ATS Automation Tooling Systems: Q4 2008 results

ATS Automation Tooling Systems Inc. today reported its financial results for the three and 12 months ended March 31, 2008 - and announced that it has completed a number of further steps to strengthen the organization and restore profitability.

"We are executing a value creation strategy," said Anthony Caputo, ATS Chief Executive Officer. "In fiscal 2009, we plan to stabilize and improve operating performance. Our plan has four elements: improve management; fix Automation Systems Group; position Photowatt France to become a standalone company; and strengthen the balance sheet. To date, we have made good progress on all these fronts."

        Highlights
        -   Strengthened leadership, improved business processes;
        -   Returned Photowatt France to profitability in the fourth quarter
            through cell efficiency and manufacturing yield improvements;
        -   Advanced the PV Alliance relationship;
        -   Improved ASG operating margin to 4% before restructuring charges of
            $9.0 million;
        -   Initiated the consolidation of certain small facilities and reduced
            ongoing ASG costs through staff reductions;
        -   Booked a $27 million repetitive equipment manufacturing order in the
            solar industry;
        -   Increased period end ASG Order Backlog to $232 million, 25% higher
            than a year ago;
        -   Improved liquidity through the sale of $16.8 million of silicon not
            usable by Photowatt France;
        -   Signed an $85 million credit facility subsequent to quarter end; and
        -   Sold the SSP building for net proceeds of $16.0 million subsequent to
            quarter end.


As previously announced, management estimated the costs to improve operations at approximately $30 million. Costs incurred during the fourth quarter of fiscal 2008 included $11.1 million for restructuring and severance, PCG operating losses of $1.4 million and costs of $0.9 million related primarily to the wind down of Spheral Solar. To offset a portion of the remaining costs, management intends to monetize other redundant and non-core assets. The payback period on operational improvement costs is expected to be less than one year.

Earnings per Share

Fourth quarter 2008 earnings from continuing operations were 13 cents per share compared to a loss of $1.31 per share in the fourth quarter a year ago. Earnings per share during the fourth quarter were 10 cents compared to a loss of $1.35 per share a year ago. For fiscal 2008, earnings from continuing operations were 17 cents per share versus a loss of $1.28 per share in fiscal 2007. Net loss for the year was 33 cents per share compared to a net loss of $1.42 in fiscal 2007.

        Financial Results

        In millions                    3 months   3 months  12 months  12 months
         of dollars,                     ended      ended      ended      ended
         except per                     Mar. 31,   Mar. 31,   Mar. 31,   Mar. 31,
         share data                       2008       2007       2008       2007
        -------------------------------------------------------------------------

        -------------------------------------------------------------------------
        Revenues     Automation Systems
         from         Group            $  125.3   $  113.8   $  465.0   $  466.0
         continuing  ------------------------------------------------------------
         operations  Photowatt
                      Technologies         61.3       38.5      198.6      150.6
                     ------------------------------------------------------------
                     Inter-segment         (0.1)      (0.9)      (0.3)      (2.1)
                     ------------------------------------------------------------
                     Consolidated      $  186.5   $  151.4   $  663.3   $  614.5
        -------------------------------------------------------------------------

        -------------------------------------------------------------------------
        EBITDA       Automation Systems
                      Group            $   (2.1)  $   (1.5)  $    9.1   $   17.9
                     ------------------------------------------------------------
                     Photowatt
                      Technologies
                      - Photowatt France    6.8        5.9        6.3       28.9
                      - Other Solar        (0.9)     (33.8)      (6.4)     (48.6)
                      - Gain on sale of
                        silicon            16.8        0.0       16.8        0.0
                     ------------------------------------------------------------
                     Gain on sale of
                      investments           0.0        0.0       31.8        0.0
                     ------------------------------------------------------------
                     Corporate and
                      Inter-segment
                      elimination          (6.6)      (6.0)     (26.7)     (14.9)
                     ------------------------------------------------------------
                     Consolidated      $   14.0   $  (35.4)  $   30.9   $  (16.7)
        -------------------------------------------------------------------------

        -------------------------------------------------------------------------
        Net income
         (loss) from
         continuing
         operations  Consolidated      $   10.3   $  (78.4)  $   12.2   $  (76.7)
        -------------------------------------------------------------------------

