H2O Innovation reports fiscal 2013 first quarter results - Revenues increase
41%, Company records net earnings
Alternext: MNEMO: ALHEO
-- Revenues of $9.98 million, up by 41% from $7.1 million for the
same period in fiscal 2012.
-- Gross profit stable at 24.7%, compared to the same period in
-- Adjusted EBITDA(1) at $726,693, compared to $332,808 for the
same period in fiscal 2012.
-- Operating, selling and administrative expenses at 18.4% of
revenues, down compared to 25.8% for the same period in fiscal
-- Net earnings of $269,696, up compared to a net loss of
($88,216) for the same period in fiscal 2012.
-- Operating activities generated $1,210,214 in net cash, compared
to $1,082,533 for the same period in fiscal 2012.
-- Order backlog still above the $20 million mark.
All amounts in Canadian dollars unless otherwise stated.
QUEBEC CITY, Nov. 13, 2012 /CNW Telbec/ - (TSXV: HEO) - H(2)OInnovation Inc.
("H(2)OInnovation" or the "Company") announces its results for the first
quarter of fiscal year 2013. During this quarter, the Company's revenues
increased by 41% to $9.98 M, up from $7.1 M in the comparable quarter of the
previous fiscal year. This sound level of revenues enabled the Company to
generate net earnings of $269,696 compared to a net loss of ($88,216) for the
same period in fiscal 2012. "In this first quarter, the fundamental changes
that we initiated over the last months towards an enhanced culture of project
execution and management have impacted positively our gross profit. We are
more than satisfied with our performance, which is the result of a great team
effort. I am grateful to all our employees who have proactively embraced our
new culture", stated Frédéric Dugré, President and Chief Executive Officer
The Company's revenues for the first quarter of fiscal 2013 totaled $9.98 M,
representing a $2.9 M or 41.2% increase, as compared with revenues of $7.1 M
for the same quarter of fiscal 2012. The increase is largely attributable to
revenues from water treatment projects which reached $7.0 M compared to $4.3 M
in the corresponding period of the previous fiscal year, representing a 63.6%
increase. More than half of that $7.0M revenues come from three projects in
the oil & gas sector in Western Canada. This is a direct consequence of the
materialisation of the Company's order backlog which remained above the $20 M
mark as at September 30, 2012.
The increase of the Company's revenues is also attributable to a lesser extent
to the recurring revenues from sales of specialty chemicals and consumables
which reached $2.9 M in this quarter compared with $2.8 M in 2012,
representing a 6.4% increase. Continued efforts are being deployed to increase
the Company's footprint through the addition of new specialty chemical
distributors. Moreover, management gave particular attention to maintain
service contracts on the Company's installed base while continuing to build
relationships with clients of newly commissioned projects.
In this first quarter of fiscal 2013, the Company was able to generate a 24.7%
gross profit, a level similar to the first quarter of fiscal year 2012. This
is a significant improvement from the 19.4% gross profit realized in the
fourth quarter of fiscal year 2012.
|CONSOLIDATED RESULTS | Three-month period|
|Selected financial data |ended on September 30,|
| | (Unaudited)|
| | 2012| 2011|
| | $| $|
|Revenues |9,982,894| 7,069,768|
|Gross profit |2,462,571| 1,744,081|
|Gross profit | 24.7%| 24.7%|
|Operating expenses | 135,772| 105,106|
|Selling expenses | 843,154| 864,667|
|Administrative expenses | 863,263| 855,092|
|Net earnings (loss) | 269,696| (88,216)|
|Basic and diluted earnings (loss) per share| 0.004| (0.001)|
|Adjusted EBITDA | 726,693| 332,808|
The Company also brought in a solid $6.7 M in new bookings for water treatment
projects over the quarter. These new bookings kept the order backlog above the
$20 M mark as at September 30, 2012. This represents a significant improvement
from $0.9M level of new bookings recorded in the corresponding quarter of
fiscal 2012. The level of new bookings achieved in the first quarter of fiscal
2013 is in line with management's expectations for the current fiscal year.
The Company's ratio of selling, operating and administrative expenses ("SG&A")
as a whole over revenues amounted to 18.4% for this quarter, down from 25.8%
for the corresponding quarter of the previous fiscal year. This decrease is
partially attributable to the increase in volume of business and reflects the
Company's efforts to reach profitability and maximize the use of its internal
resources. Overall, the Company's SG&A expenses remain in line with its fiscal
year 2013 budget.
