Mr. Derek Webb reports

BIOREM REPORTS INCREASED REVENUES AND EARNINGS FOR FIRST QUARTER

Biorem Inc. has released its results for the three-month period ended March 31, 2015. Biorem's complete 2015 first quarter financial statements and management discussion and analysis have been filed on SEDAR.

                     FINANCIAL SUMMARY
      (in thousands of dollars, except per-share data) 

                                       Three months ended March 31,
                                                 2015         2014 
          
Revenue                                      $  4,689     $  1,974          
Gross profit                                    1,531          329            
EBITDA                                            720         (318)          
Net earnings (loss)                               528         (531)          
Basic earnings (loss) per share                  0.04        (0.04)
Diluted earnings (loss) per share                0.02        (0.04)   

Revenues for the quarter totalled $4.7-million, an 18-per-cent increase over the previous quarter, and $2.7-million, or a 138-per-cent increase from revenues of $1.9-million recorded during the first quarter of 2014. The increase in 2015 first quarter revenues was a result of the substantially higher order backlog at Dec. 31, 2014.

Gross profit increased by $156,000 from the previous quarter to $1.5-million, representing 32.7 per cent of revenue, compared with $329,000 of gross profit achieved in the first three months of 2014, representing 16.7 per cent of revenue. This increase in gross profit was the result of the increased volume of business, and the 16-per-cent increase in gross profit percentage was due to the fixed costs of engineering and operations that remained consistent with the previous corresponding quarter, representing a lower percentage of cost of goods sold.

Operating expenses in the quarter of $834,000 were $100,000 higher than in the same period in the previous year; the increase was largely the result of higher sales commissions earned on the higher revenue recorded.

The company's unrestricted cash position stood at $1.3-million on March 31, 2015, compared with $1.2-million held on Dec. 31, 2014. Working capital stood at $1.4-million compared with $584,000 at Dec. 31, 2014, and a working capital deficit of $86,000 at March 31, 2014. During the quarter, the company repaid $200,000 of long-term debt.

The company booked new orders totalling $4.5-million in the quarter, resulting in a backlog of orders at March 31, 2015, of $14.7-million, compared with $8.6-million at March 31, 2014.

"Booking activity in late 2014 and the first quarter of 2015 has been strong, helping to provide a healthy backlog for the rest of the year," said Derek S. Webb, president and chief executive officer. "This continuing positive trend is a reflection of municipalities selecting a reliable option for odour control.

"Two consecutive quarters of increased bookings, revenue, working capital and reduced expenses have improved the financial health of the company, placing it in a stronger condition. With urban encroachment on infrastructure posing challenges to the operation of waste water facilities; safe, efficient solutions with small carbon footprints are being chosen for those high-profile applications. Biorem's engineered media and innovative designs are well positioned to take advantage of these needs."

Subsequent to March 31, 2015, the holders of $659,000 of convertible debentures agreed to extend the maturity date of the debentures from May 5, 2015, to Aug. 16, 2016.