Victoria, BC, Canada (November 12, 2008) Carmanah Technologies Corporation (TSX:CMH) today announces its third quarter financial results for the three-month period ending September 2008.

In Q3 2008, Carmanah's recent strategic renewal and restructuring initiative proved especially timely, as the newly streamlined Company navigated challenging global market conditions to deliver its third profitable EBITDA quarter (adjusted for restructuring charge) in a row. While supporting the restructuring initiatives announced in June, the Company introduced a new flagship product to its line of solar LED marine lanterns, entered into a partnership with wireless technology provider ENCOM, and reported significant sales wins in key target markets including aviation lights for airfields in the Middle East and solar power systems for telecommunication towers throughout North Africa.

Highlights for the Quarter

  • Sales results: $13.9 million down $1.6 million from the same period in 2007, although sales are 4.7% higher when the Q4 2007 sale of the home power business is factored in
  • Gross margin up: 37.7% for 2008, up from 30.5% in 2007
  • Operating costs reduced: $4.6 million (excluding restructuring costs) down from $5.3 million for the same period of 2007 – restructuring charge of $0.5 million during the three month period ended September 30, 2008, compared to nil for the same period of 2007
  • Improved bottom line: Net income of $0.8 million, up from a net loss of $0.8 million in the same period of 2007
  • Higher Adjusted EBITDA: Adjusted EBITDA of $1.5 million, up from negative $0.8 million in the same period of 2007
  • Positive cash flow from operations: $0.2 million, compared to $1.5 million for the same period in 2007, which was due to a one-time reduction of surplus inventory
  • Cash balance increased: $5.5 million, up from $1.4 million in the same period of 2007
  • Nil debt: Continued debt-free operation

Summary of Results

The third quarter of 2008 saw continued progress towards Carmanah's renewed corporate objectives announced at the start of the year, including the ongoing implementation of the major restructuring initiatives introduced in Q2 to support the Company's return to sustained, profitable growth.

According to Ted Lattimore, Carmanah CEO, this renewed focus on the Company's core strengths, combined with a commitment to maximizing efficiency and controlling costs, has helped prepare the Company to weather the recent global economic conditions. "Even in today's challenging times, we can now see how our broad based restructuring last quarter has resulted in our increased strength today," said Lattimore. "With the majority of our transition behind us, Carmanah is now prepared to face the challenges ahead as a much leaner, more focused and responsive business. I am confident that our team has the focus, commitment and skill to persevere, and that the current rocky markets will merely test and clarify our strategy. Even with the challenges of today's stock market, our operating costs remain low, we have cash in the bank, and we're maintaining an overall financial position that is increasingly enviable these days. The key over the coming months will be to keep sales coming, and with our strong industrial markets, our new global sales team and some exciting new products, we're well prepared to do just that."

Carmanah CFO, Roland Sartorius added, "…our recent efforts to control costs and support sustained, profitable growth could not have come at a bet
ter time. Guided by solid business metrics, our net cash balance has grown from a 2007 low of negative $2 million to more than $5 million as at Q3 2008. We've maintained our positive growth trend — with no bank debt — and recorded our third quarter of positive Adjusted EBITDA and cash flow results in a row," said Sartorius. "Thanks to our loyal customer base, our relevant technology, and an unfaltering commitment to sustainable growth and solid business fundamentals, we believe that Carmanah is in good financial shape for whatever challenges lay ahead — even in today's changeable economic environment."

For full financial statements as well as the Management Discussion & Analysis, visit:

http://www.carmanah.com/content/investors/ShowNewsRelease.aspx?id=081112pt

 

Media Contact:

David  Davies

ddavies@carmanah.com

direct:   250.382.4332