Avensys Corporation Reports Fiscal Third Quarter 2009 Financial Results
May 13, 2009 8:13:00 AM
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MONTREAL, May 13 /PRNewswire-FirstCall/ -- Avensys Corporation (OTC Bulletin Board: AVNY; FRANKFURT WKN: A0M9YA), a leading manufacturer of high-end fiber optic components, and a distributor and integrator of environmental and process monitoring systems, today reported its financial results for the third quarter of fiscal year 2009, ended March 31, 2009.
Third Quarter Fiscal 2009 Results
Total consolidated revenue for the fiscal third quarter 2009 ended March 31, 2009, was $5.4 million compared to $5.8 million in the same period a year ago. For the third quarter of fiscal 2009, consolidated gross profit was $1.9 million compared to $2.0 million year-over-year. Gross margin as a percentage of revenues, for the quarter, increased to 35.4% compared to 34.7% in the same period a year ago. Cash flow generated by operations for the third quarter was $285,000 as compared to cash used in operations of $691,627 for the same period a year ago.
Net loss for the third quarter was $134,257 versus $273,779 in the same period of the previous year, and includes a provision for severance costs of $218,000.
Nine Month Fiscal 2009 Results
Total consolidated revenue for the nine months ended March 31, 2009, rose 12.5% to $16.5 million, from the $14.7 million recorded for the same period a year ago.
For the nine months ended March 31, 2009, gross profit on a consolidated basis was $5.5 million as compared to $5.3 million in the same period a year ago. During this period, gross margin was 33.2%, as a percentage of consolidated revenues, compared to 36.3% for the same period a year ago. Cash used in operations during the first nine months was $35,000, compared to cash used in operations of $1.6 million for the same period a year ago.
For the nine months ended March 31, 2009, net loss was $4.1 million as compared to $2.8 million during the same period a year ago. Included in the net loss of $4.1 million is a loss on impairment of goodwill of $3.9 million taken in the second quarter ended December 31, 2008.
Avensys Solutions
Avensys' environmental and process monitoring business, Avensys Solutions, continued to see growth, 25.1% for the current quarter, compared to the same period a year ago. This growth is a result of the positive integration from the Willer Engineering acquisition, which offset the negative impact of the current economic downturn, since revenues generally lagged behind our expectations.
During the third quarter, we further continued the restructuring of Avensys Solutions by reducing the size and related costs of our management team. Dr. Hassan Kassi was appointed chief operating officer (COO) of Avensys Inc., and is now responsible for the operations of both divisions: Avensys Tech and Avensys Solutions. In addition, Mr. Pierre Michaud was promoted as vice-president of Sales & Marketing for Avensys Solutions.
Avensys Tech
Avensys' optical component business, Avensys Tech, reported revenues for the third quarter period, ending March 31, 2009 of $2.9 million, a 23% decline from the $3.8 million reported for the same period a year earlier. Avensys Tech experienced a softening in demand from the telecommunications market during this quarter, particularly as it relates to undersea components and demodulators. This decline was partially offset by an increase in demand of multi-mode combiners for the industrial fiber laser market and an increase in revenues derived from contracts to build leading-edge high power fiber laser components and systems. We continue to ship substantial quantities of Fiber Bragg Gratings.
President and Chief Executive Officer, John G. Fraser of Avensys Corporation, commented, "We are confident that our efforts to diversify our offering, conserve cash, reduce costs and increase our sales efforts has allowed us to weather this challenging economic environment."
Mr. Fraser added, "Management believes that Avensys will survive the current economic downturn, however, the current capital structure may not be sufficient to support its future growth objectives and technology development. To this end, the Company has engaged Connecticut-based Lightwave Advisors Inc., a financial advisory firm, to assist the Company in reviewing and evaluating its financial and strategic alternatives."
About Avensys Corporation
Avensys Corporation operates Avensys Inc., its wholly-owned core subsidiary. Avensys Inc., through its manufacturing division Avensys Technologies, designs, manufactures, distributes, and markets high reliability optical components and modules as well as FBGs for the telecom market, and high power devices and sub-assemblies for the industrial market. Avensys Technologies is also a pioneer in the development of packaged fiber-based sensors and possesses licences in regards to leading edge intellectual property. Avensys Solutions, the other division of Avensys Inc., is an industry leader in providing instrumentation and integrated solutions for the monitoring of industrial processes and environmental surveillance applications for air, water and soil in the Canadian marketplace. To find out more about Avensys Solutions, please visit our website at www.avensyssolutions.com. For Avensys Corporation company news and updates you can also visit www.avensyscorporation.com.
