AlarmForce announces 2013 Q2 results
TORONTO, June 13, 2013 /CNW/ - TSX - Trading symbol - AF
AlarmForce Industries Inc., Canada's largest manufacturer and installer of live two-way voice home alarm systems, is pleased to announce results for the six months ended April 30, 2013:
|April 30, 2013||April 30, 2012||Change|
|(6 months ended)||(6 months ended)||(over same period)|
|Revenue||$ 24,026,000||$ 22,054,000||+ 9%|
|Gross profit||$ 18,204,000||$ 16,193,000||+12%|
|Income before income taxes||$ 3,669,000||$ 628,000||+ 484%|
|Net income||$ 2,694,000||$ 461,000||+ 484%|
|Cash flow from operations||$ 3,659,000||$ 2,307,000||+ 59%|
|EBITDA*||$ 6,152,000||$ 3,075,000||+ 100%|
|EBITDA* per share||$ 0.50||$ 0.25||+ 100%|
|EBITDA* before marketing expenses||$ 12,753,000||$ 11,186,000||+ 14%|
|Basic Net income / share||$ 0.22||$ 0.04||+ 450%|
|Diluted Net income / share||$ 0.22||$ 0.04||+ 450%|
* EBITDA (Earnings Before Interest, Income Taxes, Depreciation, and Amortization) is a key measure in the security industry and should not be interpreted as IFRS
EBITDA is defined as earnings before interest expenses, income taxes, depreciation and amortization. EBITDA is a measure used in the security industry to assist in understanding and comparing operating results and is often referred to by our competitors. Management views EBITDA as a measure to assess the operating performance of the Company. Since it does not have any standardized meaning defined by IFRS, it may not be considered in isolation of IFRS measures such as net income/loss or cash flows, as a measure of liquidity. The Company, however, utilizes these measures in making operating decisions and assessing its performance. Management believes that it allows the Company to assess its ongoing business without the impact of depreciation or amortization expenses. Since EBITDA is not a defined term under IFRS, it is unlikely to be comparable to similar measures presented by other issuers.
Joel Matlin, President and CEO of AlarmForce, announced that, "For the six months ended April 30, 2013 AlarmForce revenues increased to $24.0 million, reflecting an annualized growth rate of 9%. Total subscribers for the same period increased to 137,700 accounts, reflecting an annualized growth rate of 6%."
Gross profit for the six month period increased by $2.0 million, which is a 12% increase over the comparative period. Gross margin increased from 73% to 76%, reflecting a favourable trend in economies of scale, as more of our customers are adopting video technology, resulting in higher revenue per subscriber. Net income for the six month period increased to $2.7 million, an increase of 484% over the comparative period.
For the six month period, EBITDA increased by $3.1 million, an increase of 100% over 2012. Excluding the impact of marketing, the company's EBITDA increased by $1.6 million, a 14% increase over 2012.
Dividends of $0.6 million were paid to shareholders in the six month period, compared with nil in the comparative period of 2012. Cash flows from operations, which is net of working capital requirements increased to $3.7 million, an increase of $1.4 million or 59% over 2012. Operating cash flows before working capital adjustments increased to $4.9 million for the six months, an increase of $2.3 million, compared to 89% in 2012.
We continue to grow without adding debt, funding the costs of marketing, research and development expenses, as well as dividends to our shareholders, from the company's operating cash flows.
In the second quarter we installed 1,150 VideoRelay systems, representing over 20% of all the two-way voice alarms installed compared with approximately 10% a year ago. The increasing proportion of VideoRelay subscribers compared to the total subscriber base will result in an increase in the company's future average revenue per subscriber. We expect this favourable trend to continue over the next several years.
Looking ahead to the remainder of our fiscal year, we are optimistic that our VideoRelay proprietary technology will continue to contribute to the overall growth in subscribers, allowing them to remotely control their homes using both visual and audible features of our technology.
We are very pleased to announce that we have completed the development of CellWave, AlarmForce's innovative two-way voice monitored home technology. CellWave allows an AlarmForce system to be installed in any home without a phone line or internet connectivity. This leading edge two-way voice product has been recently introduced and systems installed in Canada with very positive initial response. It is expected to be introduced in the U.S. shortly. We anticipate that the new technology will open up new market opportunities for AlarmForce in both Canada and the U.S. in the near future.
Mr. Matlin said, "I am pleased and excited about the future outlook for the company, and would like to thank our shareholders and all our employees and the Board of Directors for their continued support and confidence in AlarmForce."
AlarmForce provides security alarm monitoring, personal emergency response monitoring, video surveillance and related services to residential and commercial subscribers throughout Canada and selected centres across the United States. AlarmForce is a leading provider of two-way voice alarm systems in Canada. More information about the Company's products and services can be found at www.alarmforce.com and www.videorelay.com.
SOURCE Alarmforce Industries Inc.