IRD Announces First Quarter Fiscal 2013 Results
SASKATOON, SASKATCHEWAN--(Marketwired - April 11, 2013) - International Road Dynamics Inc. (IRD.TO), one of the world's leading providers of systems and solutions for the global Intelligent Transportation Systems (ITS) industry, today announced its results for the three months ended February 28, 2013.
HIGHLIGHTS:
Trend of improved year-over-year quarterly financial performance continues
Solid increase in gross margin percentages on product mix and increased performance on international sales
Service revenues continue to provide consistent contribution to earnings
XPCT investment pays dividend of $491,601
Subsidiary in India maintains trend of improved operating results
Subsidiary in Chile provides strong market position and continued growth in Latin America
Strong financial position maintained with positive working capital of $7.5 million
"While we were pleased that the trend in improved year-over-year profitability continued in the quarter, our revenues were impacted by delays in certain key projects that we had expected to include in our first quarter results," commented Terry Bergan, President and CEO. "Looking ahead, these contracts will make a positive contribution in the coming quarters, augmented by our solid and growing order backlog and the continuing long-term opportunities in our markets."
Revenues for the first quarter of fiscal 2013 were $7.8 million compared to $8.9 million for the same period last year.
Revenues in the Company's Canadian and United States markets declined due to a delay in expected awards of new projects. Management continues to believe that its North American business will grow over the near term due to a recently-approved funding bill passed by the U.S. Congress.
Latin American revenues, originating from the Company's successful subsidiary in Chile, increased by 49% in the quarter compared to last year despite a delay in a major project in Paraguay.
South Asian revenues were down in the quarter compared to last year as several highway and toll systems projects were being completed and not yet replaced by new projects.
Other International revenues, which include all other overseas sales originating from North America, fell in the quarter primarily due to a decline in product sales resulting from delay in orders primarily in the Company's Chinese market.
For the three months ended February 28, 2013 the Company reported an improved equity share loss from its 50% equity investment in XPCT in China of $3,899 compared to a loss of $73,446 in the same prior year period as XPCT recorded positive gains in its wiring harness business. The Company received dividends of $491,601 from XPCT during the period.
Gross margin as a percentage of revenues improved significantly to 32.8% in the first quarter of fiscal 2013 from 26.5% in the same prior year period due primarily to increased revenues from higher margin service revenues and product sales this year, as well as improved performance on international projects, particularly at the Company's subsidiary in India.
Administrative and marketing expenses increased compared to the prior year due primarily to higher selling costs in its Latin America operations resulting in the higher sales revenues. Net research and development costs increased due to accelerated technology development programs aimed at adding to the functionality of its products. Interest costs were higher due to increased interest rates on the Company's credit lines.
The Company continued to demonstrate a trend of improved year-over-year quarterly performance as earnings before interest, taxes, depreciation and amortization ("EBITDA") reduced to a negative $190,359 in the first quarter of 2013 compared to a negative $322,506 in the same prior year period. The Company generated a net loss of $383,000 ($0.03 per share) compared to a loss of $512,919 ($0.04 per share) last year.
The Company's balance sheet remained solid at February 28, 2013 with working capital of $7.5 million. Cash flow from operating activities, after changes in non-cash working capital items, rose to $1.7 million for the three months ended February 28, 2013 compared to $55,591 in the prior year period due primarily to higher deferred revenue balances resulting from customer advances received in the Company's Latin American operations. The Company's current ratio remained strong at 1.51 times with a solid debt to equity ratio of 93%.
Financial Highlights (financial statements are available on the Company's web site)
| 2013 | 2012 | ||||
(in $000's except per share amounts) | ||||||
Sales | $ | 7,808 | $ | 8,916 | ||
Gross Margin | 2,562 | 2,362 | ||||
Gross Margin Percentage of Revenues (%) | 32.8 | % | 26.5 | % | ||
EBITDA | (190 | ) | (323 | ) | ||
Net Loss | (383 | ) | (513 | ) | ||
Net Loss per Common Share (basic) | $ | (0.03 | ) | $ | (0.04 | ) |
Working Capital | 7,490 | 6,975 | ||||
Shareholders' Equity per Share | $ | 1.18 | $ | 1.21 | ||
Common Shares Outstanding | 13,998 | 13,998 | ||||
Certain statements contained in this news release constitute forward-looking information within the meaning of securities laws. Implicit in this information, particularly in respect of future operating results and economic performance of the Company, are assumptions regarding projected revenue and expenses. These assumptions, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. Readers are cautioned that actual future operating results and economic performance of the Company are subject to a number of risks and uncertainties, including general economic, market and business conditions and could differ materially from what is currently expected. For more exhaustive information on these risks and uncertainties, please refer to our most recently filed annual information form, available at www.sedar.com. Forward-looking information contained in this report is based on management's current estimates, expectations and projections, which management believes are reasonable as of the current date. You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While we may elect to do so, we are under no obligation and do not undertake to update this information at any particular time unless required by applicable securities law.
As used herein, "EBITDA" means earnings before interest, income taxes, depreciation, and amortization, and includes gains or losses from foreign exchange and earnings or losses from the Company's equity investments. EBITDA is not a recognized measure under International Financial Reporting Standards ("IFRS"). Management believes that EBITDA is a useful supplemental measure to net earnings (loss), as it provides investors with an indication of operating performance prior to debt service, capital expenditures and income taxes. Investors should be cautioned, however, that EBITDA should not be construed as an alternative to net earnings (loss) determined in accordance with IFRS as an indicator of the Company's performance or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. The Company's method of calculating EBITDA may differ from the methods by which other companies calculate EBITDA and, accordingly, EBITDA may not be comparable to measures used by other companies.
IRD is a highway traffic management technology company specializing in supplying products and systems to the global Intelligent Transportation Systems (ITS) industry. IRD is a North American company based in Saskatoon, Saskatchewan Canada with sales and service offices throughout the United States and overseas. Private corporations, transportation agencies and highway authorities around the world use IRD's products and advanced systems to manage and protect their highway infrastructures.
The Company's shares trade on the Toronto Stock Exchange under the symbol IRD.
IRD is listed on the TSX - trading symbol - IRD
