Clearford Announces Results for quarter ended September 30, 2015, Grants options to Senior Management and Board of Directors

OTTAWA, Nov 6, 2015 /CNW Telbec/ - Clearford Water Systems Inc. ("Clearford" or the "Company"), (TSXV: CLI), today released results for its three and nine months ended September 30, 2015 The condensed interim financial statements are presented in accordance with IFRS (all figures in Canadian dollars).

During the quarter, the Company continued to focus on the marketing and sales of Clearford One™ for Ontario municipalities with the Pay for Performance (P4PTM) delivery model. Response by municipalities has been positive. The Company has continued its discussions with the Township Council of Adjala-Tosorontio and anticipates that it will receive a response during the current year on the steps forward for providing services under its P4PTM offering within the township.

The Company began the installation of its Clearford OneTM system in Fetherston with an anticipated completion date by the end of the current fiscal year. The Company also began the installation of its first complete system in India which includes the Clearford OneTM System with toilet blocks in Jambudiyapura, a small village in the state of Gujarat, India under the Corporate Social Responsibility ("CSR") program mandated by the India government for corporations operating in India. It is anticipated that this project will be completed in the first quarter of 2016 and will provide an operating demonstration site of Clearford OneTM that is expected to increase interest for companies in India required to spend a portion of their profits on CSR related activities.

The Company issued 3 million new common shares through a private placement for proceeds of $1.5 million and issued a $3.6 million debenture through a second private placement for a total of $5.1 million during the quarter as previously announced. The proceeds were used to repay short-term debt, finance the Company's Fetherston project, and provide working capital.

UV Pure completed its third consecutive profitable quarter since acquisition by Clearford in December 2014. For the first nine months of this year UV Pure revenue was $2,124,840 with EBITDA of $195,915 and net income of $101,621.

Kevin Loiselle, President and CEO of Clearford, expressed enthusiasm for the future of Clearford: "We are very pleased with our progress in the quarter. With Clearford One™ systems currently under construction in Ontario and India, we feel that the basis for strong sales growth is being put in place for the South Asian market and our P4P™ offering in Ontario. "Our Clearford OneTM system has been short-listed in the Township of Adjala-Tosorontio and consideration of the Clearford proposal is continuing", he said.

"International opportunities for Clearford, particularly in India where public policy has set priority on sanitation and clean water continue to look very positive, Mr. Loiselle continued. "With the completion of our first Clearford One™ system in Prime Minister Modi's home state of Gujarat next quarter, our subsidiary Clearford India Pvt. Ltd. will have a live demonstration site of our technology.  We believe the operational system in Gujarat will lead to additional contract signings in India", he concluded.

The Company's consolidated financial results for the three months ended September 30, 2015, included: revenue of $766,938 compared with revenue of $32,469 for the prior year; an operating loss before finance costs of $1,252,990 compared with an operating loss, before finance costs of $978,338 for the prior year; and a net loss of $1,866,471 or $0.02 per share compared with a net loss of $1,408,158 or $0.02 for the prior year. Net financing costs for the quarter were $586,450 compared with $415,833 for the prior year.

The Company's consolidated financial results for the nine months ended September 30, 2015 included: revenue of $2,329,000 compared with $417,092 for the prior year; an operating loss before finance costs of $2,882,147 compared with an operating loss before financing costs of $2,707,946 for the prior year; and a net loss of $4,724,347 or $0.06 per share compared with a net loss of $3,704,705 or $0.05 per share for the prior year. Net financing costs were $1,809,060 compared with $1,016,272 for the prior year.

For the three and nine month ended September 30, 2015 overall operating expenses increased by $590,997 and $1,099,661 respectively. UV Pure accounted for $321,669 and $960,789 of operating expenses during the three and nine months respectively.

Clearford ended the September 30, 2015 quarter with unrestricted cash of $822,505 compared with $710,299 on December 31, 2014. The Company's condensed interim financial statements and MD&A are available at www.SEDAR.com.

Subsequent to the quarter end, the Company entered into an additional short-term debt arrangement for C$1.1 million. The new loan is unsecured and bears an interest rate of 6% and is due on December 31, 2015.

