IRD.TO / IRDYF: (International Road Dynamics)
They had a great quarter and their international sales are growing at a spectacular rate. As it appears there will be legislation for infrastructure spending next year sometime (if not sooner) the US sales should reverse and be strong. I don't know what this market will do the stock has be getting hammered since my prior post but now it appears unfounded (there was a fund in September that filed about selling in rebalancing so I wouldn't be surprised if that contributed to the weakness. The weakness in the Canadian currency hasn't helped the stock price but it should help the company a bit.
IRD Announces Improved Third Quarter 2008 Results
SASKATOON, SASKATCHEWAN--(Marketwire - Oct. 9, 2008) - International Road Dynamics Inc. (TSX:IRD - News; IRD), the world's largest provider of Weigh-In-Motion systems and solutions for the global Intelligent Transportation Systems (ITS) market, today announced its results for the three and nine months ended August 31, 2008.
Sales for the third quarter of fiscal 2008 were $10.2 million, in line with sales of $10.4 million for the same period last year. For the first nine months of fiscal 2008, sales were $26.4 million compared to $29.8 million for the same period in fiscal 2007.
Offshore sales continued to grow in the third quarter and first nine months of fiscal 2008, rising to $4.2 million and $9.8 million respectively compared to $2.1 million and $8.1 million respectively for the same periods last year. The increase in offshore sales was due primarily to increased revenues from toll systems and a significant weigh station delivery in the Middle East, as well as higher revenues from the Company's subsidiary in Chile.
Revenues in the United States for the third quarter of fiscal 2008 declined to $4.9 million from $7.1 million in the prior year period due primarily to delays in the awarding of new systems contracts. For the nine months ended August 31, 2008, sales in the US were $13.6 million compared to $17.3 million for the same period last year.
Canadian sales were $1.1 million in the third quarter of 2008 compared to $1.2 million in the prior year. For the nine months ended August 31, 2008, sales in Canada were $3.0 million compared to $4.5 million last year. Fiscal 2007 included substantial revenues from the delivery and installation of two large data collection and truck pre-clearance site contracts completed in the first half of the year. There were no similar contracts during the first nine months of fiscal 2008.
With the slowdown in the U.S. economy, the Company is experiencing delays in the awarding of federally-funded contracts for weigh station and data collection systems. In response, the Company has increased its sales efforts in the city, municipal and private sectors, and accelerated its efforts in specific international markets with higher growth potential, including India, China, Chile and Brazil. Through the first nine months of fiscal 2008 new contract awards to the Company's subsidiaries in India and Chile have exceeded forecasts, with the resulting revenues to continue to be realized in the fourth quarter of fiscal 2008 and into early fiscal 2009. In addition, management believes the acquisition of Xuzhou-PAT Control Technologies in China in the first quarter of 2008 will generate increased sales volumes over the longer term.
"While the continued uncertainty in the North American economy has reduced our growth prospects for our U.S.-based businesses, we believe our successful efforts to build our offshore sales will help to offset any contract delays in this market," commented Terry Bergan, President and CEO. "Our efforts in Chile, Brazil, China and India are beginning to reap positive rewards, and we believe they will continue to generate solid results through the remainder of 2008 and going forward." Earnings before interest, taxes, depreciation and amortization (EBITDA) rose to $1.1 million in the third quarter of 2008 compared to $962,000 in the same prior year period. For the nine months ended August 31, 2008 EBITDA was $1.5 million compared to $3.1 million last year. Gross margin as a percentage of sales decreased marginally in the third quarter and first nine months of fiscal 2008 compared to the prior year periods.
Administrative and marketing expenses in fiscal 2008 have risen compared with the prior year due primarily to increased sales and marketing efforts, while research and development costs decreased in the third quarter of 2008 and remained stable through the first nine months of the year compared to the same prior year periods. The Company continues its active development programs to enhance the functionality of its products and systems. Amortization expense has increased in fiscal 2008 primarily due to the commencing of the amortization of the Company's new manufacturing facility completed in the fourth quarter of fiscal 2007.
