AlarmForce posts record revenues in Second Quarter



    Trading symbol: AF

    TORONTO, June 11 /CNW/ - Joel Matlin, President and CEO, is pleased to
announce results for the second quarter ended April 30, 2008:

    
    -------------------------------------------------------------------------
                                      April 30,      April 30,
                                          2008           2007         Change
                                     (6 months      (6 months     (over same
                                         ended)         ended)        period)
                                  -------------  -------------  -------------

    Revenue                       $ 14,416,000   $ 12,025,000             20%
    Income before income taxes    $  1,824,000   $  1,334,000             37%
    Net income                    $  1,203,000   $    840,000             43%

    Cash flow form operations     $  2,233,000   $  1,672,000             34%

    EBITDA                        $  3,367,000   $  2,651,000             27%
    EBITDA/share                  $       0.28   $       0.22             27%

    EBITDA before marketing
     expenses                     $  7,573,000   $  6,639,000             14%

    Basic Net income/share        $       0.10   $       0.07
    Diluted Net income/share      $       0.10   $       0.07
    -------------------------------------------------------------------------

    (*) EBITDA (Earnings Before Interest, Income Taxes, Depreciation, and
        Amortization) is a key measure in the security industry and should
        not be interpreted as GAAP)
    

    Mr. Matlin said that: "In the first six months of our 2008 fiscal year we
achieved a net increase in subscribers of approximately 6,200 accounts which
represents a 20% increase over the comparative six months in 2007. This
increase brings our total subscriber base to 85,400 which is an increase of
20%."
    Mr. Matlin went on to add: "During the second quarter we launched
AlarmCare, our 24-hour personal emergency response system. Building the
capacity and the rollout for the AlarmCare subscriber service required an
increased use of resources including quality control, brand-building and
launch. This was reflected in an increase in expenses, and also contributed to
the fact that our second quarter subscriber increases did not exceed the
record set in the immediately preceding quarter. Currently, AlarmCare branding
has moved past the start-up phase and our course has resumed to allow us to
increase our margins in future quarters."
    "Having successfully completed the launch of AlarmCare, we look ahead to
revenue growth in all the current markets that we service in Canada and the
US. Retirees represent one of the fastest growing segments of the population
and we are excited to add this to AlarmForce's recurring revenue business."
    "AlarmForce revenues for the second quarter reached $7,317,000, setting a
record for the highest quarterly revenue in the company's history. This
increase brought total revenues for the first six months of 2008 to
$14,416,000, up by 20% over the first six months of 2007. Income before taxes
for the period was up by 37%, and Net income was up by 43%."
    "EBITDA, a performance measure used in the security industry, increased
by 27% from the corresponding 2007 period. Included in this measure is the
effect of the marketing expenses that drives the company's growth engine. The
effect of increased marketing expenses results in a charge, thus reducing the
operating income. Excluding marketing expenses, EBITDA increased from
$6.6 million to $7.5 million for the six months, reflecting the increase in
recurring revenues and cash flows. Ultimately, every subscriber account added
increases the asset value of the company, and therefore the underlying value
of our shareholders' investment. We have expanded the account base at a record
level without any increase in debt financing. Our total debt decreased during
the period and our debt per subscriber decreased to $19 per account from $22
at the end of 2007. By continuing to grow our subscriber base organically, we
expect to continue to grow more profitably than the industry average."
    Mr. Matlin ended by saying: "Our future outlook is immensely positive.
Favourable demographic trends continue to provide impetus for growth in the
residential alarm business. Several important factors are driving an increased
level in home ownership, including immigration and strong population growth,
increased urbanization, longer life expectancy rates, smaller households, and
more second homes for the baby boom generation. All these factors will have a
far-reaching and highly beneficial effect on demand for our subscriber
services."

    AlarmForce is Canada's largest manufacturer and installer of two-way
voice home alarms systems and line-cut protection. The Company has offices
serving all major markets in Canada and selected markets in the United States.





For further information:

For further information: Investor Relations Dept., Tel: (416) 445-2001
ext No. 225, Fax: (416) 445-9381, E-mail: investor@alarmforce.com

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AlarmForce Industries Inc.

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