Revenue Increase of 60.1% Driven by Wireless Infrastructure Products and Acquisition of Advantech Wireless
Investor Conference Call on August 2, 2018 at 8:00 a.m. ET
Revenue for the second quarter ended June 30, 2018 was $32.6 million, an increase of 60.1% over the prior year period.
Gross profit grew to $13.0 million in the second quarter of 2018, compared to $6.8 million in the second quarter of 2017.
Adjusted EBITDA was $2.9 million in the second quarter of 2018, compared to $0.4 million in the second quarter of 2017.
TORONTO, Aug. 1, 2018 /CNW/ - Baylin Technologies Inc. (TSX: BYL) (the "Company" or "Baylin"), a leading, diversified, global wireless technology management company focused on research, design, development, manufacturing and sales of passive and active radio frequency products and services, today announced its financial results for the three months ended June 30, 2018. All amounts are stated in Canadian dollars unless otherwise indicated.
Key highlights for the three months ended June 30, 2018 include the following:
Revenue grew to $32.6 million in the second quarter of 2018, an increase of $12.2 million or 60.1% over the second quarter of 2017.
Gross profit was $13.0 million in the second quarter of 2018, an increase of $6.2 million over the second quarter of 2017. Gross margin was 40.1% in the second quarter of 2018, an improvement of seven percentage points compared to the prior year period.
Adjusted EBITDA(1) was $2.9 million in the second quarter of 2018 compared to $0.4 million in the second quarter of 2017. Adjusted EBITDA for the second quarter of 2018 excludes certain non-recurring and one-time expenses of $0.4 million which were primarily expenses related to the acquisition of Advantech Wireless.
Cash on hand at June 30, 2018 was $6.2 million, a reduction of $29 million from December 31, 2017. The decrease was primarily due to cash utilized for payment of a portion of the purchase price for Advantech Wireless and an increase in non-cash working capital.
Manufacturing of initial production units of small cell antennas commenced at the Company's contract manufacturing facility in Guadalajara, Mexico in the second quarter of 2018.
(1) Adjusted EBITDA refers to operating income (loss) plus depreciation and amortization plus non-recurring items.
"We are very pleased with the Company's organic revenue growth and higher gross margins in the second quarter of 2018," stated Randy Dewey, Baylin's President and Chief Executive Officer. "The senior management additions to our Wireless Infrastructure Group in 2017 have contributed significantly to the Company's financial results in 2018 and we expect the momentum to continue into the second half of 2018."
"Subsequent to the end of the quarter, we completed the acquisition of Alga Microwave Inc. We are excited to have completed this strategic acquisition following the acquisition of Advantech Wireless in January 2018," added Mr. Dewey.
SELECTED FINANCIAL INFORMATION
Selected financial information of the Company is summarized below for the periods indicated:
(in $000's except per share amounts)
Three Months Ended June 30,
Six Months Ended June 30,
Income (loss) before income taxes
Income tax expense
Net income (loss)
Basic and diluted income (loss) per share
A copy of the Company's unaudited interim condensed consolidated financial statements for the three months ended June 30, 2018 and corresponding management's discussion and analysis (the "MD&A") are available under the Company's SEDAR profile on www.sedar.com.
Management expects that the strategic acquisitions of Advantech Wireless and Alga will accelerate growth by broadening the Company's product offering and will provide access to new verticals and geographies while contributing to the diversification of the Company's revenue base. While Advantech will continue to be run as a stand-alone business for the foreseeable future, management believes there will be significant revenue and cost synergy opportunities; achieving these synergies will be a key focus for the remainder of 2018. Michael Perelshtein and Frank Panarello, the principal vendors of Alga, continue to hold executive management positions at Alga. The Company believes Messrs. Perelshtein and Panarello have excellent operational and procurement skills and expect that they will be instrumental in accelerating improvements and efficiencies at Advantech and facilitating the move of Advantech's operations to the Alga Facility.
INVESTOR CONFERENCE CALL
Baylin will hold a conference call on August 2, 2018 at 8:00 a.m. (ET) to discuss its financial results for the three months ended June 30, 2018. The call will be hosted by Randy Dewey, President and Chief Executive Officer, and Michael Wolfe, Chief Financial Officer. All interested parties are invited to participate using the dial-in details provided below.
Certain statements contained in this press release constitute "forward-looking statements" that involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, objectives or achievements of the Company, or industry results, to be materially different from any future results, performance, objectives or achievements expressed or implied by such forward-looking statements. Forward-looking statements are frequently, but not always, identified by words such as "expects," "anticipates," "believes," "intends," "estimates,", "predicts," "potential," "targeted," "plans," "possible" and similar expressions, or statements that events, conditions or results "will," "may," "could" or "should" occur or be achieved. The forward-looking statements in this press release include, but are not limited to, statements regarding the Company's expected product pipeline, plans to expand the Company's business into new markets, the Company's ability to achieve organizational efficiencies, and other statements regarding the Company's plans, objectives and expectations. These statements reflect the Company's current views regarding future events and operating performance and are based on information currently available to the Company as of the date of this press release. These forward-looking statements involve a number of risks, uncertainties and assumptions and should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not such performance or results will be achieved. Those assumptions and risks include, but are not limited to, the Company's ability to successfully allocate capital as needed and to develop new products, as well as the fact that the Company's results of operations and business outlook are subject to significant risk, volatility and uncertainty. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company's Annual Information Form dated March 1, 2018 and the Company's prospectus supplement dated July 3, 2018 to a short form base shelf prospectus dated November 16, 2017, all of which are available on the Company's profile at www.sedar.com. All of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. Unless required by applicable securities law, the Company does not intend and does not assume any obligation to update these forward-looking statements.
This press release includes a number of measures that are not prescribed by Canadian generally accepted accounting principles ("GAAP") and as such may not be comparable to similar measures presented by other companies. We believe these measures are commonly employed to measure performance in our industry and are used by analysts, investors, lenders and interested parties to evaluate financial performance and our ability to incur and service debt to support our business activities. While management of the Company believes that non-GAAP measures are helpful supplemental information, they should not be considered in isolation as an alternative to net income, cash flows generated by operating, investing or financing activities, or other financial statement data presented in accordance with GAAP. See "Non-GAAP Measures" on page 2 of the MD&A for further information.
Baylin Technologies Inc. (TSX: BYL) is a diversified leading global wireless technology management company. Baylin focuses on research, design, development, manufacturing and sales of passive and active radio-frequency products and services. Baylin aspires to meet its customers' needs and anticipate the direction of the market. For further information, please visit www.baylintech.com.
Baylin (TSX: BYL) is a diversified leading global wireless technology management company. Baylin focuses on research, design, development, manufacturing and sales of passive and active RF products and services. We aspire to meet our customers' needs and anticipate the...