Lockerbie & Hole Announces First Quarter Fiscal 2008 Results



    TSX: LH

    EDMONTON, Aug. 8 /CNW/ - Lockerbie & Hole Inc. (the "Company" or
"Lockerbie") announces first quarter fiscal 2008 results.

    Overall Performance

    Overall profit performance for the three months ended May 31, 2007
improved over the same period in the previous fiscal year. Net income
increased to $4.9 million ($0.25 per share) for the three months ended May 31,
2007 from $0.9 million ($0.05 per share) for the three months ended May 31,
2006 and EBITDA increased to $8.5 million from $3.1 million over the same
period. Lockerbie's continued focus on risk management and productivity
resulted in increased profitability in the industrial segment while the
infrastructure segment continued to increase profitability through improved
performance on several projects.
    For a definition of EBITDA as used in this press release, see "Advisories
- Non-GAAP Measures".

    Selected Financial Information

    The following table provides selected financial information as at and for
the periods indicated. The information has been derived from, and should be
read in conjunction with, Lockerbie's unaudited interim consolidated financial
statements as at and for the three months ended May 31, 2007.

    
    -------------------------------------------------------------------------
                                                    Three months ended
    -------------------------------------------------------------------------
    (in thousands, except per
     share amounts)                           May 31, 2007      May 31, 2006
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Contract revenue                               $74,333           $89,743
    -------------------------------------------------------------------------
    Income before income taxes and
     discontinued operations                         7,717             2,246
    -------------------------------------------------------------------------
    Income before discontinued operations            4,761             1,453
    -------------------------------------------------------------------------
      Basic and diluted per share                     0.24              0.07
    -------------------------------------------------------------------------
    Net income                                       4,877               948
    -------------------------------------------------------------------------
      Basic and diluted per share                     0.25              0.05
    -------------------------------------------------------------------------
    Cash from continuing operations                  9,289             1,370
    -------------------------------------------------------------------------
    EBITDA                                           8,500             3,130
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                                      As at May 31,       As at February 28,
                                              2007                     2007
    -------------------------------------------------------------------------
    Total assets                          $123,280                 $126,240
    -------------------------------------------------------------------------
    Loans payable                            5,812                    6,155
    -------------------------------------------------------------------------
    Shareholders' deficiency                (3,020)                  (7,577)
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
    EBITDA Reconciliation:                          Three months ended
    -------------------------------------------------------------------------
    (in thousands)                            May 31, 2007      May 31, 2006
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net income                                      $4,877              $948
    -------------------------------------------------------------------------
    Depreciation                                       626               619
    -------------------------------------------------------------------------
    Interest and bank charges                          157               265
    -------------------------------------------------------------------------
    Income taxes                                     2,956               793
    -------------------------------------------------------------------------
    Income (loss) from discontinued operations        (116)              505
    -------------------------------------------------------------------------
    EBITDA                                          $8,500            $3,130
    -------------------------------------------------------------------------
    

    Outlook

    Lockerbie is focused on controlled growth in its industrial and
infrastructure segments, with an emphasis on risk management and strong
profitability. The Company seeks to increase its revenues through established
relationships with existing customers and the development of new business
opportunities.
    The Company is awaiting the outcome of the current labour negotiations
between Alberta building trades unions and the industry labour relations
organizations, of which Lockerbie is a member. If these unions were to strike,
it could have a material adverse effect on the Company's business, financial
conditions and results of operations. Assuming there is no strike by the
building trades unions, the Company is still anticipating a significant
decline in profitability in the second quarter, as major projects currently
forming part of the Company's backlog do not commence until the third quarter
at the earliest. Assuming there are no project delays, project activity and
related revenues are anticipated to be stronger in the third quarter than in
the second quarter.

    First Quarter Fiscal 2008 Financial Statements and MD&A

    Lockerbie has filed its first quarter fiscal 2008 financials statements
and management's discussion and analysis ("MD&A") for such period on the
System for Electronic Data Retrieval (SEDAR) at www.sedar.com under the
Company's profile. Such financial statements and MD&A are also available on
Lockerbie's website at www.lockerbiehole.com.

