OTTAWA, May 24, 2018 /CNW/ - Clearford Water Systems Inc. ("Clearford" or the "Company"), (TSXV: CLI), today released results for its three months ended March 31, 2018. The unaudited consolidated financial statements are presented in accordance with IFRS (all figures in Canadian dollars).
The first fiscal quarter of 2018 is the first full quarter of results since the acquisition of Koester Canada in November 2017. During the first quarter, the Company focused on the marketing and sales of its now complete Clearford One™ offering in Ontario and India and the continued growth and profitability of its subsidiary UV Pure Technologies Inc. (UV Pure).
Delivery of backlog related to monthly treatment plant operating contracts from Clearford Waterworks was the primary driver of this growth. Revenue from equipment sales and the Company's Indian operations rounded out the growth.
UV Pure is in the final stages of its investment in its next generation product to provide more robust systems with the expectation that the new product releases will begin in the latter half of the 2018 fiscal year.
Kevin Loiselle, President and CEO of Clearford, expressed enthusiasm for the future of Clearford: "We are seeing the expected synergies from our recent acquisition of Koester Canada on the revenue line, we expect revenue to continue to grow and now we will focus on the earnings line. Clearford continues to execute on its new business model transitioning into a full-service utility that will benefit from the full value of our product offerings".
"Our plan calls for additional acquisitions this year as we continue to move toward selling water as a service" Mr. Loiselle concluded.
Revenue for the quarter was $1,668,881 compared with $836,768 for the prior year's quarter and included the first full quarter of revenue relating to the Clearford Koester acquisition. The operating loss before net financing costs was $1,776,946 for the quarter compared with $642,102 for the prior year's quarter and included a $651,072 foreign exchange loss on the Company's US dollar denominated debt. Net financing costs for the quarter were $937,546 compared with $741,705 for the prior year's quarter, with net loss for the quarter of $2,714,492 or $0.02 per share compared with $1,383,283 or $0.02 per share for the prior year's quarter.
Costs of sales increased to $922,602 during the quarter from $423,981 in the prior year's quarter primarily due the increase in revenues, and the cost to deliver these revenues, associated with the acquisition of Koester.
Sales and marketing costs increased to $375,790 from $335,622 in the prior year's quarter reflecting new marketing efforts for UV Pure 3rd generation products and for the integration of the Clearford One® and Koester products into one complete package focused on Ontario and New York State.
Costs of engineering and research and development increased slightly to $212,829 from $204,249 in the prior year's quarter primarily relating to the UV Pure Generation 3 product nearing the end of the product development stage.
General and administration costs increased to $1,201,314 from $490,604 in the prior year's quarter primarily reflecting the addition of Clearford Koester Canada Inc. and Clearford Waterworks for one full quarter.
Clearford ended the March 31, 2018 quarter with unrestricted cash of $627,191 compared with $1,217,373 on December 31, 2017. The Company's quarterly unaudited consolidated financial statements and MD&A are available at www.SEDAR.com.
Subsequent to its quarter end, the Company issued a new C$1.65 million convertible debenture with a 5-year term, 5% annual interest rate, compounding annually, and a $0.20 Conversion Price.
Neither the 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.
About Clearford Water Systems Inc.
Clearford Water Systems is a provider of unified water management solutions for the design, deployment, finance and operation of water infrastructure systems. The Company's technology-based water solutions include Clearford One® wastewater infrastructure systems, Clearford M‑brane™ packaged treatment solutions, and a full range of UV Pure® water disinfection products. Clearford is the winner of the Frost & Sullivan 2017 Enabling Technology Leadership Award for Global Decentralized Water & Wastewater Treatment. For more information, visit www.clearford.com.
About Clearford Koester Canada Inc.
Clearford Koester Canada Inc. is a manufacturer of packaged water and wastewater treatment systems for municipal, commercial and industrial applications. The company designs and builds custom modular and containerized treatment systems that integrate advanced technologies like membrane filters, ultraviolet disinfection, and smart instrumentation and control systems for highly efficient treatment solutions that address any site constraints and water quality challenges. The company's M-brane™ membrane bioreactor (MBR) treatment plant has been installed at sites in Ontario and New York State.
About Clearford Waterworks Inc.
Clearford Waterworks Inc. is a full-service provider of water and wastewater systems management including in-field operations and maintenance, emergency operations, regulatory compliance support, technical assistance and troubleshooting, and asset management services. The company operates over 80 treatment plants, water distribution and wastewater collection systems in Ontario for private developments, golf courses, camps and campgrounds.
About UV Pure Technologies Inc.
UV Pure Technologies is a manufacturer of advanced ultraviolet water disinfection systems for residential, commercial, industrial, public, and municipal applications. The company's patented Crossfire Technology® is an innovative water disinfection solution with over 18,000 installations worldwide. UV Pure has earned an Artemis Top 50 Clean Tech Company award, Going Green Global Top 200 award, two Frost & Sullivan Best Practices Awards, and a Canadian Drinking Water Association award for innovation. For more information, visit www.uvpure.com.
Forward Looking Statements
This news release contains certain statements that constitute forward-looking statements as they relate to the Company and its management. Forward-looking statements are not historical facts but represent management's current expectation of future events, and can be identified by words such as "believe", "expects", "will", "intends", "plans", "projects", "anticipates", "estimates", "continues" and similar expressions. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that they will prove to be correct.
By their nature, forward-looking statements include assumptions and are subject to inherent risks and uncertainties that could cause actual future results, conditions, actions or events to differ materially from those in the forward-looking statements. If and when forward-looking statements are set out in this news release, Clearford will also set out the material risk factors or assumptions used to develop the forward-looking statements. Except as expressly required by applicable securities law, the Company assumes no obligation to update or revise any forward looking statements. The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: industry cyclicality; the ability to secure third party agreements; successful integration of Clearford's system with third party technology; competition; reduction in demand for products; collection from customers; relationships with suppliers; product liability; intellectual property; reliance on key personnel; environmental; interest rates; uninsured and underinsured losses; operating hazards; risks of future legal proceedings; income tax matters; credit facilities; availability and terms of financing; distribution of securities; restrictions on potential growth; effect of market interest rates on price of securities; and potential dilution.
SOURCE Clearford Water Systems Inc.
For further information: Kevin Loiselle, President & CEO, Clearford Water Systems Inc., Phone: (613) 599-6474 ext. 303, www.clearford.com