TSX-V : ERG
LAVAL, QC, Oct. 27, 2017 /CNW Telbec/ - Ergoresearch Ltd ("Ergoresearch" or "the Company") based in Laval and known under the «Équilibre, orthèses et biomécanique» banner – announces its results for the fiscal year ended June 30, 2017. All dollar amounts in the present release are in Canadian currency. The year 2017 was dedicated to improving the efficiency of the Company, forward research projects and launch complementary opportunities as well as laying out the foundations for future growth.
Revenues for the period ending June 30, 2017 amounted to $14 028 021 which represented a decrease of 2.1% compared to the same period last year. Revenues this year were negatively impacted by the strategic and planned closure of the "home care" division, the evolution of the market and changes in the organization of health care in Quebec.
Net results for the period were ($214 058) compared to $111 733 last year. This decrease in earnings is mainly related to the other items that generated a credit of $ 170,393 in fiscal year 2016, a tax expense of $ 64,092 resulting from a change in the provincial tax rate in 2017 and start-up costs incurred during the 2017 financial year:
These start up cost were to launch of new organic initiatives:
- Sleep apnea services in some Equilibre clinics in Quebec
- Dynamic knee analysis service, called "Kneegraphy" (Knee KG)
- Recruitment and training of distributors outside Quebec for Ergoresearch's flagship products
Cash flow from operating activities represented $887 612 compared to $694 301 last year.
Concerning the balance sheet, the Company reimbursed in full its long-term debt by paying amounts totalling $366 667 during the period. In addition, as was announced in November 2016, the Company redeemed for cancellation 225 000 common shares of its capital stock for a total amount of $51 625.
The Company still has a cash equivalent of more than $8 million that the Company plans to use over the next few years.
Mr. Sylvain Boucher, president and C.E.O. stated: the health care industry is in mutation and more specifically in Québec where the Company operates. The year 2017 saw the adoption of new legislation regarding accessory fees, a parliamentary commission on medical laboratories (Bill 118) and the launch of the «Super clinics» project. These major developments combined with high acquisition price expectations from potential sellers, all contributed to management's decision to focus on complementary opportunities.
Hence, the Company signed agreements to open three new Equilibre laboratories within «Super-clinic» locations. These sites will open during the course of next year. Equilibre also launched its new apnea division known as « Apnée Equilibre » and integrated the « Knee KG » «kneegraphy» to its operations. Knee KG is one of the featured technologies presented at the Quebec government's « Stratégie québécoise des sciences de la vie, 2017-2027 ». These complementary services are perfectly in line with Equilibre's mission and benefit from the Company's administrative and commercial platforms. It is expected that these activities will impact the short term profitability of the group. It is expected that the breaking point for each initiative will be reached between 18 to 24 months from their respective launch.
In its efforts to innovate, the Company presented two requests for patents in 2016 and 2017. The added value of its products supported by its technological platform, allowed the Company to sign a distribution agreement with a Canadian physiotherapy network. Investments were made in training programs and marketing tools to insure the success of these launches. Management expects positive results during the course of the next fiscal year. The Company is also seriously looking into distributing its products in the United-States.
Development and perspectives
Our current priorities and development plans include the following objectives:
- Strengthened by our cash position, pursue the exploration of potential acquisitions or partnership in Quebec and across Canada.
- Deploy the "Equilibre" brand in a multidisciplinary and interdisciplinary concept through the opening or designation of the super-clinics in Quebec.
- Continue to develop the marketing of our technology platform and derivative orthotic related specialty products.
- Continuing our investments in Research and Development (R&D)
Mr. Sylvain Boucher would like to thank all of our employees for their dedication and their ongoing desire to improve. Progress, the desire to excel and commitment are values that we all share, which reveals a bright future.
Ergoresearch is a Canadian company that designs and manufactures cutting edge technologies for the orthopedic industry. The Company is a trend-setter in creating custom orthotics and speciality orthotics for the orthopedics market and holds a portfolio of patents in the orthopedics field and in human bionics. The mission of our banner "Équilibre orthèses et biomécanique" is to keep people active and moving. "ÉQUILIBRE", driven by its proprietary technologies and the expertise of its professionals, offers a range of products, treatments and services in order to relieve pain, restore motor function and optimize performance.
This document is not intended to encourage the purchase of securities listed on the TSX Venture Exchange. TMX Group and its affiliates do not endorse or recommend any of the securities referenced here. Please seek professional advice to evaluate specific securities.
Certain statements in this Press Release contain forward-looking statements and information that may entail certain risks related to uncertainties. Such statements are not historical facts and are based on current management's expectations. We ask the reader to note that these statements are subject to a multitude of risks and uncertainties that could affect the potential future results, circumstances or events and may differ materially from those contained in the forward-looking statements. Such risk factors include, but are not limited to, those related to the Company's ability to finance its activities, competition, ability to negotiate and maintain partnerships, the market acceptance of the Company's product, the strength of intellectual property, the success of research and development programs, the trust invested in sub-contractors or their core personnel as well as other risks and uncertainties that are put forth every now and then by the Company in the documents filed with various Canadian securities and exchange commissions and made available at www.sedar.com.
The reader should not give great importance to forward-looking statements as (i) the results may differ from conclusions, predictions or projections contained in such forward-looking statements; and (ii) certain important factors or hypotheses taken into account in reaching conclusions or the preparation of a projection or prediction may prove to be incorrect in fact.
These statements are correct only on the date on which they were written, and Management disclaims any obligation to revise these statements after any event, circumstance or other situation, except as required by law. All figures are in Canadian dollars, unless otherwise specified.
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.
SOURCE Ergoresearch Ltd
For further information: Sylvain Boucher, President and CEO - Ergoresearch Ltd., Tel.: 450-973-6700, ext. 213, [email protected]