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DIRTT provides US GAAP Financial Information

CALGARY, Alberta, Oct. 08, 2019 (GLOBE NEWSWIRE) -- DIRTT Environmental Solutions Ltd., (TSX:DRT; Nasdaq: DRTT) (“DIRTT” or the “Company”) an interior construction company that uses technology for client-driven design and manufacturing, today announced the following information has been disclosed on SEDAR and posted DIRTT's website at: www.dirtt.com/investors/financial-reports/:

  • Unaudited financial statements for the second quarter of 2019 prepared in accordance with the accounting standards generally accepted in the United States (“U.S. GAAP”), which include the consolidated balance sheets as of June 30, 2019 and December 31, 2018, and the related statements of operations, comprehensive income (loss), shareholders’ equity and cash flows for the three- and six-month periods ended June 30, 2019 and June 30, 2018;
  • Unaudited financial statements for the first quarter of 2019 prepared in accordance with U.S. GAAP, which include the consolidated balance sheets as of March 31, 2019 and December 31, 2018, and the related statements of operations, comprehensive income (loss), shareholders’ equity and cash flows for the three-month periods ended March 31, 2019 and March 31, 2018; and
  • Annual U.S. GAAP financial statements, which include consolidated balance sheets as of December 31, 2018 and 2017 and the related statements of operations, comprehensive income (loss), shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2018, 2017 and 2016 (on SEDAR such statements are contained in the Form 10 which was filed as an "Other" document on October 8, 2019).

Upon the U.S. Securities and Exchange Commission’s (“SEC”) declaration of effectiveness of the Company’s Registration Statement on Form 10 on June 8, 2019, in connection with the listing of its common shares on The Nasdaq Global Select Market ("Nasdaq"), the Company completed a conversion of its financial statements from International Financial Reporting Standards (“IFRS”) to U.S. GAAP and adopted U.S. GAAP as its financial reporting framework. The Company’s Registration on Form 10 and other filings with the SEC are available to the public through SEC’s website at www.sec.gov.  The purpose of this press release is to help readers accustomed to the past preparation of DIRTT’s financial statements under IFRS understand the change in preparation to U.S. GAAP.

DIRTT changed its reporting currency to U.S. dollars (“US$”) upon adoption of U.S. GAAP. The change in reporting currencies has a material impact on the Company’s financial statements for all periods presented. DIRTT continues to consolidate the Company and its subsidiaries’ financial statements in Canadian dollars (“C$”), the Company’s functional currency, and translates the assets and liabilities at the period end rate which results in period-on-period translation adjustments recorded in comprehensive income from the impact of the change in exchange rate on net assets. 

The following discussion has been prepared using the Accounting Standards Codifications (“ASCs”), Accounting Standards Updates (“ASUs”) and interpretations currently issued and expected to be effective at the end of the Company’s first U.S. GAAP annual reporting period, December 31, 2019.  Management does not expect the adoption of U.S. GAAP to have a material impact on the Company’s business activities or cash flows; however, it will impact certain aspects of the reported financial results, the more significant of which are described as follows:

1.    Accounting for intangible assets and software development costs

Under U.S. GAAP, product development costs are not eligible for capitalization, and therefore the initial value of the Company’s intangible assets is lower as compared to IFRS.  This change also has the impact of reducing net income and Adjusted EBITDA (see Non-GAAP measures) as product development costs are expensed as incurred. This change has also resulted in a reduction in the impairment charges recognized in 2018 as development costs for the DIRTT for Life and DIRTT Timber lines of business would have been previously expensed as incurred under U.S. GAAP and therefore not subject to impairment. 

Under U.S. GAAP, software development costs are capitalized as internal use software in accordance with ASC 350 – Intangibles Goodwill and Other, with no material differences to the accounting treatment under IFRS. 

2.     Amounts included in cost of sales

Certain of the Company’s fixed costs were treated as overhead items under IFRS and accounted for as operating expenditures.  Under U.S. GAAP, these costs are presented within cost of sales as they relate to the production of DIRTT solutions.  The impact of this is a reclassification of US$8 to US$9 million (including US$4 million to US$5 million of depreciation and amortization) annually from operating costs to cost of sales with a corresponding 3% to 4% reduction in gross profit. This change is an adjustment within the statement of operations only; there is no impact to net income or Adjusted EBITDA (see Non-GAAP measures) as compared to amounts previously reported under IFRS.

