1st Quarter Results

FOR: GENESIS WORLDWIDE INC. TSX, AIM SYMBOL: GWI May 1, 2008 Genesis Worldwide Inc. Announces 93% Revenue Growth and Improved Operating Results for First Quarter 2008 MISSISSAUGA, ONTARIO--(Marketwire - May 1, 2008) - Genesis Worldwide Inc. ("Genesis" or the "Company"), (TSX:GWI)(AIM:GWI), a leading provider of 'green' structural building technology using light steel, is pleased to announce its financial results for the first quarter ended March 31, 2008. The Company reports its financial statements in accordance with Canadian generally accepted accounting principles ("GAAP") and reports in Canadian dollars. Financial Highlights - Revenue from the licensing division for the first quarter ended March 31, 2008 was $3,217,484, compared to $958,778 for the same period in 2007, representing a growth rate of 236%. - Revenue from the structural products division for the first quarter of 2008 increased 47% to $4,464,642, compared to $3,030,520 recorded in the first quarter of 2007. - Total revenue for the first quarter of 2008 was $7,682,126, representing an increase of 93% over first quarter 2007 revenue of $3,989,298. - Contribution margin for the licensing division for the first quarter of 2008 increased by 233% to $1,445,082, compared to $434,107 for the same period last year. - Total contribution margin increased by 66% in the first quarter of 2008 to $2,282,280, compared to $1,373,810 for the same quarter last year. - Net loss for the first quarter ended March 31, 2008 decreased by 41% to $1,240,559, or ($0.04) per common share, compared to a net loss of $2,098,779, or ($0.10) per common share for the first quarter of 2007. /T/ Three Months Ended March 31, 2008 (unaudited, in thousands Structural of dollars) Licensing Products Corporate Total ---------------------------------------------------------------------------- Revenue $ 3,217 $ 4,465 $ - $ 7,682 Contribution margin 1,445 837 - 2,282 Operating expenses 1,357 1,076 753 3,186 Income (loss) before other expenses 88 (239) (753) (904) Other income (expenses) (183) (180) 28 (336) Net loss for the quarter (95) (419) (727) (1,241) ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Three Months Ended March 31, 2007 (unaudited, in thousands Structural of dollars) Licensing Products Corporate Total ---------------------------------------------------------------------------- Revenue $ 959 $ 3,030 $ - $ 3,989 Contribution margin 434 940 - 1,374 Operating expenses 771 1,217 560 2,548 Loss before other expenses (337) (277) (560) (1,174) Other expenses (152) (150) (623) (925) Net loss for the quarter (489) (427) (1,183) (2,099) ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- /T/ Strategic Update During the first quarter of 2008, Genesis made substantial progress on its core strategic initiatives, including the following: Focus on licensing activities - Signed a license agreement for Ukraine. - Shipped industrial equipment to the Russian licensee. - Shipped its first Material Optimization Technology ("MOT") to a licensee. - Revenue growth of 230%. Commercializing structural products division - Grew revenue by 47%. - Received its shipment of MOT. - Signed four new contracts with first-time customers. "We are pleased with our performance for the first quarter of 2008," stated Vince Mifsud, Genesis' President and Chief Executive Officer. "We are following through on our strategic initiatives. Licensing activities continue around the world and interest in the Genesis Solution is growing. Our structural products division continues to show growth, even though we experienced cost increases as a result of rising steel prices and a particularly harsh winter in the Ontario, Canada marketplace". Mr. Mifsud continued, "In addition to completing the license agreement for Ukraine, the roll-out of MOT in the quarter is a significant event. It will allow our licensees, and KML, to reduce their cost of steel and lower their manufacturing labour costs, as well as reducing their dependency on outside steel suppliers. In the face of rising steel prices, it is important that we continue to innovate our way to a lower cost with the Genesis Solution." Further information regarding the Company, and its business and operations, may be obtained from the Company's continuous disclosure documents filed from time-to-time with the Canadian securities regulatory authorities. These continuous disclosure documents are available through the Company's web site at www.genesisworldwide.com or through the SEDAR website maintained by the Canadian securities regulatory