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Sales 30405000 Current Assets 10087000 Total Assets 24307000 Ownership 100 10 PANTHER INDUSTRIES Another year has passed. It would be nice if it could be said that everything went as planned. It seems that our new projects end up taking twice as long and are twice as expensive. Panther needs to be cautious spending capital going forward.The focus will be on the last 10 million dollars spent at Fort Sask. Fort Sask needs to prove that the investment is indeed worth the risk.The next six months will shape the design of the process to achieve this goal. Despite many delays full rail cars of HCL are being shipped to the site to add pressure for a startup. It is a beautiful plant built for speed and safety.The lesson learned from the past is the right people are needed to bring project expectations to reality. HCL is still a product high on the list of priorities. With Fort Sask in the finishing stages it is time to move on to the other strategies. Panther is looking for partners to expand the potential growth selling HCL.Three areas have been targeted. Somewhere around Estevan and perhaps evenWilliston would serve as potential sites. Medicine Hat has good potential for the future.The last is Grande Prairie which has been in our sights for 15 years. Panthers biggest issue up to today has been supply of HCL.With ErcoWorld Wide starting production on two new burners this will hopefully be the solution to limited supply. Two years have been spent on improving results on our last automated equipment purchase. It is a real challenge to work with so many different kinds of products and so many different sizes and types of packaging. Automated equipment is designed to do the same product the same packaging day after day. It is clear that additional skills with experience are needed for projects like this. The ice melt market is growing leaps and bounds.Tonnes more than doubled last year from the year prior.This year is already busier than last year. As the ice melt market grows so does the complexity of the packaging. After this winter an evaluation of ice melt products and packaging needs to be discussed. Panther needs to decide how to proceed so that the packaging business remains profitable. The Edmonton pallet plant at Sherwood Park is now a stand alone business. HCL will no longer be the driver at this location. They need to build a lot of pallets to cover the overhead which will be a challenge considering the size of the property. Davidson pallet plant numbers are down due to losing a big contract to the CHEP program. It is too bad because the Davidson pallet plant is a great little business. It is always neat and tidy. Employee retention is excellent with good production with a good quality control. Davidson has a limited customer base where as Edmonton is a huge market. Panther Industries success is based on the oil and gas business. Our business is to provide chemicals to the cementers and mud companies.The major chemicals are potash salt hydrochloric acid and calcium chloride.The calcium chloride is reworked to meet specific screen sizes to better service the application it is being used for. Panther also does custom packaging for large users.The business is complimented with several pallet plants to supply pallets to the packaging sector and also design and build pallets for other customers.To add to the hectic fall and winter program Panther also plays a major role in the ice melt business. Blends of chemicals usually salt potash and calcium chloride are packaged in various sizes and types of containers. A good percentage of products are coloured and may be orange green and blue. which achieved by adding the dye during the blending process. To sum it up opportunities exist in the ice melt HCL and pallets markets in Edmonton.With Fort Saskatchewan and all the opportunities that will be presented will be enough to keep Panther busy for the next year. Jack Schneider