Canada NewsWire
CALGARY, May 3, 2016
CALGARY, May 3, 2016 /CNW/ - Pure Technologies Ltd. ("Pure" or the "Company") (TSX: PUR) announced its financial performance for the quarter ended March 31, 2016.
First Quarter Highlights:
"We are pleased with Pure's first quarter performance which has improved dramatically compared to the same three months last year," said Jack Elliott, President and CEO of Pure. "These early results, driven largely by our Growth and Optimization plan set in motion late last year, set a positive tone for the remainder of 2016. Overall, our efforts to diversify Pure into natural adjacencies to its core business are starting to translate into significant benefits for the Company. The secular trends inherent in the water and oil and gas infrastructure sectors will continue to benefit Pure and its stakeholders in 2016 and beyond."
Financial Highlights for the Three Month Period Ended March 31, 2016
For further details on the results, please refer to Pure's Management Discussion and Analysis (MD&A) and Consolidated Financial Statements which are available on the Company's website (www.puretechltd.com).
For the period ended March 31 |
2016 |
2015 |
$ Change |
% Change | |
Revenue |
25,121 |
14,666 |
10,455 |
71 | |
Cost of sales |
6,249 |
3,958 |
2,291 |
58 | |
Gross margin |
18,872 |
10,708 |
8,164 |
76 | |
Gross margin (%) |
75 |
73 |
- | ||
Operating expenses1 |
21,111 |
15,883 |
5,228 |
33 | |
Adjusted EBITDA2 |
1,108 |
(2,085) |
3,193 |
153 | |
Adjusted EBITDA2 (%) |
4 |
(14) |
|||
Loss for the year |
(2,458) |
(2,304) |
(154) |
(7) | |
Per share – basic |
(0.05) |
(0.04) |
|||
Per share – diluted |
(0.05) |
(0.04) |
|||
Cash flow from operations before working capital changes2 |
1,119 |
(1,302) |
2,421 |
186 | |
Adjusted loss for the period2 |
(1,488) |
(3,896) |
2,408 |
62 | |
Total assets3 |
139,037 |
147,080 |
(8,043) |
(5) |
1. |
Excludes Libya accounts receivable and loss or gains on asset disposals |
2. |
See Non-GAAP Measures. |
3. |
Comparative figure is as at December 31 |
Outlook
Pure's business is impacted by the seasonal nature of its work in North America, particularly in the first quarter which is historically the slowest period due to winter weather and client scheduling challenges. Activity in North America is expected to increase in the second and subsequent quarters driven by municipal project schedules and improvements in weather.
In the Americas region, accounting for 72% of revenue for the quarter, revenues grew by 77% over 2015, including the contribution from WWS, acquired in Q2/15. Excluding the impact of foreign exchange and WWS, the region grew by 26% over 2015, primarily driven by a 40% increase in inspection and consulting services. Inspection and consulting revenues in the Americas are expected to increase in 2016 due to organic growth and improved project execution.
WWS expands Pure's services towards a full network management offering, including valve, hydrant and non-revenue water (NRW) services and broadens Pure's customer base to include more small and medium sized utilities. The combination of Pure and WWS forms the platform for significant growth in 2016 and beyond. Specific efforts to refocus the business development activities combined with the elimination of certain administrative cost redundancies in mid-2016 are expected to result in improved performance in 2016 compared to 2015.
Internationally, Pure continues to build a foothold in key strategic markets as several regions turn their attention towards the benefits of condition assessment over capital replacement. International revenues decreased $0.8 million from 2015 mainly as a result of the first quarter of 2015 including a $1 million AFO sale to the Company's joint venture in China. Management expects full year increases in international sales, subject to the execution of significant scheduled projects in Europe and South America in the second half of 2016.
The Company continues to capitalize on its PureHM acquisition, Pure's fastest growing business segment, which grew revenues to $4.7 million in the first quarter of 2016 from $1.4 million in the prior year. The increase results from the elimination of contracting delays, increased work in the U.S. offsetting the seasonality of the Canadian business, and increased product acceptance for both the Spectrum XLI and SmartBall technologies for the oil and gas pipeline sector.
The Company continues to invest in research and development initiatives that are focused on increasing the capability and efficiency of Pure's technology platforms in both the water and oil and gas pipeline sectors. Pure anticipates commercialization of several of these initiatives in late 2016 and 2017 with corresponding positive impacts on revenue and profitability.
Conference Call and Webcast
A teleconference and webcast will be held tomorrow morning, May 4, 2016, at 10:30 am EDT. Senior Management will speak to the results and provide a financial and business update. Presentation slides will be made available on the Company's website prior to the call.
Teleconference: The telephone numbers for the conference are toll-free 1-800-319-4610 (within Canada & USA) and 416-915-3239 (Local / International).
Webcast & Presentation Slides: Investors will be able to listen to the conference over the Internet as well as access presentation slides (in pdf format) during the call.
About Pure Technologies Ltd.
Pure Technologies Ltd. is an international asset management, technology and services company which has developed patented technologies for inspection, monitoring and management of critical infrastructure around the world. Pure's business model incorporates four distinct but complementary business streams:
Forward-Looking Statements
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. These statements constitute "forward-looking information" within the meaning of applicable Canadian securities laws. These statements are based on the Company's current expectations, estimates, forecasts and assumptions. Forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other important factors that could cause the Company's actual performance to be materially different from that projected. Examples of these statements would include those relating to the benefits expected to be realized from the Company's Growth and Cost Optimization Plan, integration of recent acquisitions, where the Company forecasts the timing of new and existing projects and the success of the Company's new technologies and entering new markets. The assumptions, risks and uncertainties that could cause actual results to differ materially from the forward-looking information, include, but are not limited to, the Company's ability to successfully implement its Growth and Cost Optimization Plan, integrate the Wachs Water business into its existing operations, market changes, the Company's ability to deliver services in a timely and cost effective manner, technological change, changes in general economic conditions and other risks detailed from time to time in our ongoing filings with the Canadian securities regulatory authorities, including those in the Company's 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, the Company undertakes no obligation to publicly update or revise any forward-looking statements either as a result of new information, future events or otherwise.
® Registered Trademarks, property of Pure Technologies Ltd.
"The TSX has not reviewed and does not accept responsibility for the adequacy or accuracy of this release"
SOURCE Pure Technologies Ltd.
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