LAVAL, QC, Jan. 25 /CNW Telbec/ - LAB Research Inc. ("LRI" or "LAB
Research") (TSX: LRI), a Canadian-based global non-clinical contract research
organization, announces projected revenues of $13.4 million and a loss per
share of $0.06 to $0.08 for the fourth quarter ended December 31, 2007
compared to an $0.08 earnings per share market consensus. Considering the
above preliminary fourth quarter results, the 2007 year-end revenues are
projected to be $55.9 million and earnings per share would stand at $0.14 to
$0.16. These results are based on preliminary assessments and subject to
finalization and audit. This press release contains forward-looking
information; investors are cautioned that the statements are based on current
information and assumptions and that actual outcomes may vary.
Fourth quarter results for the Hungarian site were impacted by a
shortfall in revenues coupled with a $0.03 per share reserve for doubtful
accounts. In addition to disappointing results in Hungary, both the Canadian
and Danish operations have experienced a weaker than expected profitability
caused by lower sales in Canada and reduced gross margins for Denmark. The
disappointing revenue performance for the fourth quarter 2007 has taken place
while contract signing has reached a record level thus contributing to a
projected 45% backlog increase over the previous year-end numbers and an
approximate 20% increase compared to the third quarter.
"While finalizing our fourth quarter results, we have had to
significantly increase our bad debt reserves to address the unexpected
liquidity problems of a major Hungarian client. We have also not yet been able
to materialize the anticipated revenues and operational gains in Hungary from
the various initiatives implemented since October 2007 specifically aimed at
improving capacity utilization. "With the addition of new executives and staff
in Hungary, we are confident to see benefits of our actions early in 2008."
said Mr. Luc Mainville, President and CEO of LAB Research. "While contract
signing has been strong in both the Canadian and Danish operations,
translating into respective increases in backlog, we have not enjoyed the
expected capacity utilization required to ensure maximization of our revenues
and margins. Our consolidated record backlog as at December 31, 2007 provides
good visibility for a stronger performance in the first quarters of 2008."
added Mr. Mainville.
Based on preliminary results for the year 2007, revenues from continuing
operations are projected to represent an increase of 17% over 2006, while
EBITDA and earnings per share results would represent an approximate 7% and
47% decrease, respectively. Excluding the 2006 and preliminary 2007 results in
Hungary, the results for the rest of LRI show a 26% increase in revenues, a
54% increase in EBITDA and an approximate 50% increase in net earnings. "The
above clearly demonstrates the impact of the Hungarian operations on the
Corporation's projected consolidated results. We are confident that with the
new vivarium completed in September 2007 and the new management now in place
since January 2008, that our Hungarian operations will demonstrate quarterly
progress from this point on." said Mr. Mainville.
"Considering our record backlog, continuing strong demand for our
services, the increased capacity created in each of our sites over the past
year, the addition of key staff throughout our organization, and the ongoing
expansion plans in Canada, we are very enthusiastic about the prospects for
LAB Research in 2008." concluded Mr. Mainville.
LAB Research expects to report audited results for the fourth quarter and
year-end 2007 on March 12, 2008. No further details on these results will be
communicated until then.
ABOUT LAB RESEARCH INC.
LAB Research is a Canadian global non-clinical contract research
organization that provides contract research services to the pharmaceutical,
biotechnology, agro-chemical, petro-chemical and industrial markets. LAB
Research supports the development of its customers' products from three
state-of-the-art facilities located in Canada, Denmark and Hungary. LAB
Research's shares trade on the TSX under the symbol "LRI", with 18.1 million
For further information:
For further information: LAB Research Inc.: Luc Mainville, Chief
Executive Officer, (450) 973-2240 Ext.: 1206, email@example.com;
Media and Investor: Dominic Sicotte, Echoes Financial Network Inc., (866)
633-9551, (514) 842-9551, firstname.lastname@example.org