        -------------------------------------------------------------------------
        Earnings     From continuing
         (loss)       operations
         per share    (basic &
                      diluted)         $   0.13   $  (1.31)  $   0.17   $  (1.28)
                     ------------------------------------------------------------
                     After discontinued
                      operations (basic
                      & diluted)       $   0.10   $   1.35   $  (0.33)  $  (1.42)
        -------------------------------------------------------------------------


        ASG Results

        -   Excluding severance costs of $9.0 million and $2.6 million
            respectively, fiscal 2008 fourth quarter EBITDA was $6.9 million
            compared to EBITDA of $1.1 million a year ago;
        -   Period end ASG Order Backlog increased 25% to $232 million from
            $185 million a year ago;
        -   ASG Order Bookings for the fourth quarter increased to $137 million
            compared to $134 million a year ago;
        -   ASG Order Bookings were $110 million during the first 10 weeks of the
            first quarter.


ASG's revenues increased 10% in the fourth quarter compared to a year ago. The increase came from strong Order Bookings during fiscal 2008. Period end Order Backlog supports continued revenue growth. Operating results improved, after severance costs, due to increased revenue, reduced amortization and better program execution.

        Photowatt Technologies Results

        -   Fourth quarter Photowatt France EBITDA was $6.8 million compared to
            $5.9 million a year ago;
        -   Total megawatts (MWs) sold at Photowatt France increased 64% to
            13.1 MWs from 8.0 MWs in the fourth quarter of fiscal 2007 - with
            UMGSi products accounting for 60% of revenue;
        -   Average cell efficiency improved in the fourth quarter to
            approximately 13.5% for UMGSi cells (from 12.6% a year ago);
        -   Photowatt Technologies operating earnings of $19.2 million in the
            fourth quarter were comprised of $3.3 million of operating earnings
            at Photowatt France and $15.9 million generated from a gain on the
            sale of non-solar grade silicon that had nominal carrying value; the
            gain more than offset wind-down costs of SSP.


Significant production gains, including lower silicon usage per watt and improved cell efficiency during the fourth quarter led to increased profitability of Photowatt's UMGSi products. Photowatt will continue to focus on improving profitability through cost reductions and improved efficiencies.

The PV Alliance, a joint venture involving Photowatt France, EDEV EnR Reparties, (a partially owned subsidiary of Electricité de France), and CEA Valorisation was advanced. The PV Alliance is contemplated to include Lab-Fab and manufacturing in France. Phase 1 of Lab-Fab, designed to increase cell efficiency by up to 2%, was initiated.

Precision Components Group

The Company is in negotiations to sell the key operating assets and liabilities of PCG. Results have been restated to reflect the reclassification of PCG as a discontinued operation.

Board Changes

Neil D. Arnold, Chairman of the Board of ATS, today announced the appointment of Anthony Caputo to the Board of Directors, effective immediately. Mr. Caputo joined ATS in November 2007 as Chief Executive Officer with a 25 year track record of delivering performance, growth and value creation.

Peter Puccetti, founder, Chairman and Chief Investment Officer of Goodwood Inc. and J. Cameron MacDonald, President and Chief Executive Officer of Goodwood also announced their decision to step down from the Board effective June 19, 2008 as part of a planned governance transition.

In announcing their decision, Mr. Puccetti said: "While we intend to remain active ATS shareholders, we have accomplished what we set out to do last year. We facilitated change at the Board and CEO level and participated in the development of a new strategy for ATS. We're confident in the future direction of the business."

Quarterly Conference Call

ATS's quarterly conference call begins at 10 am eastern today and can be accessed over the Internet at www.atsautomation.com or on the phone at 416 644 3416.

About ATS

ATS Automation Tooling Systems Inc. provides innovative, custom designed, built and installed manufacturing solutions to many of the world's most successful companies. Founded in 1978, ATS uses its industry-leading knowledge and global capabilities to serve the sophisticated automation systems' needs of multinational customers in industries such as healthcare, computer/electronics, automotive, energy and consumer products. It also leverages its many years of experience and skills to fulfill the specialized repetitive equipment manufacturing requirements of customers. Through Photowatt Technologies, ATS participates in the growing solar energy industry as an integrated manufacturer of ingots, wafers, cells and modules. Photowatt-branded products and systems serve businesses, institutions and homeowners in established and emerging markets. ATS employs approximately 3,500 people at 23 manufacturing facilities in Canada, the United States, Europe, Southeast Asia and China. The Company's shares are traded on the Toronto Stock Exchange under the symbol ATA. Visit the Company's website at www.atsautomation.com.

