Franchise Services of North America Inc. announces Third Quarter Results for Period Ending June 30, 2007
-Expansion of Network Continues-
TSX-V Trading Symbol: FSN
CALGARY, Aug. 27 /PRNewswire-FirstCall/ - Franchise Services of North America Inc. ("FSNA" or the "Company") announced today its third quarter results for the period ending June 30, 2007. Revenue for the nine months ending June 30, 2007 was USD $9.8 Million and net income was USD $307,821, after consideration of approximately USD $200,000 of one-time expenses related to the acquisition and development of revenue from the newly acquired insurance agency. Both were in line with management's expectations, and compare to revenue of CDN $473,029 and a net loss of CDN ($90,717) for the comparable period in the prior year. These numbers include only seven months of U-Save's results due to the November 2006 Reverse Take-Over (RTO) between U-Save Auto Rental of America, Inc. and the predecessor company, Rent-A-Wreck Capital Inc. Reference is hereby made to the company's filings on Sedar, at www.sedar.com, for a detailed description of the RTO and the related financial information. The Company also announced that unique visitors to the company's website (www.usave.com) continued to experience exponential growth in the quarter, resulting in triple-digit booking growth. "The newly acquired insurance agency, and the insurance platform in general, incurred a non-recurring investment of approximately USD $200,000 to build the infrastructure for its anticipated MGA designation and the expansion of its menu of insurance products. The insurance division currently represents a significant percentage of the companies' revenue, and with this investment we anticipate realization of the revenue stream to begin its increase in the fourth quarter and into the 2008 fiscal year. The addition of this revenue stream will enable us to continue our efforts to expand our franchise network in North America for the U-Save brand and in Canada for the Rent-A-Wreck brand. In addition, we continue to identify strong interest in new franchises and currently have several quality candidates under consideration," said Robert M. Barton, Chief Operating Officer of the Company. About FSNA ---------- In November 2006, U-Save Auto Rental of America, Inc. and Rent-A-Wreck Capital Inc. completed a reverse takeover transaction. The resulting company, FSNA, is a publicly traded company on the TSX Venture Exchange. The company and its subsidiaries own the following brands: U-Save Car & Truck Rental, U-Save Car Sales, Rent-A-Wreck of Canada, Auto Rental Resource Center ("ARRC"), Xpress Rent A Car and Peakstone Insurance. U-Save, with its subsidiary ARRC, has over 1,100 locations throughout the United States and is one of North America's largest franchise car rental companies. Having primarily serviced the local market for the past 25 years, current expansion plans call for the opening of airport locations in the top 30 markets in the United States and the major airports in Canada. U-Save currently services 25 airport markets in 13 different states. U-Save Car Sales is a recent expansion of the U-Save brand into the car sales market. Practicar Systems Inc. (a wholly owned subsidiary of FSNA) owns the rights to the Rent-A-Wreck(R) trademark for all of Canada. The Rent-A-Wreck(R) system operates a network of 50 franchises from coast-to-coast in Canada, providing a range of vehicle rental, leasing and sales options to its customers. The Rent-A-Wreck(R) system has been in continuous operation in Canada since 1976. Forward-Looking Information --------------------------- Certain information included in this press release is of a forward-looking nature. Forward-looking information is subject to known and unknown risks, as well as uncertainties and other factors. Accordingly, actual results may differ materially from those expressed or implied in forward-looking information. Some of the risks, uncertainties and other factors affecting FSNA are discussed in our public filings with the securities regulatory authorities in Canada. Copies of FSNA's Canadian filings, including our most recent management information circular, annual information form, interim financial statements, material change reports and news releases, are available online at www.sedar.com. Information in this document is presented as of August 27, 2007 and is subject to change after this date. However, FSNA disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The TSX Venture Exchange has in no way passed upon the merits of this transaction and has neither approved or disapproved the contents of this press release.
SOURCE Franchise Services of North America Inc.
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