XPEL Reports Third Quarter Results

Published 

XPEL REPORTS THIRD QUARTER RESULTS

– Quarterly Revenues up 139% –
– Generated Positive Net Income for the Quarter –
– Achieved Second Consecutive Quarter of Positive Cash Flow –

SAN ANTONIO, TEXAS, November 20, 2007…XPEL Technologies Corp. (TSXV: DAP.U) today announced results for the three and nine months ended September 30, 2007, as compared to the three and nine months ended September 30, 2006.

XPEL’s Chief Executive Officer, Steven J. McAuley, stated, “The third quarter of 2007 was truly monumental for XPEL. We followed up on the breakthrough of the second quarter with third quarter positive cash flows and our first quarter of net earnings, which puts us on pace to achieving full year profitability in 2007. Our balance sheet continued to show improvement with working capital of approximately US$1.5 million and we are seeing better than expected same store results from our facilities in both the United States and Canada.”

Mr. McAuley further added, “We believe our results will continue to improve as we integrate our recent acquisition of Paintshield, Limited, and address the exceptional demand for our new XPEL Protection Film, domestically and in international markets.”

Three and Nine Months Ended September 30, 2007 compared to the Three and Nine Months ended September 30, 2006

Revenues. Revenues, inclusive of a full quarter of Canadian operations, increased from US$826,497 to US$1,972,063, or 139% between quarters and from US$2,548,266 to US$3,887,986, or 53% between the nine month periods.

Cost of Sales. Cost of sales increased from US$276,113 to US$753,455 and as a percentage of revenues from 33% to 38%, between quarters. For the nine months ended September 30, 2007, cost of sales increased from US$958,042 to US$1,339,444 but decreased as a percentage of revenues from 38% to 34%.

Expenses. Total expenses decreased $11,278 from US$845,425 to US$834,147, or approximately 1% between quarters and increased approximately 9% from US$2,478,494 to US$2,711,300 between years. The change in total expenses was a result of increased general and administrative expenses and increased amortization expense offset by a decline in research and development expenses.

General and administrative expenses increased from US$687,497 to US$701,290, or 2% between quarters and from US$1,962,068 to US$2,336,545, or 19% between the nine month periods.

Research and development expenses decreased from US$54,649 to $0 during the quarters and from US$165,093 to $0 during the nine months ended, as the Company determined that the costs related to its design function should be expensed over a twenty-four month period. In previous periods, the Company expensed its design costs as incurred.

Net earnings (loss). The Company had net earnings of US$384,461 for the quarter ended September 30, 2007 as compared to a net loss of US$295,041 for the quarter ended September 30, 2006. When adjusted for non-cash expenses the Company recorded net income of US$386,177 for the quarter ended September 30, 2007 as compared to an adjusted net loss of US$174,165 for the quarter ended September 30, 2006. This represents the second quarter of cash flow profitability since the Company went public in late 2004. The Company had a net loss of US$162,758 for the nine months ended September 30, 2007 as compared to a net loss of US$888,270 for the nine months ended September 30, 2006. When adjusted for non-cash expenses we recorded net income of US$312,055 for the nine months ended September 30, 2007 as compared to an adjusted net loss of US$558,389 for the nine months ended September 30, 2006.

This press release should be read in conjunction with the Interim Financials, Notes and Management Discussion and Analysis filed on www.sedar.com.

About XPEL Technologies Corp.

With distribution channels in North America, Europe, Asia, the Middle East and Australia, XPEL Technologies Corp. is the worldwide leading supplier of automotive survival products. XPEL sells paint protection film, headlamp protection products and installation tools and is the developer of the Design Access Program software. XPEL sells its products directly to consumers and installer partners, providing them everything they need to develop a thriving paint protection business. In addition to its expansive line of products, the Company offers installation training and marketing support making it the premier source for dealers and installers of paint protection products. XPEL is publicly traded on the TSX Venture Exchange. Additional information can be found on the Company’s website at www.xpel.com.

Certain statements contained herein such as “We followed up on the breakthrough of the second quarter with third quarter positive cash flows and our first quarter of net earnings, which puts us on pace to achieving full year profitability in 2007,” and “We believe our results will continue to improve as we integrate our recent acquisition of Paintshield, Limited, and address the exceptional demand for our new XPEL Protection Film, domestically and in international markets” are considered “forward-looking statements.” These types of statements are based upon the belief of the Company’s management, as well as assumptions made beyond information currently available to the Company’s management. Because “forward-looking statements” are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, price competition, the inability to obtain additional capital, loss of key personnel, unavailability of leased facilities, technological changes, service interruptions, equipment failures, customer attrition, general economic conditions, relationships with vendors, government supervision and regulation, changes in industry practices, and other factors.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy and accuracy of this information.

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Company Contact:

Ryan Pape
Chief Executive Officer
210-678-3700

Investor Relations:

John Nesbett/Jennifer Belodeau
Institutional Marketing Services (IMS)
(203) 972-9200
[email protected]