Note to Reader

This press release and Fourth Quarter Summary for the three months ended March 31, 2008 (fourth quarter of fiscal 2008) provide information on the Company's operating activities of the fourth quarter of fiscal 2008 and should be read in conjunction with the Company's audited Consolidated Financial Statements and Management's Discussion and Analysis ("MD&A") for the years ended March 31, 2008 and 2007 and the Company's fiscal 2008 Annual Report. The Company assumes that the reader of this press release and Fourth Quarter Summary has access to, and has read the audited Consolidated Financial Statements and MD&A of the Company for fiscal 2008 and the unaudited interim Consolidated Financial Statements and MD&A for the first, second and third quarters of fiscal 2008. Accordingly, the purpose of this press release and fourth quarter summary is to provide a fourth quarter update. These documents and other information relating to the Company, including the Company's fiscal 2008 audited Consolidated Financial Statements, MD&A and Annual Information Form, may be found on SEDAR's website at www.sedar.com.

The Company has two reportable segments: Automation Systems Group ("ASG") and Photowatt Technologies ("Photowatt") which includes Photowatt France (the ongoing Photowatt Technologies operations), Photowatt USA (a small module assembly and sales operation closed during fiscal 2008) and Spheral Solar (a halted development project that has been wound down). Any reference to solar production capacity assumes the use of polysilicon at 15% cell efficiency, unless otherwise stated. Actual solar capacity may vary materially for a number of reasons including the use of UMGSi, changes in cell efficiency and/or changes in production processes. References to Photowatt's cell ''efficiency'' means the percentage of incident energy that is converted into electrical energy in a solar cell. Solar cells and modules are sold based on wattage output. "Silicon" refers to a variety of silicon feedstock, including polysilicon, UMGSi and polysilicon powders and fines.

Non-GAAP Measures

Throughout this press release and Fourth Quarter Summary the term "operating earnings" is used to denote earnings (loss) from operations. EBITDA is also used and is defined as earnings (loss) from operations excluding depreciation, amortization (which includes amortization of intangible assets) and segment and division allocation of corporate costs. The term "margin" refers to an amount as a percentage of revenue. The terms "earnings from operations", "operating earnings", "margin", "operating loss", "operating results", "operating margin", "EBITDA", "Order Bookings" and "Order Backlog" do not have any standardized meaning prescribed within GAAP and therefore may not be comparable to similar measures presented by other companies. Operating earnings and EBITDA are some of the measures the Company uses to evaluate the performance of its segments. ATS presents EBITDA to show its performance before depreciation and amortization. Management believes that ATS shareholders and potential investors in ATS use non-GAAP financial measures such as operating earnings and EBITDA in making investment decisions about the Company and measuring its operational results. A reconciliation of EBITDA to total Company revenue and earnings from operations for the three and twelve month periods ending March 31, 2008 and 2007 is contained in the MD&A and this press release. EBITDA should not be construed as a substitute for net income determined in accordance with GAAP. Order Bookings represent new orders for the supply of automation systems that management believes are firm. Order Backlog is the estimated unearned portion of ASG revenue on customer contracts that are in process and have not been completed at the specified date.

        Fourth Quarter Summary

        ASG Segment

        ASG Revenue (in millions of dollars)

        Revenue by industry                                   Q4 2008    Q4 2007
        -------------------------------------------------------------------------
        Healthcare                                           $   39.7   $   32.1
        Computer-Electronics                                     29.4       34.7
        Automotive                                               29.4       26.3
        Energy                                                   17.7        8.9
        Other                                                     9.1       11.8
        -------------------------------------------------------------------------
        Total Revenue                                        $  125.3   $  113.8
        -------------------------------------------------------------------------
        -------------------------------------------------------------------------


Fourth quarter ASG revenue increased 10% or $11.5 million compared to the same quarter a year ago. This improvement was due to growth in Order Bookings and Order Backlog experienced in the first half of fiscal 2008.