Forward-Looking Statements:
Except for historical information contained herein, the statements in this news release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause a company's actual results, performance and achievement in the future to differ materially from forecasted results, performance, and achievement. These risks and uncertainties are described in the Company's periodic filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events or changes in the Company's plans or expectations.
For more information, please contact:
Ms. Sherine Attia
Avensys Corporation
Tel: 1.877.904.6030
Use of Non-GAAP Financial Measures
The Company provides non-GAAP financial measures, such as adjusted EBITDA, to complement its consolidated financial statements presented in accordance with GAAP. Non-GAAP financial measures do not have any standardized definition and, therefore, are unlikely to be comparable to similar measures presented by other reporting companies. These non-GAAP financial measures are intended to supplement the user's overall understanding of the Company's current financial and operating performance and its prospects for the future. Specifically, the Company believes the non-GAAP results provide useful information to both management and investors by identifying certain expenses, gains and losses that, when excluded from the GAAP results, may provide additional understanding of the Company's core operating results or business performance, which management uses to evaluate financial performance for purposes of planning for future periods. However, these non-GAAP financial measures are not intended to supersede or replace the Company's GAAP results.
The company uses adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, adjusted for debentures and preferred shares accretion, and changes in fair value of derivative instruments) as a non-GAAP financial measure in this press release. A reconciliation of EBITDA to the operating loss for the first quarter of 2009 is as follows:
Adjusted EBITDA
(Expressed in thousands of US Dollars)
For the Three For the Nine
Months Ended Months Ended
March 31, March 31,
2009 2008 2009 2008
Net Income (Loss) (134) (274) (4,056) (2,835)
Plus
Interest expense, net 83 53 236 238
Depreciation and amortization 262 323 834 940
Loss on impairment of goodwill - - 3,889 -
Loss on redemption of convertible
debentures - - - 1,423
Debentures and preferred shares
accretion 342 234 953 679
Change in fair value of derivative
financial instruments (440) 97 (1,617) (242)
Income Tax Benefit (181) (275) (538) (870)
Adjusted EBITDA (Loss) (68) 158 (299) (667)
Condensed Financial Statements
Consolidated Statements of Operations
(Expressed in thousands of U.S. Dollars, except for per share amounts)
For the Three For the Nine
Months Ended Months Ended
March 31, March 31,
2009 2008 2009 2008
$ $ $ $
Revenue 5,410 5,781 16,497 14,659
Cost of Revenue 3,496 3,775 11,020 9,336
Gross Margin 1,914 2,006 5,477 5,323
Operating Expenses
Depreciation and
amortization 208 222 644 712
Selling, general and
administration 1,790 1,676 5,062 4,786
Loss on impairment of
goodwill - - 3,888 -
Research and development 250 644 1,004 1,806
Total Operating Expenses 2,248 2,542 10,598 7,304
Loss from Operations (334) (536) (5,121) (1,981)
Other Income (Expenses) 29 (359) 537 (2,355)
Income Tax Benefit -
Refundable tax credits 181 275 538 870
Non-Controlling Interest - - - -
Results of Discontinued
Operations (10) 346 (10) 631
Net Loss (134) (274) (4,056) (2,835)
Net Loss per share -
Basic and Diluted (0.00) (0.00) (0.04) (0.03)
Weighted Average
Common Shares
Outstanding 99,086,152 98,290,264 99,082,755 96,866,392
Consolidated Balance Sheets
(Expressed in thousands of U.S. Dollars)
March 31, June 30,
2009 2008
$ $
ASSETS
Current Assets 8,114 9,836
Property and equipment, net 1,760 2,490
Intangible assets 2,753 3,879
Goodwill - 4,645
Deferred financing costs 311 405
Deposits 125 85
Total Assets 13,063 21,340
LIABILITIES AND STOCKHOLDERS' EQUITY
Total Current Liabilities 8,460 9,137
Long-term debt, less current portion 90 191
Convertible debentures 1,415 1,299
Balance of purchase price payable 1,259 1,706
Derivative financial instruments 117 1,364
Total Liabilities 11,341 13,697
Non-controlling Interest - 8
Total Stockholders' Equity 1,722 7,635
Total Liabilities and Stockholders'
Equity 13,063 21,340
SOURCE Avensys Corporation
----------------------------------------------
Ms. Sherine Attia
Avensys Corporation
1-877-904-6030
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