BIOREM reports record revenue of $18.9M in 2009

GUELPH, ON, April 13 /CNW/ - BIOREM Inc. (TSX-V: BRM) ("Biorem" or "the Company") today announced its results for the three and twelve-month periods ended December 31, 2009. Biorem's complete fiscal 2009 fourth quarter and year-end financial statements and MD&A have been filed on SEDAR (www.sedar.com).

"We are pleased to report on a particularly strong fiscal year, with more than 30% growth in revenue and gross profit and a sustained 40% gross margin level, which resulted in $1,387,000 of EBITDA," said Peter Bruijns, President & CEO. "2009 also marked our first full year of positive cash flow generation, and one of our highest levels of cash to-date, representing an 83% increase in cash over 2008 levels. Our performance during 2009 was driven by an increased number of completed air emissions control projects and good order bookings in North America and internationally, notwithstanding the weak economic environment."

"During 2009, we made significant investment and progress in advancing our growth strategy," added Mr. Bruijns. "We are focused on offering our customers best-in-class, clean air emissions technologies. In line with this objective, in each of the last three years, we have invested approximately $1 million dollars in the research and development of our proprietary filter media products. We also believe that this ongoing investment has better positioned Biorem to deal with a greater range of air emissions problems and has set the Company apart from its competitors."

"In late 2009, we launched our newest product, the SK Series, a skid-mounted, two-stage biofilter that uses Biorem's engineered XLD media. The development of the SK Series should help Biorem significantly increase international bookings in 2010. We also strengthened our management team this past year with the addition of Mr. Mark Hawley as Vice President of Operations. Mr. Hawley will focus on cost reduction and project delivery performance. With the support of a strong balance sheet, experienced and proven management team, and best-in-class proprietary air emissions control technology, we have entered the next stage of our growth strategy. This strategy will be focused on capitalizing on the key growth markets of volatile organic compounds and biogas emissions with significant investment in sales infrastructure and product development."

Bookings in 2009 were $16,176,000 down from $17,377,000 in 2008. Lower 2009 bookings and exceptional revenue lead to a reduced backlog of $10,187,000 down from $14,803,000 in 2008. However, Q1 2010 bookings have rebounded which will lead to an increased backlog in 2010.

    
                             ------------------------------------------------
                                Three months        Twelve months
                                    ended               ended
                                 December 31,        December 31,
    (in thousands of         -------------------------------------  % Change
     Canadian dollars,
     except percent and
     per share data)            2009      2008      2009      2008
    -------------------------------------------------------------------------
    REVENUE                   $4,252    $4,639   $18,878   $14,400     31.1%
    -------------------------------------------------------------------------
    GROSS PROFIT              $1,608    $1,754    $7,588    $5,769     31.5%
    -------------------------------------------------------------------------
    GROSS MARGIN               37.8%     37.8%     40.2%     40.1%     0.01%
    -------------------------------------------------------------------------
    EBITDA(1) (excluding
     gains and losses on
     foreign exchange)           $(2)      $54    $1,387     $(287)   583.0%
    -------------------------------------------------------------------------
    NET INCOME (LOSS)          $(360)     $191     $(503)    $(432)  (16.3)%
    -------------------------------------------------------------------------
    BASIC AND DILUTED
     EARNINGS (LOSS)
     PER SHARE                $(0.04)    $0.02    $(0.04)   $(0.04)        -
    -------------------------------------------------------------------------
    

THREE MONTHS ENDED DECEMBER 31, 2009

Revenue for the three-month period ended December 31, 2009 (Q4 2009) was $4,252,000, compared to $4,639,000 in the comparative period in the prior year. New orders for the quarter totaled $4,344,000.

Gross profit in Q4 2009 was $1,608,000 down slightly from $1,754,000 in Q4 2008. Biorem achieved a strong gross margin percentage in the fourth quarter of 2009, which is in line with the Company's target annual level of 40%. Total operating expenses in Q4 2009 were $1,612,000 compared to $1,699,000 in Q4 2008.