3.    Adoption of ASC 842 Leases (“ASC 842”) and onerous lease accruals

On January 1, 2019, DIRTT adopted IFRS 16 – Leases (“IFRS 16”), which had a material impact on DIRTT’s balance sheet and cash flows, and Adjusted EBITDA (see Non-GAAP measures). The impact is described in DIRTT’s unaudited condensed consolidated interim financial statements and management’s discussion and analysis for the first and second quarters of 2019, previously filed on SEDAR.  Consistent with IFRS 16, the adoption of ASC 842 had a material impact on the Company’s balance sheet, resulting in the recognition of US$23 million of right-of-use (“ROU”) assets and associated US$24 million lease liabilities as at January 1, 2019.  Under U.S. GAAP, the charge on the statement of operations is accounted for as rent expense on a straight-line basis.  This treatment is different from that under IFRS, which classifies the expense as depreciation of the ROU asset and interest expense for the accretion of the lease liability. 

This difference results in changes to cash flows from operations and Adjusted EBITDA (see Non-GAAP measures) from January 1, 2019 forward with minimal change in net income.   In 2019, cash flows from operations are lower under U.S. GAAP as lease payments are classified as operating expenditures rather than as financing expenditures under IFRS.  Adjusted EBITDA (see Non-GAAP measures) is lower from January 1, 2019 forward as a result of the change in classification of the expense from depreciation and interest under IFRS to lease expense under US GAAP.  

Additionally, the Company recognized a provision of C$1.8 million for an onerous lease under IFRS in 2018.  Under US GAAP, this provision would not be recognized.

4.    Stock-based compensation

During 2018, the Company modified its employee stock option plan to provide a cash settlement alternative to its employees in connection with the exercise of stock options.  At period end under U.S. GAAP, the liability is adjusted to fair value and the excess of fair value over previously recognized stock-based compensation is expensed.  Increases or decreases in fair value subsequent to the modification date of the stock option plan will be recorded in earnings, except that the Company may not recognize a cumulative expense lower than the grant date fair value of the original equity awards. IFRS does not have the ‘previously recognized’ thresholds in modification accounting, which has resulted in a C$2.1 million increase in stock-based compensation charges in 2018.

Additionally, U.S. GAAP allows for a policy choice for graded or straight-line attribution of stock-based compensation expense, whereas IFRS requires stock options to be expensed using the graded vesting methodology only.  On adoption of US GAAP, the Company’s management has elected to use the straight-line methodology to be more comparable with U.S. peer companies. This change resulted in a C$0.9 million increase to stock-based compensation expense for the year-ended December 31, 2018.

5.    Other items, presentation and disclosures

The Company has disclosed other items in its reconciliation from IFRS to US GAAP, which include adjustments that are considered individually immaterial to the financial statements.

The Company has incorporated changes to the presentation and disclosure of certain items in the consolidated balance sheets, statements of operations, comprehensive loss and cash flows, and notes to the consolidated financial statements to conform to the requirements of the applicable ASCs, ASUs and, if applicable, U.S. securities laws and the rules of the United States Securities and Exchange Commission.

The following is an unaudited tabular reconciliation from IFRS to US GAAP:

Q2 2019: Statement of Operations for the three-month period ended June 30, 2019 (unaudited)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Product revenue 81,808 - 157 - - - - 81,965 61,273
Service revenue 3,769 - - - - - - 3,769 2,818
Total revenue 85,577 - 157 - - - - 85,734 64,091
Product cost of sales 47,079 - - 2,554 - - - 49,633 37,102
Service cost of sales 3,048 - - 386 - - - 3,434 2,568
Total cost of sales 50,127 - - 2,940 - - - 53,067 39,670
Gross profit 35,450 - 157 (2,940) - - - 32,667 24,421
Operating expenses 29,050 - (135) (2,940) 325 - - 26,300 19,660
Operating income 6,400 - 292 - (325) - - 6,367 4,761
Foreign exchange loss 591 - - - - - - 591 441
Interest income (51) - - - - - - (51) (38)
Interest expense 402 - - - (368) - - 34 25
Net income before tax 5,458 - 292 - 43 - - 5,793 4,333
Current tax 1,251 - - - - - - 1,251 936
Deferred tax 1,223 - 79 - - - (250) 1,052 786
Net income 2,984 - 213 - 43 - 250 3,490 2,611
Exchange differences on foreign ops (1,712) - - - - - - (1,712) 1,276
Comprehensive income 1,272 - 213 - 43 - 250 1,778 3,887
Net income per share 0.03             0.04 0.03
                   

