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Q2 2008 CARMANAH TECHNOLOGIES CORP Earnings Conference Call - Final.

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Original Source: FD (FAIR DISCLOSURE) WIRE

OPERATOR: Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the Carmanah Technologies Corporation quarter two 2008 results conference call. (OPERATOR INSTRUCTIONS).

Before beginning its final remarks, Carmanah would like to remind listeners that certain portions of today's discussion may contain forward-looking statements that reflect views with respect to future events. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in those forward-looking statements.

For more information on the forward-looking statements and the Company risks and uncertainties relating to such forward-looking statements, please read Carmanah's annual report for the fiscal year ended December 31, 2007, as well as on SEDAR, and which is also posted on their website, www.Carmanah.com.

(OPERATOR INSTRUCTIONS). I would like remind everyone this conference call is being recorded today, Wednesday, August 13, 2008 at 2 PM Pacific time and 5 PM Eastern time.

I would now like to turn over the call to Mr. Ted Lattimore, Chief Executive Officer. Please go ahead, sir.

TED LATTIMORE, CEO, CARMANAH TECHNOLOGIES CORPORATION: Welcome everyone. As usual, I'm joined today by my colleagues, Roland Sartorius, Chief Financial Officer, and Philippe Favreau, our Chief Operating Officer.

I closed my remarks on our Q1 call three months ago by stating one quarter does not a success story make. But the strategy is taking hold and we will continue a similar execution focus in Q2. Even two positive quarters does not quite a trend make, although management is clearly encouraged by having the opportunity to report a second successful outcome on our strategy.

We're not yet the torrid growth machine that we're all looking forward to. But we're building strength in all areas, financial performance and stability, product and development, strategic alliances, and sales and marketing cohesion.

Just a few comments from me before Roland highlights the financial results. We continue with year-over-year improvement in sales and gross margin of our vital strategic business. Overall our total Companywide sales appear flat, as the improvement in the sales in the higher margin strategic business is matched by reductions in the lower margin tactical business. This exchange was anticipated due to the sale of our home power business.

Also positive is the growth in worldwide or non-North American sales. Reciprocally North American sales have reduced at approximately the same rate as non-North American sales have improved. But that was also anticipated, again, largely because of home power, which we exited at the end of 2007, and was strictly North American business. It is no longer part of the mix.

However, within the sales outside North America, we are very encouraged as their growth is in the dealer-based sales. And this shift to the regionally-based dealers is part of the worldwide sales organization plan which was announced in our June restructuring.

Restructuring creates certain wounds. But these are quickly healing. Focus, clarity and commitment are motivating our staff. We last spoke with you on the day of our downsizing. And as I noted then, it was a difficult point in time for Carmanah's employee stakeholders. Yet employees, and even the Victoria community and media, quickly understood the positives in our changes.

Outsourcing, focus and a shift to developing products rather than manufacturing them are becoming our core competency and the vision of our new Carmanah. These points, as well as the transparent and decisive manner with which the restructuring actions were taken, provided the Company with the opportunity to move forward immediately.

Management credibility has been maintained through the process, and staff attitudes are quickly escalating as they begin to feel essential to our new Carmanah.

Most noticeable is the vigor with which the regionally-based sales channel managers are diving into the additional products and territories that they now manage as part of the restructuring.

Just a final few comments on other items before Roland takes over. I want to be sure to...

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