Glendale International reports first quarter results

About this update from Firan Technology Group Corporation

Toronto Stock Exchange Symbol: GIN OAKVILLE, ON, April 17 /CNW/ - Glendale International Corp. (TSX: GIN) today reported financial results for the first quarter of fiscal 2006 ended March 3, 2006. "We had an encouraging first quarter with positive highlights in each of our businesses," said Edward C. Hanna, Chief Executive Officer and Chairman, Glendale International Corp. "In our Recreational Vehicles business, we saw the first quarter-over-quarter sales growth in over two years as our 2006 model line and strong demand in Western Canada for specialty trailers contributed to sales growth of 3.6% for the quarter, despite the challenges inherent in the stronger Canadian dollar. Our Electronics business posted strong growth in sales and operating earnings with solid contributions from both their Circuits division and their Aerospace division. And, prior to the conversion to Canadian dollars, our U.K.-based Navigational Aids business posted sales growth of 1.1% and growth in operating earnings of 6.7%, while receiving its first production order from the U.S. Air Force for Tactical Air Navigation beacons." Financial Results Sales for the first quarter of fiscal 2006 increased 4.2% to $38.6 million compared with $37.0 million for the first quarter of last year. Sales growth in the Recreational Vehicles business and the Electronics business was partially offset by lower sales in the Navigational Aids business due to the stronger Canadian dollar. Net earnings for the first quarter of fiscal 2006 increased 329.8% to $0.8 million, or $0.06 per share, compared with $0.2 million, or $0.01 per share, for the first quarter of fiscal 2005. As of March 3, 2006, Glendale International had working capital of $10.1 million, including cash and cash equivalents of $1.0 million, compared to working capital of $9.2 million, including cash and cash equivalents of $6.2 million, on November 30, 2005. Recreational Vehicles (Glendale RV and Travelaire Canada) Sales for the Recreational Vehicles business for the quarter increased 3.6% to $21.4 million from $20.6 million for the first quarter of last year. The Recreational Vehicles business benefited from a strong Albertan economy, and in particular, sales of specialty trailers were positively affected by the booming oil sands industry. Operating earnings for the first quarter decreased 13.8% to $0.9 million compared with $1.0 million for the same period last year. The decrease in operating earnings was the result in differences in sales mix from one period to another, partially attributable to the business expanding its mid-priced product offering. Results continued to be impacted by the appreciation of the Canadian dollar, having the effect of lowering U.S. dollar denominated sales, and making Canadian manufactured RVs comparatively more expensive than those of U.S. rivals. Electronics (Firan Technology Group Corporation) Sales for Firan Technology Group Corporation (TSX: FTG) for the quarter increased 11.1% to $13.4 million from $12.0 million for the same period last year. The increase was primarily attributable to strong performance from the Circuits division, which posted sales growth of 11.6% for the quarter, driven by increased volumes and improved production yields. The Aerospace division posted sales growth of 8.4%, resulting from higher Quick Turn activity and increased shipments to key customers. The stronger Canadian dollar reduced the translated value of U.S.-denominated sales by $0.7 million. Operating earnings for the quarter were $0.3 million compared with an operating loss of $0.8 million for the first quarter of fiscal 2005. In accordance with its ownership position in Firan Technology Group Corporation, Glendale International recorded net earnings from the company for the first quarter of fiscal 2006 of less than $0.1 million, compared with a net loss of $0.3 million for the first quarter last year. Navigational Aids (Fernau Avionics) Sales for Fernau Avionics for the quarter decreased 11.5% to $3.9 million from $4.4 million for the same period last year. Operating earnings for the quarter decreased 6.4% to $0.5 million compared with $0.6 million for the first quarter of fiscal 2005. When adjusted for the effect of the stronger Canadian dollar, sales for the quarter increased 1.1% and operating earnings increased by 6.7%. During the quarter, in addition to receiving its first production order from the U.S. Air Force for TACANs (Tactical Air Navigation beacons), Fernau received a multi-million dollar order from Italian-based Selex Sensors and Airborne Systems for Mode-S radar transmitters, as well as orders from Columbia, Denmark, Georgia, and Spain, for distance measuring equipment. Other (Quality Plastics) During the first quarter, management determined that it would close its plastics business unit, included in the "Other" operating segment, by March 30, 2006. At March 3, 2006, the Corporation's plastics business unit was classified as discontinued operations and their results of operations, financial position and cash flows in the quarterly financial statements are separately reported. The Corporation recorded a $360,000 accrual in the first quarter of 2006 in connection with the discontinued operation. The accrual includes costs for severance, retiring allowance and other costs. The costs as a result of severances and the retiring allowance are expected to be paid in the second quarter of 2006. The amount of the accrual at March 3, 2006 is $360,000. Outlook "We are pleased by what we see as a potential turnaround in our core Recreational Vehicles business," said Mr. Hanna. "In our RV business, we continue to execute a focused strategy with specific attention to innovation, differentiation, and targeting cost reduction, to achieve long-term growth. With Glendale RV's entrance into the mid-priced segment of the RV market we hope to capture more of the price-sensitive market, while our park models target a growth market that is essentially bullet-proof to U.S. competition and to the impact of rising fuel prices. Our Electronics business is seeing increased opportunities from existing and new customers, and is well- positioned to capitalize on the robust aerospace and defence markets. With a strong order book, our Navigational Aids business looks to further penetrate the lucrative North American market, and has tremendous potential to secure additional major contracts." About Glendale International Corp. Glendale International Corp. manages businesses that provide the opportunity for superior long-term value creation through the application of proven managerial expertise and innovative business strategies. The Corporation has built a portfolio of profitable growth businesses in the recreational vehicles, electronics and technology sectors and will seek to acquire complementary businesses that support its value-building proposition. Glendale International's core business, Glendale Recreational Vehicles/Travelaire Canada, is the largest Canadian manufacturer of recreational vehicles. The Corporation also owns a controlling position in Firan Technology Group Corporation, the largest aerospace and defence supplier of advanced technology printed circuits (PCBs) in Canada and among the top 25 PCB manufacturers in North America, Fernau Avionics, a leading international supplier of ground-based air navigational systems for military, naval and civil aviation applications. Glendale International Corp. is a public corporation whose shares trade on the Toronto Stock Exchange ("TSX") under the symbol "GIN". The Corporation has approximately 12.5 million common shares outstanding. To reach Glendale International via the worldwide web logon to www.glendaleint.com. This press release contains certain forward-looking statements that reflect the current views and/or expectations of management of Glendale International Corp. with respect to its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly. >

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