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Press release from Marketwire

Evertz Technologies Reports Record Revenues in Fiscal 2013

Wednesday, June 12, 2013

Evertz Technologies Reports Record Revenues in Fiscal 2013

16:00 EDT Wednesday, June 12, 2013

BURLINGTON, ONTARIO--(Marketwired - June 12, 2013) -

Attention Business/Financial Editors:

Evertz Technologies Limited (TSX:ET), a global leader in video infrastructure solutions for production, playout and delivery systems for television broadcasters, telecom and multi-system operators, today reported its results for the fourth quarter and year ended April 30, 2013.

Fiscal 2013 Highlights

  • Record annual revenue of $316.3 million, an 8% increase over prior year
  • Fully diluted earnings per share of $0.88, an increase of 9% as compared to $0.81 a year ago
  • Continued growth in R&D with a gross investment of $52.9 million
  • Cash and instruments held for trading increased to over $220 million
  • Quarterly dividend increased to $0.16 per share during the year
  • Continued expansion through the completion of a selective acquisition and the opening of North American and International sales offices

Selected Financial Information
Consolidated Statement of Earnings Data
(in thousands of dollars, except per share amounts)

Q4'13 YE'13 Q4'12 YE'12
Revenue $ 65,415 $ 316,305 $ 76,340 $ 293,400
Gross Margin 37,079 181,866 42,783 166,168
Earnings from operations 10,522 86,758 17,474 80,276
Net earnings 8,133 65,163 13,490 59,956
Fully-diluted earnings per share $ 0.11 $ 0.88 $ 0.18 $ 0.81
Selected Financial Information
Consolidated Balance Sheet Data
(in thousands of dollars)
YE'13 YE'12
Cash and instruments held for trading $ 220,668 $ 185,669
Working capital 352,164 325,677
Total assets 465,307 431,864
Shareholders' equity 406,797 378,417

Revenue

For the quarter ended April 30, 2013, revenues were $65.4 million as compared to revenues of $76.3 million for the quarter ended April 30, 2012. For the quarter, revenues in the United States/Canada region were $33.3 million, a decrease of $3.3 million or 9.1% when compared to the same quarter last year. The International region had revenues of $32.1 million, as compared to $39.6 million in the same quarter last year.

For the year ended April 30, 2013, sales were $316.3 million, an increase of $22.9 million or 7.8% as compared to sales of $293.4 million for the prior year. The United States/Canada region increased by $23.3 million or 15.6% when compared to the prior year, and the International region was consistent at $143.1 million compared to $143.5 million in the prior year.

Gross Margin

For the quarter ended April 30, 2013 gross margin was $37.1 million compared to $42.8 million in the same quarter last year. Gross margin percentage was approximately 56.7%, up from 56.0% in the quarter ended April 30, 2012.

For the year ended April 30, 2013, gross margin was $181.9 million as compared to $166.2 million for the year ended April 30, 2012. Gross margin percentage was approximately 57.5% for the year ended April 30, 2013 up when compared to 56.6% for the prior year.

Earnings

For the quarter ended April 30, 2013 net earnings were $8.1 million as compared to $13.5 million in the corresponding period last year.

For the year ended April 30, 2013, net earnings were $65.2 million as compared to $60.0 million in the corresponding period last year.

For the quarter ended April 30, 2013, earnings per share on a fully-diluted basis were $0.11 as compared to $0.18 in the same period in 2012.

For the year ended April 30, 2013, earnings per share on a fully-diluted basis were $0.88 as compared to $0.81 in the same period in 2012.

Operating Expenses

For the quarter ended April 30, 2013 selling and administrative expenses were $14.0 million compared to $12.3 million for the quarter ended April 30, 2012.

For the year ended April 30, 2013, selling and administrative expenses were $53.1 million compared to $47.1 million for the year ended April 30, 2012.

For the quarter ended April 30, 2013 gross research and development expenses increased by $2.6 million or 20.1% as compared to the corresponding period in 2012. Gross research and development expenses represented approximately 23.5% of revenue for the quarter ended April 30, 2013.

For the year ended April 30, 2013, gross research and development expenses increased by 19.6% or $8.7 million as compared to the prior year. Research and development expenses represented approximately 16.7% of sales.

Liquidity and Capital Resources

The Company's working capital as at April 30, 2013 was $352.2 million as compared to $325.7 million on April 30, 2012.

Cash and instruments held for trading were $220.7 million as at April 30, 2013 as compared to $185.7 million on April 30, 2012.

Cash provided by operations was $11.3 million for the quarter ended April 30, 2013 as compared to $8.0 million for the quarter ended April 30, 2012. Before taking into account taxes and the changes in non-cash working capital, the Company generated $11.8 million from operations for the quarter ended April 30, 2013 compared to $18.2 million for the same period last year.

Cash provided by operations was $89.6 million for the 2013 fiscal year as compared to cash provided by operations of $66.6 million for the 2012 fiscal year. Before taking into account taxes and the changes in non-cash working capital, the Company generated $78.6 million from operations for fiscal 2013 as compared to $73.0 million for fiscal 2012.

The Company used $3.9 million in investing activities largely a result of purchases in capital assets of $4.1 million during the quarter ended April 30, 2013, compared to $1.6 million in capital assets purchased for the quarter ended April 30, 2012.

The Company invested $3.8 million net of cash in a technology based company and $11.0 million on the purchase of capital assets for the year ended April 30, 2013, compared to $16.6 million in capital assets purchased for the year ended April 30, 2012.

For the quarter ended April 30, 2013, the Company used cash in financing activities of $11.4 million which was principally a result of the payment of dividends of $11.8 million offset by the issuance of capital stock of $0.6 million.

