SIMC Simclar Inc (CE)

HIALEAH, Fla., May 15 /PRNewswire-FirstCall/ -- Simclar, Inc. (NASDAQ:SIMC), a multi-plant electronics contract manufacturer, reported its results for the three months ended March 31, 2008. Revenue for the three months ended March 31, 2008 was $29,922,815 compared to $31,407,512 in the same period in 2007. The decrease, while disappointing, was due in the main to the postponement of the introduction of a key customer's new programs until later in the year. Pre-tax income for the three months ended March 31, 2008 was $59,101 compared to $967,634 for the same period in 2007. While this decrease was partly as a result of the decrease in sales, the most significant factor was the inclusion in the 2008 results of costs of approximately $797,000 in relation to the closure of our North Carolina facility. Net income for the three months ended March 31, 2008 was $40,485 or $0.01 per share, compared to $638,639 or $0.10 per share in the same period in 2007. However, exclusion of the North Carolina closure costs would give an adjusted net income for the first quarter of 2008 of $566,304 or $0.09 per share. Chairman Sam Russell commented, "The quarter's performance, although below our expectations, was nevertheless severely impacted by the $0.8 million of costs incurred as a result of the closure of our North Carolina facility. With the closure now complete and the transferred business now fully integrated into our Mexican facility, we look forward to the future benefits of improved profitability and cash flow. Although it is evident that the economic slow-down has affected some of our key customers, our backlog at the end of the quarter was $28 million, an increase of 6% since the end of 2007, and our forecasts indicate a stronger second quarter. Management has implemented cost-reduction programs across each location to mitigate the effect of lower sales and reduced margins to improve profitability in future quarters, while retaining our competitive advantage. The company's cash generation in the first quarter has been good allowing the repayment of $1.5 million of bank loans, half of which were voluntary repayments". Simclar, Inc., with four North American manufacturing locations, and numerous regional sales locations, has been engaged in contract manufacturing of electronic and electro-mechanical products for OEMs for 32 years. Statements in this news release, which relate to other than strictly historical facts, such as statements about the Company's plans and strategies, expectations for future financial performance, and markets for the Company's products and services are forward-looking statements. The words "believe," "expect," "anticipate," "estimate," "project," and similar expressions identify forward-looking statements that speak only as of the date hereof. Investors are cautioned that such statements involve risks and uncertainties that could cause actual results to differ materially from historical or anticipated results due to many factors including, but not limited to, the Company's customer concentration, debt covenants, competition, the effectiveness of our internal controls, and other risks detailed in the Company's most recent Annual Report on Form 10-K and other Securities and Exchange Commission filings. The Company undertakes no obligation to publicly update or revise any forward-looking statements. Visit Simclar, Inc. at its website, http://www.simclar.com/ for more information about the Company. DATASOURCE: Simclar, Inc. CONTACT: Steph Donnelly, CFO of Simclar, Inc., +1-937-220-9777 Web site: http://www.simclar.com/

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