By industrial market, healthcare revenue increased 24% year over year on strong Order Backlog entering the quarter. Computer-electronics revenue decreased 15%, primarily on lower sales in Asia and the U.S. Automotive revenue increased 12%, reflecting strong automotive revenue in Europe. ASG revenue from the energy market increased 99%, driven by activity in the nuclear and solar industries. Revenue from "other" markets decreased 23% due primarily to lower revenues in the consumer products industry.

On a regional basis, strong revenue growth in ASG's Canadian operations was partially offset by revenue declines in U.S. and Asian operations. REM revenue increased 35% to $12.8 million in the fourth quarter of fiscal 2008, compared to $9.5 million a year ago, primarily reflecting increased order flow from existing customers. REM currently generates revenue primarily from customers in the healthcare industry, but new orders secured in the fourth quarter of fiscal 2008 will advance the business into the solar industry.

Quarter-over-quarter foreign exchange rate changes negatively impacted ASG revenues by an estimated $12.8 million for the fourth quarter, compared to a year ago, primarily reflecting a stronger Canadian dollar relative to the U.S. dollar.

        ASG Operating Results (in millions of dollars)

                                                              Q4 2008    Q4 2007
        -------------------------------------------------------------------------

        Earnings (loss) from operations                      $   (4.2)  $   (4.5)
        Amortization                                              2.1        3.0
        -------------------------------------------------------------------------
        EBITDA                                               $   (2.1)  $   (1.5)
        -------------------------------------------------------------------------
        -------------------------------------------------------------------------


Fiscal 2008 fourth quarter operating loss of $4.2 million included severance and restructuring costs of $9.0 million, compared to an operating loss of $4.5 million including severance costs of $2.6 million in same quarter a year ago. Fiscal 2008 fourth quarter severance and restructuring costs affected approximately 250 positions in North America, Europe and Asia, and includes positions at small operating facilities in Thailand and Michigan, which will be closed in fiscal 2009. Management anticipates continuing costs associated with finalizing the wind-up of these two small operations to negatively impact operating earnings in the first half of fiscal 2009. Fiscal 2007 fourth quarter severance costs were associated with workforce reductions of 180 positions primarily in North America.

Excluding severance costs, fiscal 2008 fourth quarter operating earnings were $4.8 million (operating margin of 4%), compared to an operating loss of $1.9 million in fiscal 2007. This improvement was driven by increased revenue, reduced amortization and better program execution in the fourth quarter of fiscal 2008 compared to a year ago. On a regional basis, improvements in Canadian operating results before severance and restructuring costs were partially offset by reduced earnings in the Company's U.S. and Asian operations.

Foreign exchange rate changes negatively impacted ASG operating earnings in the fourth quarter fiscal 2008 by an estimated $3.1 million compared to a year ago, primarily reflecting a stronger Canadian dollar relative to the U.S. dollar.

        ASG Order Bookings by Quarter (in millions of dollars)

                                                         Fiscal 2008 Fiscal 2007
        -------------------------------------------------------------------------
        Q1                                                   $   146    $     98
        Q2                                                       133         101
        Q3                                                       115         109
        Q4                                                       137         134
        -------------------------------------------------------------------------
        Total Order Bookings                                 $   531    $    442
        -------------------------------------------------------------------------
        -------------------------------------------------------------------------


Fiscal 2008 Order Bookings were $531 million, 20% higher than the previous year, driven primarily by strong Order Bookings in healthcare and energy sectors. Order Bookings during the first 10 weeks of fiscal 2009 were approximately $110 million.

        ASG Order Backlog by Industry (in millions of dollars, except percentage
        change)

                                                March 31,  March 31,  Percentage
                                                    2008       2007       Change
        -------------------------------------------------------------------------
        Healthcare                                $   58     $   53          9.4%
        Computer-electronics                          41         34         20.6%
        Automotive                                    41         50       (18.0)%
        Energy                                        68         33        106.1%
        Other                                         24         15         60.0%
        -------------------------------------------------------------------------
        Total                                     $  232     $  185         25.4%
        -------------------------------------------------------------------------
        -------------------------------------------------------------------------


Order Backlog of $232 million at March 31, 2008 was 25% higher than at March 31, 2007 primarily reflecting higher Order Bookings throughout fiscal 2008 compared to fiscal 2007.

