- Management to Host Conference Call at 8:30 am Pacific Time
(11:30 am Eastern Time) -
VANCOUVER, Aug. 4, 2016 /CNW/ - Norsat International
Inc. ("Norsat" or the "Company") (TSX: NII and NYSE MKT: NSAT), a provider of unique and customized communication solutions for
remote and challenging applications, today reported financial results for the second quarter ended June 30,
2016.
Financial Highlights
For the three months ended June 30, 2016
- $9.0 million in revenue for the quarter, consistent with the amount for the same period
last year.
- Gross profit margin of 46% for the quarter, an increase of 7% from 39% for the same period last year.
- Net earnings for the quarter were $0.9 million, or $0.16 per
share, basic and diluted, compared to $0.7 million, or $0.12 per
share, basic and diluted, for the same period last year.
- Adjusted EBITDA1 of $1.7 million for the quarter, an increase
of 50% from $1.2 million for the same period last year.
For the six months ended June 30, 2016
- $18.5 million in revenue for the six months ended June 30,
2016, an increase of 7% compared to $17.4 million for the same period last year.
- Gross profit margin of 45% for the six months ended June 30, 2016, an increase of 6%
from 39% for the same period last year.
- Net earnings for the six months ended June 30, 2016 were $2.1
million, or $0.36 per share, basic and diluted, compared to $1.2
million, or $0.21 per share, basic and diluted, for the same period last year.
- Adjusted EBITDA1 of $3.4 million for the six months ended
June 30, 2016, an increase of 63% from $2.1 million for the same
period last year.
- $9.3 million of cash and cash equivalents at June 30,
2016, an increase of $4.7 million compared to $4.6 million
at December 31, 2015.
- $22.6 million of working capital at June 30, 2016, an
increase of $3.2 million compared to $19.4 million at December 31, 2015.
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__________________
1Adjusted EBITDA is a measure that the Company uses to reflect the results of its core earnings. Adjusted EBITDA
is defined as earnings before income tax expense, financing costs, depreciation and amortization, foreign exchange gain or
loss, corporate development costs, write-down of inventory, impairment charges or recoveries, discontinued operations and
other non-cash charges.
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"We are very pleased with the second quarter results. Despite continued softness in the Canadian infrastructure and public
safety markets, our total revenue and profitability have remained strong as we continue to manage our cost structure while
challenging ourselves to develop and market reliable products to meet customer needs," said Dr. Amiee
Chan, President and CEO of Norsat. "To demonstrate our continued commitment to our long-term strategy to expand our market
share in remote and challenging applications, we have introduced new products and solutions during the quarter, including the
Median 40W Ku-band BUC, along with a range of LNBs to our microwave product line," added Dr. Chan.
A full set of financial statements and Management's Discussion and Analysis for Norsat is available at www.norsat.com and will be available at www.sedar.com.
Conference Call Details
Norsat will host a conference call today, August 4, 2016 at 8:30 am
Pacific Time (11:30 am Eastern Time) to discuss its fiscal year 2016 second quarter results.
To access the conference call, please dial toll-free 1-888-886-7786 or 416-764-8658. The conference call title is: 'Norsat Investor
Call'. Please connect approximately 10 – 15 minutes prior to the beginning of the call to ensure participation. A digital recording
and transcript of the call will be available after the live call at: http://www.norsat.com/investors/financial-information/conference-call-recordings/
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Norsat International Inc.
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Condensed Interim Consolidated Statements of Financial Position
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(Expressed in United States dollars)
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(Unaudited)
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June 30, 2016
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December 31, 2015
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ASSETS
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Current assets
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Cash and cash equivalents
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$
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9,318,248
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$
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4,585,754
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Trade and other receivables
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8,753,411
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8,987,392
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Inventories
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11,339,377
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10,956,524
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Prepaid expenses and other
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258,347
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394,617
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29,669,383
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24,924,287
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Non-current assets
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Property and equipment, net
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570,756
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558,609
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Intangible assets, net
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4,434,258
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4,724,490
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Goodwill
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4,097,751
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4,097,751
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Investment tax credits recoverable
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4,694,480
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4,985,139
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Deferred income tax assets
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1,704,126
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2,218,848
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15,501,371
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16,584,837
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Total assets
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$
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45,170,754
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$
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41,509,124
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LIABILITIES
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Current liabilities
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Trade and other payables
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$
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2,545,612
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$
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1,906,703
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Accrued liabilities
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2,149,332
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2,375,107
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Provisions
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957,466
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947,682
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Taxes payable
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-
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-
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Deferred revenue
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1,430,914
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286,432
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7,083,324
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5,515,924
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Non-current liabilities
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Long-term deferred revenue
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14,199
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45,889
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Total liabilities
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7,097,523
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5,561,813
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SHAREHOLDERS' EQUITY
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Issued capital
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39,995,215
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39,850,648
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Treasury shares
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(431,547)
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(320,750)
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Contributed surplus
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4,148,106
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4,318,487
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Accumulated other comprehensive loss
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(4,508,316)
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(4,673,811)
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Deficit
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(1,130,227)
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(3,227,263)
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Total shareholders' equity
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38,073,231
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35,947,311
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Total liabilities and shareholders' equity
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$
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45,170,754
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$
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41,509,124
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Norsat International Inc.