Q2 2019: Adjusted EBITDA for the three-month period ended June 30, 2019 (unaudited, see Non-GAAP measures)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Net income 2,984 - 213 - 43 - 250 3,490 2,611
Interest expense 402 - - - (368) - - 34 25
Interest income (51) - - - - - - (51) (38)
Income tax expense 2,474 - 79 - - - (250) 2,303 1,722
Depreciation on ROU assets 1,386 - - - (1,386) - - - -
Depreciation and amortization 4,166 - (233) - - - - 3,933 2,940
EBITDA 11,361 - 59 - (1,711) - - 9,709 7,260
Stock based compensation (2,212) - - - - - - (2,212) (1,655)
Adjusted EBITDA 9,149 - 59 - (1,711) - - 7,497 5,605
Adjusted EBITDA % 10.7%             8.7% 8.7%
                   

Q2 2019: Statement of Operations for the six-month period ended June 30, 2019 (unaudited)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Product revenue 166,516 - 324 - - - - 166,840 125,113
Service revenue 5,392 - - - - - - 5,392 4,039
Total revenue 171,908 - 324 - - - - 172,232 129,152
Product cost of sales 97,450 - - 5,453 - - - 102,903 77,170
Service cost of sales 4,895 - - 386 - - - 5,281 3,957
Total cost of sales 102,345 - - 5,839 - - - 108,184 81,127
Gross profit 69,563 - 324 (5,839) - - - 64,048 48,025
Operating expenses 69,989 - (170) (5,839) 608 (571) - 64,017 48,029
Operating income (426) - 494 - (608) 571 - 31 (4)
Foreign exchange loss 1,280 - - - - - - 1,280 960
Interest income (123) - - - - - - (123) (92)
Interest expense 811 - - - (712) - - 99 74
Net income before tax (2,394) - 494 - 104 571 - (1,225) (946)
Current tax 1,454 - - - - - - 1,454 1,088
Deferred tax 983 - 134 - - (36) (250) 831 620
Net income (loss) (4,831) - 360 - 104 607 250 (3,510) (2,654)
Exchange differences on foreign ops (2,399) - - - - - - (2,399) 3,372
Comprehensive income (7,230) - 360 - 104 607 250 (5,909) 718
Net income per share (0.06)             (0.04) (0.03)
                   

Q2 2019: Adjusted EBITDA for the six-month period ended June 30, 2019 (unaudited, see Non-GAAP measures)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Net income (loss) (4,831) - 360 - 104 607 250 (3,510) (2,654)
Interest expense 811 - - - (712) - - 99 74
Interest income (123) - - - - - - (123) (92)
Income tax expense 2,437 - 134 - - (36) (250) 2,285 1,708
Depreciation on ROU assets 2,805 - - - (2,805) - - - -
Depreciation and amortization 8,906 - (459) - - - - 8,447 6,335
EBITDA 10,005 - 35 - (3,413) 571 - 7,198 5,371
Stock based compensation 6,930 - - - - (571) - 6,359 4,792
Foreign exchange on debt revaluation (280) - - - - - - (280) (211)
Reorganization expense 3,508 - - - - - - 3,508 2,639
Adjusted EBITDA 20,163 - 35 - (3,413) - - 16,785 12,591
Adjusted EBITDA % 11.7%             9.7% 9.7%
                   

Q2 2019: Balance Sheet as at June 30, 2019 (unaudited)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost
of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
ASSETS                  
Current Assets                  
Cash and cash equivalents 76,868 - - - - - - 76,868 58,736
Trade and other receivables 37,280 - - - - - - 37,280 28,487
Inventory 24,488 - - - - - - 24,488 18,712
Prepaids and other current assets 2,927 - - - - - - 2,927 2,236
Total Current Assets 141,563 - - - - - - 141,563 108,171
Property, plant and equipment, net 47,207 - - - - - - 47,207 36,072
Intangible assets 18,620 (18,922) 302 - - - - - -
Capitalized software, net - 11,371 (325) - - - - 11,046 8,442
Right of use assets 25,909 - - - 1,578 - - 27,487 21,004
Deferred tax assets, net 6,278 (321) (134) - - 35 250 6,108 4,665
Goodwill 1,845 - - - - - - 1,845 1,410
Other assets 2,309 4,790 54 - - - - 7,153 5,465
Total Assets 243,731 (3,082) (103) - 1,578 35 250 242,409 185,229
LIABILITIES                  
Current Liabilities                  
Accounts payable and accrued liabilities 30,413 (1,974) - - - - - 28,439 21,730
Other liabilities 9,990 - - - - - - 9,990 7,615
Customer deposits 9,785 674 (465) - - - - 9,994 7,638
Current lease liabilities 5,347 - - - 783 - - 6,130 4,685
Total Current Liabilities 55,535 (1,300) (465) - 783 - - 54,553 41,668
Other liabilities 1,523 246 - - 1,432 - - 3,201 2,465
Long-term lease liabilities 23,352 - - - (742) - - 22,610 17,277
Total Liabilities 80,410 (1,054) (465) - 1,473 - - 80,364 61,410
SHAREHOLDERS' EQUITY                  
Common shares 198,575 295 - - - - - 198,870 180,579
Additional paid-in capital 8,161 1,174 - - - (571) - 8,764 6,185
Accumulated other comprehensive income 4,008 (2,093) - - - - - 1,915 (18,720)
Accumulated deficit (47,423) (1,404) 362 - 105 606 250 (47,504) (44,225)
Total Shareholders' Equity 163,321 (2,028) 362 - 105 35 250 162,045 123,819
Total Liabilities and Shareholders' Equity 243,731 (3,082) (103) - 1,578 35 250 242,409 185,229
                   