Increased healthcare Order Backlog primarily reflects higher Order Backlog in North America, which more than offset lower healthcare Order Backlog in Europe compared to the prior year. Increased computer-electronics Order Backlog primarily reflects higher Order Backlog in North America and Europe, which more than offset lower computer-electronics Order Backlog in Asia compared to the prior year. Lower automotive Order Backlog reflects continued weakness in the North American "Big 3" automotive sector; however, European automotive Order Backlog remained consistent with the prior year. The increase in energy Order Backlog reflects strong Order Bookings in both the nuclear and solar industries during fiscal 2008. During the fourth quarter of fiscal 2008, the Company secured a $27 million Order Booking in the solar industry with a new REM customer. Management believes this order will significantly increase REM's solar market penetration.

        Photowatt Technologies Segment

        Photowatt Technologies Revenue (in millions of dollars)

                                                              Q4 2008    Q4 2007
        -------------------------------------------------------------------------
        Photowatt France                                     $   61.4   $   37.8
        Other Solar                                              (0.1)       0.7
        -------------------------------------------------------------------------
        Total Revenue                                        $   61.3   $   38.5
        -------------------------------------------------------------------------
        -------------------------------------------------------------------------


Photowatt Technologies' fourth quarter revenue of $61.3 million was 59% higher than in the fourth quarter of fiscal 2007. Higher year-over-year revenues primarily reflected a 64% increase in total MWs sold at Photowatt France to 13.1 MWs from 8.0 MWs in the fourth quarter of fiscal 2007. Growth in MWs sold resulted from increased ingot, wafer, cell and module production capacity at Photowatt France which came on line in March 2007. In the fourth quarter, Photowatt France also increased revenue from the sale of module systems ("Systems") to approximately $9.1 million from $0.4 million in the fourth quarter of fiscal 2007. Systems include modules, combined with installation kits, solar power system design and/or other value added services.

Photowatt France's revenue reflects the change in revenue mix from polysilicon products to products made from UMGSi. Total UMGSi products represented $36.7 million of fiscal 2008 fourth quarter revenue compared to $3.8 million a year ago. Average cell efficiency was improved in the fourth quarter to approximately 13.5% for UMGSi cells, compared to approximately 12.6% during the fourth quarter of fiscal 2007.

Revenue from polysilicon products was $24.6 million in the fourth quarter, compared to $34.7 million in the fourth quarter of fiscal 2007. Average polysilicon cell efficiency improved in the fourth quarter to approximately 15.6%, compared to approximately 14.8% during the fourth quarter of fiscal 2007.

Foreign exchange rate changes negatively impacted Photowatt France fourth quarter revenues by an estimated $1.3 million compared to the fourth quarter of fiscal 2007, primarily reflecting a stronger Canadian dollar relative to the Euro.

        Photowatt Technologies Operating Results (in millions of dollars)

                                                              Q4 2008    Q4 2007
        -------------------------------------------------------------------------
        Operating Earnings (Loss):
        Photowatt France                                     $    3.3   $    3.0
        Other Solar                                              15.9      (34.1)
        -------------------------------------------------------------------------
        Photowatt Technologies
         Operating Earnings (Loss)                           $   19.2   $  (31.1)
        -------------------------------------------------------------------------
        -------------------------------------------------------------------------

        Photowatt France EBITDA
        Operating earnings (loss)                            $    3.3   $    3.0
        Amortization                                              3.5        2.9
        -------------------------------------------------------------------------
        Photowatt France EBITDA                              $    6.8   $    5.9
        -------------------------------------------------------------------------
        -------------------------------------------------------------------------


Photowatt France had operating earnings of $3.3 million in the fourth quarter of fiscal 2008, compared to operating earnings of $3.0 million in the fourth quarter of fiscal 2007. Photowatt France's most recent operating performance includes approximately $0.2 million of costs related to the investment in the PV Alliance. Photowatt France amortization expense was $3.5 million in the fourth quarter of fiscal 2008, compared to $2.9 million in the fourth quarter of fiscal 2007.

Photowatt France continues to focus on improving its profitability, particularly on UMGSi products, through cost reductions and improved cell efficiency. During the fourth quarter, significant production improvements that lowered UMGSi usage per watt and improved cell efficiency continued to increase the profitability of UMGSi products.

