TORONTO, Jan. 27 /CNW/ - AlarmForce Industries Inc. (TSX:AF) is pleased to announce annual results for the year ended October 31, 2009.
2009 2008 Change
Revenue 34,133,000 29,942,000 +14%
Gross profit 26,101,000 23,346,000 +12%
Operating cash flow 6,467,000 6,812,000 -5%
Operating cash flow
excluding working capital 6,718,000 5,176,000 +30%
Subscriber base 102,000 91,000 +12%
EBITDA* 9,057,000 7,218,000 +25%
Income before taxes 5,673,000 3,885,000 +46%
Net income 3,780,000 2,610,000 +45%
Net income per share 0.31 0.22 +41%
Diluted Net income per share 0.31 0.22 +41%
* Earnings before interest, taxes, depreciation and amortization as
reconciled to GAAP earnings in management's discussion and analysis
Joel Matlin, President and CEO, announced that AlarmForce Industries Inc. closed its fiscal year by adding 11,400 net new subscribers for a total ending subscriber account base of 102,400, which is a net increase of 12%. Mr. Matlin said, "We achieved record revenues of $34 million, an annual increase of $4.2 million or 14% from 2008. Our earnings per share increased from $0.22 to $0.31,the highest in our 21 years of business. Net income increased by 45% or $1.2 million to $3,780,000. Driven by increases in operating efficiency to our organic growth model our earnings have grown at a higher rate than revenues in 2009.
"The growth in subscribers and monthly recurring revenues was accompanied by an increase in EBITDA of 25% to $9 million when compared to 2008. Excluding marketing expenses, EBITDA increased from $16 million to $18.1 million, up by 13%. We continue to fund all of our growth from internally generated cash flows, including our recently announced entry into the State of Minnesota.Together with the overall growth in accounts, the AlarmCare subscriber base of personal emergency response systems ( PERS ) also expanded in 2009 through advertising programs and customer referrals."
Net cash flows from operating activities decreased by 5% to $6.5 million for 2009, due to increased working capital required to support expansion in the subscriber base. Excluding working capital items, our operating cash flow increased by 30% in 2009. In the fourth quarter, no additional shares were purchased by the company under the stock buyback, which expired December 21, 2009. After financing and investing activities, total cash increased by $2.9 million.
Mr. Matlin added that: "We were able to close the year with a double-digit growth rate,notwithstanding the sharp economic slowdown in North America. While virtually every business hasbeen adversely affected, our organic growth model and low-cost of account creation continues tostrengthen our balance sheet and proves our value in these uncertain economic times.
"Our future outlook is very exciting for a number of reasons. We are investing substantial resources in order to continue innovating and enhancing the benefits of our two-way voice wireless systems.We are also designing new subscriber applications and services for home alarm systems andAlarmCare systems. Innovation is central to our vision of adding new recurring revenue sources out of AlarmForce's traditional brand strength. Furthermore, we believe that users of internet and broadband devices, who want new security applications at an affordable cost, will become new subscribers of AlarmForce.
"In addition, the emerging culture of wireless, mobility and broadband is changing the landscape. As our industry continues to migrate to wireless technologies and more enhanced service options, weanticipate that AlarmForce will be able to take advantage and grow revenues through theconvergence of these new trends and technologies.
Mr. Matlin concluded, We would like to thank our investors and employees who have supported us in creating one of the best known brands in the security industry. Building on our past success and an improving economy, we believe the future will offer superior rewards for AlarmForce and its shareholders."
AlarmForce provides security alarm and personal emergency response monitoring and related services to residential and commercial subscribers throughout Canada and selected centers across the United States. The Company is a leading provider of two-way voice alarm systems in Canada and sole provider of AlarmPlus, a wireless line-cut protection system. More information about the Company s products and services can be found at www.alarmforce.com.
SOURCE AlarmForce Industries Inc.
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