Carmanah Reports Fourth Quarter and Fiscal Year 2012 Results

FSC / Press Release 
Carmanah Reports Fourth Quarter and Fiscal Year 2012 Results 
Q4-2012 revenue of $8.4 million underpins positive adjusted EBITDA 
Victoria, British Columbia CANADA, March 14, 2013 /FSC/ - Carmanah Technologies
Corporation (CMH - TSX), ("the Company" or "Carmanah") today reported its fourth
quarter and fiscal year financial results for the period ended December 31,
For the quarter-end December 31, 2012, the Company recorded revenue of $8.4
million and a net loss of $0.7 million, including approximately $0.4 million of
one-time charges related to acquisition and restructuring activities.  Adjusted
EBITDA for the quarter was slightly positive at $8 thousand.   Q4 2012 reflects
the strongest revenue quarter in 2012, reflecting a 17% increase versus prior
year quarter and marks the significant recovery of our Solar EPC Services
For the year end December 31, 2012 the Company recorded revenue of $26.4 million
and a net loss of $3.9 million.  Revenue results for the year reflect a decline
of $9.5 million year on year. The significant decline in revenue relates to soft
first half year performance, heavily impacted by uncertainties in the Ontario
FIT program negatively impacting our Solar EPC Services segment.  These
uncertainties were resolved mid-2012, with second half 2012 sales up 31% versus
the first half of the year.  Net loss improved $4.6 million year on year. 
Improvement in net loss relates to non-recurring charges in 2011 related to the
write-down of tax assets. 
"Revenue performance in the quarter reflects our strongest quarter in 2012, and
adjusting for one-time charges delivers positive EBITDA in the business.
One-time charges relate to restructuring and acquisitions undertaken late in the
year to further strengthen execution and protect positive cash flow in the
business. Unfortunately, revenue shortfall experienced in the first half  2012
was not recovered in the second half, with overall year on year results
disappointing" stated Bruce Cousins, Chief Executive Officer, adding "A tough
year for CMH and disappointing overall financial results.  However, a strong
fourth quarter and significant foundational progress made in the year.  Momentum
is building and I believe we are poised for a much stronger 2013." 
Financial Condition at December 31, 2012 compared to December 31, 2011 
* Cash and cash equivalents of $2.7 million, down $2.2 million from $4.9 million 
* Working capital of $6.3 million, down $1.5 million from $7.8 million 
* Continued debt-free operations 
Fourth quarter 2012 compared to fourth quarter 2011 
* Revenues: $8.4 million, up $1.3 million from $7.1 million 
* Gross margin: 28.8%, up from 27.5% 
* Operating costs: $3.0 million, up $0.1 million from $2.9 million 
* Net loss: $0.7 million, down $8.2 million from $8.9 million 
* Adjusted EBITDA (a non-IFRS measure): slightly positive at $8 thousand,
comparable to negative $0.4 million 
Fiscal 2012 compared to fiscal 2011 
* Sales: $26.4 million, down $9.5 million from $35.9 million 
* Gross margin: 31.2%, down from 31.4% 
* Operating costs: $12.1 million, up $0.6 million from $11.5 million 
* Net loss: $3.9 million, down $4.6 million from $8.5 million 
* Adjusted EBITDA (a non-IFRS measure): negative $2.1 million, down $3.4 million
from $1.3 million 
Summary of operations: 
* Revenues for the fourth quarter of 2012 were $8.4 million, up $1.3 million
from $7.1 million in the fourth quarter of 2011. By product sector, revenues are
as follows: 
o Signals, $3.0 million, down from $3.1 million 
o Outdoor Lighting, $1.3 million, down from $1.9 million 
o Solar EPC Services, $2.5 million, up from $1.0 million 
o Go Power!, $1.6 million, up from $1.1 million 
* Sales for fiscal 2012 were $26.4 million, down $9.5 million from $35.9 million
in fiscal 2011.  Broken down by product sector, sales are as follows: 
o Signals, $11.5 million, down from $15.9 million 
o Outdoor Lighting, $3.7 million, down from $5.2 million 
o Solar EPC Services, $4.7 million, down from $9.6 million 
o Go Power!, $6.5 million, up from $5.2 million 
