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Calian Reports First Quarter Results: Respectable Results Amidst Uncertain Markets

Calian Reports First Quarter Results: Respectable Results Amidst Uncertain Markets

Calian Technologies Ltd. has released unaudited results for the first quarter ended December 31, 2012. Revenues for the quarter were $57.9 million (&pound37.0M) , a 2% increase from the $56.8 million reported in the same quarter of the previous year. Net earnings were $3.4 million (&pound2.1M), compared to $3.6 million or $0.47 per share basic and diluted in the same quarter of the previous year.

"I am pleased with the results posted during the first quarter. Consolidated year over year revenues continued to grow at single digit rates with SED showing a strong quarter from a revenue perspective despite a lower level of manufacturing activity than the prior year. Engineering projects remained at healthy levels, continuing the trend from last quarter. Our BTS division experienced a slight drop in revenues as constraints in federal government spending started to impact the division late in the calendar year." stated Ray Basler, President and CEO.

"Gross margin percentages were down during the quarter, primarily as a result of lower margins in the SED division. The lower level of manufacturing activity did not offer the associated economies of scale experienced in the prior year and accordingly resulted in reduced margins. The addition of Primacy's higher gross margins once again assisted the BTS division to achieve a slight improvement from those recorded in the same quarter of last year. While margins on our signed backlog are quite predictable, we expect to see continued pricing pressure on new contracts as competition remains strong" continued Basler.

"Despite a difficult business environment expected for the balance of the year we have, and will continue, to invest in business development resources to evolve our service lines and expand our markets for the longer term. Primacy continues to perform at levels which exceed our initial expectations and we have been successful in establishing our first Calian-operated clinic at a Loblaw location in the Maritimes, thereby furthering our knowledge and capabilities related to healthcare delivery" stated Basler.

While the company's first quarter performance was respectable in the current environment, we remain guarded in relation to our customer's spending patterns for the balance of the year. In particular, the continued roll out of the federal government's cost cutting initiatives along with the related increase in competitive pressures have negatively impacted short term expectations for both revenues and profitability. Ultimately, revenues realized will be dependent on the extent and timing of future contract awards as well as customer utilization of existing contracting vehicles. Based on currently available information and our assessment of the marketplace, we expect revenues for fiscal 2013 to be in the range of $230 million to $250 million and net earnings in the range of $1.70 to $1.95 per share.

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