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Condensed Interim Consolidated Statements of Earnings and Comprehensive Income
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(Expressed in United States dollars, except per share amount)
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(Unaudited)
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Three months ended June 30
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Six months ended June 30
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2016
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2015
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2016
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2015
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Revenue
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$
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8,959,936
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$
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8,950,091
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$
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18,513,363
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$
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17,360,416
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Cost of sales
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4,846,117
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5,467,065
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10,224,397
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10,519,547
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Gross profit
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4,113,819
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3,483,026
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8,288,966
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6,840,869
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Expenses:
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Selling and distributing
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1,259,794
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1,271,795
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2,663,736
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2,538,788
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General and administrative
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821,057
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734,713
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1,703,158
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1,759,170
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Product development
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856,782
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730,932
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1,640,777
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1,489,708
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Less: Government contributions
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(387,703)
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(312,933)
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(767,178)
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(643,957)
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Loss on foreign exchange
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131,550
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210,792
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82,391
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388,541
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Interest and bank charges
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27,583
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40,908
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54,383
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76,306
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Total expenses
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2,709,063
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2,676,207
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5,377,267
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5,608,556
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Earnings before income taxes
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1,404,756
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806,819
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2,911,699
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1,232,313
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Current income tax expense/(recovery)
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3,373
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-
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3,373
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(66,068)
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Deferred income tax expense
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466,382
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132,710
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811,290
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64,585
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Net earnings
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$
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935,001
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$
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674,109
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$
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2,097,036
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$
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1,233,796
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Other comprehensive income (loss)
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Exchange differences on translation of operations
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in currencies other than United States dollars
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148,558
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464,402
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165,495
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(79,377)
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Total comprehensive income
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$
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1,083,559
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$
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1,138,511
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$
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2,262,531
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$
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1,154,419
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Net earnings per share
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Basic earnings per share
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$
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0.16
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$
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0.12
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$
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0.36
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$
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0.21
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Diluted earnings per share
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$
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0.16
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$
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0.12
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$
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0.36
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$
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0.21
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Weighted average number of shares outstanding
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Basic
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5,764,892
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5,759,439
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5,765,922
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5,762,789
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Diluted
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5,815,681
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5,783,048
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5,800,064
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5,785,985
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Norsat International Inc.
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Condensed Interim Consolidated Statements of Cash Flows
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(Expressed in United States dollars)
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(Unaudited)
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Three months ended June 30
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Six months ended June 30
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2016
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2015
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2016
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2015
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Cash and cash equivalents provided by/(used in)
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Operating activities:
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Net earnings for the period
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$
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935,001
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$
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674,109
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$
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2,097,036
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$
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1,233,796
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Income taxes paid
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(3,373)
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(43,270)
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(3,373)
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(43,270)
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Adjustments for items not affecting cash:
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Depreciation and amortization
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201,919
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329,742
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431,247
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657,791
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Write-off of property and equipment
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-
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-
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-
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31,139
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Unrealized foreign exchange loss
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119,569
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210,793
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144,425
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388,541
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Acquisition loan cost amortization
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-
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-
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-
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2,262
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Other income
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-
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(198,997)
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-
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(198,997)
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Current income tax expense/(recovery)
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3,373
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-
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3,373
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(66,068)
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Deferred income tax expense
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466,382
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132,710
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811,290
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64,585
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Share-based payments
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84,531
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64,410
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129,407
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118,361
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Vesting of RSUs
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-
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(14,632)
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-
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(14,632)
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Government contributions
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(387,703)
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(312,933)
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(767,178)
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(643,957)
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Changes in non-cash working capital
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1,065,497
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(1,977,058)
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1,298,835
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(2,888,486)
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Net cash flows provided by/(used in) operating activities
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2,485,196
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(1,135,126)
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4,145,062
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(1,358,935)
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Investing activities:
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Purchase of intangible assets, property and
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equipment, net of SADI
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(111,222)
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(43,454)
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(134,640)
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(99,549)
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Net cash flows used in investing activities
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(111,222)
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(43,454)
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(134,640)
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(99,549)
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Financing activities:
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Repayment of acquisition loan
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-
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(1,306,762)
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-
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(2,286,762)
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Purchase of treasury shares, including purchase costs
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(266,018)
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(273,298)
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(266,018)
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(273,298)
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Government contributions
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46,058
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69,727
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1,000,518
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833,211
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Net cash flows (used in)/provided by financing activities
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(219,960)
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(1,510,333)
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734,500
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(1,726,849)
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Effect of foreign currency translation on
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cash and cash equivalents
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(7,514)
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(73,410)
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(12,428)
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266,812
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Increase/(decrease) in cash and cash equivalents
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2,146,500
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(2,762,323)
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4,732,494
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(2,918,521)
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Cash and cash equivalents, beginning of period
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7,171,748
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5,357,535
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4,585,754
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5,513,733
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Cash and cash equivalents, end of period
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$
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9,318,248
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$
|
2,595,212
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$
|
9,318,248
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$
|
2,595,212
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Norsat International Inc.
