Cinram reported consolidated revenue of $447.8 million for the quarter ended March 31, 2006, compared to $453.8 million for the same quarter in the prior year. Net earnings were $3.9 million compared to $4.1 for the same quarter in the prior year.

"The year is off to an exciting start with the overwhelming shareholder approval for the conversion of Cinram into an income trust and the shipment of the first High Definition DVD titles," stated Isidore Philosophe, Chief Executive Officer.

For the first quarter of the year, DVD revenue was $225.5 million, compared to $224.2 million for the same quarter last year. The increase was mainly due to higher unit volumes, partially offset by lower selling prices. DVD revenue accounted for approximately 50% of consolidated revenue for the quarter, up slightly from 49% in the prior year.

The company also recorded its first high definition HD-DVD revenues of $66,000 during the same period.

Cinram’s CD revenue was $65.7 million for the quarter, compared to $73.1 million for the same quarter in the prior year. CD revenue accounted for approximately 15% of Cinram's 2006 consolidated revenue, compared to 16% for the same quarter in the prior year.

In Europe, revenue for the quarter ended March 31, 2006 was $120.8 million, compared to $102.1 million for the same period last year, the increase was due to higher DVD volume and higher distribution revenue, primarily as a result of a major studio contract that came into effect in the second half of 2005. These gains were partially offset by lower audio CD, VHS video cassette and CD-ROM sales. European revenue represented 27% of consolidated revenue for the quarter, compared to 22% for the same quarter in the prior year.

During the first quarter of 2006, the management formulated an exit plan to shut down a combined CD and DVD manufacturing facility located in Commerce, California, transferring current production to its Pennsylvania facility. The plan was finalised in early March and termination notices were given to approximately 350 employees.

Also, in the first quarter of 2006, the company moved forward with a plan to shut down the CD operations at its manufacturing facility located in Louviers, France. The Louviers facility will continue to be utilised for DVD manufacturing, leading to the layoff of 120 employees.

Story filed 08.04.06