Clearwater Finance Inc. - Ársreikningur

CLEARWATER REPORTS 2009 YEAR-TO-DATE AND SECOND QUARTER RESULTS STRONGER THAN 2008

Attention Business/Financial Editors                                            

CLEARWATER REPORTS 2009 YEAR-TO-DATE AND SECOND QUARTER  RESULTS STRONGER THAN  
2008                                                                            

/Not for distribution to United States or for dissemination in the United States
/                                                                               

HALIFAX, AUGUST 11/CNW/ - (TSX:CLR.UN, CLR.DB, CLR.DB.A):                       

Earnings before interest, taxes, depreciation and amortization (“EBITDA”),      
excluding foreign exchange losses and one time and unusual adjustments,         
increased by 30% or $3.6 million year-to-date over 2008 to $15.3 million.       
EBITDA increased by 39% or $1.9million over the second quarter of 2008 to $6.7  
million.                                                                        

Sales increased year-to-date by 12% or $14.8 million over 2008 to $141.1        
million.  Sales increased by 1% in Q2 2009 or $0.9 million to $70 million.      

Gross profit margins increased by 41% or $5.9 year-to-date over the 2008 to     
$20.4 million.  Gross profit margins in the second quarter were up 6.4% or $0.5 
million over the second quarter of 2008.                                        

Management successfully completes refinancing of maturing debt facilities       

Today, Clearwater Seafoods Limited Partnership (“Clearwater”) reported its      
year-to-date and second quarter 2009 results                                    

Clearwater reported a 12% year-to-date increase in sales to $141.1 million and a
41% increase in gross margins to $20.4 million, improvements of $14.8 million   
and $5.9 million over the respective periods in 2008.  With the launch of the   
new clam vessel and the finalization of a new shrimp joint venture, both of     
which occurred in the second quarter of 2008, Clearwater's operating results    
have continued to show improvement. These and other positive factors such as an 
improved foreign exchange environment for exporters resulted in a 30% increase  
in EBITDA before foreign exchange losses and one time and unusual adjustments,  
in 2009                                                                         

Clearwater reported a 1% increase in sales to $70 million and gross margins of  
$9.3 million for the second quarter of 2009, improvements of $943,000 in sales  
with margins up $0.5 million over the respective periods in 2008.               

Clearwater reported normalized EBITDA of $15.3 million year-to-date 2009 versus 
$11.7 million the same period of 2008. Clearwater reported normalized EBITDA of 
$6.7 million in the second quarter of 2009 versus $4.7 million the same period  
of 2008 (for calculation of normalized EBITDA refer to the Definitions and      
Reconciliations section of the 2009 first quarter MD&A).  The improvements for  
both periods are a result of higher sales and gross profits as the business     
returns to more normal operations.                                              

Year-to-date, the business experienced overall higher margins as a percentage of
sales despite higher costs in the first quarter of 2009 as it sold down         
inventories harvested in 2008 when fuel costs were higher.  In addition,        
challenging weather conditions in late 2008 and early 2009 impacted catch rates 
and the related catching costs per pound. However, late in the first quarter of 
2009 weather conditions began to improve and we saw a corresponding improvement 
in catch rates and harvesting costs per pound.  In addition, fuel costs remain  
substantially lower than the costs in 2008.  Should these factors persist, they 
will result in lower harvest costs going forward in 2009.                       

During the quarter Clearwater successfully completed the refinancing of its     
maturing debt facilities.  The refinancing consists of a new $60 million        
revolving debt facility with a three-year term fully underwritten by GE Capital 
in Canada and a new three year, $59.5 million term loan underwritten by GE      
Capital, Export Development Canada, The Business Development Bank of Canada, and
the Province of Nova Scotia, through the Industrial Expansion Fund.  The        
proceeds were used to repay maturing term debt facilities.                      

During the course of the refinancing Clearwater and Glitnir Banki hf reached an 
agreement to resolve its dispute concerning any potential liability associated  
with foreign exchange derivative contracts entered into with Glitnir. Under the 
agreement all outstanding derivative contracts were closed and the potential    
liability under these contracts was capped at $13.97 million represented by two 
notes with any payments due the later of September 15th, 2012 and 30 days after 
the final court ruling. Clearwater has agreed to commence litigation on its     
position that these contracts are null and void and there is no liability under 
the contracts. If Clearwater is successful, there is a minimum settlement of    
$2.9 million represented by a note secured by a subordinated charge on all of   
Clearwater's assets. Both notes will accrue interest at Libor plus 7% until such
time as they are settled.                                                       

During the quarter Clearwater continued to generate cash by disposing of        
non-core quotas from which it was not earning an adequate return on its capital 
employed.  In the second quarter Clearwater sold $8 million of non-core         
groundfish quotas and used the proceeds to reduce its outstanding indebtedness, 
reducing the amounts to be refinanced in June.                                  

The refinancing of its term debt facilities and the sale of these non-core      
quotas are all part of Clearwater's focused strategy for maintaining liquidity  
which includes tightly managing its working capital, limiting capital spending, 
liquidating under performing assets and selling non-core assets which do not    
achieve an adequate return on capital, limiting distributions and maximizing the
amount of cash on hand.                                                         

Looking forward to the second half of 2009, Clearwater believes that with the   
improvements to the clam, shrimp and lobster fleets and the possibility of      
continued lower fuel costs it will be able to operate without disruption to grow
and to generate positive cash flows and profit margins, subject to any impact of
weakened economic conditions in North America, Europe and Asia.  Clearwater     
believes that as a food company the business will respond well in the current   
recessionary period.                                                            

Over the next several years Clearwater will be focused on reducing its leverage.
This will come from a combination of improved earnings levels and from using the
positive cash flow of the business to reduce debt.                              

Colin MacDonald, Chairman and Chief Executive Officer, commented, “We are       
pleased to report these strong results despite the challenging worldwide        
economic conditions. Our solid results speak to the success of all our business 
units and in particular our outstanding and dedicated workforce which continues 
to seek and find ways to drive innovation in our harvesting, our processing and 
in building strong relationships with our customers.”                           


Colin MacDonald                                                                 
Chairman and Chief Executive Officer                                            
Clearwater Seafoods Limited Partnership                                         
August 11, 2009   

Financial Statements and Management's Discussion and Analysis Documents         

For an analysis of Clearwater and Clearwater Seafoods Income Fund's second      
quarter results, please see the Management's Discussion and Analysis and the    
2009 second quarter financial statements.  These documents can be found in the  
disclosure documents filed by Clearwater Seafoods Income Fund with the          
securities regulatory authorities available at www.sedar.com or at its website  
(www.clearwater.ca).                                                            










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The Fund does not consolidate the results of Clearwater's operations but rather 
accounts for the investment using the equity method.  Due to the limited amount 
of information that this would provide on the underlying operations of          
Clearwater, the financial highlights of Clearwater are included above.          

About Clearwater                                                                

Clearwater is recognized for its consistent quality, wide diversity and reliable
delivery of premium seafood, including scallops, lobster, clams, coldwater      
shrimp, crab and ground fish.                                                   

Since its founding in 1976, Clearwater has invested in science, people,         
technology, resource ownership and resource management to preserve and grow its 
seafood resource. This commitment has allowed it to remain a leader in the      
global seafood market.                                                          

For further information: Robert Wight, Chief Financial Officer, Clearwater,     
(902) 457-2369; Tyrone Cotie, Director of Corporate Finance and Investor        
Relations, Clearwater, (902) 457-8181.