Compared to the prior year quarter, increased revenue during the fourth quarter of fiscal 2008 of $23.6 million positively impacted Photowatt France operating earnings. This contribution was offset by a number of factors, including:

        -   Increased costs of polysilicon feedstock due to industry shortages;

        -   Higher costs of using UMGSi feedstock compared to polysilicon used a
            year ago, despite the operational improvements made using UMGSi
            during the fourth quarter of fiscal 2008;

        -   A $0.6 million increase in amortization compared to the fourth
            quarter of fiscal 2007 primarily as a result of the capacity
            expansion completed in fiscal 2007;

        -   Increased factory overhead costs in the fourth quarter of this year
            compared to the fourth quarter last year reflecting higher activity
            levels and increased capacity.


"Other Solar" includes Spheral Solar, Photowatt USA and inter-solar eliminations. Fourth quarter operating earnings included a gain of $16.8 million on the sale of non-solar grade silicon that had a nominal carrying value. This gain more than offset ongoing costs associated with the wind-down of these operations.

Fourth quarter fiscal 2007 operating loss included solar corporate costs of $11.1 million related to the withdrawal of the solar IPO. A year ago, Spheral Solar and Photowatt USA incurred non-cash charges of $17.0 million, comprised of $16.5 million for Spheral Solar and $0.5 million for Photowatt USA, related to the decision to halt Spheral Solar's internal development and to close the module assembly facility in New Mexico. This non-cash charge included fixed asset, inventory and other working capital write-downs of $11.7 million and $5.3 million related to a non-cash provision against a portion of the Company's Canadian investment tax credits generated by Spheral Solar.

The estimated effect of changes in foreign exchange rates increased the fourth quarter fiscal 2008 operating earnings by $0.3 million compared to the fourth quarter fiscal 2007.

        Consolidated Fourth Quarter (in thousands of dollars, except per share
        data)

                                                              Q4 2008    Q4 2007
        -------------------------------------------------------------------------
        Revenue                                              $186,474   $151,444
        -------------------------------------------------------------------------
        Earnings (loss) from operations                      $  8,183   $(41,664)
        -------------------------------------------------------------------------
        Net income (loss) from
         continuing operations                               $ 10,343   $(78,440)
        -------------------------------------------------------------------------
        Net income (loss)                                    $  7,939   $(80,854)
        -------------------------------------------------------------------------
        Earnings (loss) per share
         from continuing operations, basic
         and diluted                                         $   0.13   $  (1.31)
        Earnings (loss) per share, basic
         and diluted                                         $   0.10   $  (1.35)
        -------------------------------------------------------------------------


Fourth quarter 2007 results have been restated to reflect the reclassification of the Precision Components segment as a discontinued operation. The impact of this reclassification reduced fourth quarter revenue in fiscal 2007 by $21.0 million; reduced loss from operations by $1.7 million; reduced net loss from continuing operations by $2.4 million; and, reduced loss per share from continuing operations by $0.04 per share.

Fourth quarter fiscal 2008 revenue from continuing operations was $186.5 million, $35.0 million or 23% higher than the same period a year earlier. This increase primarily reflected a 59% increase in Photowatt revenue on higher MWs produced and sold during the fourth quarter of fiscal 2008 compared to the same period a year ago. ASG revenue increased 10% due to increased Order Bookings during fiscal 2008 compared to fiscal 2007. Changes in effective foreign exchange rates reduced consolidated revenue by an estimated $14.1 million in the fourth quarter of fiscal 2008 compared to fiscal 2007.

Fourth quarter consolidated earnings from operations was $8.2 million, compared to a consolidated loss from operations of $41.7 million in the fourth quarter of fiscal 2007. The improvement in fourth quarter earnings from operations in fiscal 2008 reflects operational improvements in ASG, the gain of $16.8 million on scrap silicon sold during the quarter and a reduction in expenses in the other solar divisions, as these operations are being wound down, partially offset by consolidated severance and restructuring charges of $11.1 million. Fourth quarter consolidated earnings from operations in fiscal 2007 included $17.0 million of asset impairment and other charges related to the decision to halt internal development in the Spheral Solar division, consolidated severance and restructuring charges of $4.2 million and $11.1 million of costs related to the withdrawal of the solar IPO. Changes in effective foreign exchange rates reduced consolidated operating earnings for the fourth quarter of fiscal 2008 compared to fiscal 2007 by an estimated $2.8 million.

