CLEARWATER REPORTS FIRST QUARTER 2009 RESULTS AND UPDATE ON FINANCING INITIATIVES

Attention Business/Financial Editors 

CLEARWATER REPORTS FIRST QUARTER 2009 RESULTS AND UPDATE ON FINANCING
INITIATIVES 

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

HALIFAX, May 15/CNW/ - (TSX:CLR.UN, CLR.DB, CLR.DB.A): 


§	Sales increased by 24% or $13.9 million over the first quarter of 2008 to $71
million 

§	Gross profit margins increased by 70% or $4.6 million over first quarter of
2008 to $11.1 million 

§	Earnings before interest, taxes, depreciation and amortization (“EBITDA”),
excluding foreign exchange losses and one time and unusual adjustments,
increased by 34% or $2.2 million over the first quarter of 2008 to $8.6 million 

§	Management successful in selling $8 million of non-core quotas after
quarter-end and used proceeds along with cash on hand to repay $10.7 million of
long-term debt in advance of refinancing in June. 

§	Secured $8.3 million short-term bridge facility from Export Development
Canada. 

§	Management remains highly confident that refinancing will be completed prior
to the maturity of the existing term loans on June 8th. 

Today, Clearwater Seafoods Limited Partnership (“Clearwater”) reported its
first quarter 2009 results 

Clearwater reported sales of $71 million and gross margins of $11.1 million for
the first quarter of 2009, improvements of $13.9 million and $4.6 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 happened 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 24% increase in sales, a 70%
increase in gross margins and a 34% increase in EBITDA before foreign exchange
losses and one time and unusual adjustments,  in 2009. 


Clearwater reported normalized EBITDA of $8.6 million in the first quarter of
2009 versus $6.4 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 are a result of higher sales and gross profits
offset by higher SG&A costs as the business returns to more normal operations. 

Normalized cash flows were $2.6 million in the first quarter of 2009 versus $2
million the same period of 2008  with the increase attributable to higher
EBITDA partially offset by higher interest costs (for calculation of normalized
cash flows refer to the Definitions and Reconciliations section of the 2009
first quarter MD&A). 

The business experienced 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.  These factors should result in
lower harvest costs going forward in 2009. 

Clearwater remains highly confident that it will complete the refinancing of
its senior debt facilities prior to maturity on June 8, 2009.   As of April 4,
2009 Clearwater had approximately CDN $86.8 million of long-term notes to be
refinanced. In addition, in December 2008 Clearwater arranged with its foreign
exchange lenders to restructure certain of its foreign exchange contracts to
match its foreign currency receipts with a short-term loan, $14.4 million of
which remained outstanding as of April 4, 2009.  Therefore, after taking into
account the term notes and foreign exchange facilities outstanding at April 4,
2009 of $101.2 million, the $10.7 million in principal payments made after
quarter-end as noted in the following paragraph and $8.3 million in new funds
from Export Development Canada noted subsequent to that, the total debt
facilities that Clearwater is planning to refinance total approximately CDN$99
million. 

Subsequent to quarter end Clearwater was successful in selling $8 million of
non-core groundfish quotas.  Clearwater used the proceeds from these sales plus
cash on hand to make principal payments totaling approximately $10.7 million on
the facilities noted above thus reducing the amount to be refinanced in June. 

In addition, subsequent to quarter-end Clearwater obtained an $8.3 million
short-term bridge facility from Export Development Canada.  This facility has
similar terms and conditions to the amortizing facility Clearwater has in place
with its foreign exchange lenders and will provide Clearwater with additional
flexibility in managing its working capital needs until the refinancing is
complete in June. 

The sale of these non-core quotas, the early debt repayment and creating
additional working capital lines from the EDC facility 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, selling non-core assets, limiting distributions and
maximizing the amount of cash on hand. 

Clearwater's sales and gross profit margins continue to strengthen now that the
fishing fleet is operating without disruption and despite soft markets that
result from the global economic slow down, improving trends Clearwater has seen
over the past two quarters. Clearwater remains highly confident that it will
complete its debt refinancing and this, combined with the improving operations
will enable Clearwater to maintain strong liquidity to operate the business.
The credit markets remain volatile and challenging, therefore, while management
expects to be successful in refinancing this debt there is no guarantee that it
will be able to do so in the current markets.   Clearwater anticipates that its
new debt covenants will include restrictions on future distributions,
restrictions on capital expenditures as well as some agreed reductions in
principal. 

Over the next several years Clearwater will be focused on reducing its
leverage.  This will come from a combination of improved earnings levels, which
will improve trailing EBITDA levels, and from using the positive cash flow of
the business to reduce debt. Clearwater believes that over time this approach
will provide for a lower cost of capital by restoring access to a greater
variety of debt sources. 


Colin MacDonald
Chairman and Chief Executive Officer
Clearwater Seafoods Limited Partnership   
May 15, 2009

Financial Statements and Management's Discussion and Analysis Documents 

For an analysis of Clearwater and Clearwater Seafoods Income Fund's first
quarter results, please see the Management's Discussion and Analysis and the
2009 first 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.