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Evertz Technologies Reports Fiscal 2021 Results for the Year Ended April 30, 2021

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Burlington, Ontario--(Newsfile Corp. - June 17, 2021) - Evertz Technologies Limited (TSX: ET), the leader in Software Defined Video Network ("SDVN") technology, today reported its results for the fourth quarter and year ended April 30, 2021.

Fiscal 2021 Highlights

  • Revenue of $342.9 million

  • Earnings from operations before foreign exchange ("FX") of $72.8 million

  • Net earnings of $42.0 million for the year

  • Fully diluted earnings per share of $0.55 for the year

  • Completed investment in DDSports, Inc. (Shottracker)

  • Completed acquisition of EaseLive AS, a direct to consumer interactive graphics company

  • Completed strategic asset acquisition of iconic Studer audio brand, technology and related assets from Harman International

Fourth Quarter 2021 Highlights

  • Quarterly revenue of $93.3 million

  • Earnings from operations before foreign exchange of $19.2 million

  • Net earnings of $9.8 million for the quarter

  • Fully diluted earnings per share of $0.13 for the quarter

Selected Financial Information
Consolidated Statement of Earnings Data
(in thousands of dollars, except earnings per share and share data)

Q4'21


Q4'20


YE'21


YE'20


Revenue

$

93,293


$

92,167


$

342,888


$

436,592


Gross margin

55,558


52,053


199,424


248,376


Earnings from operations

14,055


21,400


57,986


92,558


Earnings from operations before FX

19,166


15,279


72,847


89,074


Net earnings

9,810


16,038


41,960


69,172


Fully-diluted earnings per share

$

0.13


$

0.21


$

0.55


$

0.90


Fully-diluted shares

76,646,831


76,415,396


76,403,894


76,642,787


Selected Financial Information
Consolidated Balance Sheet Data
(in thousands of dollars)

YE ' 21


YE '20


Cash and cash equivalents

$

108,771


$

75,025


Working capital

214,515


223,720


Total assets

451,793


443,673


Shareholders' equity

292,734


295,012


Revenue
For the quarter ended April 30, 2021, revenues were $93.3 million compared to revenues of $92.2 million for the quarter ended April 30, 2020. For the quarter, revenues in the United States/Canada region were $63.6 million, an increase of $4.9 million, compared to $58.7 million in the same quarter last year. The International region had revenues of $29.7 million compared to $33.5 million in the same quarter last year.

For the year ended April 30, 2021, sales were $342.9 million, compared to sales of $436.6 million for the year ended April 30, 2020. For the year, revenues in the United States/Canada region were $222.7 million compared to $289.0 million in the prior year. The International region had revenues of $120.2 million compared to $147.6 million in the prior year.

Gross Margin
For the quarter ended April 30, 2021, gross margin was $55.6 million as compared to $52.1 million in the same quarter last year. Gross margin percentage was approximately 59.6% as compared to 56.5% in the quarter ended April 30, 2020.

For the year ended April 30, 2021, gross margin was $199.4 million as compared to $248.4 million for the year ended April 30, 2020. Gross margin percentage was approximately 58.2% as compared to 56.9% for the prior year.

Earnings
For the quarter ended April 30, 2021, net earnings were $9.8 million as compared to $16.0 million in the corresponding period last year.

For the year ended April 30, 2021, net earnings were $42.0 million as compared to $69.2 million in the corresponding period last year.

For the quarter ended April 30, 2021, earnings per share on a fully-diluted basis were $0.13 as compared to $0.21 in the corresponding period last year.

For the year ended April 30, 2021, earnings per share on a fully-diluted basis were $0.55 as compared to $0.90 in the same period in 2020.

Operating Expenses
For the quarter ended April 30, 2021, selling and administrative expenses were $13.0 million as compared to $15.4 million for the quarter ended April 30, 2020.

For the year ended April 30, 2021, selling and administrative expenses were $49.4 million as compared to $67.6 million for the year ended April 30, 2020.

For the quarter ended April 30, 2021, gross research and development expenses were $22.5 million as compared to $21.2 million for the quarter ended April 30, 2020.

For the year ended April 30, 2021, gross research and development expenses were $80.2 million as compared to $90.8 million for the year ended April 30, 2020.

Liquidity and Capital Resources
The Company's working capital as at April 30, 2021 was $214.5 million as compared to $223.7 million on April 30, 2020.

Cash was $108.8 million as at April 30, 2021 as compared to $75.0 million on April 30, 2020.

Cash generated from operations was $33.6 million for the quarter ended April 30, 2021 as compared to $47.1 million cash generated for the quarter ended April 30, 2020. Before taking into account taxes and the changes in non-cash working capital and current taxes, the Company generated $12.4 million from operations for the quarter ended April 30, 2021 compared to $21.6 million for the same period last year.

Cash provided by operations was $101.0 million for the 2021 fiscal year as compared to cash provided by operations of $109.3 million for the 2020 fiscal year. Before taking into account taxes and the changes in non-cash working capital and current taxes, the Company generated $59.0 million from operations for fiscal 2021 as compared to $87.7 million for fiscal 2020.

For the quarter, the Company used $4.1 million for investing activities.

