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Organic Resource Management Inc. Reports Fiscal 2009 Third Quarter Results
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Organic Resource Management Inc. Reports Fiscal 2009 Third Quarter Results
Toronto, ON, May 13, 2009 - Organic Resource Management Inc. (TSX: ORI) ("ORMI" or "the Company"), today announced the financial results for the three and nine-month periods ended March 31, 2009.
Q3 2009 Highlights:
- § Net loss before taxes of $118,000 compared to a net loss of $207,000 in Q3 2008
- § Gross margin of $989,000, 2% greater than $966,000 in Q3 2008
- § Excluding non-core business of wholly-owned subsidiary, A&A Anderson Tank Services Ltd. ("A&A") sold in October 2008, comparative revenue was 2% less than Q3 2008
- § Total revenue of $2,948,000, 23% less than $3,828,000 in Q3 2008
- § Paid off the asset-based revolving loan, strengthening the Company's balance sheet
- § Established a new line of credit with the Royal Bank of Canada.
"The net loss for the current quarter reflects a period of transition as the Company adapts to a lower revenue base following the sale of A&A's non-core assets and moves towards lower recycling costs through on-farm anaerobic digestion" said Charles Buehler, Chairman and Chief Executive Officer of ORMI.
Revenue for the three-months ended March 31, 2009 was $2,948,000, a decrease of $880,000 compared to $3,828,000 during the third quarter of last year. The decrease in revenue was due to the sale of A&A's non-core assets in October 2008. On a comparative basis excluding the non-core business, revenue for the quarter was 2% less than the same quarter last year.
Although total revenue for the third quarter was 23% less than last year, total gross margin was $989,000, an increase of 2% or $23,000 from $966,000 last year. As a percentage of revenue, gross margin was 34% for the quarter compared to 25% for the same quarter last year. During the quarter, the Company continued to use disposal sites in Ontario and New York that were sourced earlier in the year, which contributed to higher margins in the Ontario market.
Cash flows from operating activities were $77,000 for the three-months ended March 31, 2009, compared to $510,000 for the same quarter last year. The higher cash flows last year were largely a result of the combined effect of a decrease in accounts receivable and an increase in accounts payable.
During the quarter:
- 1. The Company terminated its relationship with Textron Financial Canada Ltd., paid off the balance owing on its revolving loan and established a new line of credit with the Royal Bank of Canada. The Company has not drawn on the new credit facility.
- 2. The Company was successful in obtaining new grease trap customer accounts that is expected to generate annual revenues of between $1 and $1.5 million.
- 3. The Ontario government announced the intent to pass the Green Energy Act in the legislature by midyear. This act positions Ontario as the North American leader in renewable energy policy. If passed, it will stimulate Ontario anaerobic digestion development (www.ontariogreenenergyact.ca/index.html).
Nine-month results:
Net income before taxes for the nine-month period ended March 31, 2009 was $1,700,000, an increase of $1,610,000 from $90,000 for the same period last year. The increase was due to the gain of $1,708,000 on the sale of A&A's non-core assets. This gain was partially offset by approximately $250,000 in one-time costs related to the sale and rebranding of ORMI's remaining assets in British Columbia from A&A to ORMI, as well as the relocation to a new Vancouver facility.
Total revenue for the current nine-month period was $10,213,000, a decrease of $1,138,000 compared to $11,351,000 for the same period last year. Total gross margin for the nine-month period ended March 31, 2009 was $3,544,000, an increase of $116,000 compared to $3,428,000 for the same period last year. Gross margin as a percentage of revenue was 35% for the current period compared to 30% during the same nine-month period last year.
The comparative financial statements for the three and nine-months ending March 31, 2009 along with other information may be obtained through the Company's website at www.ormi.com, or on SEDAR at www.sedar.com.
This press release is available on the Company's official on-line investor relations site for investor commentary, feedback and questions. Investors are asked to visit the investor relations section of the Company's website at http://www.ormi.com/ORMI_Investor.asp. Alternatively, investors are asked to e-mail all questions and correspondence to info@ormi.com where they can also request addition to the Company's investor e-mail list to receive all future press releases and updates directly.
About Organic Resource Management Inc.
Organic Resource Management is Canada's largest provider of vacuum truck services for the collection, processing and recycling of food-related organic residuals. ORMI services in excess of 6,000 commercial, industrial, institutional and residential customers in Ontario, Quebec and British Columbia. Further information about ORMI may be obtained at the Company's web site at www.ormi.com.
Note: Certain information contained in this press release may be forward-looking and therefore subject to unknown risks or uncertainties. The actual results, performance or achievements of Organic Resource Management Inc. may differ materially from the results, performance or achievements of the Company expressed or implied by such forward-looking statements.
For further information, contact:
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Organic Resource Management Inc. Charles Buehler Website: www.ormi.com |
The Equicom Group Glen Williams Investor Relations Tel: 416-815-0700 ext. 272 Email: gwilliams@equicomgroup.com
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