For the year ended April 30, 2013, the Company used cash in financing activities of $40.1 million as a result of the payment of dividends of $42.9 million, repurchase of capital stock costing $4.2 million offset by the issuance of share capital of $8.0 million.

Shipments and Backlog

Purchase order backlog at the end of May 2013 was in excess of $35 million and shipments during the month of May 2013 were $19 million.

Dividend Declared

Evertz Board of Directors declared a dividend on June 12, 2013 of $0.16 per share.

The dividend is payable to shareholders of record on June 21, 2013 and will be paid on or about June 28, 2013.

Selected Consolidated Financial Information
(Unaudited)
(in thousands of dollars, except earnings per share and share data)
Three month periods ended Twelve month periods ended
April 30, April 30,
2013 2012 2013 2012
Revenue $ 65,415 $ 76,340 $ 316,305 $ 293,400
Cost of goods sold 28,336 33,557 134,439 127,232
Gross margin 37,079 42,783 181,866 166,168
Gross margin % 56.7% 56.0% 57.5% 56.6%
Expenses
Selling and administrative 13,988 12,320 53,106 47,118
General 1,076 2,110 5,366 6,788
Research and development 15,349 12,782 52,851 44,200
Investment tax credits (3,609) (2,562) (13,178) (9,872)
Foreign exchange (gain) loss (247) 659 (3,037) (2,342)
26,557 25,309 95,108 85,892
10,522 17,474 86,758 80,276
Finance income 807 488 2,383 1,915
Finance costs (290) (55) (559) (197)
Other income and expenses (8) 403 264 (154)
Earnings before income taxes 11,031 18,310 88,846 81,840
Provision for income taxes
Current 2,536 3,865 21,816 21,669
Deferred 362 955 1,867 215
2,898 4,820 23,683 21,884
Net earnings for the period 8,133 13,490 65,163 59,956
Net earnings attributable to non-controlling interest 23 110 573 416
Net earnings attributable to shareholders 8,110 13,380 64,590 59,540
Net earnings for the period 8,133 13,490 65,163 59,956
Earnings per share
Basic $ 0.11 $ 0.19 $ 0.88 $ 0.81
Diluted $ 0.11 $ 0.18 $ 0.88 $ 0.81
Selected Consolidated Financial Information
(Unaudited)
(in thousands of dollars, except earnings per share and share data)
April 30, April 30, April 30,
2013 2012 2011
Assets
Current assets
Cash and cash equivalents $ 208,658 $ 173,665 $ 175,835
Instruments held for trading 12,010 12,004 16,190
Trade and other receivables 57,087 61,806 52,732
Inventories 111,619 109,211 106,422
Income tax receivable 7,233 11,695 2,014
$ 396,607 $ 368,381 $ 353,193
Assets held for sale $ 3,781 $ 3,781 $ -
Property, Plant and Equipment $ 46,637 $ 41,190 37,627
Goodwill 17,724 17,507 17,467
Intangible assets 558 1,005 2,224
$ 465,307 $ 431,864 $ 410,511
Liabilities
Current liabilities
Trade and other payables $ 36,237 $ 37,034 $ 21,814
Provisions 1,104 809 1,235
Deferred revenue 6,712 4,460 3,664
Current portion of long term debt 390 401 451
$ 44,443 $ 42,704 $ 27,164
Long term debt $ 1,539 $ 1,875 $ 2,493
Deferred taxes 9,590 7,331 7,095
$ 55,572 $ 51,910 $ 36,752
Equity
Capital stock $ 81,453 $ 67,458 $ 58,882
Share based payment reserve 10,727 14,320 13,762
Accumulated other comprehensive (loss) income (1,063) (906) 440
Retained earnings 315,680 297,545 299,125
$ 314,617 $ 296,639 $ 299,565
Total equity attributable to shareholders 406,797 378,417 372,209
Non-controlling interest 2,938 1,537 1,550
409,735 379,954 373,759
$ 465,307 $ 431,864 $ 410,511

Forward-Looking Statements

The report contains forward-looking statements reflecting Evertz's objectives, estimates and expectations. Such forward looking statements use words such as "may", "will", "expect", "believe", "anticipate", "plan", "intend", "project", "continue" and other similar terminology of a forward-looking nature or negatives of those terms.

Although management of the Company believes that the expectations reflected in such forward-looking statements are reasonable, all forward-looking statements address matters that involve known and unknown risks, uncertainties and other factors. Accordingly, there are or will be a number of significant factors which could cause the Company's actual results, performance or achievements, or industry results to be materially different from any future results performance or achievements expressed or implied by such forward-looking statements.

Conference Call

The Company will hold a conference call with financial analysts to discuss the results on June 12, 2013 at 5:00 p.m. (EDT). Media and other interested parties are invited to join the conference call in listen-only mode. The conference call may be accessed by dialing 1-416-849-6166 or toll-free (North America) 1-866-250-6267.

For those unable to listen to the live call, a rebroadcast will also be available until July 11, 2013. The rebroadcast can be accessed at 1-416-915-1035 or toll-free 1-866-245-6755. The pass code for the rebroadcast is 672047.

About Evertz

Evertz Technologies Limited (TSX:ET) designs, manufactures and markets video and audio infrastructure solutions for the television, telecommunications and new-media industries. The Company's solutions are purchased by content creators, broadcasters, specialty channels and television service providers to support their increasingly complex multi-channel digital and high definition television ("HDTV") broadcast environments and by telecommunications and new-media companies. The Company's products allow its customers to generate additional revenue while reducing costs through the more efficient signal routing, distribution, monitoring and management of content as well as the automation of previously manual processes.

FOR FURTHER INFORMATION PLEASE CONTACT:

Contact Information:
Evertz Technologies Limited
Anthony Gridley
Chief Financial Officer
(905) 335 7580
ir@evertz.com

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