authorities, which can be assessed at www.sedar.com. Conference Call The Genesis management team will discuss its first quarter 2008 financial results on a conference call to be held on Thursday, May 1, 2008 at 8:30 a.m. Eastern time (1:30 p.m. BST). As well, a webcast link (audio only) will be made available from the Investor Relations portal of Genesis' website at http://www.genesisworldwide.com/financial-reports.aspx. There will be a short presentation followed by a question and answer period (Q & A for conference call participants only) lasting for approximately one (1) hour. Conference Call Details Date: Thursday, May 1, 2008 Time: 8:30 a.m. Eastern time (1:30 p.m. BST) Local dial-in: 416-641-6123 North America toll-free: 866-300-7687 Global toll-free: 800-6578-9898 (dial the international access code of the country you are calling from, i.e. a call from the United Kingdom would be dialed 00-800-6578-9898) A replay of the call will be made available through the Genesis' Investor Relations website portal at http://www.genesisworldwide.com/financial-reports.aspx, or by dialing 416-695-5800 (local callers only), or toll-free at 1-800-408-3053 (passcode 3259643#), from approximately 12:00 p.m. Eastern time on the date of the call through to May 8, 2008. About Genesis Worldwide Inc. Genesis develops and licenses structural building technology aimed at the residential, commercial and institutional building markets. Genesis offers licensees a turn-key solution enabling them to custom design, manufacture and install complete light steel building structures. The Genesis Solution encompasses engineered processes and materials that are environmentally sustainable or "green". Genesis is headquartered in Mississauga, Ontario, Canada and currently has nine licensees worldwide. For additional information about the Company, visit www.genesisworldwide.com. Caution Regarding Forward Looking Information Certain statements in this press release which are not historical facts constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws ("forward-looking statements") and are made pursuant to the "safe harbour" provisions of such laws. Statements related to the Company's projected revenues, earnings, growth rates, performance, business prospects and opportunities are forward- looking statements, as are any statements relating to future events, conditions or circumstances. The use of terms such as "may", "will", "should", "plan", "believes", "predict", "potential" "anticipate", "expect", "project", "target", "estimate", "continue" and similar terms are intended to assist in identification of these forward-looking statements. These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects and opportunities. These assumptions, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. Readers are cautioned not to place undue reliance upon any such forward-looking statements. Such forward- looking statements are not promises or guarantees of future performance and involve both known and unknown risks and uncertainties that may cause the actual results, performance or achievements of the Company to differ materially from the results, performance, achievements or developments expressed or implied by such forward- looking statements. Many factors could cause the actual results of the Company to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements, including, without limitation, those factors discussed under the heading "Risk Factors" in the Company's most recent Annual Information Form ("AIF"), a copy of which is available on SEDAR at www.sedar.com. Forward-looking statements are based on management's current plans, estimates, projections, beliefs and opinions, and the Company does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. /T/ Genesis Worldwide Inc. INTERIM CONSOLIDATED BALANCE SHEETS (unaudited) As at As at March 31 December 31 2008 2007 $ $ ------------------------- ASSETS Current Cash and cash equivalents 1,928,802 5,987,862 Accounts receivable 10,404,339 11,347,550 Inventories and deposits on inventory 1,045,031 895,686 Prepaid expenses 427,755 535,485 ------------------------- Total current assets 13,805,927 18,766,583 Long-term accounts receivable 287,500 287,500 Property, plant and equipment 5,379,205 4,530,567 Intangible asset 1,982,892 2,050,548 ------------------------- 21,455,524 25,635,198 ------------------------- ------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Current Accounts payable and accrued liabilities 6,986,669 7,566,970 Deferred revenue - current portion 2,062,385 4,459,648 Minimum