press release 2008-9
FOR IMMEDIATE RELEASE
Toronto Stock Exchange
Symbol “TSX: CSA”
Commercial Announces Third Quarter Fiscal 2008 Results
Edmonton Alberta, Canada, August 14, 2008 - COMMERCIAL SOLUTIONS INC. ("Commercial" or "Company") (TSX:CSA) a leading Canadian distributor of bearings, power transmission, oilfield, industrial, safety, survey and resource management equipment products, today announced its financial results for the third quarter ended June 30, 2008. A complete copy of the Company's report is available on the Internet at www.sedar.com. Financial highlights from the fiscal 2008 third quarter are as follows:
For the three-month period ended June 30, 2008, Commercial reported revenue of $33.9 million compared to revenue of $36.2 million for the same period last year, representing a year-over-year decrease of 6.4 percent. For the quarter, the Company reported a 17.3 percent decrease in Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of $0.6 million versus $0.7 million for the same period last year. Due to the $15.0 million goodwill impairment charge, net loss for the quarter increased by 7,265.4 percent to $15.1 million compared to a loss of $0.2 million during the third quarter of fiscal 2007. Without the goodwill impairment charge, the quarterly loss would have been $0.1 million and basic and diluted EPS would have been $0.00.
For the nine-month period ended June 30, 2008, the goodwill impairment charge decreased earnings 544.7 percent creating a loss of $14.4 million or $0.72 per share (basic and diluted) as compared to net earnings of $3.2 million or $0.17 per share ($0.16 diluted) for the comparable nine-month period in 2007. Consolidated revenues decreased by 14.0 percent to $105.1 million from $122.3 million and EBITDA fell by 54.1 percent to $3.4 million from $7.5 million for the prior year. Without the goodwill impairment charge, the year-to-date net earnings would have been $0.6 million and basic and diluted EPS would have been $0.03.
"Fiscal 2008 has been a restructuring year. In line with our operational changes to adjust to the current economic environment, we felt an examination of balance sheet intangibles was also warranted, resulting in our goodwill write down." noted Jim Barker, President & CEO of Commercial. "While Commercial continues to face challenging market conditions with the cyclical slowdown in the Western Canadian drilling and forest industries, optimism exists that we maybe entering an upward swing for the natural gas drilling industry. We will persist reducing operating costs in fiscal 2008, but this will be done in a judicious manner so Commercial will be well positioned to gain greater market share when our markets return."
About Commercial
Headquartered in Edmonton, Alberta, Commercial is one of Canada's leading independent industrial distributors with 37 Services Centres and approximately 350 employees located across Canada. Commercial offers more than 160,000 items critical to maintenance repair and operations (MRO) and original equipment manufacturer (OEM) customers. The Company represents 450 leading manufacturers and serves over 11,000 customer accounts within a broad cross-section of industries, including oil and gas, forestry, food processing, chemical processing, mining and aggregate, utilities, agriculture and construction Commercial trades under the symbol "CSA" on the Toronto Stock Exchange. For further information on the Company, please visit www.commercialsolutions.ca and for detailed financial information visit www.sedar.com.
Forward Looking Statements
From time to time, the Company may publish forward-looking statements relating to such matters as expected financial performance, business prospects, development activities and like matters. These statements involve risk and uncertainties, including but not limited to the risk factors previously described. Actual results could differ materially from those projected as a result of these risks and should not be relied upon as a prediction of future events. Commercial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events, with an exception to securities laws requirements.
FOR FURTHER INFORMATION PLEASE CONTACT:
Commercial Solutions Inc.
Eric Sauze
Chief Operating and Financial Officer
(780) 577-2215
esauze@csinet.ca
or
Spinnaker Capital Markets Inc.
Ali Mahdavi
(416) 962-3300
+1 (866) 430-6247
am@spinnakercmi.com
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