Q1 2019: Statement of Operations for the three-month period ended March 31, 2019 (unaudited)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Product revenue 84,708 - 167 - - - - 84,875 63,840
Service revenue 1,623 - - - - - - 1,623 1,221
Total revenue 86,331 - 167 - - - - 86,498 65,061
Product cost of sales 50,371 - - 2,899 - - - 53,270 40,068
Service cost of sales 1,847 - - - - - - 1,847 1,389
Total cost of sales 52,218 - - 2,899 - - - 55,117 41,457
Gross profit 34,113 - 167 (2,899) - - - 31,381 23,604
Operating expenses 40,939 - (35) (2,899) 283 (571) - 37,717 28,369
Operating income (6,826) - 202 - (283) 571 - (6,336) (4,765)
Foreign exchange loss 689 - - - - - - 689 519
Interest income (72) - - - - - - (72) (54)
Interest expense 409 - - - (344) - - 65 49
Net income before tax (7,852) - 202 - 61 571 - (7,018) (5,279)
Current tax 203 - - - - - - 203 152
Deferred tax (240) - 55 - - (36) - (221) (166)
Net income (7,815) - 147 - 61 607 - (7,000) (5,265)
Exchange differences on foreign ops (687) - - - - - - (687) 2,096
Comprehensive income (8,502) - 147 - 61 607 - (7,687) (3,169)
Net income per share (0.09) - 0.00 - 0.00 0.01 - (0.08) (0.06)
                   

Q1 2019: Adjusted EBITDA for the three-month period ended March 31, 2019 (unaudited, see Non-GAAP measures)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost
of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Net income (7,815) - 147 - 61 607 - (7,000) (5,265)
Interest expense 409 - - - (344) - - 65 49
Interest income (72) - - - - - - (72) (54)
Income tax expense (37) - 55 - - (36) - (18) (14)
Depreciation on ROU assets 1,419 - - - (1,419) - - - -
Depreciation and amortization 4,740 - (226) - - - - 4,514 3,395
EBITDA (1,356) - (24) - (1,702) 571 - (2,511) (1,889)
Stock based compensation 9,142 - - - - (571) - 8,571 6,447
Foreign exchange on debt revaluation (280) - - - - - - (280) (211)
Reorganization costs 3,508 - - - - - - 3,508 2,639
Adjusted EBITDA 11,014 - (24) - (1,702) - - 9,288 6,986
Adjusted EBITDA % 12.8%             10.7% 10.7%
                   