Adjusted EBITDA for the quarter was recorded at $726,693, compared with
$332,808 for the same period ended September 30, 2011. The higher revenues
recorded during the quarter compared with the corresponding quarter of the
previous fiscal year and the somewhat stable SG&A expenses also contributed to
generating solid positive adjusted EBITDA. The Company quickly and strongly
returned to positive adjusted EBITDA this quarter after one quarter of
negative adjusted EBITDA for the fourth quarter ended June 30, 2012.
The Company's net earnings (loss) was $269,696 or $0.004per share for the
first quarter of fiscal 2013 compared with ($88,216) or ($0.001 per share) for
the first quarter of fiscal 2012. This improvement is primarily due to higher
revenues which generated a solid gross profit of 24.7% and to a tighter
control of the Company's fixed costs.
"We have applied a tight control on project execution notably for procurement
and on hours spent on projects. Moreover, we keep challenging SG&A and we are
looking for additional savings on recurring expenses", added Frédéric Dugré.
Operating activities generated $1,210,214 in cash for the period ended
September 30, 2012, compared with $1,082,533 of cash generated during the
corresponding period ended September 30, 2011. The rise is mainly attributable
to the improvement in net earnings in the first quarter of fiscal year 2013 as
compared with the corresponding period ended September 30, 2011 and to the
change in working capital items.
Annual General Meeting of Shareholders
H(2)O Innovation will hold its Annual General Meeting of Shareholders tomorrow
Wednesday, November 14, 2012 at 4p.m. (Eastern Time) at its headquarters
located at 330 St-Vallier Street East, Suite 340, Quebec City (Quebec), Canada.
Philippe Gervais, Chairman of the Board, and Frédéric Dugré, President and
Chief Executive Officer, are pleased to invite shareholders and all other
interested parties to attend the meeting, during which they will review the
results of fiscal 2012 and comment the results of the first quarter of fiscal
The first quarter financial report is available on www.h2oinnovation.com and
on NYSE Euronext Alternext's site. Additional information on the Company is
also available on SEDAR (www.sedar.com).
Certain statements set forth in this press release regarding the operations
and the activities of H(2)OInnovation as well as other communications by the
Company to the public that describe more generally management objectives,
projections, estimates, expectations or forecasts may constitute
forward-looking statements within the meaning of securities legislation.
Forward-looking statements concern analysis and other information based on
forecast future results and the estimate of amounts that cannot yet be
determined. Forward-looking statements include the use of words such as
"anticipate", "if", "believe", "continue", "could", "estimate", "expect",
"intend", "may", "plan", "potential", "predict", "project", "should" or
"will", and other similar expressions, as well as those usually used in the
future and the conditional, notably regarding certain assumptions as to the
success of a venture. Those forward-looking statements involve a number of
risks and uncertainties, which may result in actual and future results of the
Company to be materially different than those indicated. Information about the
risk factors to which the Company is exposed is provided in the Annual
Information Form dated September25, 2012 available on SEDAR (www.sedar.com).
Unless required to do so pursuant to applicable securities legislation,
H(2)OInnovation assumes no obligation to update or revise forward-looking
statements contained in this press release or in other communications as a
result of new information, future events and other changes.
H(2)O Innovation designs and provides state-of-the-art, custom-built, and
integrated water treatment solutions based on membrane filtration technology
to municipal, energy & natural resources end-users. H(2)O Innovation also
provides a complete line of specialty chemicals and consumables for membrane
filtration and reverse osmosis systems. For more, visit www.h2oinnovation.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) nor the Alternext
Exchange accepts responsibility for the adequacy or accuracy of this release.
(1) The definition of adjusted earnings before interest, tax depreciation and
amortization (adjusted EBITDA) does not take into account the Company's
changes in fair value of contingent considerations, impairment of intangible
assets, impairment of goodwill and share of (earnings) loss in a joint venture
and stock-based compensation costs. The definition of adjusted EBITDA used by
the Company may differ from those used by other companies.
Source: H2O Innovation Inc. www.h2oinnovation.com
Contact: Marc Blanchet +1418-688-0170 email@example.com
SOURCE: H2O INNOVATION INC.
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