royalty payment obligations 266,700 173,330 ------------------------- Total current liabilities 9,315,754 12,199,948 ------------------------- Long-term Deferred revenue 287,500 287,500 Minimum royalty payment obligations 1,277,948 1,377,869 ------------------------- Total long-term liabilities 1,565,448 1,665,369 ------------------------- Shareholders' equity Capital stock 56,733,075 56,733,075 Contributed surplus 1,123,474 1,078,474 Deficit (47,282,227) (46,041,668) ------------------------- Total shareholders' equity 10,574,322 11,769,881 ------------------------- 21,455,524 25,635,198 ------------------------- ------------------------- Genesis Worldwide Inc. INTERIM CONSOLIDATED STATEMENTS OF LOSS, COMPREHENSIVE LOSS AND DEFICIT (unaudited) Three months ended ------------------------- March 31 March 31 2008 2007 $ $ ------------------------- Revenues Licensing 3,217,484 958,778 Structural products 4,464,642 3,030,520 ------------------------- Total revenues 7,682,126 3,989,298 ------------------------- Direct cost of revenues Licensing 1,772,402 524,671 Structural products 3,627,444 2,090,817 ------------------------- Total direct cost of revenues 5,399,846 2,615,488 ------------------------- 2,282,280 1,373,810 ------------------------- Expenses Research and development 433,221 231,151 SR&ED investment tax credits (57,217) - Selling and marketing 590,736 385,971 Engineering and project management 464,737 386,179 General and administrative 1,374,723 1,019,067 Occupancy 379,943 303,583 Plant commissioning and restructuring costs - 222,591 ------------------------- 3,186,143 2,548,542 ------------------------- Loss before other expenses (903,863) (1,174,732) ------------------------- Amortization of property, plant and equipment 200,890 177,180 Amortization of intangible asset 67,656 67,413 Foreign exchange loss (gain) 45,135 (13,207) Bank interest income (50,434) - Minimum royalty accretion 73,449 74,327 Debenture and loan interest expense - 618,334 ------------------------- 336,696 924,047 ------------------------- Net loss and comprehensive loss for the period (1,240,559) (2,098,779) ------------------------- Deficit, beginning of period (46,041,668) (41,533,806) ------------------------- Deficit, end of period (47,282,227) (43,632,585) ------------------------- ------------------------- Loss per share Basic and diluted (0.04) (0.10) ------------------------- ------------------------- Weighted average number of shares outstanding 30,982,858 20,982,858 ------------------------- ------------------------- Genesis Worldwide Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) Three Months Ended ------------------------- March 31 March 31 2008 2007 $ $ ------------------------- OPERATING ACTIVITIES Net loss for the period (1,240,559) (2,098,779) Adjustments for non-cash items Amortization of property, plant and equipment and intangible asset 268,546 244,593 Stock-based compensation expense 45,000 8,562 Debenture interest expense accretion - 473,787 Minimum royalty accretion 73,449 74,327 ------------------------- (853,564) (1,297,510) Changes in non-cash working capital balances related to operations Accounts receivable 943,211 852,910 Inventories and deposits on inventory (149,345) (1,565,527) Prepaid expenses 107,730 188,551 Accounts payable and accrued liabilities (1,144,550) 238,663 Deferred revenue (2,397,263) (299,689) ------------------------- Cash used in operating activities (3,493,781) (1,882,602) ------------------------- FINANCING ACTIVITIES Debenture proceeds - 2,000,000 ------------------------- Cash provided by financing activities - 2,000,000 ------------------------- INVESTING ACTIVITIES Additions to property, plant and equipment (485,279) (199,307) Minimum royalties paid (80,000) (80,000) ------------------------- Cash used in investing activities (565,279) (279,307) ------------------------- Net decrease in cash and cash equivalents during the period (4,059,060) (161,909) Cash and cash equivalents, beginning of period 5,987,862 1,011,386 ------------------------- Cash and cash equivalents, end of period 1,928,802 849,477 ------------------------- ------------------------- Supplemental cash flow information Interest paid - 162,453 ------------------------- ------------------------- /T/ -30- FOR FURTHER INFORMATION PLEASE CONTACT: Genesis Worldwide Inc. Catherine Smyth Manager, Investor Relations (905) 285-9909, ext. 302 Website: www.genesisworldwide.com OR Canaccord Adams Robert Finlay +44 020 7050 6500 -0- Genesis Worldwide Inc.

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