years. The risks
    associated with future events are mitigated where possible by KTI but are
    uncontrollable and no guarantee of the accuracy of the forecasts or
    future financial performance of the company is offered.


    
    KELMAN TECHNOLOGIES INC.
    Consolidated Balance Sheets
    (Unaudited)

    -------------------------------------------------------------------------
                                                      June 30,   December 31,
                                                         2007           2006
    -------------------------------------------------------------------------

    Assets

    Current assets:
      Cash                                       $  2,459,671   $  2,045,785
      Accounts receivable                           5,266,242      5,406,905
      Work in progress                              1,509,341      2,081,447
      Prepaid expenses and deposits                   397,513        423,566
      -----------------------------------------------------------------------
                                                    9,632,767      9,957,703

    Property and equipment                          5,819,335      5,517,916

    Other assets                                       14,234         17,081
    -------------------------------------------------------------------------
                                                 $ 15,466,336   $ 15,492,700
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities and Shareholders' Equity

    Current liabilities:
      Indebtedness                               $    487,500   $    487,500
      Accounts payable and accrued liabilities      1,305,122      1,613,736
      Deferred revenue                                 83,328              -
      Current portion of capital leases               152,047              -
      Preferred shares                                605,321        605,321
      -----------------------------------------------------------------------
                                                    2,633,318      2,706,557

    Long-term portion of capital leases               318,851              -

    Preferred shares                                3,727,045      3,645,774

    Shareholders' equity:
      Share capital                                13,125,325     13,125,325
      Equity component of preferred shares            812,706        812,706
      Contributed surplus                             866,520        799,512
      Deficit                                      (6,017,429)    (5,597,174)
      -----------------------------------------------------------------------
                                                    8,787,122      9,140,369

    -------------------------------------------------------------------------
                                                 $ 15,466,336   $ 15,492,700
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    KELMAN TECHNOLOGIES INC.
    Consolidated Statements of Operations, Comprehensive Income (Loss)
    and Deficit

    Three and six months ended June 30, 2007 and 2006

    -------------------------------------------------------------------------
                            Three Months Ended              Six Months Ended
                        June 30,       June 30,       June 30,       June 30,
                           2007           2006           2007           2006
    -------------------------------------------------------------------------

    Revenue        $  6,304,131   $  6,789,286   $ 12,942,076   $ 13,247,446

    Expenses:
      Operating       5,543,585      5,556,441     11,124,354     11,046,850
      Depreciation
       and
       amortization     754,924        770,712      1,497,921      1,512,771
      Interest          145,430        150,474        287,701        304,917
      Foreign
       exchange loss    362,662        130,021        452,355        100,068
    -------------------------------------------------------------------------
                      6,806,601      6,607,648     13,362,331     12,964,606

    -------------------------------------------------------------------------
    Net earnings
     (loss) and
     comprehensive
     income            (502,470)       181,638       (420,255)       282,840

    Deficit,
     beginning
     of period     $ (5,514,959)  $ (5,735,129)  $ (5,597,174)  $ (5,836,331)
    -------------------------------------------------------------------------

    Deficit, end
     of period     $ (6,017,429)  $ (5,553,491)  $ (6,017,429)  $ (5,553,491)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net earnings
     (loss) per
     Common Share,
     basic and
     diluted       $      (0.01)  $       0.00   $      (0.01)  $       0.01
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    KELMAN TECHNOLOGIES INC.
    Consolidated Statements of Cash Flows

    Three and six months ended June 30, 2007 and 2006

    -------------------------------------------------------------------------
                            Three Months Ended              Six Months Ended
                        June 30,       June 30,       June 30,       June 30,
                           2007           2006           2007           2006
    -------------------------------------------------------------------------

    Cash provided
     by (used in):

    Operations:
      Net earnings
       (loss)      $   (502,470)  $    181,638   $   (420,255)  $    282,840
      Items not
       involving cash:
        Depreciation
         and
         amortization   754,924        770,712      1,497,921      1,512,771
        Accretion of
         preferred
         shares          40,635         40,636         81,271         81,272
        Stock-based
         compensation
         expense         21,254         77,550         67,008        137,379
        Unrealized
         foreign
         exchange
         loss (gain)     17,801         31,620         66,485        (13,044)
        Amortization
         of other
         assets           1,424          1,424          2,847          2,847
        Loss on
         disposal of
         property and
         equipment            -          3,090          1,910          3,090
        Lease
         inducement
         benefit            828            828          1,656          1,656
      -----------------------------------------------------------------------
                        334,396      1,107,498      1,298,843      2,008,811

      Change in
       non-cash working
       capital items    958,290       (468,148)       445,395       (955,004)
      -----------------------------------------------------------------------
                      1,292,686        639,350      1,744,238      1,053,807

    Financing:
      Repayment of
       capital leases   (16,080)             -        (16,080)        (5,779)
      Issue of Common
       Shares                 -        512,500              -        512,500
      Decrease in
       indebtedness           -       (512,500)             -       (512,500)
      -----------------------------------------------------------------------
                        (16,080)             -        (16,080)        (5,779)

    Investing:
      Expenditures
       on property
       and Equipment   (400,475)      (680,500)    (1,314,272)    (1,632,259)
      Change in
       non-cash working
       capital items   (416,959)      (353,383)             -        115,084
    -------------------------------------------------------------------------
                       (817,434)    (1,033,883)    (1,314,272)    (1,517,175)

    -------------------------------------------------------------------------
    Increase (decrease)
     in cash            459,172       (394,533)       413,886       (469,147)

    Cash, beginning
     of period        2,000,499      1,776,862      2,045,785      1,851,476

    -------------------------------------------------------------------------
    Cash, end of
     period        $  2,459,671   $  1,382,329   $  2,459,671   $  1,382,329
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    




For further information:

For further information: please visit our web site at
http://www.kelman.com/ or contact Mr. Rene VandenBrand, President and CEO at
(281) 293-0537, or by email to rene@kelman.com

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KELMAN TECHNOLOGIES INC.

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