Q1 2019: Balance Sheet as at March 31, 2019 (unaudited)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost
of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
ASSETS                  
Current Assets                  
Cash and cash equivalents 72,239 - - - - - - 72,239 54,059
Trade and other receivables 49,686 - - - - - - 49,686 37,182
Inventory 24,650 - - - - - - 24,650 18,447
Prepaids and other current assets 3,408 - - - - - - 3,408 2,550
Total Current Assets 149,983 - - - - - - 149,983 112,238
Property, plant and equipment, net 48,170 - - - - - - 48,170 36,048
Intangible assets 18,270 (18,922) 652 - - - - - -
Capitalized software, net - 11,371 (575) - - - - 10,796 8,079
Right of use assets 27,590 - - - 1,549 - - 29,139 21,805
Deferred tax assets, net 7,722 (321) (55) - - 35 - 7,381 5,522
Goodwill 1,845 - - - - - - 1,845 1,381
Other assets 2,202 4,790 (141) - - - - 6,851 5,126
Total Assets 255,782 (3,082) (119) - 1,549 35 - 254,165 190,199
LIABILITIES                  
Current Liabilities                  
Accounts payable and accrued liabilities 37,093 (1,974) - - - - - 35,119 26,281
Other liabilities 16,712 - - - - - - 16,712 13,771
Customer deposits 7,829 674 (267) - - - - 8,236 6,163
Current lease liabilities 5,943 - - - (49) - - 5,894 4,410
Total Current Liabilities 67,577 (1,300) (267) - (49) - - 65,961 50,625
Other liabilities 1,424 246 - - 1,432 - - 3,102 1,056
Long-term lease liabilities 24,749 - - - 105 - - 24,854 18,599
Total Liabilities 93,750 (1,054) (267) - 1,488 - - 93,917 70,280
SHAREHOLDERS' EQUITY                  
Common shares 198,558 295 - - - - - 198,853 180,566
Additional paid-in capital 8,161 1,174 - - - (571) - 8,764 6,185
Accumulated other comprehensive income 5,720 (2,093) - - - - - 3,627 (19,996)
Accumulated deficit (50,407) (1,404) 148 - 61 606 - (50,996) (46,836)
Total Shareholders' Equity 162,032 (2,028) 148 - 61 35 - 160,248 119,919
Total Liabilities and Shareholders' Equity 255,782 (3,082) (119) - 1,549 35 - 254,165 190,199
                   

Q4 2018: Statement of Operations for the year ended December 31, 2018 (unaudited):

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Product revenue 346,028 - (296) - - - - 345,732 266,434
Service revenue 10,651 - - - - - - 10,651 8,247
Total revenue 356,679 - (296) - - - - 356,383 274,681
Product cost of sales 199,329 - - 10,738 - - - 210,067 161,844
Service cost of sales 7,527 - - - - - - 7,527 5,828
Total cost of sales 206,856 - - 10,738 - - - 217,594 167,672
Gross profit 149,823 - (296) (10,738) - - - 138,789 107,009
Operating expenses 148,483 - (7,501) (10,738) (1,729) 2,997 - 131,512 101,315
Operating income 1,340 - 7,205 - 1,729 (2,997) - 7,277 5,694
Foreign exchange gain (3,280) - - - - - (917) (4,197) (3,214)
Interest income (550) - - - - - - (550) (425)
Interest expense 655 - - - - - - 655 503
Net income before tax 4,515 - 7,205 - 1,729 (2,997) 917 11,369 8,830
Current tax 2,798 - - - - - - 2,798 2,178
Deferred tax (1,280) - 1,941 - 467 36 247 1,411 1,102
Net income (loss) 2,997 - 5,264 - 1,262 (3,033) 670 7,160 5,550
Exchange differences on foreign ops 434 - - - - - 292 726 (9,980)
Comprehensive income 3,431 - 5,264 - 1,262 (3,033) 962 7,886 (4,430)
Net income per share 0.04             0.08 0.07
                   

Q4 2018: Adjusted EBITDA for the year ended December 31, 2018 (unaudited, see Non-GAAP measures):

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost
of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Net income 2,997 - 5,264 - 1,262 (3,033) 670 7,160 5,550
Interest expense 655 - - - - - - 655 503
Interest income (550) - - - - - - (550) (425)
Income tax expense 1,518 - 1,941 - 467 36 247 4,209 3,280
Depreciation and amortization 19,474 - (1,717) - - - - 17,757 13,699
EBITDA 24,094 - 5,488 - 1,729 (2,997) 917 29,231 22,607
Stock based compensation 1,761 - - - - 2,997 - 4,758 3,661
Foreign exchange on debt revaluation 741 - - - - - - 741 546
Impairment expense 19,975 - (6,864) - (1,729) - - 11,382 8,680
Reorganization costs 9,600 - - - - - - 9,600 7,380
Adjusted EBITDA 56,171 - (1,376) - - - 917 55,712 42,874
Adjusted EBITDA % 15.7%             15.6% 15.6%
                   

Q4 2018: Balance Sheet as at December 31, 2018 (unaudited)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost
of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
                   
