Evertz Technologies Third Quarter Fiscal 2013 Earnings Per Share Up 6%

Marketwired

BURLINGTON, ONTARIO--(Marketwire - Mar 5, 2013) -

Attention Business/Financial Editors:

Evertz Technologies Limited (ET.TO), a global leader in video infrastructure solutions for production, playout and delivery systems for television broadcasters, telecom and multi-system operators, today reported its results for the third quarter of its fiscal 2013 year.

Quarterly Highlights

  • Revenue of $71.8 million, including an increase of 6% in the US/Canada region
  • Fully diluted earnings per share of $0.18, an increase of 6% as compared to $0.17 a year ago
  • Accretive investment of over $5 million in a complimentary communications solutions company
  • Continued growth in R&D with a gross investment increase of 18% compared to a year ago
  • Cash and instruments held for trading increased to over $224 million
Selected Financial Information
Consolidated Statement of Earnings Data
(in thousands of dollars, except per share amounts)
 
 Q3 ''13 Q3 ''12
Revenue$71,771 $71,445
Gross margin 40,272  40,162
Earnings from operations 17,108  17,357
Net earnings 13,179  12,745
Fully-diluted earnings per share$0.18 $0.17
 
Selected Financial Information
Consolidated Balance Sheet Data
(in thousands of dollars)
 Q3 ''13 YE ''12
Cash and instruments held for trading$224,315 $185,669
Working capital 355,652  325,677
Total assets 462,801  431,864
Shareholders'' equity 409,690  378,417

Revenue

For the quarter ended January 31, 2013, revenues were $71.8 million as compared to revenues of $71.4 million for the quarter ended January 31, 2012. For the quarter, revenues in the United States/Canada region were $33.8 million, an increase of $1.8 million or 6% when compared to the same quarter last year. The International region had revenues of $38.0 million, as compared to $39.5 million in the same quarter last year.

Gross Margin

For the quarter ended January 31, 2013 gross margin was $40.3 million compared to $40.2 million in the same quarter last year. Gross margin percentage was approximately 56% and consistent with the quarter ended January 31, 2012.

Earnings

For the quarter ended January 31, 2013 net earnings were $13.2 million as compared to $12.7 million in the corresponding period last year.

For the quarter ended January 31, 2013, earnings per share on a fully-diluted basis were $0.18 as compared to $0.17 in the same period in 2012.

Operating Expenses

For the quarter ended January 31, 2013 selling and administrative expenses were $13.7 million compared to $12.7 million for the quarter ended January 31, 2012. Selling and administrative expenses represented approximately 19% of revenue in the quarter compared to 18% for the same period last year.

For the quarter ended January 31, 2013 gross research and development expenses increased by $2.0 million or 18% as compared to the corresponding period in 2012. Gross research and development expenses represented approximately 18% of revenue for the quarter ended January 31, 2013.

Liquidity and Capital Resources

The Company''s working capital as at January 31, 2013 was $355.7 million as compared to $325.7 million on April 30, 2012.

Cash and instruments held for trading were $224.3 million as at January 31, 2013 as compared to $185.7 million on April 30, 2012.

Cash provided by operations was $22.0 million for the quarter ended January 31, 2013 as compared to $23.8 million for the quarter ended January 31, 2012. Before taking into account the changes in non-cash working capital, the Company generated $16.7 million from operations for the quarter ended January 31, 2013 compared to $16.7 million for the same period last year.

The Company invested $6.2 million in a technology based company and on the purchase of capital assets for the quarter ended January 31, 2013, compared to $10.9 million in capital assets purchased for the quarter ended January 31, 2012.

For the quarter ended January 31, 2013, the Company used cash from financing activities of $6.3 million which was principally a result of the payment of dividends of $10.2 million offset by the issuance of capital stock of $4.5 million.

Shipments and Backlog

Purchase order backlog at the end of February 2013 was in excess of $45 million and shipments during the month of February 2013 exceeded $15 million. 

Dividend Declared

On March 5, 2013, the Evertz Board of Directors approved a 14% increase of the dividend to $0.16 per share from $0.14 per share. This is the 6th dividend increase in the past six years, reflecting the underlying strength of the Company''s cash flow and business outlook.

The dividend is payable to shareholders of record on March 15, 2013 and will be paid on or about March 22, 2013.

