BIOREM announces strong first quarter revenues

GUELPH, ON, May 11 /PRNewswire-FirstCall/ – BIOREM Inc. (TSXV: BRM) announced today its results for the first quarter of 2009:

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                                                First quarter ended March 31,
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    Information in table is in thousands
    except per share data                                     2009      2008
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    REVENUE                                                 $4,038    $3,184
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    GROSS PROFIT                                             1,306     1,455
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    EBITDA(1)                                                 (182)      234
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    NET EARNINGS                                              (425)      104
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    BASIC EARNINGS PER SHARE                                 (0.04)     0.01
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    DILUTED EARNINGS PER SHARE                               (0.04)     0.01
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    WEIGHTED AVERAGE COMMON SHARES                          11,978    11,978
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Q1 revenue was $4,038,000, which is up $853,000 or 27% over the comparative period in the prior year. New orders in the quarter were over $2 million resulting in a current backlog of $12.8 million. The backlog is up $3.8 million or 42% from March 31, 2008.

Gross profit in the quarter was $1,306,000, which is down $150,000 or 10% over the comparative period in the prior year. The first quarter gross margin percentage is down from the prior year margin primarily due to strategic marketing reasons associated with a few specific projects. Therefore, we see this decrease in gross margin as a one-time occurrence for this specific quarter.

EBITDA was a loss of $182,000 in the first quarter compared to a gain of $234,000 in the comparative period from last year. The main reasons for this loss are the decline in gross margin as described above, which we anticipate to be non-reoccurring. Secondly, a significant foreign exchange loss of $155,000 was realized as opposed to a $102,000 gain in 2008, which represents a swing in foreign exchange gains and losses of $257,000.

“The year has started out well as we are significantly ahead of the first quarter of 2008.” said Peter Bruijns, President and CEO. “Our outlook continues to be very positive since we have a strong balance sheet and an increasing sales pipeline as a result of the various global economic stimulus packages and our advances into China. Furthermore, we are anticipating significant bookings in the remainder of the year keeping us in line with our 2009 targets.”

At the end of the quarter, the Company generated cash flows of $160,000 from operations and has substantial cash liquidity in its $6.6 million of working capital. This strong working capital position is considered adequate to fund the future operating requirements of the business for the foreseeable future.

About BIOREM Inc.

BIOREM manufactures Biosorbens(R) biofilter media and is a leading supplier of biofilters and biotrickling for air pollution control in municipal and industrial applications, including BIOCUBE(R) modular units and Mytilus(R) biotrickling filters. With over 600 installed systems and over a decade of experience, the Company’s products are the technology of choice for odor control at wastewater treatment plants across North America. Additional information on BIOREM is also available at our web site at www.biorem.biz.

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Forward-Looking Statements

This press release contains forward-looking statements based on current expectations. These forward-looking statements contain various risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Risks and uncertainties about the Company’s business are more fully discussed in the disclosure materials, financial statements and MD&A filed with the securities regulatory authorities in Canada on www.sedar.com

Non-GAAP Measures

(1). EBITDA is a non-GAAP earnings measure, therefore, it does not have any standardized meaning prescribed by Canadian generally accepted accounting principles and may not be similar to measures presented by other companies. EBITDA represents earnings before interest, income taxes, depreciation and amortization. This measure is important to management since it is used by potential lenders to evaluate the ongoing cash generating capability of the Company and thus the amounts those lenders are willing to lend to the Company.

“Order Bookings” and “Order Backlog” do not have any standardized meaning prescribed by Canadian generally accepted accounting principles (“GAAP”) and may not be comparable to measures presented by other companies. Order Bookings and Order Backlog are non-GAAP measures that the Company uses to evaluate its sales performance. Order Bookings are those binding contracts that the Company enters into with a third party for the delivery of our products or services. As Order Bookings are received, the contract value (before any associated sales taxes) is included in the Order Backlog. The Order Backlog is reduced by the revenue that is recognized on each project and then adjusted for any currency changes.

SOURCE Biorem Inc.