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Press release from Marketwire

Gendis Inc. Announces Second Quarter Results

Friday, September 09, 2011

Gendis Inc. Announces Second Quarter Results17:12 EDT Friday, September 09, 2011WINNIPEG, MANITOBA--(Marketwire - Sept. 9, 2011) - Gendis Inc. (TSX:GDS) today announced its financial results for the 2nd quarter ended July 31, 2011.Gendis Inc. has applied International Financial Reporting Standards for the quarters ended July 31, 2011 and 2010, has retrospectively applied those standards to all prior year periods, and will apply those standards for its fiscal year ending January 31, 2012.Applying those standards has resulted in an increase in volatility to reported earnings for the quarters, primarily negative fair value changes to OSUM for the quarter ended July 31, 2011. The Company reported a loss of $3.4-million ($0.24 per share) in the current quarter compared to a loss of $3.7-million ($0.26 per share) in the prior year quarter. In the quarter last year, the Company recorded a provision for the settlement of legal claims of $2.8-million.Lease rental revenue & recoverable property expenses and investment income are even with the prior year quarter.Condensed summarized information is as follows:quarter endedyear-to-dateJul 31Jul 31Jul 31Jul 31in millions of Canadian dollars except per share2011201020112010Lease rental revenue0.90.92.11.8Investment income0.50.51.01.0Fair value change:Veresen0.80.21.90.6OSUM(7.9)(3.5)(9.0)1.1Other investments(0.1)(0.2)—(0.1)Real estate1.21.50.20.1Expenses(0.9)(0.8)(2.0)(1.6)Settlement of legal claims—(2.8)—(2.8)Deferred tax recovery (expense)2.11.42.1(0.1)Net loss(3.4)(2.8)(3.7)—Loss per share$(0.24)$(0.20)$(0.26)—Fair value of investments:Veresen27.920.5OSUM18.922.0Other investments0.20.5Real estate25.324.7Other assets1.20.6Debt & payables13.314.8Deferred tax payable1.62.0Shareholders equity58.651.5quarter endedyear-to-datein millions of Canadian dollarsJul 31Jul 31Jul 31Jul 31except per share2011201020112010Cash flow from:Operations(1.3)0.4(0.7)1.2Investing————Financing – debt advance (reduction)1.5(0.5)1.0(1.4)GENDIS INC.CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITIONJul 31Jul 31Jan 31Feb 01(thousands of Canadian dollars)2011201020112010ASSETSCash2903539261Receivables832549454305Equity investments47,04742,92154,15041,366Investment property25,27024,70025,02024,550Furnishings and equipment48485943Total assets73,48768,25379,72266,525LIABILITIESCredit facilities11,9829,99710,99511,398Payables4753,9081,791790Provisions———89Current income tax payable——69—Post employment benefit obligation870862890872Deferred income tax payable1,5881,9503,7191,81114,91516,71717,46414,960SHAREHOLDERS' EQUITY58,57251,53662,25851,565Total liabilities and shareholders' equity73,48768,25379,72266,525GENDIS INC.CONDENSED CONSOLIDATED INTERIM STATEMENT OF SHAREHOLDERS' EQUITYShareRetainedTotalCapitalEarnings(thousands - shares & Canadian dollars as applicable)#$$$Balance– January 31, 201013,93714,65036,91551,565Comprehensive income for the period——2,7762,776Balance– April 30, 201013,93714,65039,69154,341Comprehensive loss for the period——(2,805)(2,805)Balance– July 31, 20103,93714,65036,88651,536Comprehensive income for the remainder of the year——10,79610,796Refundable dividend tax——(74)(74)Balance– January 31, 201113,93714,65047,60862,258Comprehensive loss for the period——(261)(261)Balance– April 30, 201113,93714,65047,34761,997Comprehensive loss for the period——(3,425)(3,425)Balance– July 31, 201113,93714,65043,92258,572GENDIS INC.CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIODS ENDED JULY 31(thousands of Canadian dollarsquarteryear-to-dateexcept for share data)2011201020112010RevenueInvestment propertyLease rentals9509202,0781,834Fair value change1,1601,449225952,1102,3692,3031,929Equity investmentsDividends & distributions5104901,020980Fair value change(7,251)(3,455)(7,102)1,610(6,741)(2,965)(6,082)2,590Total revenue(4,631)(596)(3,779)4,519ExpensesProperty4393931,061755Administration388415792760Settlement of legal claims—2,750—2,750Finance expense93731851449203,6312,0384,409Earnings (loss) before income tax(5,551)(4,227)(5,817)110Deferred income tax (expense) recovery2,1261,4222,131(139)Net loss from