Richards Packaging Income Fund Announces 2007 Second Quarter Results



    TORONTO, Aug. 10 /CNW/ - Richards Packaging Income Fund (TSX: RPI.UN)
(the "Fund") announced today results for the quarter ended June 30, 2007. The
Fund owns 95% of Richards Packaging Inc. ("Richards Packaging"), the leading
packaging distributor in Canada, and third largest in North America.
    "The Fund delivered another solid quarter with second quarter revenue
growth of 0.4% over the same period in 2006. Gross profit as a percentage of
sales and EBITDA(1) as a percentage of sales continued to run at strong levels
of 16.7% and 10.9% respectively. Net income was $3.9 million, up $0.3 million,
or 2.9 cents per Unit, for the second quarter," commented Gerry Glynn, Chief
Executive Officer.
    "The Fund paid monthly distributions of 9.35 cents per Unit for January
through June, which represents an annualized yield of 11.8% on a $9.50 price
per Unit. The payout ratio(3) for the second quarter was 97% and for the first
half of 2007 was 98%. The increase from the 2006 first half payout ratio of
92% reflects higher tax leakage in Richards US, which should largely reverse
during the second half of 2007. As a result, the payout ratio is expected to
decrease for the remainder of 2007(4)," added Mr. Glynn.
    Details of the Fund's results are currently available on Richards
Packaging's website at www.richardspackaging.com and on August 11, 2007 on
SEDAR at www.sedar.com.

    About Richards Packaging

    Richards Packaging is a full-service packaging distributor targeting
small- and medium-sized North American businesses. Richards Packaging has
operated for over 90 years and currently serves over 7,000 regional food, wine
and spirits, cosmetic, specialty chemical, pharmaceutical and other companies
from 17 locations throughout North America.

    
    1   Management defines EBITDA as earnings before amortization, interest,
        unrealized gain / loss on financial instruments and taxes. EBITDA is
        the same as income before under noted items, income taxes and non-
        controlling interests as outlined in the interim consolidated
        financial statements. Management believes that in addition to net
        income, EBITDA is a useful supplemental measure for investors of
        earnings available for distribution prior to debt service, capital
        expenditures and taxes. Management uses this measure as a starting
        point in the determination of earnings available for distribution to
        unitholders and exchangeable shareholders. In addition, EBITDA is
        intended to provide additional information on the Fund's operating
        performance. This earnings measure should not be construed as an
        alternative to net income or as an alternative to cash flow from
        operating, investing and financing activities as a measure of the
        Fund's liquidity and cash flows. EBITDA does not have a standardized
        meaning prescribed by GAAP and therefore the Fund's method of
        calculating EBITDA may not be comparable to similar measures
        presented by other companies or income trusts.
    2   Management defines distributable cash flow, in accordance with the
        Richards Packaging's credit agreement, as EBITDA less interest, cash
        income tax expense, maintenance capital expenditures and loan
        payments. The objective of presenting this measure is to calculate
        the amount which is available for distribution to unitholders and
        exchangeable shareholders. Investors are cautioned that distributable
        cash flow should not be construed as an alternative to cash flow from
        operating, investing and financing activities as a measure of the
        Fund's liquidity and cash flows. Distributable cash flow does not
        have a standardized meaning prescribed by GAAP and therefore the
        Fund's method of calculating distributable cash flow may not be
        comparable to similar measures presented by other income trusts.
    3   Management defines payout ratio as distributions and dividends
        declared over distributable cash flow(2). The objective of presenting
        this measure is to calculate the percentage of actual distributions
        in comparison to the amount available for distribution. Payout ratio
        does not have a standardized meaning prescribed by GAAP. The Fund's
        method of calculating the payout ratio may not be comparable to
        similar measures presented by other income trusts.
    4   This release contains certain forward looking statements (the
        "Statements") regarding future growth potential, results of
        operations, performance and business prospects and opportunities of
        the Fund. These Statements reflect management's current beliefs and
        are based on information currently available to the management of
        Richards Packaging. A number of factors could cause actual events or
        results to differ materially from those discussed in the forward-
        looking statements. Factors that could cause such differences
        include, among other things, changes in customer and supplier
        relationships and the impact on order volumes and pricing,
        competition in the industry, inventory obsolescence, trade risks in
        respect to foreign suppliers and fluctuations in foreign exchange and
        interest rates. Although the Statements contained in this release are
        based upon what management believes to be reasonable assumptions,
        there can be no assurance that actual results will be consistent with
        these Statements. These Statements are made as of the date of this
        release and the Fund assumes no obligation to update or revise them
        to reflect new events or circumstances.
    

    %SEDAR: 00020433E




For further information:

For further information: Gerry Glynn, Chief Executive Officer, Richards
Packaging Inc., (905) 624-3391, gglynn@richardspackaging.com; Enzio Di
Gennaro, Chief Financial Officer, Richards Packaging Inc., (416) 245-8230,
edigennaro@richardspackaging.com


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