Route1 Reports 2015 Fourth Quarter and Full Year Financial RRoute1 Reports 2015 Fourth Quarter and Full Year Financial Results
Company Posts Its Eighth Consecutive Quarter of Growth in Services Revenue and MobiKEY Subscribers
TORONTO, ONTARIO--(Marketwired - April 5, 2016) - Route1 Inc. (TSX VENTURE:ROI) (the Company or Route1), a leading provider of secure access technologies for the mobile workspace to protect businesses and government agencies, today announced its fourth quarter (Q4) and fiscal year (FY) financial results for the period ended December 31, 2015.
"I am very pleased to be reporting our eighth consecutive quarter of growth in both services revenue and MobiKEY subscribers. As we move into and through 2016, I believe we have started to turn a corner with respect to adoption and penetration within certain civilian, intelligence and defense components of the U.S. Government; both with current customers as well as those undergoing pilot testing. Our team is hyper-focused on generating shareholder value through organic expansion of our current subscriber base, as well as adding to our product portfolio through ongoing development initiatives that are designed specifically for the U.S. Government sector," said Tony Busseri, Chief Executive Officer, Route1 Inc.
Fourth Quarter 2015
For Q4 2015, total revenue increased to $1.63 million from $1.49 million in Q4 2014. Gross profit also increased during the fourth quarter of 2015 to $1.34 million or 83% of revenue compared to gross profit of $1.24 million or 84% of revenue in Q4 2014.
Total Revenue Q4 Q4 FY FY
in 000s of CAD dollars 2015 2014 2015 2014
----- ----- ----- -----
Devices 9 12 156 536
Services 1,616 1,415 6,218 5,470
Other - 58 23 71
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Total Revenue 1,625 1,485 6,397 6,077
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During the fourth quarter of 2015 Route1 realized further growth in revenue from subscribers (recurring revenue). The net increase in MobiKEY application software users (subscriber revenue being the largest component of Route1's services revenue) primarily came from agencies and components within the U.S. Department of Defense, the U.S. Navy, the U.S. Department of the Interior, and the U.S. Department of Agriculture.
Services
Revenue In
000s of CAD Dec 31 Sep 30 Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
dollars 2015 2015 2015 2015 2014 2014 2014 2014
------- ------- ------- ------- ------- ------- ------- -------
Closing
number of
subscribers 16,286 15,989 15,410 15,012 14,792 14,645 14,461 14,240
Average
number of
subscribers 16,246 15,725 15,278 14,983 14,631 14,588 14,401 14,198
Revenue per
subscriber $ 361 $ 362 $ 353 $ 334 $ 334 $ 332 $ 329 $ 312
------ ------ ------ ------ ------ ------ ------ ------
Subscriber
Revenue $ 1,467 $ 1,424 $ 1,346 $ 1,252 $ 1,221 $ 1,211 $ 1,185 $ 1,108
Other
Services
Revenue $ 149 $ 148 $ 223 $ 209 $ 194 $ 188 $ 189 $ 173
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Total
Services
Revenue $ 1,616 $ 1,572 $ 1,569 $ 1,461 $ 1,415 $ 1,399 $ 1,374 $ 1,281
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Earnings before interest, tax, depreciation, and amortization (Adjusted EBITDA) during the fourth quarter of 2015 amounted to approximately $279,000 compared to $107,000 in Q4 2014.
Adjusted EBITDA Dec 31 Sep 30 Jun 30 Mar 31 Dec 31
in 000s of CAD dollars 2015 2015 2015 2015 2014
------ ------ ------ ------ ------
Revenue 1,625 1,614 1,620 1,538 1,485
Gross Profit 1,341 1,294 1,326 1,272 1,243
Adjusted EBITDA 279 242 227 404 107
Amortization 127 118 99 90 87
Operating profit before stock based
compensation 152 124 128 314 20
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Route1's fourth quarter 2015 total comprehensive gain after income tax was $0.377 million compared to $0.021 million during the same period in 2014.
Fiscal Year 2015
The Company's operating results in fiscal year 2015 with comparatives are as follows:
In 000s of CAD dollars FY 2015 FY 2014 FY 2013
------- ------- -------
Revenue
Device 156 536 447
Services 6,218 5,470 4,948
Other 23 71 38
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Total Revenue 6,397 6,077 5,433
Cost of revenue 1,164 1,145 1,137
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Gross profit 5,233 4,932 4,296
Operating expenses 4,515 4,398 4,485
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Operating profit (1) 718 534 (189)
Total other expenses (10) (103) 154
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Comprehensive net income 728 637 (343)
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(1) Note: Before stock-based compensation
During FY 2015, Route1 had cash generated from operating activities of $0.88 million compared with cash generated $1.31 million in FY 2014.
Balance Sheet Extracts Dec 31 Dec 31 Dec 31
In 000s of CAD dollars 2015 2014 2013
------ ------ ------
Cash 1,251 1,533 700
Total current assets 2,112 2,246 1,588
Total current liabilities 1,948 1,927 1,715
Net working capital 164 319 (127)
Total assets 3,656 2,976 2,387
Bank debt 0 0 0
Total liabilities 2,059 2,032 1,854
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Route1's cash position is at its highest level during the second quarter of the fiscal year as a direct result of the timing of annual enterprise user subscription renewal payments.
Share Repurchase Program
On September 22, 2015, the Company announced with approval from the TSX Venture Exchange its intention to make a Normal Course Issuer Bid (NCIB). The NCIB permits the Company to purchase for cancellation up to 5% of the common shares in the public float. The maximum number of shares allowed for repurchase is 18,262,570. Purchases under the NCIB commenced September 27, 2015 and will end September 26, 2016, or the date upon which the maximum number of common shares have been purchased by the Company. As of December 31, 2015 and March 31, 2016 the Company had purchased a total of 2,592,000 and 4,357,000 common shares respectively under the NCIB.
Since the first NCIB was announced on February 28, 2012, Route1 has repurchased a total of 28,026,200 of its common shares, representing 7.2% of Route1's common shares outstanding as at February 28, 2012.
As at March 31, 2016, Route1 has 360,894,414 common shares outstanding.
Investor Conference Call and Webcast
The Company will hold a conference call and web cast on Tuesday, April 5, 2016 at 4:15 pm Eastern to discuss its Q4 2015 and FY 2015 financial results, and provide an update on its business and product development activities. Participants should dial 1-888-503-8169 or 1-719-325-2329 at least 10 minutes prior to the conference time of 4:15 pm Eastern. For those unable to attend the call, a replay will be available after 7:15 p.m. at 1-877-870-5176 or 1-858-384-5517, pass code 5799014 until midnight on April 19, 2016. The webcast will be presented live at https://public.viavid.com/index.php?id=118746.
About Route1, Inc.
Route1 enables the mobile workspace without compromising on security. Its flagship technology MobiKEY uniquely combines secure mobile access, with high assurance identity validation and plug-and-play usability. Remote and mobile workers are able to securely and cost-effectively access their workspace from any device without exposing the organization to the risk of data spillage or malware propagation. MobiKEY customers include Fortune 500 enterprises as well as the U.S. Department of Defense, the Department of Homeland Security, the Department of Energy and the Government of Canada. Headquartered in Toronto, Canada, Route1 is listed on the TSX Venture Exchange.
For more information, visit www.route1.com.
This news release, required by applicable Canadian laws, does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
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.
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