Devonshire Industries Releases 2012 Annual Report

Hamilton, Bermuda – 27 September, 2012 – In a filing to the Bermuda Stock Exchange (BSX) Devonshire Industries Limited (Ticker: DEV.BH) released its audited financial report to 31 March, 2012. In a letter to shareholders Company Chairman, Barry Hanson, states:

“Dear Shareholder,

Enclosed are the audited financial statements of Devonshire Industries Limited (the “Company”) for the year ending March 31, 2012.

It was another challenging year for the Company and the Bermuda economy in general. Reduced customer spending and the severe decline in construction industry activity contributed to a 9% reduction in revenue, which we consider to be a good outcome bearing in mind the difficult economic environment. Our gross margin decreased from 39.7% to 37.5% reflecting pricing constraints.

Net income declined to $49,000 as compared with $133,000 for the prior year. The Company was able to achieve a modest profit as a result of very careful cost management. Operating costs decreased by $115,000 (9.7%) as compared with the prior year. Despite the challenging environment, revenue for the current year to date is marginally ahead of the prior period.

The Company remains in a strong financial position. As at March 31, 2012 net assets were $2.6 million and cash and deposits totalled $575,000. The Company was marginally cash positive after accounting for a dividend of $108,000 paid during the year.

We continue to focus on the future, improving our products and services, controlling our expenses and increasing our market share. As previously announced, the Valspar brand has been added to our range of products and are now available in our retail store. Our revolutionary new colour system will be introduced in October of this year with seminars, newspaper and television advertising.  With the purchase of the new tint dispenser and colour matching equipment, we can easily match any colour in any colour system for any paint we sell.

Our new Website (www.bermudapaint.bm) went on-line in the middle of this year. If you have not already done so, we encourage you to visit the website as it will give you a sense of our progress and the initiatives we have introduced. The new colour system will be added upon launch in October of this year.

As previously advised, we are investigating the economics of a new building to better showcase our new colour system and branding. We believe it is imperative that the physical plant be in place to take full advantage of our new initiatives and to maximise shareholder value. Progress in this area has been slower than we would like but we are keen to move forward, such that we may have physical plant reflective of our impressive product range.  

The projected construction and related cost of the new building is estimated to be approximately $2 million. The Company is to explore all methods of financing but we are keen to offer existing shareholders the opportunity to further invest in the growth of the Company. Support from our shareholders in this important initiative would help bring our exciting vision to fruition and we believe add long term shareholder value. We expect to be in contact with shareholders regarding this matter in due course.

In closing, I would like to thank the Board of Directors and all of our employees for their hard work during this unprecedented business environment.”

Enquiries:

Richard A. Moulder

General Manager                                (441) 236-4662