The Company also announced that its Board of Directors has approved 3,800,000 stock options pursuant to its stock option plan for its senior management team consisting of the Company's Chairman, President & CEO, CFO and CTO. The Company's Board of Directors has also approved 1,600,000 stock options in total for its four independent directors on the same terms and conditions for a total approved stock option grant of 5,400,000 stock options. Pursuant to the Company's insider trading policy, the stock options shall be granted on November 12, 2015, at an exercise price being the greater of $0.50 per share or the closing market price on November 11, 2015. Additionally, the stock option grant date will be subject to any undisclosed material information which may arise prior to the intended grant date. The stock options have a five year term and will vest annually in equal amounts over 3 years with an expiry date of November 12, 2020.

As the stock options approved to the certain members of management and its independent directors exceed the limits allowed by the Company's current amended and restated stock option plan (2013) and TSX-V regulations, 914,000 stock options approved for senior management and independent directors will be subject to disinterested shareholder approval at its next Annual General Meeting ("AGM") for shareholders. Additionally, 1,629,000 of the stock options approved for senior management will be subject to approval by its shareholders of a new amended and restated stock option plan and disinterested shareholder approval at its next AGM for shareholders as well as TSX-V approval of the amended and restated stock option plan.

All other terms and conditions of the grants are in accordance with the TSX Venture Exchange policies and the terms and conditions of the Company's Stock Option Plan.

Neither the 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.

About Clearford Water Systems Inc.
Clearford Water Systems Inc. (TSX-V: CLI) is a provider of unified water management and sanitation systems based on Clearford One™. Clearford One™ is a proprietary system comprised of ClearDigest™ smart digester, ClearConvey™ small bore sewer, and ClearRecover™ final treatment facility. For more information on Clearford Water Systems, please visit www.clearford.com .

About UV Pure Technologies Inc.
UV Pure Technologies manufactures technically advanced UV water purification systems. The Company has won an Artemis Top 50 Clean Tech Company award, two Frost and Sullivan Best Practices awards, a Canadian Drinking Water Association award for innovation, and is a Going Green Global Top 200 company.

There are currently over 15,000 UV Pure systems in residential, commercial, industrial, public and municipal applications, with flow rates up to 1 million gallons per day. An aerospace version of UV Pure's system is being used by Boeing to purify water on its new 787 Dreamliner.

UV Pure's patented Crossfire Technology® is dramatically advantaged compared to conventional UV systems. Lamps are mounted in air surrounded by elliptical reflectors providing more effective deactivation of pathogens, facilitating easy lamp changes and visual quartz inspection. They are self-cleaning, smart – with multiple sensors and on-board diagnostics guiding maintenance, engineered to be fail-safe, virtually maintenance free, and are plug-in ready for remote monitoring. For more information on UV Pure Technologies, please visit www.uvpure.com.

Forward Looking Statements
This news release contains certain statements that constitute forward-looking statements as they relate to the Company and its management. Forward-looking statements are not historical facts but represent management's current expectation of future events, and can be identified by words such as "believe", "expects", "will", "intends", "plans", "projects", "anticipates", "estimates", "continues" and similar expressions.  Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that they will prove to be correct.

By their nature, forward-looking statements include assumptions and are subject to inherent risks and uncertainties that could cause actual future results, conditions, actions or events to differ materially from those in the forward-looking statements. If and when forward-looking statements are set out in this news release, Clearford will also set out the material risk factors or assumptions used to develop the forward-looking statements. Except as expressly required by applicable securities law, the Company assumes no obligation to update or revise any forward looking statements. The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: industry cyclicality; the ability to secure third party agreements; successful integration of Clearford's system with third party technology; competition; reduction in demand for products; collection from customers; relationships with suppliers; product liability; intellectual property; reliance on key personnel; environmental; interest rates; uninsured and underinsured losses; operating hazards; risks of future legal proceedings; income tax matters; credit facilities; availability and terms of financing; distribution of securities; restrictions on potential growth; effect of market interest rates on price of securities; and potential dilution.

 

SOURCE Clearford Water Systems Inc.

For further information: Kevin Loiselle, President & CEO, Clearford Water Systems Inc., Phone: (613) 599-6474 ext. 303, www.clearford.com

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