Net loss for the fourth quarter of 2009 was $360,000, or a loss of $0.04 per basic and diluted share, compared to net income of $191,000, or $0.02 per basic and diluted share in the fourth quarter of 2008. This change was due mainly to gains and losses in foreign exchange (FX) as well as interest expense. A negative variance in FX of $451,000 resulted from a FX gain of $386,000 in the fourth quarter of 2008 compared to a FX loss of $65,000 in the fourth quarter of 2009. Also, there was $57,000 in increased financing costs in Q4 2009 over the same period in 2008. On October 31, 2008, the Company secured long-term financing in the form of a $3,000,000 debenture and as such, two months of interest was incurred in 2008 (November-December) versus three months (October-December) in 2009.

TWELVE MONTHS ENDED DECEMBER 31, 2009

For the twelve months ended December 31, 2009, revenue increased 31.1% to $18,878,000, from $14,400,000 for the same period in 2008. During 2009, the Company completed, or substantially completed, 91 projects in comparison to 73 projects in 2008. The 2009 average revenue per project was $178,000, which was approximately the same amount as in 2008.

Gross profit was $7,588,000 for the year-ended December 31, 2009, up 31.5% from gross profit of $5,769,000 for the year-ended December 31, 2008.

Total operating expenses were $6,201,000 for the year-ended December 31, 2009 compared to $6,056,000 for the year-ended December 31, 2008. The increase was primarily the result of increased sales and marketing expenses, due to Biorem's new operations in Beijing, China, as well as increased commissions due to greater revenue.

In fiscal 2009, EBITDA increased to $1,387,000 from $(287,000) in fiscal 2008.

Net loss for fiscal 2009 was $503,000, or a loss of $0.04 per basic and diluted share, compared to net loss of $432,000, or a loss of $0.04 per basic and diluted share, in the fourth quarter of 2008. The variance in net income for 2009 from 2008 was attributed to $1,316,000 of a negative swing in FX, $179,000 of additional accretion costs associated with the debenture, and $319,000 of increased interest costs.

As at December 31, 2009, the Company had working capital of $7,089,000, including cash and short-term investments of $4,031,000, trade and other receivables of $2,898,000, and unbilled revenue of $3,449,000, compared to total working capital of $6,935,000, cash and short-term investments of $2,199,000, trade and other receivables of $5,419,000, and unbilled revenue of $3,810,000 as at December 31, 2008.

About BIOREM Inc.

BIOREM is a leading clean technology company that designs, manufactures and distributes a comprehensive line of high-efficiency air emissions control systems used to eliminate odors, volatile organic compounds (VOCs), and hazardous air pollutants (HAPs). With sales and manufacturing offices across the continent, a dedicated research facility, a worldwide sales representative network and over 600 installed systems worldwide, Biorem offers state-of-the-art technology-based products and peace of mind for municipalities, industrial companies and their surrounding communities. Additional information on Biorem is available on our website at www.biorem.biz.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements

This press release contains forward-looking statements based on current expectations. These forward-looking statements contain various risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Risks and uncertainties about the Company's business are more fully discussed in the disclosure materials, financial statements and MD&A filed with the securities regulatory authorities in Canada on www.sedar.com.

Non-GAAP Measures

(1) EBITDA is a non-GAAP earnings measure, therefore, it does not have any standardized meaning prescribed by Canadian generally accepted accounting principles and may not be similar to measures presented by other companies. EBITDA represents earnings before interest, income taxes, depreciation and amortization. This measure is important to management since it is used by potential lenders to evaluate the ongoing cash generating capability of the Company and thus the amounts those lenders are willing to lend to the Company.

"Order Bookings" and "Order Backlog" do not have any standardized meaning prescribed by Canadian generally accepted accounting principles ("GAAP") and may not be comparable to measures presented by other companies.

Order Bookings and Order Backlog are non-GAAP measures that the Company uses to evaluate its sales performance. Order Bookings are those binding contracts that the Company enters into with a third party for the delivery of our products or services. As Order Bookings are received, the contract value (before any associated sales taxes) is included in the Order Backlog. The Order Backlog is reduced by the revenue that is recognized on each project and then adjusted for any currency changes.

%SEDAR: 00020304E

SOURCE BIOREM Inc.

For further information: For further information: Ed Corbett, Chief Financial Officer, BIOREM Technologies Inc., ecorbett@biorem.biz, Tel: (519) 767-9100 x275; Adriana Braczek, Investor Relations, The Equicom Group Inc., abraczek@equicomgroup.com, Tel: (416) 815-0700 x240

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