* Gross margin percentages for fiscal 2012 were 31.2%, down from 31.4% for
fiscal 2011.  Key drivers in margin variation include overall sales mix, with
stronger performance in lower margin segments, and foreign currency exchange
rates. Broken down by product sector, gross margin percentages are as follows: 
o Signals, 36.0% down from 41.5% 
o Outdoor Lighting, 26.6% up from 24.8% 
o Solar EPC Services, 24.6% up from 19.3% 
o Go Power!, 29.8%, unchanged 
Corporate operational highlights during 2012 included: 
* Negotiated and signed two long term exclusive co-operation agreements to
enhance the business portfolio and strengthen the network of strategic
partnerships with the following companies: 
o Sabik Oy ("Sabik"), a marine signalling partner based in Finland. The five
year agreement expands on the previous two year sales and marketing
collaborations to include reciprocal technology access as well as joint product
o Laser Guidance Inc., a US-based pioneer in aviation precision guidance
systems. The agreement provides the Company with a five year exclusive
world-wide marketing license for a portfolio of Laser Guidance aviation
navigation aids. 
* Strengthened the Company's distribution channel through the addition of new
partners in key markets including Best Light in Mexico and Al-Babtain in Saudi
Arabia for the Outdoor Lighting market. 
* Embarked on major development efforts for the Company's signalling products,
which will see a variety of new products launched, most significantly a new
state of the art Marine signal lantern that replaced the Company's 700 series
lights and a new Traffic signalling device, the rectangular rapid flashing
beacon ("RRFB") that improved crosswalk safety. 
* Agreed to (a) acquire the business assets of Spot Devices, Inc., a market
leader in the traffic signaling industry and (b) an exclusive license for the
use in roadway applications of System Infrastructure Management Application
("SIMA") technology developed by with Cirrus Systems, LLC, a related company of
Spot Devices Inc., The acquisition of Spot Devices Inc.'s business complements
and expands the Company's RRFB portfolio. The SIMA technology will expand
Carmanah's offerings by providing remote cloud based network management
capability which enables customers to monitor and control traffic systems from a
central location. The transaction closed on January 4, 2013. 
* Signed a supply agreement with Acuity Brands, Inc, a leading provider of LED
lighting and lighting controls in early 2013.  The agreement provides for the
supply of our solar outdoor light engines for integration into certain
luminaires provided by Acuity. 
* Negotiated a number of major sales contracts, including 8 Solar EPC Services
projects worth over $5.1 million. 
* Signed a $10 million non-binding letter of agreement with one of the Company's
South American distributors to procure, commission and install various aids to
navigation on a major South American waterway. Conditionality by the end
customer has been resolved, and progress has been made to move forward into the
finalization of technical specifications on the product. It is anticipated that
specifications will be completed in early 2013 with commencement of delivery of
the product throughout 2013 and early 2014. 
* Expanded the Company's focus on revenue growth with the hiring of additional
sales employees to complement the new vertical oriented sales structure. Under
this new structure, each market vertical has its own leadership and supporting
team and is directly responsible for driving the planning, development and
execution within the market. 
* Closed a non-brokered private placement of 3,981,722 common shares for net
proceeds of $1.8 million. 
Reporting Currency and Change in Accounting Standards
Unless otherwise indicated, all financial information presented in this press
release is in US dollars and has been prepared in accordance with International
Financial Reporting Standards ("IFRS"). The conversion to IFRS from Canadian
Generally Accepted Accounting Principles became effective January 1, 2011.
Please refer to the Company's most recently issued consolidated financial
statements for further discussion. 