    First Quarter Fiscal 2008 Conference Call

    As previously announced, Gordon L. Panas, President and Chief Executive
Officer, and Michael G. Slapman, Chief Financial Officer, will host a
conference call to discuss the first quarter fiscal 2008 results today at
9:00 a.m. MDT (11:00 a.m. EDT). Interested parties are encouraged to
participate by calling 866.250.4877 or 416.915.5763 (in Toronto, Ontario) at
least ten minutes before the start of the call in order to participate. For
those unable to call in to the live call, a replay will be available up to 14
days after the event at 416.640.1917 (in Toronto) or 877.289.8525, passcode
21243122 followed by the number sign and on Lockerbie's website at
www.lockerbiehole.com.

    About Lockerbie

    Lockerbie was founded in 1898 and is one of the largest mechanical
construction contractors in Canada. Lockerbie is a multi-disciplined
contractor providing mechanical, electrical, instrumentation, pipe
fabrication, module assembly, boiler erection, insulation and civil
construction services primarily to the oilsands, mining, institutional,
municipal and commercial market sectors. Lockerbie is headquartered in
Edmonton, Alberta.

    Advisories

    Non-GAAP Measures

    EBITDA is a non-GAAP performance measure. EBITDA is calculated as income
before interest and bank charges, income taxes, depreciation and discontinued
operations and the change in redemption value of shares which were redeemable
under contract, but have ceased to be redeemable as a result of Lockerbie
completing its initial public offering. EBITDA is not a recognized performance
measure under GAAP and does not have a standardized meaning prescribed by
GAAP. The Corporation believes that EBITDA is a useful complementary measure
of pre-tax profitability commonly used by Management to evaluate its
performance. The most directly comparable measure to EBITDA calculated in
accordance with GAAP is net income.

    Forward Looking Statements

    This press release contains statements concerning Lockerbie's intentions
to increase its revenues, the effect of an Alberta building trades unions
strike on Lockerbie, Lockerbie's second quarter and third quarter fiscal 2008
performance or other expectations, plans, goals, objectives, assumptions,
information or statements about future events or conditions that may
constitute forward-looking statements or information under applicable
securities legislation. Such forward-looking statements or information are
based on a number of assumptions which may prove to be incorrect. Assumptions
have been made regarding, among other things, the successful implementation of
Lockerbie's business plan, the availability to Lockerbie of qualified
personnel, the continuation and completion of the projects forming Lockerbie's
backlog, whether or not Lockerbie's unionized employees in Alberta will go on
strike and the effect of such a strike on Lockerbie and general economic,
business and market conditions. Although Lockerbie believes that the
expectations reflected in such forward-looking statements or information are
reasonable, undue reliance should not be placed on forward-looking statements
because Lockerbie can give no assurance that such expectations will prove to
be correct. The forward-looking statements are based on Lockerbie's current
expectations, estimates and projections, and are subject to a number of
significant risks and uncertainties that could cause actual results to differ
materially from those anticipated. Such risks and uncertainties include, among
others, Lockerbie's ability to be retained for existing and new project work
by existing and new clients, Lockerbie's ability to retain and hire qualified
personnel required, oil and gas prices, the delay or cancellation of projects
forming Lockerbie's backlog, a strike by Lockerbie's unionized employees,
general economic, business and market conditions and other risks as are
detailed from time to time in other continuous disclosure filings of
Lockerbie. Should one or more of these risks or uncertainties materialize, or
should assumptions underlying the forward-looking statements prove incorrect,
actual results may vary materially from those described herein as anticipated,
believed, estimated or expected. These forward-looking statements are made as
of the date of this press release, and Lockerbie assumes no obligation to
update or revise them to reflect new events or circumstances, except as
required by applicable laws.

    %SEDAR: 00025533E




For further information:

For further information: Gordon L. Panas, President & Chief Executive
Officer, or Michael G. Slapman, Chief Financial Officer, Telephone: (780)
452-1250, Fax: (780) 452-1284, Website: www.lockerbiehole.com

Organization Profile

LOCKERBIE & HOLE INC.

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