Forward-Looking Statements

This press release and Fourth Quarter Summary contains certain statements that constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of ATS, or developments in ATS's business or in its industry, to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements include all disclosure regarding possible events, conditions or results of operations that is based on assumptions about future economic conditions and courses of action. Forward-looking statements may also include, without limitation, any statement relating to future events, conditions or circumstances. ATS cautions you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made. Forward-looking statements relate to, among other things: the 2009 plan to stabilize and improve operating performance, including, improving management, fixing ASG, positioning Photowatt France to become a standalone company, and strengthening the balance sheet; estimated costs of operational improvements and related pay-back period; intention to monetize redundant non-core assets; cost reductions and improved efficiencies at Photowatt; the PV Alliance and contemplated Lab-Fab and manufacturing in France; design of Lab-Fab to increase cell efficiency by up to 2%; potential sale of PCG operating assets; costs associated with winding up two small operations; and management belief that REM will increase its solar market penetration. The risks and uncertainties that may affect forward-looking statements include, among others; general market performance including capital market conditions; economic market conditions; financial failure of customers, increased pricing pressure and possible margin compression; foreign currency and exchange risk; the effect of the strength of the Canadian dollar; performance of the market sectors that ATS serves; successful implementation of cost improvement initiatives at Photowatt France and achievement of intended outcomes; potential inability of Lab-Fab to achieve improvements in cell efficiency, including problems with the technology or commercialization thereof; inability to secure the required management depth and talent; inability to effectively management ASG programs due to issues with quoting or proper structure and controls; that ASG customers will not be receptive to a new approach to that market; that external market forces or internal structural issues inhibit shaping of divisions; slow-down in progress being made with the efficiency of UMGSI cells; that planned factory improvements at Photowatt France are unsuccessful or delayed; reversal of current silicon supply arrangements and negotiation of new supply arrangements; political, labour or supplier disruptions in manufacturing and supply of silicon; inability to finalize strategic partnerships or alliances to provide for silicon supply; the ability of ATS to exit the remaining PCG operations on terms satisfactory to ATS; inability to achieve expected payback period on operational improvements due to unexpected additional costs; customer resistance to ASG productized technology or other unanticipated issues with identifying and protecting ASG technology; ASG program challenges associated with executing programs from multiple ASG locations; ability to negotiate beneficial agreements with suppliers; ability to shift ASG business from a "customized" focus to one that accommodates and promotes standardized products; ASG competitive pressures; a decrease in order bookings and backlog; delays in the stabilization of ASG European and Asian operations; that some or all of the trends towards automation that ATS believes are attractive dissipate or do not result in increased demand for automation; risks associated with operating and servicing customers in a foreign country including integration risks; that multinational companies withdraw from global manufacturing for business, political, economic or other reasons; Photowatt France's ability to improve efficiencies of its solar modules produced using lower grade polysilicon or refined metallurgical silicon either alone or through partnerships; ability to finalize beneficial agreements needed to effectively implement Lab-Fab and ability to properly manage the Lab-Fab relationship; reluctance of solar customers to commit to longer term supply arrangements; the availability of government subsidies for solar products, extent of market demand for solar products; reductions in the average selling price of solar products; the development of superior or alternative technologies to those developed by ATS; the success of competitors with greater capital and resources in exploiting their technology; inability of Photowatt France or PV Alliance to obtain grants in the future to fund research and development; market risk for developing technologies; economic viability of use of metallurgical silicon; risks relating to legal proceedings to which ATS is party; exposure to product liability claims of Photowatt Technologies; risks associated with compliance with existing and new legislation; risks associated with greater than anticipated tax liabilities or expenses; and other risks detailed from time to time in ATS's filings with Canadian provincial securities regulators. Forward-looking statements are based on management's current plans, estimates, projections, beliefs and opinions, and ATS does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change.

For further information

    Anthony Caputo, Chief Executive Officer, Maria Perrella, Chief Financial Officer, Carl Galloway, Vice-President and Treasurer, (519) 653-6500

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