Resin Systems Inc., a developer of innovative advanced material products
("RS"), today announced its financial and operating results for the quarter
ended June 30, 2007. RS reports in Canadian dollars and all financial
references in this news release are in Canadian dollars unless otherwise
Second Quarter 2007 Highlights
- Net loss of $8.1 million or $0.06 per share, down 32 percent from
fourth quarter 2006 of $11.9 million or $0.13 per share and down
24 percent from second quarter 2006 of $10.6 million or $0.12 per
- use of cash in operations of $4.1 million, down 58 percent compared to
$9.9 million in the fourth quarter of 2006 and down 56 percent
compared to $9.3 million in the second quarter 2006;
- completion of the move and upgrade of RStandard pole production in
- completion of the installation and commissioning of the manufacturing
equipment and process of the first RStandard(TM) pole production cell;
- together, RS and FMC Technologies, Inc. have identified over 20
initial customer-paid pilot sites for Link-Belt(R) Composite Conveyor
Idler Rollers exclusively using RS's composite roller tubes with
installations occurring over the remainder of 2007; and
- RS delivered its first significant shipment of composite roller tubes
to FMC Technologies, Inc.
"Our second quarter results demonstrate that we have successfully met
our goal of dramatically reducing the use of cash in operations from 2006
levels," said Paul Giannelia, president and chief executive officer. "All
our focus is on resuming and then increasing our RStandard utility pole
production, adding more production cells and successfully introducing our
composite roller tube to the market with the objective of reaching
profitability in 2008."
RStandard Utility Poles
Further to RS's binding letter of intent with Global Composite
Manufacturing, Inc. announced February 2, 2007, RS entered into a
definitive manufacturing and licensing agreement with Global Composite
Manufacturing, Inc. in August 2007. This agreement provides the framework
whereby Global Composite Manufacturing is responsible to move, upgrade and
re-commission the existing RStandard utility pole manufacturing equipment
as well as related additions for use in Global Composite Manufacturing,
Inc.'s production of RStandard utility poles under license from RS.
Pursuant to this agreement, RS has agreed to advance up to $3.5 million to
be repaid through future product deliveries or upon completion of financing
by Global Composite Manufacturing, Inc. and to provide a limited recourse
guarantee not to exceed $4 million in connection with such financing. This
guarantee will be collateralized with the RStandard utility pole
manufacturing equipment and related additions.
Under this agreement, Global Composite Manufacturing, Inc. has
completed the move and upgrade to the RStandard utility pole production and
have successfully commissioned the manufacturing equipment and process for
the first production cell. Global Composite Manufacturing, Inc. is
currently completing the climate controls in various production cell work
zones which is the last step required for regular commercial production and
deliveries to customers to resume.
RS also continued its transition of sales and distribution functions to
HD Supply Utilities, Ltd. RS has already completed training of HD Supply
Utilities, Ltd.'s regional sales teams in 30 different sites while work
continues on product literature and technical support requirements.
Deliveries to HD Supply Utilities, Ltd. are expected to begin in the latter
part of the third quarter.
RStandard Roller Tubes
FMC Technologies, Inc.'s is now formally introducing to the market its
line of Link-Belt Composite Conveyor Idler Rollers using RS's composite
roller tube. In conjunction with the introduction to market, RS announces
it will market its composite roller tube under the RStandard brand name
(formerly referred to as VRoll).
Together, RS and FMC Technologies, Inc. have identified over 20 initial
customer-paid pilot sites for Link-Belt(R) Composite Conveyor Idler Rollers
using RS's composite roller tubes. In preparation of initial deliveries to
these sites, RS delivered to FMC Technologies, Inc. its first significant
shipment of composite roller tubes and deliveries were made to the first
pilot installations in July and August 2007.
"We are very close to resuming commercial production of RStandard
utility poles at Global Composite Manufacturing, Inc.'s new efficient
facility in Ontario," said Mr. Giannelia. "Resuming production and
commercial deliveries of RStandard poles and successfully introducing our
new composite rollers to the market will mark the beginning of a
significant growth phase for our company."
RS has filed its unaudited consolidated financial statements for the
quarter ended June 30, 2007 and related management's discussion and
analysis with Canadian securities regulatory authorities. The financial
statements and management's discussion and analysis have also been filed
with the United States Securities and Exchange Commission