ASSETS                  
Current Assets                  
Cash and cash equivalents 72,865 - - - - - - 72,865 53,412
Trade and other receivables 59,852 - - - - - - 59,852 43,873
Inventory 25,442 - - - - - - 25,442 18,650
Prepaids and other current assets 3,025 - - - - - - 3,025 2,217
Total Current Assets 161,184 - - - - - - 161,184 118,152
Property, plant and equipment, net 50,104 - - - - - - 50,104 36,728
Intangible assets 18,922 (24,718) 5,796 - - - - - -
Capitalized software, net - 10,440 931 - - - - 11,371 8,335
Deferred tax assets, net 8,618 1,162 (1,941) - (467) (36) 962 8,297 6,083
Goodwill 1,845 - - - - - - 1,845 1,353
Other assets 2,385 4,313 477 - - - - 7,175 5,260
Total Assets 243,058 (8,803) 5,263 - (467) (36) 962 239,977 175,911
LIABILITIES                  
Current Liabilities                  
Trade accounts payable and other liabilities 42,673 - - - - - - 42,673 31,283
Other liabilities 9,262 - (283) - 327 - - 9,306 6,823
Customer deposits 9,832 674 - - - - - 10,506 7,701
Current portion of long-term debt 3,411 - - - - - - 3,411 2,500
Total Current Liabilities 65,178 674 (283) - 327 - - 65,896 48,307
Deferred tax liabilities, net 1,314 2 - - - - - 1,316 965
Other liabilities 1,773 - - - (1,773) - - - -
Long-term debt 4,263 - - - - - - 4,263 3,125
Total Liabilities 72,528 676 (283) - (1,446) - - 71,475 52,397
SHAREHOLDERS' EQUITY                  
Common shares 198,552 295 - - - - - 198,847 180,562
Additional paid-in capital 8,163 (1,824) 1,167 - (283) 2,114 - 9,337 6,615
Accumulated other comprehensive income 6,407 (2,385) - - - - 292 4,314 (22,092)
Accumulated deficit (42,592) (5,565) 4,379 - 1,262 (2,150) 669 (43,996) (41,571)
Total Shareholders' Equity 170,530 (9,479) 5,546 - 979 (36) 962 168,502 123,514
Total Liabilities and Shareholders' Equity 243,058 (8,803) 5,263 - (467) (36) 962 239,977 175,911
                   

Q3 2018: Statement of Operations for the three-month period ended September 30, 2018 (unaudited)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost
of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Product revenue 93,738 - - - - - - 93,738 71,720
Service revenue 2,866 - - - - - - 2,866 2,193
Total revenue 96,604 - - - - - - 96,604 73,913
Product cost of sales 52,500 - - 2,658 - - - 55,158 42,202
Service cost of sales 2,128 - - - - - - 2,128 1,628
Total cost of sales 54,628 - - 2,658 - - - 57,286 43,830
Gross profit 41,976 - - (2,658) - - - 39,318 30,083
Operating expenses 47,786 - (7,120) (2,658) - 1,769 - 39,777 30,435
Operating income (5,810) - 7,120 - - (1,769) - (459) (352)
Foreign exchange (gain) loss (73) - - - - - 598 525 400
Interest income (132) - - - - - - (132) (101)
Interest expense 127 - - - - - - 127 97
Net income before tax (5,732) - 7,120 - - (1,769) (598) (979) (748)
Current tax 1,495 - - - - - - 1,495 1,144
Deferred tax (2,360) - 1,919 - - - (162) (603) (461)
Net income (loss) (4,867) - 5,201 - - (1,769) (436) (1,871) (1,431)
Exchange differences on foreign ops (2,293) - - - - - 1,807 (486) 1,783
Comprehensive income (7,160) - 5,201 - - (1,769) 1,371 (2,357) 352
Net income per share (0.06)             (0.02) (0.02)
                   

Q3 2018: Adjusted EBITDA for the three-month period ended September 30, 2018 (unaudited, see Non-GAAP measures)

   IFRS
C$
Opening
Adjs
Intangible
Assets
Cost
of
Sales
Leases
and
Onerous
Contracts
Stock
Based
Comp
Other Adjusted
C$
US
GAAP
US$
Net income (loss) (4,867) - 5,201 - - (1,769) (436) (1,871) (1,433)
Interest expense 127 - - - - -   127 97
Interest income (132) - - - - - - (132) (101)
Income tax expense (865) - 1,919 - - - (162) 892 683
Depreciation and amortization 5,010 - (378) - - - - 4,632 3,545
EBITDA (727) - 6,742 - - (1,769) (598) 3,648 2,791
Stock based compensation 893 - - - - 1,769 - 2,662...