Canadian ice cream and frozen snacks producer CoolBrands International has posted a net loss for the first quarter of US$4.85m, or $0.09 per basic and fully diluted share, against a net loss of $4.40m.

The first-quarter loss comprised a net loss from continuing operations of $7.13m, which was offset by net income from discontinued operations of $2.28m.
 
Net sales from continuing operations for the first quarter fell by 65% to $7.76m, from $22.10m. The sharp decrease was attributed to the closing of the Americana Foods L.P. plant, the company's 50.1% subsidiary which accounted for $50.76m in annual net sales in the last fiscal year but was generating significant operating losses.
 
Further to its announcement in October that it would not meet the statutory filing deadline for its audited annual financial statements for the financial year ended August 31, 2006, the company said it had filed its audited annual financial statements and related management's discussion and analysis with the applicable Canadian securities regulators on 29 January, 2007.
 
In the management's analysis and discussion of the first-quarter results, the company said that it identified "certain material weaknesses and deficiencies in internal controls over financial reporting", and reported that it had undergone a significant downsizing and divestiture programme. CoolBrands said it now expects that its financial reporting will become less complicated and management is "designing processes and procedures appropriate for the organisation".
 
In connection with the sale of a portion of its businesses and assets, CoolBrands said it had mutually terminated the licence agreements with certain licensors. However, it added that its ability to "effect the termination of the remainder of its licences on favourable terms is uncertain".