St. Felician, Quebec, October 2, 2006--TechCana Inc. a Canadian manufacturer of pre-finished engineered wood flooring, announced its financial statements for the first quarter of 2006-2007 ended on July 31, 2006.
For the period ended July 31, 2006, revenues, coming from sales of wood flooring, amounted $1,004,134 compared to non existent revenues for the corresponding period ended July 31, 2005. These results constitute an increase in sales level compared to the last quarter of the previous fiscal year. During this period, the net loss reached $344,479 or $0.02 per share resulting from insufficient sales to reach a break even point despite their growth. A loss of $0.02 per share has also been incurred during the corresponding period ended July 31, 2005.
As of July 31, 2006, the Corporation had $6,700 overdraft and an amount of $110,000 was under escrow awaiting the review of POS's tax returns, which should be completed during the current quarter. However, Desjardins-Innovatech s.e.c. and Domtar took part, on July 18, 2006, in the completion of an interim financing for a total amount of $1 million to allow the Corporation to continue its operations until the closing of the proposed transaction with Domtar announced by the Corporation on June 19, 2006.
The Corporation operated sporadically due to cash shortages during the quarter, in addition to the bank freezing our line of credit because of the non compliance with certain financial ratios. This situation had a negative impact on the marketing its product. It is worth mentioning that marketing programs are of the utmost importance in supporting products sales in the wood flooring industry; hence, there is a price to pay when a seasonal marketing opportunity is forgone due to cash shortages. However, this slower period has allowed TechCana to improve its production process in Saint-Felicien and Montebello.
TechCana is the manufacturer, marketer and supplier of "Evolution Hardwood Floors™", a pre-finished engineered multi-layered wood flooring product offering structural stability, durability and resistance to warping. This product has the distinct advantage of being more stable than traditional solid hardwood flooring in either extremely humid or dry conditions owing to its patented gluing technology called "Cold Fusion LCL".
