CALGARY, Aug. 28 /PRNewswire-FirstCall/ -- Franchise Services of North America Inc. ("FSNA" or the "Company") announced today that it has filed its Q3 report, and the corresponding Management's Discussion and Analysis, for the period ending June 30, 2008. The reports may be found on the Company's website (http://www.fsna-inc.com/), as well as on SEDAR (http://www.sedar.com/).
For the three months ended June 30, 2008, the Company reported a net loss of $15,567 as compared to net income of $235,011 for the period ending June 30, 2007. Included in the quarterly loss was approximately $100,000 of one-time legal and accounting expenses associated with the Cease Trade Order. Total revenue for the three-month period ending June 30, 2008 was $3,745,377 as compared to $4,110,665 for the period ended June 30, 2007. The Company was unable to generate any franchise sales revenue during the period as a result of the Cease Trade Order, and the inability of the Company to file a current Offering Circular until the issues regarding the Cease Trade Order were resolved.
For the nine-month period ended June 30, 2008, net income was $258,071 as compared to $165,173 for the ten month period ended June 30, 2007. Revenues were $11,850,078 for the nine months ended June 30, 2008, as compared to $14,508,585 for the ten month period ended June 30, 2007.
FSNA also announced today the sale of its second operating rental location under its Canadian Master Franchise Agreement for the U-Save brand in South Etobicoke, Canada.
Bob Barton, the Company's Chief Operating Officer, stated, "This was a very difficult quarter for us. The Cease Trade Order ("CTO") that was in effect and the resulting incremental legal and accounting costs were both significant and time consuming. Additionally, as a result of the CTO, there was a delay in the filing of the Company's Offering Circular for the U-Save brand. It was not effective during the quarter, preventing the sale of any domestic franchises. The Company filed its Offering Circular following resolution of the Cease Trade Order and has begun the process of selling. Overall, excluding the incremental legal and accounting costs, the Company performed well during the quarter in what can be described as challenging economic conditions for the car rental industry.
We are also pleased with the progress of the Canadian Master Franchisee in opening their second location under their agreement and expanding the U-Save brand in Canada. This location will actually be operated by the Master Franchisee himself, confirming his commitment to the development of the Ontario market."
About FSNA ----------
FSNA is a publicly traded company listed 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 Financial Services.
U-Save, together 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, the Company is expanding into the airport market with plans 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 28 airport markets in 14 different states. U-Save Car Sales is an expansion of the U-Save brand into the car sales market, and provides goods and services to car sales operators looking to affiliate with a national brand.
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 53 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.
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contents of this press release.