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Reconciliation of IFRS to non-IFRS Measures
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(Expressed in United States dollars)
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Three months ended June 30
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Six months ended June 30
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2016
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2015
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2016
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2015
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Net earnings for the period
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$
|
935,001
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$
|
674,109
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$
|
2,097,036
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$
|
1,233,796
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Interest (income)/expense
|
(2,258)
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7,139
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(3,816)
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21,644
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Depreciation and amortization
|
201,919
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329,742
|
431,247
|
657,791
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Tax expense/(recovery)
|
469,755
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132,710
|
814,663
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(1,483)
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EBITDA(2)
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$
|
1,604,417
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$
|
1,143,700
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$
|
3,339,130
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$
|
1,911,748
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Loss on foreign exchange
|
131,550
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210,792
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82,391
|
388,541
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Other income
|
-
|
(198,997)
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-
|
(198,997)
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Adjusted EBITDA(2)
|
$
|
1,735,967
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$
|
1,155,495
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$
|
3,421,521
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$
|
2,101,292
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(2)
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We disclose non-IFRS measures as we believe they provide useful information on actual operating results and assist in
comparisons from one period to another. Readers are cautioned that non-IFRS measures do not have any standardized meaning
prescribed by IFRS and therefore may not be comparable to similar measures presented by other companies. For a more
detailed description of non-IFRS measures, please refer to Management's Discussion and Analysis for the three and six
months ended June 30, 2016 posted on Norsat's website and SEDAR.
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About Norsat International Inc.
Founded in 1977, Norsat International Inc. is a provider of unique and customized communication solutions for remote and
challenging applications. Norsat's products and services include leading-edge product design and development, production,
distribution and infield support and service of fly-away satellite terminals, microwave components, antennas, Radio Frequency (RF)
conditioning products, maritime based satellite terminals and remote network connectivity solutions. More information is available
at www.norsat.com, via email at investor@norsat.com or by phone at 1-604-821-2800.
Forward Looking Statements
The discussion and analysis of this news release contains forward-looking statements concerning anticipated developments in
Norsat's operations in future periods, the adequacy of its financial resources and other events or conditions that may occur in the
future. Forward-looking statements are frequently, but not always, identified by words such as "expects," "anticipates,"
"believes," "intends," "estimates,", "predicts," "potential," "targeted," "plans," "possible" and similar expressions, or
statements that events, conditions or results "will," "may," "could" or "should" occur or be achieved. These forward-looking
statements include, without limitation, statements about Norsat's market opportunities, strategies, competition, expected
activities and expenditures as it pursues its business plan, the adequacy of available cash resources and other statements about
future events or results. Forward-looking statements are statements about the future and are inherently uncertain, and actual
achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking
statements due to a variety of risks, uncertainties and other factors, such as business and economic risks and uncertainties. The
forward-looking statements are based on the beliefs, expectations and opinions of management on the date the statements are made.
Consequently, all forward-looking statements made in this news release are qualified by this cautionary statement and there can be
no assurance that actual results or anticipated developments will be realized. For the reasons set forth above, investors should
not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date of this news
release and Norsat assumes no obligation to update or revise them to reflect new events or circumstances, other than as required by
law.
SOURCE Norsat International Inc.