Selected Consolidated Financial Information
(Unaudited)
(in thousands of dollars, except earnings per share and share data)
 
 
Three month period ended January 31,  
 
 
 
Nine month period ended January 31,  
 
  2013     2012     2013     2012  
Revenue $ 71,771     $ 71,445     $ 250,890     $ 217,060  
Cost of goods sold   31,499       31,283       106,103       93,675  
Gross margin   40,272       40,162       144,787       123,385  
                               
Expenses                              
  Selling and administrative   13,659       12,677       39,118       34,798  
  General   1,393       1,580       4,290       4,678  
  Research and development   13,098       11,058       37,502       31,418  
  Investment tax credits   (3,519 )     (2,574 )     (9,569 )     (7,310 )
  Foreign exchange (gain) loss   (1,467 )     64       (2,790 )     (3,001 )
    23,164       22,805       68,551       60,583  
Earnings before undernoted   17,108       17,357       76,236       62,802  
                               
Finance income   699       551       1,576       1,427  
Finance costs   (103 )     (45 )     (269 )     (142 )
Other income and expenses   276       (332 )     272       (557 )
Earnings before income taxes   17,980       17,531       77,815       63,530  
                               
Provision for (recovery of) income taxes                              
  Current   3,968       4,323       19,280       17,804  
  Deferred   833       463       1,505       (740 )
    4,801       4,786       20,785       17,064  
                               
Net earnings for the period $ 13,179     $ 12,745     $ 57,030     $ 46,466  
                               
Net earnings attributable to non-controlling interest   195       108       550       306  
Net earnings attributable to shareholders   12,984       12,637       56,480       46,160  
Net earnings for the period $ 13,179     $ 12,745     $ 57,030     $ 46,466  
                               
Earnings per share                              
Basic $ 0.18     $ 0.17     $ 0.77     $ 0.63  
Diluted $ 0.18     $ 0.17     $ 0.77     $ 0.62  
 
Consolidated Balance Sheet Data As at January 31,
2013
  As at April 30, 2012
Cash and instruments held for trading $ 224,315   $ 185,669
Inventory $ 114,937   $ 109,211
Working capital $ 355,652   $ 325,677
Total assets $ 462,801   $ 431,864
Shareholders'' equity $ 409,690   $ 378,417
           
Number of common shares outstanding:          
  Basic   73,574,766     73,225,786
  Fully -diluted   78,239,966     77,904,086
           
Weighted average number of shares outstanding:          
  Basic   73,190,057     73,612,759
  Fully -diluted   73,707,805     73,812,767

Forward-Looking Statements

The report contains forward-looking statements reflecting Evertz''s objectives, estimates and expectations. Such forward looking statements use words such as "may", "will", "expect", "believe", "anticipate", "plan", "intend", "project", "continue" and other similar terminology of a forward-looking nature or negatives of those terms.

Although management of the Company believes that the expectations reflected in such forward-looking statements are reasonable, all forward-looking statements address matters that involve known and unknown risks, uncertainties and other factors. Accordingly, there are or will be a number of significant factors which could cause the Company''s actual results, performance or achievements, or industry results to be materially different from any future results performance or achievements expressed or implied by such forward-looking statements.

Conference Call

The Company will hold a conference call with financial analysts to discuss the results on March 5, 2013 at 5:00 p.m. (EDT). Media and other interested parties are invited to join the conference call in listen-only mode. The conference call may be accessed by dialing 1-416-849-6166 or toll-free (North America) 1-866-250-6267.

For those unable to listen to the live call, a rebroadcast will also be available until April 4, 2013. The rebroadcast can be accessed at 1-416-915-1035 or toll-free 1-866-245-6755. The pass code for the rebroadcast is 820034.

About Evertz

Evertz Technologies Limited (ET.TO) designs, manufactures and markets video and audio infrastructure solutions for the television, telecommunications and new-media industries. The Company''s solutions are purchased by content creators, broadcasters, specialty channels and television service providers to support their increasingly complex multi-channel digital and high definition television ("HDTV") broadcast environments and by telecommunications and new-media companies. The Company''s products allow its customers to generate additional revenue while reducing costs through the more efficient signal routing, distribution, monitoring and management of content as well as the automation of previously manual processes.

Contact:
Evertz Technologies Limited
Anthony Gridley
Chief Financial Officer
(905) 335-7580
ir@evertz.com

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