Discovery Air Inc. announces results for the quarter ended October 31, 2016

TORONTO, Dec. 8, 2016 /CNW/ - Discovery Air Inc. (the "Corporation") announced its financial and operating results for the quarter ended October 31, 2016.  The unaudited interim consolidated financial statements and management discussion and analysis ("MD&A") will be available on SEDAR at www.sedar.com and on the Corporation's website at www.discoveryair.com.






Selected Financial Information

Three months ended October 31


Nine months ended October 31

(thousands of Canadian dollars, except per share amounts)


2016



2015


% change



2016



2015


% change


















Results of continuing operations*

















Revenue

$

42,915


$

54,836


-22%


$

139,098


$

152,508


-9%


EBITDA**

$

6,190


$

13,176


-53%


$

25,157


$

33,163


-24%


Income (loss)

$

(3,897)


$

1,716




$

(5,865)


$

(1,428)


-311%


Basic and diluted income (loss) per share

$

(0.05)


$

0.02




$

(0.07)


$

(0.02)


-250%


Cash provided by operations

$

9,585


$

6,389


50%


$

6,738


$

6,720


0%


Working Capital**

$

67,225


$

64,071


5%


$

67,225


$

64,071


5%


* The results have been presented to show continuing operations for all periods. This excludes discontinued operations of Discovery Air Technical Services Inc.

** See "Non-IFRS measures" below

 

Financial Highlights

  • Consolidated revenues for the three months ended October 31, 2016 ("Current Quarter") decreased 22%, in comparison to the three months ended October 31, 2015 ("Comparative Period") due to decreased fire suppression activity across Canada and timing related variances in airborne training services.
  • EBITDA for the Current Quarter decreased by 53% in comparison to the same period in the prior year, primarily due to decreased revenue.
  • Loss for the Current Quarter was $3.9 million compared to Income of $1.7 million for the Comparative Period. The variance was mainly attributable to decreased EBITDA and increased losses on disposal of assets in the Current Quarter.
  • Consolidated revenues for the nine months ended October 31, 2016 ("Year-to-date") decreased 9%, in comparison to the nine months ended October 31, 2015 ("Year-to-date Comparative Period") primarily due to decreased fire suppression activity.
  • Year-to-date EBITDA decreased by 24% in comparison to the same period in the prior year, primarily due to decreased revenue.
  • Year-to-date loss was $5.9 million compared to $1.4 million for the Year-to-date Comparative Period. The variance was mainly attributable to losses in the Comparative period, partially offset by decreased EBITDA in the Current Quarter.

"Third quarter revenues were lower than planned" reported Jacob (Koby) Shavit, the Corporation's President and Chief Executive Officer. "The continuous severe downturn in the oil and gas and mining industries coupled with a very short firefighting season and the shift in the timing of airborne training deployments, has resulted in lower revenues than the prior year.  At the same time, a continued rigorous emphasis on cost containment measures has mitigated the impact of declining revenues on the bottom line. We continue to remain very focused on specific growth opportunities, while undertaking these long term organizational cost containment initiatives."

Recent Developments

  • On September 8, 2016, the Corporation entered into a definitive agreement with MAG Aerospace Corp., and certain of its subsidiaries and with certain Clairvest Group Inc. affiliates to sell 100% of its shares in Fire Services for $15.4 million (subject to certain post-closing purchase price adjustments and Canadian Transport Agency approval).

Forward-Looking Statements

Forward-looking information and statements are included in this earnings release.  Please refer to the statement regarding forward-looking statements contained in the Corporation's MD&A for the quarter ended October 31, 2016, which are incorporated herein by reference.  That statement provides an explanation as to what forward-looking statements are, and the specific factors, uncertainties and potential events that the Corporation has identified for the attention of readers.  When relying on forward-looking information and statements to make decisions, investors and others should carefully consider these factors and other uncertainties and potential events.

The Corporation's unaudited interim consolidated financial statements and MD&A for the quarter ended October 31, 2016, have been filed concurrently and are available on the Corporation's website at www.discoveryair.com and on SEDAR at www.sedar.com.  The reader is encouraged to review the unaudited interim consolidated financial statements and MD&A for the quarter ended October 31, 2016 for more complete disclosure on the Corporation's financial condition and results of operations.

The Corporation's Class A common voting shares and unsecured convertible debentures trade on the Toronto Stock Exchange under the symbols DA.A and DA.DB.A, respectively.

Non-IFRS Measures

References to "EBITDA" are to net profit (loss) before finance costs, income taxes, depreciation of property and equipment and intangible assets, gains and losses on disposal of assets and extinguishment of debt, gains on acquisition and disposals, impairment losses, and gains and losses resulting from the change in fair value of financial liabilities. Management believes EBITDA to be an important metric in measuring the performance of the Corporation's day-to-day operations. This measurement is useful in assessing the Corporation's ability to service debt and to meet other payment obligations, and as a basis for valuation.  "Working Capital" is current assets less current liabilities excluding current portion of loans and borrowings and operating line of credit. 

SOURCE Discovery Air Inc.

For further information: Sheila Venman, VP Human Resources & Communications, sheila.venman@discoveryair.com, 1-866-903-3247

RELATED LINKS
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