OTTAWA, April 28, 2017 /CNW/ - Clearford Water Systems Inc. ("Clearford" or the "Company"), (TSXV: CLI), today released results for its three months and fiscal year ended December 31, 2016. The audited consolidated financial statements are presented in accordance with IFRS (all figures in Canadian dollars).
During the fiscal year, the Company continued to focus on the marketing and sales of Clearford One® in Ontario and India and the continued growth and profitability of its subsidiary UV Pure Technologies Inc. (UV Pure).
The Company completed its installations in Jambudiyapura, in the state of Gujarat, India and in Fetherston, a small mobile home park in Ontario. The operational performance of both systems are exceeding expectations and are showing the advantages of the Clearford One® system in two very different environments.
During the year, the Company signed a new US$5.25 million long-term loan agreement and had received US$1,990,000 of this loan at year end. Subsequent to its fiscal year end the Company received remaining funds available for this loan. The proceeds were used to provide project related working capital including interest payments as the Company continues to develop its project opportunities in Ontario.
UV Pure sales increased to $3,037,760 from $2,717,980 in the previous year and recorded a net loss of $102,909 vs. a net profit of $46,478 in the prior year. The loss relates primarily to the first full year of its new expanded sales capacity and its continued development of its 3rd generation product which is expected to be released in phases starting in the third quarter of the 2017 fiscal year. UV Pure had earnings before interest, taxes and depreciation of $24,549 for the year compared to $156,033 in the prior year. The decrease relates primarily to an increase in cost of sales and sales and marketing resources as UV Pure prepares to launch its 3rd generation products.
Kevin Loiselle, President and CEO of Clearford, said "We are pleased with our progress in the past fiscal year. With Clearford One® systems currently in operation in Ontario, Colombia and India, we feel that the basis for strong sales growth is being put in place for the South American and Asian market and our P4P® offering in Ontario. "While the RFP for Adjala-Tosorontio was cancelled, the process shows that the life cycle cost of the Clearford One® system is lower than the conventional network which is typically installed by municipalities. We will continue to work on these opportunities in Ontario with both municipalities and private developers who see the long-term benefit of these offerings", he said. "We have received a large number of visitors to our working site in India, and we expect that this will lead to new project signings as governments, and corporations required to invest their Corporate Social Responsibility budgets in India, embrace this technology as a real solution for the low water environments faced by many of the people in the country."
"Our Colombia sales continue to be stable" Mr. Loiselle continued. "We substantially completed phase 1B of our project at Cayunda in Colombia and we expect to start the next and final phase of this project in the second quarter of 2017", he concluded.
Revenue for the year was $3,789,442 compared with $3,887,333 for the prior year. Operating loss before net financing costs were $3,311,762 for the year compared with $4,298,970 for the prior year. Net financing costs for the year were $2,713,644 compared with $2,479,644 for the prior year, with net loss for the year of $6,029,883 or $0.07 per share compared with $6,808,532 or $0.08 for the prior year.
Costs of sales decreased to $2,296,212 during the year from $2,822,873 in the prior year due to completion of the lower margin Clearford One® projects and the increase in sales by UV Pure during the fiscal year.
Sales and marketing costs decreased to $1,500,336 from $1,601,763 in the prior year reflecting additional sales efforts for Clearford One® in Ontario resulting in less international travel. This was partially offset by UV Pure incremental sales costs for its full-time sales force in 2016.
Costs of engineering and research and development decreased during the year to $862,172 from $905,052 reflecting a decrease in spending on the Clearford One® System and the capitalization of development costs in UV Pure as the next generation products near completion.
General and administration costs decreased to $2,469,007 from $2,930,908 primarily reflecting reduced spend by Clearford on consulting fees, financing related expenses, and reduced leasing costs.
Clearford ended the December 31, 2016 quarter with unrestricted cash of $411,444 compared with $585,885 on December 31, 2015. The Company's annual audited consolidated financial statements and MD&A are available at www.SEDAR.com.
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 Inc. (TSXV: CLI) is a provider of unified water management and sanitation systems based on Clearford One™. Clearford One™ is a proprietary system comprised of ClearDigest™ smart digester, ClearConvey™ small bore sewer, and ClearRecover™ final treatment facility. For more information on Clearford Water Systems, please visit www.clearford.com .
About UV Pure Technologies Inc.
UV Pure Technologies manufactures technically advanced UV water purification systems. The Company has won an Artemis Top 50 Clean Tech Company award, two Frost and Sullivan Best Practices awards, a Canadian Drinking Water Association award for innovation, and is a Going Green Global Top 200 company.
There are currently over 15,000 UV Pure systems in residential, commercial, industrial, public and municipal applications, with flow rates up to 1 million gallons per day. An aerospace version of UV Pure's system is being used by Boeing to purify water on its new 787 Dreamliner.
UV Pure's patented Crossfire Technology® is dramatically advantaged compared to conventional UV systems. Lamps are mounted in air surrounded by elliptical reflectors providing more effective deactivation of pathogens, facilitating easy lamp changes and visual quartz inspection. They are self-cleaning, smart – with multiple sensors and on-board diagnostics guiding maintenance, engineered to be fail-safe, virtually maintenance free, and are plug-in ready for remote monitoring. For more information on UV Pure Technologies, please 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