CTO Circa Enterprises Inc

CALGARY, May 10, 2012 /CNW/ - Circa Enterprises Inc. (CTO-TSXV) (the "Company" or "Circa"), a manufacturer of equipment for the telecommunication, electrical utility, and construction industries, reports results of operations for the first quarter ended March 31, 2012.

Summary of first quarter operating results:

• Q1 2012 consolidated sales of $5.2 million, representing a 7.0% decrease compared to Q1 2011 sales of $5.6 million
• Profit for the period from continuing operations for the first quarter of 2012 of $27,000 compared to profit from continuing operations of $76,000 for Q1 2011
• EBITDA of $120,000 for Q1 2012 compared to EBITDA of $212,000 for Q1 2011 (see below for explanation and calculation of EBITDA)
• Adjusted EBITDA of $165,000 for Q1 2012 compared to Adjusted EBITDA of $330,000 for Q1 2011 (see below for explanation and calculation of Adjusted EBITDA)

EBITDA is earnings before interest, taxes, depreciation and amortization.  Adjusted EBITDA is earnings before interest, taxes, depreciation and amortization and is adjusted for other non-recurring items and non-cash items. EBITDA and Adjusted EBITDA are a non-IFRS financial measures and do not have any standardized meaning prescribed by International Financial Reporting Standards and, therefore, may not to be comparable to similar measures presented by other issuers.  Management believes that EBITDA and Adjusted EBITDA are useful supplemental measures, which provides an indication of the results generated by Circa's primary business activities prior to consideration of how those activities are financed, amortized or taxed.  Readers are cautioned, however, that EBITDA and Adjusted EBITDA should not be construed as an alternative to comprehensive income (loss) determined in accordance with IFRS as an indicator of the Company's financial performance. EBITDA and Adjusted EBITDA are calculated by the Company as follows:

Consolidated sales for the first quarter of 2012 were $5.2 million -- a $0.4 million or 7.0% decrease over the same period in 2011. The decrease resulted from lower sales in Circa Metals segment as the Company realized lower sales from two of its larger customers as one of the customers began to source some of its products from overseas suppliers and the other completed a large project.  This decrease was partially offset by an increase in sales in the telecom division's sales as both U.S. and Canadian sales increased, despite a reduction in sales to the Company's large OEM customer in the quarter.

As a result of the lower sales activity, the Company's earnings decreased in the quarter and when compared to the prior year.  The Company posted after tax profit of $27,000 and comprehensive income of $12,000 for the quarter compared to after tax profit of $76,000 and comprehensive income of $6,000.  As noted in the chart above, the Company was able to generate positive EBITDA of $120,000 for the quarter.

Ivan Smith, Circa's President and Chief Executive officer, stated:

"The first quarter 2012 financial results are encouraging compared to the past few quarters.  With the exception of sales under our large OEM telecom contract, sales appear to have stabilized and are experiencing some modest growth in the telecom segment.  Management is cautiously optimistic that the economic recovery is continuing and the market for our products is improving.

In addition, the Metals business segment is beginning to see more quoting opportunities for larger projects.  Circa Metals' increased sales presence and efforts are showing some promising signals and we are hopeful this will lead to increased sustainable sales to new and existing customers.  Management believes the Company well positioned to respond to increased sales with its current production capabilities."

CIRCA ENTERPRISES INC.

Consolidated Statements of Comprehensive Income

Circa Enterprises Inc. is a public company with operations in Alberta, Ontario and Florida. The outstanding common shares of Circa Enterprises Inc. are listed and trade on the TSX Venture Exchange under the trading symbol CTO. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

The Company's quarterly financial statements and related management's discussion and analysis have been filed with certain securities regulatory authorities in Canada and may be accessed electronically through the SEDAR website at www.sedar.com. 

SOURCE Circa Enterprises Inc.