operations and comprehensive loss(3,425)(2,805)(3,686)(29)Net loss from operations per share$(0.24)$(0.20)$(0.26)—GENDIS INC.CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWSFOR THE PERIODS ENDED JULY 31quarteryear-to-date(thousands of Canadian dollars)2011201020112010Changes in cash positionBy operationsCash receipts1,0371,3232,8262,659Cash disbursements(955)(808)(2,024)(1,321)Payment on settlement of legal claims(1,250)—(1,250)—Income taxes paid——(74)—Finance expense paid(93)(74)(188)(145)(1,261)441(710)1,193By investing activitiesProceeds from sale of investments———55Expenditures on investment property—3(26)(18)Expenditures on furnishings and equipment—(34)—(55)—(31)(26)(18)By financing activitiesNet advance (repayment) of creditfacilities1,487(501)987(1,401)Increase (decrease) in cash226(91)251(226)Cash – beginning of year6412639261Cash – end of year2903529035Gendis Inc.Notes to the unaudited Condensed Consolidated Interim Financial Statements July 31, 2011 (All tabular amountsinthousandsof Canadiandollarsunlessotherwisestated)1. Significant Accounting Policies and Basis of PresentationThese unaudited condensed interim financial statements are prepared in accordance with International Financial Reporting Standards ('IFRS') as issued by the International Accounting Standards Board using the accounting standards expected to be effective at January 31, 2012. Accounting policies will only be finalized when the first annual financial statements are prepared under IFRS for the year ending January 31, 2012 and consequently, these condensed interim financial statements may be subject to change. These condensed interim financial statements do not contain all the disclosures that would be required under generally accepted accounting principles for a comprehensive set of financial statements. These condensed interim financial statements are presented in Canadian dollars, which is the Company's functional and presentation currency. The condensed consolidated interim financial statements for the quarter ended July 31, 2011 have been reviewed and approved by the Company's Audit Committee on September 9, 2011. The condensed consolidated interim financial statements for the quarter ended July 31, 2011 have not been audited or reviewed by the Company's independent Auditors. 2. Investments Jul 31Jan 3120112011Veresen27,92025,980OSUM18,87927,869Other equity investments24830147,04754,1503. Credit facilities Borrowing BalanceRemaining borrowing availabilityCarrying value of collateralJul 31Jan 31Jul 31Jan 31Jul 31Jan 31201120112011201120112011Banker's acceptances10,99510,995Bank demand loan800—11,79510,9952001,00025,85224,056Broker's margin account——9701,1132,3162,22511,79510,9951,1702,11327,16826,2814.0 Operating segmentsThe segment information provided to the CEO for the reportable segments is as follows: Quarter ended Jul 31RealtyCorporateInter-segmentTotalExternal revenue2011950510—1,4602010920490—1,410Fair values changes20111,160(7,251)—(6,091)20101,449(3,455)—(2,006)Intersegment revenue201115145(160)—201015135(150)—Operating expenses2011469403(45)8272010424429(45)808Finance expense201111593(115)93201010573(105)73Provision for lawsuit settlement2011————2010—2,750—2,750Income tax (expense) recovery2011(416)2,542—2,1262010(240)1,662—1,422Net earnings (loss) from operations20111,125(4,550)—(3,425)& Comprehensive income (loss)20101,615(4,420)—(2,805)Year-to-date ended Jul 31RealtyCorporateInter-segmentTotalExternal revenue20112,0781,020—3,09820101,834980—2,814Fair values changes2011225(7,102)—(6,877)2010951,610—1,705Intersegment revenue201131286(317)—201031270(301)—Operating expenses20111,120823(91)1,8532010815791(91)1,515Finance expense2011226185(226)1852010210144(210)144Provision for lawsuit settlement2011————2010—2,750—2,750Income tax (expense) recovery2011(267)2,397—2,1312010(180)41—(139)Net earnings (loss) from operations2011721(4,407)—(3,686)& Comprehensive income (loss)2010755(784)—(29)Assets201125,93860,858(13,309)73,487201025,05857,799(14,604)68,253Liabilities201116,44812,838(14,371)14,915201017,79316,986(18,062)16,717FOR FURTHER INFORMATION PLEASE CONTACT: James E. CohenGendis Inc.Co-President & Co-Chief Executive Officer(204) 474-5200(204) 474-5201 (FAX)finance@gendis.cawww.gendis.ca