Consolidated Mercantile Incorporated (TSX - "CMC" - common) (NASDAQ
- "CSLMF" - common) TORONTO, Aug. 16 /PRNewswire-FirstCall/ --
Revenues for the six months ended June 30, 2006 decreased to
approximately $14.7 million from $18.2 million in the comparable
2005 period. Sales reflect the consolidation of Distinctive Designs
Furniture Inc., the Company's furniture manufacturing subsidiary.
Competitive market conditions resulted in reduced sales volumes at
Distinctive. Net Loss for the period was $4.2 million compared to
$1.9 million in the preceding year. Results for the period were
impacted by the furniture operations, the Company's equity position
at Polyair and a revaluation of the future income tax benefits on
non-capital loss carry forwards. Loss per share for the period was
$0.82 compared with $0.38 in the comparable 2005 period.
CONSOLIDATED STATEMENT OF OPERATIONS
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(Unaudited) Six Months ended June 30 2006 2005 SALES $ 14,695,047 $
18,184,462 COST OF SALES 13,411,386 16,387,606 ------------
------------ 1,283,661 1,796,856 ------------ ------------
INVESTMENT INCOME (LOSS) 16,813 250,169 ------------ ------------
EXPENSES Selling and administrative 3,083,196 3,721,076
Amortization 217,088 250,000 Interest on long-term debt - 26,359
Loss (gain) on foreign exchange 88,840 (373,979) Loss on
extinguishment of debt - 320,000 ------------ ------------
3,389,124 3,943,456 ------------ ------------ LOSS FROM OPERATIONS
BEFORE THE UNDERNOTED (2,088,650) (1,896,431) Equity loss of
significantly influenced companies (622,693) (417,222) Write-down
of investment in significantly influenced company (991,732) -
------------ ------------ (1,614,425) (417,222) ------------
------------ LOSS BEFORE INCOME TAXES AND NON-CONTROLLING INTEREST
(3,703,075) (2,313,653) Income taxes (recovered) 550,005 (655,654)
------------ ------------ LOSS BEFORE NON-CONTROLLING INTEREST
(4,253,080) (1,657,999) Non-controlling interest 1,023,299 650,709
------------ ------------ LOSS FROM CONTINUING OPERATIONS
(3,229,781) (1,007,290) Share of loss from discontinued operations
of significantly influenced company (932,866) (876,815)
------------ ------------ NET LOSS FOR THE PERIOD $ (4,162,647) $
(1,884,105) ------------ ------------ ------------ ------------
LOSS PER SHARE Loss per share from continuing operations Basic $
(0.64) $ (0.20) Diluted $ (0.64) $ (0.20) Loss per share from
discontinued operations Basic $ (0.18) $ (0.18) Diluted $ (0.18) $
(0.18) Loss per share Basic $ (0.82) $ (0.38) Diluted $ (0.82) $
(0.38) CONSOLIDATED BALANCE SHEET
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(Unaudited) June 30 December 31 2006 2005 ASSETS CURRENT Cash and
cash equivalents $ 4,801,763 $ 7,064,845 Short-term investments
(market value - $5,887,992; 2005 - $3,929,552) 5,788,944 3,916,062
Accounts receivable 4,703,273 6,284,546 Income taxes recoverable -
611,389 Inventories 4,661,743 5,608,494 Prepaid expenses 625,993
293,112 Future income taxes 53,685 69,538 ------------ ------------
20,635,401 23,847,986 INVESTMENTS 4,253,395 6,779,250 PROPERTY,
PLANT AND EQUIPMENT 1,523,581 1,786,574 FUTURE INCOME TAXES 404,633
856,267 ------------ ------------ $ 26,817,010 $ 33,270,077
------------ ------------ ------------ ------------ LIABILITIES
CURRENT Bank indebtedness $ 4,045,862 $ 5,132,074 Accounts payable
and accrued liabilities 2,835,414 2,991,443 Income taxes payable
847,205 868,003 Current portion of long-term debt 9,996 9,996
------------ ------------ 7,738,477 9,001,516 LONG-TERM DEBT
558,519 562,685 NON-CONTROLLING INTEREST 1,685,716 2,709,015 FUTURE
INCOME TAXES 156,400 166,400 ------------ ------------ 10,139,112
12,439,616 ------------ ------------ SHAREHOLDERS' EQUITY CAPITAL
STOCK 2,839,453 2,840,353 CONTRIBUTED SURPLUS 59,411 59,411
CUMULATIVE TRANSLATION ACCOUNT (1,035,823) (1,048,467) RETAINED
EARNINGS 14,814,857 18,979,164 ------------ ------------ 16,677,898
20,830,461 ------------ ------------ $ 26,817,010 $ 33,270,077
------------ ------------ ------------ ------------ Consolidated
Mercantile Incorporated is a management holding company which
provides merchant banking and effects its investment strategy
through investment in and management of its core strategic
industries including furniture, packaging products and finance.
"Safe Harbor" statement under the Private Securities Reform Act of
1995: This release contains forward-looking statements which
reflect management's current views of future events and operation.
These forward-looking statements are based on assumption and
external factors, including assumptions relating to product
pricing, competitive market conditions, financial data and other
risks or uncertainties detailed from time to time in the Company's
filings with the Securities and Exchange Commission. These
forward-looking statements represent the Company's judgement as of
the date of this release and any changes in the assumptions or
external factors could produce significantly different results.
DATASOURCE: Consolidated Mercantile Incorporated CONTACT: Stan
Abramowitz, Secretary, (416) 920-0500
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