Adjusted EBITDA
Three months    Year ended 
ended       December 31 
December 31
(US$ in thousands)          2012    2011    2012    2011
Net loss                   (721) (8,888) (3,921) (8,553)
  Interest                     -       -       -       4
  Income tax expense           2   3,987       2   4,212
  Amortization               246     280   1,099   1,102
EBITDA*                    (473) (4,621) (2,820) (3,235)
  Terminated                   -       -       -   (176) 
Lightech agreement 
  Impairment of Investment     -   4,051       -   4,051 
tax credits
  Acquisition costs          145       -     145       -
  Restructuring/Retirement   291       -     291     261 
  Non-cash stock based        45     147     257     428 
Adjusted EBITDA*               8   (423) (2,127)   1,329
* A Non-IFRS measure 
Management believes that the non-IFRS measures presented provide useful
information by excluding certain items that may not be indicative of Carmanah's
core operating results and that this non-IFRS measure will allow for a better
evaluation of the operating performance of the Company's business and facilitate
meaningful comparison of results in the current period to those in prior periods
as well as future periods. Reference to this non-IFRS measure should not be
considered as a substitute for results that are presented in a manner consistent
with IFRS. This non-IFRS measure is provided to enhance investors' overall
understanding of Carmanah's current financial performance. 
A limitation of utilizing this non-IFRS measure is that the IFRS accounting
effects of the non-recurring items do in fact reflect the underlying financial
results of Carmanah's business and these effects should not be ignored in
evaluating and analyzing Carmanah's financial results. Therefore, management
believes that Carmanah's IFRS measures of net loss and the same respective
non-IFRS measure should be considered together. 
Non-IFRS measures do not have any standardized meaning prescribed by IFRS and
are therefore unlikely to be comparable to similar measures presented by other
companies. One such non-IFRS measure used for assessing financial performance is
Adjusted EBITDA, defined as net income before interest, income taxes,
amortization, non-cash stock-based compensation, restructuring/retirement
provision, and acquisition related costs. 
Complete set of Financial Statements and Management Discussion & Analysis 
A complete set of the annual 2012 Financial Statements and Management's
Discussion & Analysis are available on Carmanah's corporate website. To view
these documents, visit: Both documents for
the year ended December 31, 2012 will also be filed on SEDAR ( 
About Carmanah Technologies Corporation 
As one of the most trusted names in solar technology, Carmanah has earned a
reputation for delivering strong and effective products for industrial
applications worldwide. Industry proven to perform reliably in some of the
world's harshest environments, Carmanah solar LED lights and solar power systems
provide a durable, dependable and cost effective energy alternative. Carmanah
pursues its business strategy within six distinctive product offerings: outdoor
lighting, marine signal, aviation signals, traffic signals, Solar EPC Services
and GoPower!. Carmanah is actively seeking additional product sales
opportunities to add to its top line revenue, as well as extending existing
product lines through internal development efforts, strategic business
relationships as well as focused acquisitions.  Carmanah is a publicly traded
company, with common shares listed on the Toronto Stock Exchange under the
symbol "CMH". For more information, visit 
For further information: 
Investor Relations: Roland Sartorius, CFO
Toll-Free:  1.877.722.8877 
Public Relations: Natasha Bartlett
Tel:  +1.250.412.8315 
This release may contain forward-looking statements. Often, but not always,
forward-looking statements can be identified by the use of words such as
"expects," "plans," "estimates," "intends," "believes," "could," "might," "will"
or variations of such words and phrases. Forward-looking statements involve
known and unknown risks, uncertainties, and other factors which may cause the
actual results, performance, or achievements of Carmanah to be materially
different from any future results, performance, or achievements expressed or
implied by the forward-looking statements. These statements are based on
management's current expectations and beliefs and are subject to a number of
risks and uncertainties. For additional information on these risks and
uncertainties, see Carmanah' s most recently filed Annual Information Form (AIF)
and Annual MD&A, which are available on SEDAR at and on the
Company's website at The risk factors identified in Carmanah'
s AIF and MD&A are not intended to represent a complete list of factors that
could affect Carmanah. Accordingly, readers should not place undue reliance on
forward-looking statements. Carmanah does not assume any obligation to update
the forward-looking information contained in this press release. 
To view this press release as a PDF, please click on the following link: 
Source: Carmanah Technologies Corporation (CMH - TSX)
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