For the year, the Company used $18.6 million in investing activities which was principally driven by the acquisition of capital equipment of $9.6 million and investment in DDSports Inc. (Shottracker) for $7.8 million.

For the quarter ended, the Company used cash in financing activities of $15.2 million which was principally a result of the payment of dividends of $13.8 million.

For the year ended April 30, 2021, the Company used cash in financing activities of $49.4 million which was principally a result of the payment of dividends of $41.6 million.

Shipments and Backlog
At the end of May 2021, purchase order backlog was in excess of $138 million and shipments during the month of May 2021 were $27 million.

Dividend Declared
Evertz Board of Directors declared a regular quarterly dividend on June 17, 2021 of $0.18 per share.

The dividend is payable to shareholders of record on June 25, 2021 and will be paid on or about July 2, 2021.

Selected Consolidated Financial Information
(in thousands of dollars, except earnings per share and percentages)

Three month period ended

Twelve month period ended

April 30,

April 30,

2021

2020

2021

2020

Revenue

$

93,293

$

92,167

$

342,888

$

436,592

Cost of goods sold

37,735

40,114

143,464

188,216

Gross margin

55,558

52,053

199,424

248,376

Expenses

Selling and administrative

12,987

15,400

49,413

67,597

General

1,287

824

3,896

3,509

Research and development

22,516

21,202

80,187

90,827

Investment tax credits

(2,942

)

(1,558

)

(13,042

)

(7,595

)

Share based compensation

2,545

906

6,123

4,964

Foreign exchange loss (gain)

5,110

(6,121

)

14,861

(3,484

)

41,503

30,653

141,438

155,818

Earnings before undernoted

14,055

21,400

57,986

92,558

Finance income

66

181

687

1,077

Finance costs

(516

)

(470

)

(1,709

)

(1,845

)

Share of net loss of Investment in Associate

(531

)

-

(531

)

-

Other income and expenses

(157

)

(134

)

(588

)

169

Earnings before income taxes

12,917

20,977

55,845

91,959

Provision for (recovery of) income taxes

Current

6,459

4,232

17,369

22,304

Deferred

(3,352

)

707

(3,484

)

483

3,107

4,939

13,885

22,787

Net earnings for the period

$

9,810

$

16,038

$

41,960

$

69,172

Net earnings attributable to non-controlling interest

(144

)

138

202

565

Net earnings attributable to shareholders

9,954

15,900

41,758

68,607

Net earnings for the period

$

9,810

$

16,038

$

41,960

$

69,172

Earnings per share

Basic

$

0.13

$

0.21

$

0.55

$

0.90

Diluted

$

0.13

$

0.21

$

0.55

$

0.90

April 30,

April 30,


April 30,


2021

2020


2019



Assets



Current assets



Cash and cash equivalents

$

108,771

$

75,025


$

104,583


Marketable securities

-

-


4,023


Trade and other receivables

76,785

90,631


81,498


Contract assets

2,821

7,864


22,348


Prepaid expenses

6,559

9,003


9,045


Inventories

152,699

161,985


171,271


Income tax receivable

-

-


708


347,635

344,508


393,476



Property, plant and equipment

44,799

47,794


48,887


Right-of-use assets

23,570

28,823


-


Goodwill

21,140

20,771


20,716


Intangible assets

4,476

1,573


1,952


Investment in Associate

6,869

-


-


Deferred income taxes

3,304

204


1,566

$

451,793

$

443,673


$

466,597



Liabilities



Current liabilities



Trade and other payables

$

66,727

$

62,231


$

63,647


Provisions

4,069

5,031


4,171


Deferred revenue

58,047

45,076


42,843


Current portion of long term debt

-

238


294


Current potion of lease obligations

4,122

4,400


-


Income tax payable

155

3,812


-


133,120

120,788


110,955




Long term debt

-

-


239


Long term redemption liability

2,523

-


-


Long term lease obligations

21,245

25,465


-

156,888

146,253


111,194




Equity



Capital stock

143,605

143,915


139,865


Share based payment reserve

9,514

8,279


8,245




Accumulated other comprehensive income

(1,062

)

1,032


1,729


Retained earnings

140,677

141,786


203,284

139,615

142,818


205,013


Total equity attributable to shareholders

292,734

295,012


353,123

Non-controlling interest

2,171

2,408


2,280

294,905

297,420


355,403

$

451,793

$

443,673


$

466,597

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
June 17, 2021 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 647-490-5367 or toll-free (North America) 1-800-367-2403, access code 8321777.

For those unable to listen to the live call, a rebroadcast will also be available until
July 17, 2021. The rebroadcast can be accessed at 647-436-0148 or toll-free 1-888-203-1112. The pass code for the rebroadcast is 8321777.

About Evertz

Evertz Technologies Limited (TSX: ET) 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 and ultra-high definition television ("HDTV" and "UHD") and next generation high bandwidth low latency IP network environments and by telecommunications and new-media companies. The Company's products allow its customers to generate additional revenue while reducing costs through efficient signal routing, distribution, monitoring and management of content as well as the automation and orchestration of more streamlined and agile workflow processes on premise and in the "Cloud".

Contact Information
Evertz Technologies Limited
Doug Moore, CPA, CA
(905) 335-7580
ir@evertz.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/87936