Bennett Environmental Inc. Announces Asset Impairment
OAKVILLE, ONTARIO–( EMWNews – April 1, 2008) – Bennett Environmental Inc. (TSX:BEV) (the “Company” or “BEI”) today announced that it will take a non-cash charge to 2007 income of approximately $5 million as a write-off of its long term receivable from Defence Construction Canada (DCC), a crown corporation. The claim arose from work performed by BEI on the Saglek project in 2003 and 2004. DCC refused the claim and while there had been negotiations on this matter in 2007 there are currently no negotiations scheduled and it is expected that the matter will be settled through litigation. BEI has sued DCC, the Attorney General of Canada and the Royal Military College of Canada for $9.5 million. Given recent decisions which have increased the Company’s liabilities and potential liabilities, the consequent pressure on BEI’s liquidity, the defendant’s imperviousness to financial constraints, and the overall uncertainty of litigation the Company has decided to take this charge at this time.
During 2007 BEI’s subsidiaries Trans-Cycle Industries (TCI) and Material Resource Recovery (MRR) experienced operating losses. BEI expects that these businesses will benefit from increased demand due to the planned changes in regulations governing the management of PCBs. In the short term these changes will increase demand without an offsetting increase in supply. However in conducting the ongoing asset impairment test on these assets the Company has considered the recent operating performance and concluded that there is a need to reduce the carrying value of these assets. As a result there will be a non-cash impairment charge taken in the 2007 financials of approximately $1.0 to $2.0 million. The exact amount will be disclosed when the consolidated financial statements for 2007 are released.
Forward Looking Statements
Certain statements contained in this press release and in certain documents incorporated by reference into this press release constitute forward-looking statements. The use of any of the words “anticipate”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “should”, “believe” and “confident” and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. BEI believes that the expectations reflected in those forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in, or incorporated by reference into, this press release should not be unduly relied upon. These statements speak only as of the date of this press release. BEI undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
About Bennett Environmental Inc.
Bennett Environmental Inc. is a North American leader in high temperature treatment services for the treatment of contaminated soil and has provided thermal solutions to contamination problems throughout Canada and the U.S. Bennett Environmental’s technology provides for the safe, economical and permanent solution to contaminated soil. Independent testing has consistently proven that the technology operates well within the most stringent criteria in North America. For information, please visit the Bennett Environmental website at: www.bennettenv.com.
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