Ottawa, Ontario – November 12, 2014 - Calian Technologies Ltd. (TSX.CTY) today released unaudited results for the fourth quarter ended September 30, 2014.
The Company reported revenues for the quarter of $54.4 million, a 5% decrease from the $57.5 million reported in the same quarter of the previous year and for the year ended September 30, 2014, the Company reported revenues of $211.3 million compared to revenues of $232.0 million in the prior year.
Net profit for the fourth quarter was $2.6 million or $0.35 per share basic and diluted, compared to $3.0 million or $0.41 per share basic and diluted in the same quarter of the previous year. On a year-to-date basis, net profit was $10.6 million or $1.44 per share basic and diluted compared to net profit of $13.1 million or $1.73 per share basic and diluted in the previous year. Adjusted Net Profit(1) for the fourth quarter was $2.8 million or $0.38 per share basic and diluted, compared to $3.0 million or $0.41 per share basic and diluted in the same quarter of the previous year. On a year-to-date basis, adjusted net profit(1) was $10.7 million or $1.45 per share basic and diluted compared to net profit of $13.1 million or $1.73 per share basic and diluted in the previous year.
(1) See caution regarding non-GAAP measures at the end of this press release
“The results released today once again reflect continued contraction in government spending in both of our divisions. Program delays and activity rescheduling within DND and other government departments have resulted in reduced take-up on existing contract vehicles and postponed revenue realization on new ones. Once again, the areas most affected by military spending cuts were vehicle maintenance services and training services in our BTS division. In addition, the traditional holiday slowdown experienced in the fourth quarter was more profound. Fortunately the inclusion of revenues from our most recent acquisitions allowed the BTS division to eclipse last year’s fourth quarter revenues. At SED, the project nature of the division resulted in a significant drop in systems engineering related revenues as certain large projects are winding down and newer ones are just in the design phase. On the positive side, we experienced an increase in contract manufacturing activity during the quarter and our ancillary communications products segment has continued to produce excellent results in terms of revenue growth and gross margin contribution. While the overall results for the year are obviously below that of the prior year, we are encouraged by the fact that both gross margin dollars and EBITDA(1) for this quarter are slightly above the levels achieved in the fourth quarter of last year. As always, we continually monitor our discretionary spending, not only to improve short-term operational results, but also to ensure that our investments are aligned with the achievement of long-term strategic objectives” stated Ray Basler, President and CEO.
“We are also very pleased with the performance of our recent acquisitions of Amtek Engineering Services Ltd. and DWP Solutions Inc. Both entities have met the expectations inherent in our investment decisions and we have every expectation that they will continue to do so” continued Basler. “The current realignment of our BTS division along service lines will not only ensure renewed focus on key business sectors, but also the appropriate level of attention to the integration of these latest acquisitions.”
The company's performance in fiscal 2014 was below that of last year and is the direct result of constrained government spending and the related increase in competitive pressures. Management continues to expect that it could take some time to experience any significant rebound in certain market segments. As we enter fiscal 2015, the substantial contract wins and extensions achieved during the last year along with the book of business obtained from recent acquisitions, provide us with a solid backlog and accordingly, a higher level of revenue confidence. However, revenues ultimately realized will be dependent on the extent and timing of future contract awards as well as customer utilization of existing contracting vehicles. In addition, the requirement to categorize certain acquisition payments as compensation expense will negatively impact fiscal 2015 earnings by approximately $0.15 per share. Based on currently available information and our assessment of the marketplace, we expect revenues for fiscal 2015 to be in the range of $235 million to $ 265 million, net profit per share in the range of $1.35 to $1.65 per share and adjusted net profit(1) in the range of $1.50 to $1.80 per share.
Caution regarding non-GAAP measures:
This press release is based on reported earnings in accordance with IFRS. Reference to generally accepted accounting principles (GAAP) means IFRS, unless indicated otherwise. This press release is also based on non-GAAP financial measures including EBITDA, adjusted net profit and adjusted net profit per share. These non-GAAP measures are mainly derived from the interim consolidated financial statements, but do not have a standardized meaning prescribed by IFRS; therefore, others using these terms may calculate them differently. Management believes that providing certain non-GAAP performance measures, in addition to IFRS measures, provides users of our financial reports with enhanced understanding of our results and related trends and increases transparency and clarity into the core results of our business. Refer to the MD&A for definitions of these metrics and reconciliations to the most comparable IFRS measures.