TORONTO, ONTARIO -- (Marketwired) -- 05/30/16 -- Eurocontrol Technics Group Inc. (TSX VENTURE: EUO) ("Eurocontrol" or the "Company"), a Canadian public company specializing in the acquisition, development and commercialization of innovative security, authentication, verification and certification technologies, announces that it has filed its interim financial statements and Management's Discussion and Analysis ("MD&A") for the first quarter ended March 31, 2016.
The first quarter results reflect a 7% decrease in revenue, excluding discontinued operations, to $302,673 compared to $326,597 ($1,931,299 including discontinued operations) for the three month period ended March 31, 2016. The Company recognized EBITDA of $17,388,949 ($707,615 as at March 31, 2015) and a gain on the sale of its former subsidiary of $16,484,172 ($Nil in 2015) resulting in net income of $14,982,929 for the three months ending March 31, 2016 (net income of $546,267 in 2015). Included below is a summary table outlining earnings for the first quarter of 2016 compared to the corresponding 2015 period which is followed by a description of recent developments.
On January 4, 2016, the Company closed the sale of its wholly owned subsidiary, Global Fluids International (GFI) S.A. ("GFI") to SICPA Finance SA ("SICPA"), a subsidiary of SICPA SA, each a privately owned company based in Switzerland, in exchange for cash and post-closing earn-out payments and certain additional payments. In accordance with International Financial Reporting Standards ("IFRS"), the first quarter 2016 financial statements and MD&A are presented on an adjusted basis to include discontinued operations. For a reconciliation of discontinued operations, readers should refer to MD&A sections "Adjusted Revenue and Profit from Continuing Operations" and "Reconciliation of IFRS to Adjusted Results".
Bruce Rowlands, Chairman and CEO stated, "These results reflect the first quarter without our former subsidiary GFI. Our strong working capital position is allowing us to invest in our ED-XRF and new patented semiconductor verification technologies and to actively pursue acquisition opportunities, a number of which are currently being evaluated. We anticipate that our R&D investment will result in increased revenue from our existing technologies as we expand into new markets, such as precision agriculture through our MOU with Netafim, and through our ongoing exclusive relationship with SICPA / GFI as they execute their strategy for market expansion utilizing long held SICPA relationships."
First Quarter 2016 Financial and Operating Highlights (i)
-- Working Capital of $16,176,627 compared to $4,001,621, a 304% increase.
-- The Company has no debt, compared to $975,741 in 2015.
-- Gross profit of $85,787 compared to $145,887 (does not include
discontinued operations), a decrease of 41%.
-- Recognized EBITDA of $17,388,949 compared to $707,615 in 2015
-- Recognized income of $14,982,926 compared to $545,267 for the 2015 three
month period
-- Investment in R&D increased by 209% to $688,619 towards developing the
integration of our ED-XRF technology with automated 2D and 3D image
processing technologies for the Semiconductor and related
microelectronics industries
Three Months Ended March 31,
2016 2015
$ $
Revenue:
- from continuing operations 302,673 326,597
- from discontinued operations - 1,604,702
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Total revenue 302,673 1,931,299
Cost of sales:
- from continuing operations
Cost of sales - direct production costs (172,537) (136,362)
Cost of sales - amortization and other non
cash items (44,349) (44,348)
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(216,886) (180,710)
- from discontinued operations
Cost of sales - direct production costs - (499,302)
Cost of sales - amortization and other non
cash items - (68,953)
------------------------------
- (568,255)
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Gross profit - continuing operations 85,787 145,887
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Gross profit - discontinued operations - 1,036,447
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Expenses - continuing operations (1,955,031) (691,782)
Expenses - discontinued operations - (138,094)
Other (expense) income - continuing operations 367,998 (166,636)
Other (expense) income - discontinued
operations - 366,810
Income tax expense - discontinued operations - (6,365)
Gain on sale of subsidiary - discontinued
operations 16,484,172 -
------------------------------
Net income (loss) - continuing operations (1,501,246) (712,531)
------------------------------
------------------------------
Net income (loss) - discontinued operations 16,484,172 1,258,798
------------------------------
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Net income (loss) 14,982,926 546,267
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Basic loss per share
- from continuing operations (0.02) (0.01)
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- from discontinued operations 0.18 0.01
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- net income (loss) 0.16 0.01
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Diluted loss per share
- from continuing operations (0.02) (0.01)
------------------------------
- from discontinued operations 0.17 0.01
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- net income (loss) 0.15 0.01
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EBITDA 17,388,949 707,615
------------------------------
EBIT 17,332,680 569,821
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About Eurocontrol Technics Group Inc.
Eurocontrol is a TSX Venture listed company that specializes in the acquisition, development and commercialization of innovative authentication, verification and certification technologies. Eurocontrol has two wholly owned subsidiaries, Xenemetrix Ltd. and XwinSys Technology Development Ltd. Xenemetrix is a leading designer, manufacturer and marketer of ED-XRF systems, a technology that is the most accurate and economic method for determining the chemical composition of many types of materials, including the analysis of petroleum oils and fuel. Xenemetrix has an exclusive long-term supply, maintenance and support agreement with SICPA/GFI to supply SICPA/GFI with Xenemetrix products and services related to the oil and gas marking and monitoring field. XwinSys is in the final stage of developing a fully automated metrology system for the semiconductor industry that combines 2D and 3D image processing technology with Xenemetrix's ED-XRF technology.
For further information on Eurocontrol, please visit the Company's website at www.eurocontrol.ca.
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. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.
Forward-Looking Statements:
This press release contains forward-looking statements. More particularly, this press release contains statements. Forward-looking statements are frequently characterized by words such as "plan", "expect", "project", "intend", "believe", anticipate", "estimate", "may", "will", "would", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. The forward-looking statements are based on certain key expectations and assumptions made by Eurocontrol. Although Eurocontrol believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Eurocontrol can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. In addition to other risks that may affect the forward-looking statements in this press release are those set out in Eurocontrol's management discussion and analysis of the financial condition and results of operations for the quarter ended March 31, 2016 and the year ended December 31, 2015 which are available on the Corporation's profile at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and Eurocontrol undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Contacts:
Eurocontrol Technics Group Inc.
Bruce Rowlands
Chairman and CEO
(416) 361-2809
browlands@eurocontrol.ca
www.eurocontrol.ca
