The deterioration during the year 2008 in Florida’s economic conditions affecting company’s dominant Florida-based subsidiary’s tipping and the processing revenues and operations caused company’s revenue to decline. The Canadian dollar’s rise above par with the US dollar during 2008 fiscal year contributed about CAD1.57 million of the revenue losses from translation of the company’s US dollar denominated revenue streams for fiscal 2008 compared to the prior year. The record fuel prices during fiscal 2008 increased manufacturing input and transportation costs as the company adjusted its pricing and operations to moderate the effects of these cost pressures on its operating margins. The company generated about CAD867,000 in cash flows from the operating activities after changes in working capital for year ended September 30, 2008 compared to only CAD124,000 for the previous fiscal year.
The company recorded a net loss after the income tax recoveries of CAD548,426, or CAD0.05 per share, CAD0.05 per share diluted for the fourth quarter of 2008, compared to net loss after income tax recoveries of CAD440,582, or CAD0.04 per share, CAD0.04 per share diluted for the same quarter of 2007.
The revenue for the fourth quarter 2008 was CAD4.4 million, down 6%, from CAD4.7 million reported in the fourth quarter of 2007. The majority of these revenues in both the periods were derived from operations of the company’s Florida-based subsidiary, Consolidated Resource Recovery Inc. (CRR Florida). As in earlier quarters of 2008, the economic slowdown affecting CRR Florida’s revenues continued to influence the consolidated revenues as CRR Florida’s revenue declined 5% compared to the fourth quarter of last year. In contrast to many previous quarters, the company experienced only minor losses on the currency translation of its US dollar denominated revenues as the Canadian dollar remained at similar levels versus the US dollar in the fourth quarter of 2008 compared to the same quarter in 2007. Cash generated by operating activities during three months ended September 30, 2008 was CAD394,846 after changes in working capital compared to cash used in the operations of CAD47,312 during the fourth quarter of fiscal 2007.
The company expects the current downward trend in the revenues and operating results to continue well into 2009 fiscal year while it continues to adjust operations to meet downturn in economic conditions in US Southeast. In the expected absence of severe weather patterns experienced during the past two to three years, the company anticipates operating results to mirror the seasonal trends experienced earlier in the decade.
