RE:Costs out of Controlmuch worse than previous Q.
Distinct Infrastructure loses $175,406 in Q1 2017
2017-05-25 16:05 ET - News Release
Mr. Joe Lanni reports
DISTINCT INFRASTRUCTURE GROUP REPORTS RECORD FIRST QUARTER REVENUE AND EBITDA
Distinct Infrastructure Group Inc. has released its financial results for the three months ended March 31, 2017. For Q1 2017, the company reported record first quarter revenues of $16-million and EBITDA (earnings before interest, taxes, depreciation and amortization) of $1.6-million, an increase of 49 per cent and 52 per cent respectively as compared with the three months ended March 31, 2016. The company continues to experience strong revenue growth due to incremental demand for services from key clients.
"We are pleased with the company's performance so far in 2017," said Joe Lanni, co-chief executive officer of the company. "With a focus on managed growth and operational excellence, we believe the company's results in Q1 2017 sets a strong base for the remainder of the year."
Further commenting on the first quarter results, Alex Agius, co-chief executive officer of the company, stated: "The company continues to make select investments internally on additional manpower and equipment to meet demand from both new and existing clients. Our core business represents an exceptional platform for growth, and we remain focused on operational excellence in 2017."
Other highlights for Q1 2017:
- With over 85 per cent of revenues originating from clients with master service agreements (MSA), Distinct remains well positioned to continue meeting and exceeding its clients' expectations. The nature of the work being issued to the company by its biggest customers continues to be projects that are larger and of a longer duration. This change in the mix of work has required a continued investment in working capital by the company, as seen in its accounts receivable and work in progress balances at the end of Q1 2017. The company continues to work with its clients through various initiatives to improve cash conversion cycles.
- Revenue growth continues with a 49-per-cent increase over Q1 2016. The company experienced stronger than historically adjusted growth in Q1 2017 due to a push in work from late in the fourth quarter of 2016.
- Adjusted EBITDA was $1.6-million in Q1 2017, as compared with $1.1-million in Q1 2016, a 52-per-cent increase. Adjusted EBITDA margin was 9.9 per cent in Q1 2017, compared with 9.8 per cent in Q1 2016, an increase of 0.2 per cent year over year.
- As previously announced on March 28, 2017, the company will be refinancing its existing senior debt on May 26, 2017. The company expects the transaction to reduce annual net interest expense and directly benefit earnings per share and cash flows going forward. The funds will be used for existing debt refinancing, future working capital needs and general corporate purposes.
- The company continues to experience strong demand for its services from Canada's largest communication companies, various utilities and municipalities across the provinces of Ontario and Alberta. As well, the company's iVAC hydroexcavation business continues to perform well, with a mix of internal and external sales growth in all jurisdictions.
- Western business results remain in line with management expectations. As well, the company has added select strategic blue-chip clients to its customer roster in Western Canada, which will drive growth in 2017. The company expects a modest improvement in the broader economic landscape into mid-2017 and continues to see significant demand for the company's utilities services, specifically in Western Canada.
- The company's buildout of a robust management structure across all areas of the business continues with a view toward servicing its clients and managing growth in the field. Investment in the training of staff continues with a focus on implementation of systems and processes.