TORONTO, March 12, 2013 /CNW/ - TSX - Trading symbol - AF
AlarmForce Industries Inc., Canada's largest manufacturer and installer of live two-way voice home alarm systems, is pleased to announce results for the three months ended January 31, 2013:
|January 31, 2013||January 31, 2012||Change|
|(3 months ended)||(3 months ended)||(over same period)|
|Revenue||$ 11,922,000||$ 10,926,000||+ 9%|
|Income before income taxes||$ 1,873,000||$ 954,000||+96%|
|Net income||$ 1,375,000||$ 699,000||+97%|
|Cash flow from operations||$ 1,650,000||$ 1,538,000||+ 7%|
|EBITDA*||$ 3,216,000||$ 2,212,000||+45%|
|EBITDA/share*||$ 0.26||$ 0.18||+44%|
|EBITDA* before marketing expenses||$ 6,429,000||$ 5,911,000||+ 9%|
|Basic Net income / share||$0.11||$0.06||+83%|
|Diluted Net income / share||$0.11||$0.06||+83%|
* EBITDA (Earnings Before Interest, Income Taxes, Depreciation, and Amortization) is a key measure in the security industry and should not be interpreted as IFRS)
EBITDA is defined as earnings before interest expenses, income taxes, depreciation and amortization. EBITDA is a measure used in the security industry to assist in understanding and comparing operating results and is often referred to by our competitors. Management views EBITDA as a measure to assess the operating performance of the Company. Yet, since it does not have any standardized meaning defined by IFRS, it may not be considered in isolation of IFRS measures such as net income/loss or cash flows, as a measure of liquidity. The Company, however, utilizes these measures in making operating decisions and assessing its performance. Management believes that it allows the Company to assess its ongoing business without the impact of depreciation or amortization expenses. Since EBITDA is not a defined term under IFRS, it is unlikely to be comparable to similar measures presented by other issuers.
Joel Matlin, President and CEO, announced that, "AlarmForce closed the first quarter with revenues of $11.9 million for the three months ended January 31, 2013, and total subscribers increased to 135,600, reflecting an annualized growth rate of 7%.Three month revenues increased by $1.0 million, a 9% increase over the comparative period in 2012. Net income for the three month period increased by $0.7 million, a 97% increase over the comparative period, primarily as a result of a substantial reduction in marketing expenditures combined with continued subscriber growth."
"Gross margin decreased to 74% from 77% in the comparative period. The decrease in gross margin reflects the introduction of VideoRelay and the associated manufacturing costs, which are in line with our expectations as we transition to the new video technology and enhanced subscriber services."
"For the three months ended January 31, 2013, EBITDA increased by $1.0 million, a 45% increase over 2012. Excluding the impact of marketing expenses, which drive our growth through new account creation, EBITDA increased by $0.5 million, a 9% increase over 2012."
"Our cash flows from operations increased to $1.7 million for the three months, an increase of $0.1 million or 7% over 2012. This increase is net of working capital requirements, and our operating cash flows before working capital adjustments increased to $2.6 million for the three months, an increase of $0.8 million or 42% over 2012."
"We continue to grow without adding debt, funding all our costs of growth, including marketing, research and development expenses, from our operating cash flows."
Mr. Matlin continued: "We are optimistic that VideoRelay will continue to gain traction in 2013, building a distinct brand in the remote-access video security market, and revolutionizing the customer experience beyond traditional security services. We believe that this product, which is exclusive to AlarmForce, will add significant impetus to our subscriber expansion and recurring revenues from subscribers, across all our service areas in Canada and the United States. Our technology will enhance our market position with growing awareness of video surveillance as a superior home security option."
Mr. Matlin closed by saying: "We anticipate that we will continue our growth in revenues and earnings, with our two-way voice alarm, personal emergency response and remote-access video systems at the forefront of technology and consumer acceptance. I would like to thank our subscribers, investors, employees and Directors for their continuing support and confidence in our company's success."
AlarmForce provides security alarm monitoring, personal emergency response monitoring, video surveillance and related services to residential and commercial subscribers throughout Canada and selected centres across the United States. AlarmForce is a leading provider of two-way voice alarm systems in Canada. More information about the Company's products and services can be found at www.alarmforce.com and www.videorelay.com.
SOURCE: Alarmforce Industries Inc.
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