Axia Reports Results for the three months ended March 31, 2016
CALGARY, May 12, 2016 /CNW/ -
Arrangement Agreement
- On March 9, 2016, Axia entered into an arrangement agreement (the "Arrangement
Agreement") with Digital Connection (Canada) Corp. (the "Purchaser"), an entity which
is owned by investment vehicles managed and/or advised by Partners Group AG or its affiliates, pursuant to which the Purchaser
has agreed to acquire all the issued and outstanding shares of Axia for $4.25 per common share in
cash by way of a plan of arrangement (the "Arrangement"). On May 6, shareholders approved
the Arrangement Agreement and on May 9, approval was received from the Court of Queen's Bench of
Alberta.
- Completion of the Arrangement is subject to various closing conditions, including the receipt of regulatory approvals in the
U.S. Axia and the Purchaser are diligently working together toward the satisfaction of the remaining closing conditions as
quickly as possible.
First Quarter Highlights
- Business unit1 revenue of $36.6 million increased 10% from $33.2 million in Q1 2015.
- Business unit EBITDA of $7.5 million remained relatively flat from $7.9
million in the prior quarter of last year.
- Customer connections of 12,896 increased 11% from 11,573 in the prior quarter last year.
- IFRS net loss was $2.1 million compared to $0.1 million last
year. Net loss in the quarter was driven by transaction costs, related to the Arrangement, of $1.0
million and personnel related costs of $0.5 million, these costs are unrelated to ongoing
operations.
- Continued investment in extending network footprint and connecting new customers. Business unit capital expenditure was
$10.7 million compared to $9.2 million in Q1 2015. The cash balance
at quarter-end was $9.6 million with total debt of $15.7
million.
The condensed consolidated financial statements for the three months ended March 31, 2016 and 2015
and related Management Discussion and Analysis ('MD&A') have been reviewed and approved by Axia's Audit Committee and
Board of Directors. Axia recognizes that the majority of its investors are now accessing Axia's corporate and financial information
either through pushed news services, directly from ir.axia.com or SEDAR. Thus, Axia has prepared this truncated news release to
alert investors to its results and that a more detailed explanation and analysis is readily available in the MD&A. These
reports have been filed on SEDAR at www.sedar.com and
also posted at ir.axiafibrenet.com.
Non-GAAP Measures
Business Unit Results
1Axia's business unit summary includes 100% of the financial and operational results of Axia North America and Covage. Please see the audited consolidated financial statements and related
Management's Discussion & Analysis (MD&A) for more details.
EBITDA
The term adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) is not defined by IFRS and may
not have a standardized meaning, therefore it is referred to as a Non-GAAP measure. This measure is used by management to evaluate
the performance of Axia and its business and has been presented in this news release in order to provide shareholders and potential
investors with additional Information.
EBITDA is commonly used by management, investors and creditors in the calculation of ratios and financial performance and is
calculated as the sum of operating income plus depreciation and amortization.
About Axia
Axia owns, operates and sells services over fibre optic communications infrastructure. Axia trades on the Toronto
Stock Exchange under the symbol "AXX".
This News Release contains forward-looking statements, including, without limitation, statements containing the words
"should", "believe", "anticipate", "may", "plan", "will", "continue", "intend", "expect", "estimate" and other similar expressions
which constitute "forward-looking information" within the meaning of applicable Canadian securities laws. These statements are
based on our current expectations, estimates, forecasts and assumptions about the operating environment, economies and markets in
which we operate and are subject to important assumptions, risks and uncertainties that are difficult to predict. Examples of these
statements would include those where Axia forecasts its success and timing in winning new NGN business, the timing and amount of
future dividend payments, the timing of completion and estimated total costs of our networks, the revenues and operating costs
associated with these networks over time, and Axia's ability to generate future cash flows and avail itself of other financing
alternatives given current market conditions. The assumptions, risks and uncertainties that could cause actual results to differ
materially from the forward-looking information, include, but are not limited to, changes in customer markets, changes in demand
for our services, our inability to deliver services in a timely and cost efficient manner, technological change, general economic
conditions and other risks detailed from time to time in our ongoing filings with the Canadian securities regulatory authorities,
including those in our Annual Information Form, which filings can be found at www.sedar.com. Given these assumptions, risks and uncertainties, readers are cautioned not to place undue
reliance on such forward-looking statements. Unless otherwise required by applicable securities laws, we undertake no obligation to
publicly update or revise any forward-looking statements either as a result of new information, future events or otherwise
SOURCE Axia NetMedia Corporation
