Evertz Technologies Reports $121 Million Revenue for the Quarter Ended January 31, 2020

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Burlington, Ontario--(Newsfile Corp. - March 11, 2020) - Evertz Technologies Limited (TSX: ET), the leader in Software Defined Video Network ("SDVN") technology, today reported its results for the third quarter ended January 31, 2020.

Third Quarter 2020 Highlights

  • Quarterly revenue of $121.2 million
  • Quarterly revenue in the International region of $51.7 million, an increase of 31% from the prior year
  • Net earnings of $19.4 million for the quarter
  • Fully diluted earnings per share of $0.25 for the quarter

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



Q3 ' 20

Q3 ' 19
Revenue $121,226
$120,942
Gross margin
67,849

67,697
Earnings from operations
26,206

28,168
Net earnings
19,401

21,935
Fully-diluted earnings per share $0.25
$0.28
Fully-diluted shares
76,780,796

76,528,720

 

Selected Financial Information
Consolidated Balance Sheet Data
(in thousands of dollars)



Q3 ' 20

YE '19
Cash and cash equivalents $51,653
$104,583
Working capital
224,966

282,521
Total assets
437,338

466,597
Shareholders' equity
296,228

353,123

 

Revenue

For the quarter ended January 31, 2020, revenues were $121.2 million, an increase of $0.3 million compared to revenues of $120.9 million for the quarter ended January 31, 2019. For the quarter, revenues in the United States/Canada region were $69.5 million compared to $81.5 million in the same quarter last year. The International region had revenues of $51.7 million, an increase of $12.2 million compared to $39.5 million in the same quarter last year.

Gross Margin

For the quarter ended January 31, 2020, gross margin was $67.8 million as compared to $67.7 million in the same quarter last year. Gross margin percentage was approximately 56.0% as compared to 56.0% in the quarter ended January 31, 2019.

Earnings

For the quarter ended January 31, 2020, net earnings were $19.4 million as compared to $21.9 million in the corresponding period last year.

For the quarter ended January 31, 2020, earnings per share on a fully-diluted basis were $0.25 as compared to $0.28 in the corresponding period last year.

Operating Expenses

For the quarter ended January 31, 2020, selling and administrative expenses were $17.9 million as compared to $17.6 million for the quarter ended January 31, 2019.

For the quarter ended January 31, 2020, gross research and development expenses were $24.0 million as compared to $21.6 million for the quarter ended January 31, 2019.

Liquidity and Capital Resources

The Company's working capital as at January 31, 2020 was $225.0 million as compared to $282.5 million on April 30, 2019.

Cash and cash equivalents were $51.7 million as at January 31, 2020 as compared to $104.6 million on April 30, 2019.

Cash generated from operations was $67.3 million for the quarter ended January 31, 2020 as compared to $48.1 million for the quarter ended January 31, 2019. Before taking into account taxes and the changes in non-cash working capital and current taxes, the Company generated $23.7 million from operations for the quarter ended January 31, 2020 compared to $22.9 million for the same period last year.

For the quarter, the Company used $2.8 million for investing activities.

For the quarter ended, the Company used cash in financing activities of $18.8 million which was principally a result of the payment of dividends of $13.8 million.

Shipments and Backlog

At the end of February 2020, purchase order backlog was in excess of $93 million and shipments during the month of February 2020 were $39 million.

Dividend Declared

Evertz Board of Directors declared a regular quarterly dividend on March 11, 2020 of $0.18 per share.

The dividend is payable to shareholders of record on March 20, 2020 and will be paid on or about March 27, 2020.

Selected Consolidated Financial Information
(in thousands of dollars, except earnings per share and percentages)

 
Three month period ended

Nine month period ended


January 31,

January 31,


2020

2019

2020

2019
Revenue $121,226
$120,942
$344,425
$336,311
Cost of goods sold
53,377

53,245

148,102

145,678
Gross margin
67,849

67,697

196,323

190,633
 
 

 

 

 
Expenses
 

 

 

 
   Selling and administrative
17,863

17,570

52,197

49,864
   General
927

897

2,685

2,398
   Research and development
23,993

21,571

69,625

63,974
   Investment tax credits
(2,056)
(2,136)
(6,037)
(6,072)
   Share based compensation
1,186

1,245

4,058

3,152
   Foreign exchange (gain) loss
(270)
382

2,637

(1,528)


41,643

39,529

125,165

111,788
Earnings before undernoted
26,206

28,168

71,158

78,845
 
 

 

 

 
Finance income
84

295

896

964
Finance costs
(511)
(152)
(1,375)
(661)
Other income and expenses
162

1,081

303

1,221
Earnings before income taxes
25,941

29,392

70,982

80,369
Provision for (recovery of) income taxes
 

 

 

 
   Current
6,798

8,033

18,072

21,527
   Deferred
(258)
(576)
(224)
(1,035)


6,540

7,457

17,848

20,492
 
 

 

 

 
Net earnings for the period $19,401
$21,935
$53,134
$59,877
 
 

 

 

 
Net earnings attributable to non-controlling interest
143

241

427

564
Net earnings attributable to shareholders
19,258

21,694

52,707

59,313
Net earnings for the period $19,401
$21,935
$53,134
$59,877
 
 

 

 

 
Earnings per share
 

 

 

 
Basic $0.25
$0.28
$0.69
$0.78
Diluted $0.25
$0.28
$0.69
$0.78

 

Consolidated Balance Sheet Data
As at

As at


January 31, 2020

April 30, 2019
Cash and marketable securities $51,653
$108,606
Inventory $168,626
$171,271
Working capital $224,966
$282,521
Total assets $437,338
$466,597
Shareholders' equity $296,228
$353,123
 
 

 
Number of common shares outstanding:
 

 
   Basic
76,601,646

76,545,246
   Fully-diluted
78,170,646

77,958,746
 
 

 
Weighted average number of shares outstanding:
 

 
   Basic
76,666,791

76,510,417
   Fully-diluted
76,745,929

76,529,799

 

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 March 11, 2020 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 647-793-2625 or toll-free (North America) 1-888-297-0356, access code 9767391.

For those unable to listen to the live call, a rebroadcast will also be available until April 10, 2020. The rebroadcast can be accessed at 647-436-0148 or toll-free 1-888-203-1112. The pass code for the rebroadcast is 9767391.

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 and ultra-high definition television ("HDTV" and "UHD") and next generation high bandwidth low latency IP network environments and by telecommunications and new-media companies. The Company's products allow its customers to generate additional revenue while reducing costs through efficient signal routing, distribution, monitoring and management of content as well as the automation and orchestration of more streamlined and agile workflow processes on premise and in the "Cloud".

Contact:

Doug Moore, CPA, CA
Chief Financial Officer
Evertz Technologies Limited
(905) 335-3700 ext 2256
www.evertz.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/53361

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