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Letter to the Editor
Wednesday December 21
Boyd Group Income Fund Announces Suspension Of Distributions
The Boyd Group Income Fund has announced that it is temporarily suspending cash distributions to unitholders until further notice. The suspension of distributions will become effective following the December 23, 2005 payment of the previously announced distributions to unitholders of record as of November 30, 2005.The Trustees of the Fund and management of The Boyd Group Inc. believe that notwithstanding the company's positive business prospects, the suspension of distributions is in the best interests of unitholders as it will allow the Boyd Group to strengthen its balance sheet and improve its cash position and financial flexibility, while the company continues to focus on optimizing the performance of its existing collision repair centers and enhancing its competitive position.
The financial position of the Boyd Group will be regularly evaluated by the company's management and the Fund's Trustees to determine when a resumption of distributions will be appropriate.
"The decision to suspend distributions involved a great deal of careful consideration by the Trustees of the Fund and the Boyd Group management team, particularly given the operating performance improvements we have experienced recently. While we have achieved positive improvements in our same store sales trends in both Canada and the U.S., while reducing our operating expenses as a percentage of sales, our overall progress in strengthening our distributable cash from operations has not been as rapid as we initially anticipated when we announced a reduction to distributions earlier this year. As a result, we have determined that at this time, a suspension in distributions concurrent with a focus on strengthening our balance sheet is a prudent and appropriate course of action that is in the best long-term interests of our equityholders," said Terry Smith, President and CEO of the Boyd Group. "We recognize the importance of regular distributions to our equityholders and will continue to evaluate our financial position on a monthly basis. We believe our business is fundamentally sound and it is our intention to resume distributions at the appropriate time."
The Boyd Group Inc. is the largest operator of collision repair centers in Canada and among the largest in North America. The company operates locations in the four western Canadian provinces principally under the trade names Boyd Autobody & Glass and Service Collision Repair, as well as in six U.S. states principally under the trade name Gerber Collision & Glass.
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