BWI Holdings, Inc. (OTCBB: BWIH), operating as Budget Waste Inc. (the “Company”), is pleased to announce its financial results for the quarter ended October 31, 2008. Selected financial results are as follows:
See table at http://www.budgetwaste.com/Press%20Releases/12192008.html
Mr. Jim Can, the Company’s CEO, states: “We are very pleased with the progress we have made in regards to controlling our costs and processes. We are finally able to reap the benefits of combining excellent customer service with reasonable margins in a very tough economic climate. We will continue to add process improvements and strive to maintain a positive bottom line.”
Unfortunately due to the downturn in the housing and industrial construction markets in Alberta over the last few months accompanied with poor inclement weather, sales are substantially down from the corresponding period in 2007. However, gross margins have increased quarter over quarter. Over the past few quarters the Company embarked on an aggressive cost cutting program and implemented an efficiency improvement plan to increase margins and stream line the delivery and driver dispatch areas. These programs were difficult to implement and took longer than expected as a result of the numerous mergers and acquisitions over the last couple of years. Now, in the second quarter of BWI’s fiscal year, changed because of the takeover of Gray Creek Mining Inc., the benefits of these arduous programs are starting to take effect. Unless the economic environment continues to erode to unexpected lower levels, the Company should remain profitable.
Earnings before interest, taxes, depreciation and amortization (“EBITDA”) increased to $415,000 for the three months ended October 31, 2008 and to $973,000 for the six months ended October 31, 2008. EBITDA for the corresponding three months in 2007 was $451,000 and for the six months ended October 31, 2008 EBITDA was $164,000. We hope to maintain our EBITDA over the next few quarters as the economy continues or starts to improve. EBITDA is a non-GAAP financial measure as defined by SEC regulation G. It is most directly comparable to net income.
Over the last couple of quarters the Company has also strived to pay down outstanding trade payables and creditors and retire long term debt. To generate cash in addition to that created from operations, the Company sold off surplus equipment and land to pay off its creditors. In addition, approximately $5,420,000 of outstanding preferred shares and loans were converted to common shares. The conversion of the preferred shares and the loans will greatly conserve the Company’s cash needs in the near future. The Company is now actively pursuing raising additional conventional debt to retire a great deal of the higher than normal interest rate capital leases.