BAIE-D'URFÉ, QC, Nov. 12 /CNW Telbec/ - Prestige Telecom Inc. ("Prestige" or "the Company") (TSX-V:PR) today announced unaudited financial results for the second quarter of fiscal 2010, which ended September 30, 2009, and filed its MD&A for the period. All figures are in Canadian dollars.
Sales for the second quarter were $34.8 million, an increase of 147% over the second quarter of a year ago. Record sales were recorded by each of Prestige's three business segments: engineering, installation and aerial construction. For the second quarter, EBITDA(1) was a record $3.4 million, compared to EBITDA of $0.5 million last year. The EBITDA margin was also the highest in the Company's history, reflecting both a record gross margin of 25.2% of sales, and continued cost-cutting and efficiency measures as part of the ongoing integration of Radian Communication Services (Canada) Limited ("Radian"), which was acquired on December 15, 2008. Net income was $1.0 million, or $0.01 per share, compared to a net loss of $0.4 million, or a loss of $0.01 per share, last year.
For the six-month period ended September 30, 2009 Prestige reported sales of $65.9 million, EBITDA of $6.3 million, earnings before taxes of $2.3 million and net income of $1.1 million, or $0.01 per share. These compared to sales of $25.8 million, an EBITDA of $0.9 million and a net loss of $1.9 million, or a loss of $0.04 per share, in the first half of last year, which was prior to the Radian acquisition.
Mr. Pierre Yves Méthot, Chairman and CEO of Prestige, said, "We are very pleased to report these excellent results. The performance was broad-based across our Company, and reflected both the acquisition and successful integration of Radian, as well as strong and profitable organic growth." He continued, "The market for our services continues to grow, and we remain focused on sustainable profitability in both our wireline and wireless businesses."
The sales increase in the second quarter included an increase of $18.7 million due to the Radian acquisition and organic growth of 31% in the engineering business segment.
The Company is focused on organic growth and financial stability for the remainder of the fiscal year to March 31, 2010. Increases in working capital are expected to slow as sales growth stabilizes, thus Prestige expects to generate free cash flow which it will use to pay down debt.
Prestige's second quarter results were positively impacted by the build-outs of high-speed packet access ("HSPA") network upgrades to support enhanced voice, high-speed data and video services. These major wireless projects were outsourced by incumbent Telcos, and they are nearing completion. Sales activity with the new wireless carriers and their OEM partners has commenced in the third quarter and this activity is expected to increase in subsequent quarters. The Company also noted that there will be some seasonality to overall sales because activity in the aerial construction business typically slows in the winter months. The wireline engineering business remains strong, as evidenced by the recent announcement to expand capacity in Laval, Quebec.
The Company said that its liquidity remains adequat, and that it is in full compliance with all of its debt covenants. Cash flow provided by operating income in the second quarter was $2.6 million, which exceeded by $0.1 million an increase in working capital, which was mainly accounts receivable and work in process. At September 30, 2009, assets were $56.5 million, shareholders' equity was $15.5 million and net debt was $25.3 million. Total shares outstanding were 118.2 million.
(1) Earnings before interest, taxes, depreciation and amortization,
stock-based compensation, foreign exchange, transaction and
About Prestige Telecom Inc.
Prestige Telecom is a leading provider of network engineering, materials furnishing, installation and support services (commonly referred to as EF&I services) required to construct, operate and maintain wireline, wireless and cable television networks. Prestige Telecom assists telecommunications original equipment manufacturers and service providers to engineer, install and upgrade their infrastructures to support enhanced voice, high speed data and video services. Prestige Telecom also provides technical and aerial services to the Canadian communications and broadcast industries, including tower supply, engineering, site construction, and infrastructure and equipment maintenance.
In Canada, Prestige Telecom has over 850 professional and technical personnel operating from 16 service locations in 8 provinces. Prestige Telecom's head office is located in Baie d'Urfé (Montreal), Quebec.
This press release contains certain forward-looking statements with respect to the Company. Such forward-looking statements are dependent upon a certain number of factors and are subject to risks and uncertainties. Actual results may differ from those expected. The information contained in this press release is dated November 11, 2009, the date on which the Directors approved the press release. Management does not assume any obligation to update or revise any forward-looking statements, whether as a result of new information or future events, except when required by the regulatory authorities.
Note to readers: Complete unaudited consolidated financial statements and Management's Discussion & Analysis of Financial Position and Operating Results were posted on SEDAR and are available at www.sedar.com.
The TSX Venture Exchange accepts no responsibility for the adequacy or
the accuracy of this press release.
SOURCE PRESTIGE TELECOM INC.
For further information: For further information: Pierre Yves Méthot, Chairman and Chief Executive Officer, Prestige, (514) 457-4488, Ext. 277