Investor Relations

Back to the press releases

EnGlobe Corp. Announces First Quarter Highlights and Financial Results

BURLINGTON, ON –May 7, 2009 - EnGlobe Corp. (“EnGlobe” or the “Corporation”) (TSX: EG), today announced financial results for the first quarter, ended March 31, 2009.

First Quarter Summary
– $24.8 million in revenues
– Adjusted EBITDA of $0.7 million
– Construction of second French soil treatment facility, located in Lyon, France, on schedule and expected to be operational in the second quarter of 2009

 “EnGlobe had a good first quarter and demonstrated the strength and positive momentum of the Corporation in the challenging economic environment. Our first quarter results underline both the success of EnGlobe as it continues to grow and secure new business opportunities and the positive benefits of our reorganization plan announced last year” said André Héroux, CEO of EnGlobe. "Going forward, our priority remains to focus on improving our operational efficiency, increasing productivity, and aggressively pursuing growth opportunities in our Site Assessment and Remediation segment. We are currently completing the construction of our second soil treatment facility in France, located near Lyon, which is expected to be fully operational by mid-May 2009.  In addition, we have lowered our costs over the past several quarters and I expect that we will see further benefits from these efforts as 2009 progresses” added Mr. Héroux.

Financial Highlights for the Three Months Ended March 31, 2009

In the first quarter, EnGlobe generated revenue of $24.8 million compared to $24.3 million for the same period last year, an increase of $0.5 million.

The Corporation’s increase in revenue was driven by significant growth in the Site Assessment and Remediation segment (“SAR”). In particular, robust SAR activities in Northern Canada and Alberta and the contribution from Celtic Technologies Limited (“Celtic”), which was acquired in March 2008, led to higher revenue for the segment. Celtic contributed $4.4 million in revenues in the first quarter.

However, significant revenue gains from the SAR segment were offset by a lower revenue contribution from the Organic Waste Management segment (“OWM”). OWM experienced a planned decrease of revenue that totaled $3.6 million in the first quarter. As part of the Corporation’s previously communicated reorganization plan, OWM is now concentrating on activities that generate positive financial contribution. This has resulted in the progressive phasing out of certain contracts and business activities, which has translated into lower OWM revenues, but higher OWM margins with reduced risk.

The Tank Testing and Calibration segment’s revenue was slightly lower than the revenue generated in the same period in 2008.

Gross operating profit in the first quarter was $6.4 million compared with $5.4 million in the quarter ended March 31, 2008, an increase of 17.5%. As a percentage of sales, the gross operating profit margin for the first quarter was 25.8% compared with 22.4% for the same period in 2008. The gross operating profit margin improvement was primarily attributable to higher margins from the SAR segment (from Canadian operations in particular including the Montreal soil treatment facility), as well as positive margin contribution from the OWM segment.
 

Adjusted EBITDA for the first quarter was $0.7 million compared to a loss of $1.2 million in the quarter ended March 31, 2008. The increase was principally the result of the contribution from Celtic, the positive contribution from the OWM segment, higher contribution from the SAR segment (from the Canadian operations in particular) and a lower cost structure following the implementation of the reorganizational plan.

Cash provided by operating activities in the first quarter was $2.5 million compared with operating cash flow of $4.7 million in the same period last year. Excluding the variation in the non cash working capital items, operating cash flow improved by 2.4 million.

 “We are pleased with our first quarter results and believe we are realizing the benefits from our fall 2008 restructuring plan announced in 2008” said André Héroux, President and CEO.  “EnGlobe remains focused on controlling costs and improving our cash management activities while strengthening our business execution skills.”

Management's Discussion and Analysis and Financial Statements can be accessed at www.sedar.com.

Annual and Special Meeting of Shareholders

The Corporation announced that it will hold its Annual and Special Meeting of Shareholders on Friday, May 22, 2009 at 8:30 a.m. (Eastern Time), located at 5300 Commerce Court West, 199 Bay Street, Toronto, Ontario, Canada  M5L 1B9. At the meeting, the Corporation’s management will discuss results for the fiscal year ended December 31, 2008 and the outlook for 2009.

About EnGlobe Corp.

EnGlobe Corp. is a leading international integrated environmental services company specializing in the management of contaminated soils and organic based waste streams, with an emphasis on beneficial reuse. EnGlobe offers cost-effective solutions to municipal, commercial and industrial clients in Canada, the north-eastern United States, the United Kingdom and France through its subsidiaries: Biogénie and Celtic Technologies Limited for site assessment and remediation, GSI Environment Inc. for organic waste management, and Tanknology Canada Inc. for tank testing and calibration.  Shares of EnGlobe trade on the Toronto Stock Exchange under the ticker symbol EG. Additional information is available at www.englobecorp.com.

Forward-Looking Statements

This press release contains certain forward-looking statements. Such statements relate to, among other things, sales growth, expansion and growth of the Corporation's business, future capital expenditures and the Corporation's business strategy. Forward-looking statements are subject to inherent uncertainties and risks including, but not limited to: general industry and economic conditions, changes in the Corporation's relationships with its suppliers, pricing pressures and other competitive factors, the availability and costs of fuels and utilities, the results of the Corporation's ongoing efforts to improve cost effectiveness, changes in regulatory requirements affecting the Corporation's business and the availability and terms of financing. Other Risk Factors are set out and described in the Corporation's Annual Information Form which is available at www.sedar.com. Consequently, actual results and events may vary significantly from those included in, contemplated by or implied by such forward-looking statements. In evaluating forward-looking statements, readers should specifically consider the various factors that could cause actual events or results to differ materially from such forward-looking statements.


Investors inquiries:

Mario Saucier
Chief Financial Officer
T: 1-450-929-4949, ext. 222
msaucier@englobecorp.com


Media inquiries:

Marie-Chantal Turcotte
Senior Vice-President, Corp. Communications
T: 1- 418-781-0191, ext. 5235
mcturcotte@englobecorp.com