The Company generated improved net earnings of $0.5 million or $0.03 per common share for the three months ended August 31, 2008 compared to net earnings of $0.3 million or $0.02 per common share for the same period last year. For the nine months ended August 31, 2008, the Company generated net earnings of $0.2 million or $0.01 per common share.
Working capital at the end of the third quarter of 2008 was $5.0 million compared to $9.3 million at the end of November 2007. The change is primarily the result of an increase in the current portion of longterm debt at August 31, 2008 due to the inclusion as current portion of long-term debt of a $4.0 million non-revolving term facility used to acquire Xuzhou-PAT Control Technologies during the quarter. The Company anticipates this loan will be converted to a fixed-term loan in December 2008.
During the third quarter of 2008 IRD established a new subsidiary in Africa to expand its presence in the region. This new venture enhances IRD's global presence and joins the Company's wholly and partially owned operations in Canada, the United States, China, Brazil, Mexico, India and Chile.
"Looking ahead, the long-term prospects for our business remain very strong. Governments and the private sector around the world are increasingly embracing Intelligent Transportation Systems as a pathway to enhanced economic growth. As a proven supplier of leading edge ITS products, services and solutions, we are well positioned to capitalize on this demand," Mr. Bergan concluded.
Financial Highlights (financial statements are available on the Company's
web site) www.irdinc.com
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Three Months Nine Months
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Period Ended August 31, 2008 2007 2008 2007
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(in $000's except per share amounts)
Sales 10,209 10,399 26,366 29,819
EBITDA 1,082 962 1,539 3,119
Net Earnings 510 298 181 1,399
Net Earnings per Common Share (basic) $ 0.03 $ 0.02 $ 0.01 $ 0.10
Working Capital 4,998 7,391
Shareholders' Equity per Share $ 1.22 $ 1.20
Common Shares Outstanding 13,963 13,924
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Certain statements in this discussion may include "forward-looking" statements which involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of International Road Dynamics Inc. to be materially different from any future results, performance or achievements expressed or implied by such forwardlooking statements. When used in this discussion, such statements use such words as "may", "will", "expect", "anticipate", "project", "believe", "plan", and other similar terminology. The risks and uncertainties are detailed from time to time in reports filed by the Corporation with the securities regulatory authorities in applicable provinces and territories of Canada. New risk factors may arise from time to time and it is not possible for management to predict all of those risk factors or the extent to which any factor or combination of factors may cause actual results, performance and achievements of the Corporation to be materially different from those contained in forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.
As used herein, "EBITDA" means earnings before interest, income taxes, depreciation, and amortization, and includes gains or losses from foreign exchange and earnings or losses from the Company's equity investments. EBITDA is not a recognized measure under Canadian generally accepted accounting principles ("GAAP"). Management believes that EBITDA is a useful supplemental measure to net earnings (loss), as it provides investors with an indication of operating performance prior to debt service, capital expenditures and income taxes. Investors should be cautioned, however, that EBITDA should not be construed as an alternative to net earnings (loss) determined in accordance with GAAP as an indicator of the Corporation's performance or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. The Corporation's method of calculating EBITDA may differ from the methods by which other companies calculate EBITDA and, accordingly, EBITDA may not be comparable to measures used by other companies.
IRD is a highway traffic management technology company specializing in supplying products and systems to the global Intelligent Transportation Systems (ITS) industry. IRD is a North American company based in Saskatoon, Saskatchewan Canada with sales and service offices throughout the United States and overseas. Private corporations, transportation agencies and highway authorities around the world use IRD's products and advanced systems to manage and protect their highway infrastructures.
The Company's shares trade on the Toronto Stock Exchange under the symbol IRD.
Contact:
Terry Bergan
International Road Dynamics Inc.
President & CEO
(306) 653-6600 or U.S. (303) 355-5998
Francine Senecal-Lepage
International Road Dynamics Inc.
Investor Relations
(306) 653-6603
(306) 653-6609 (FAX)
Email: irdir@irdinc.com
Website: www.irdinc.com
Source: International Road Dynamics Inc.
