- Management to Host Conference Call at
8:30 am Pacific Time (11:30 am Eastern Time) -
VANCOUVER, Nov. 3, 2016 /CNW/ - Norsat International
Inc. ("Norsat" or the "Company") (TSX: NII and NYSE MKT: NSAT),
a provider of unique and customized communication solutions for
remote and challenging applications, today reported financial
results for the third quarter ended September 30, 2016.
Financial Highlights
For the three months ended September
30, 2016
- $8.9 million in revenue for
the quarter, a decrease of 5% compared to $9.3 million for the same period last year.
- Gross profit margin of 47% for the quarter, an increase
of 5% from 42% for the same period last year.
- Net earnings for the quarter were $1.4 million, or $0.24 and $0.23 per
share, basic and diluted, compared to $1.5 million, or $0.26 per share, basic and diluted, for the same
period last year.
- Adjusted EBITDA(1)
of $1.9 million for the
quarter, an increase of 14% from $1.7
million for the same period last year.
For the nine months ended September
30, 2016
- $27.4 million in revenue for
the nine months ended September 30,
2016, an increase of 3% compared to $26.6 million for the same period last year.
- Gross profit margin of 46% for the nine months ended
September 30, 2016, an increase
of 6% from 40% for the same period last year.
- Net earnings for the nine months ended September 30, 2016 were $3.5 million, or $0.60 and $0.59 per
share, basic and diluted, compared to $2.7 million, or $0.47 per share, basic and diluted, for the same
period last year.
- Adjusted
EBITDA(1) of
$5.4 million for the nine months
ended September 30, 2016, an
increase of 41% from $3.8 million for
the same period last year.
- $12.1 million of cash and cash
equivalents at September 30,
2016, an increase of $7.5
million compared to $4.6
million at December 31,
2015.
- $24.5 million of working
capital at September 30, 2016, an
increase of $5.1 million compared to
$19.4 million at December 31, 2015.
______________________________
|
(1) Adjusted EBITDA is a
measure that the Company uses to reflect the results of its core
earnings. Adjusted EBITDA is defined as earnings before income tax
expense, financing costs, depreciation and amortization, foreign
exchange gain or loss, corporate development costs, write-down of
inventory, impairment charges or recoveries, discontinued
operations and other non-cash charges.
|
"We are very pleased with the third quarter results. Our total
revenue and profitability have remained strong as we continue to
manage our cost structure while challenging ourselves to develop
and market reliable products to meet customer needs, which was
demonstrated by the significant order received from Harris
Corporation during the quarter," said Dr. Amiee Chan, President and CEO of Norsat.
"To demonstrate our continued commitment to our long-term
strategy to expand our market share in remote and challenging
applications, we have introduced new products and solutions during
the quarter, including a new series of heavy duty vehicle mounted
duplexers and an expanded portfolio of covert antennas designed to
support law enforcement activities," added Dr. Chan.
A full set of financial statements and Management's Discussion
and Analysis for Norsat is available at www.norsat.com and will be
available at www.sedar.com.
Conference Call Details
Norsat will host a
conference call today, November 3,
2016 at 8:30 am Pacific Time
(11:30 am Eastern Time) to discuss
its fiscal year 2016 third quarter results. To access the
conference call, please dial toll-free 1-888-886-7786 or
416-764-8658. The conference call title is: 'Investor Call – Q3
2016'. Please connect approximately 10 – 15 minutes prior to the
beginning of the call to ensure participation. A digital recording
and transcript of the call will be available after the live call
at:
http://www.norsat.com/investors/financial-information/conference-call-recordings/
|
Norsat
International Inc.
|
|
|
Condensed Interim
Consolidated Statements of Financial Position
|
|
|
(Expressed in United
States dollars)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
September 30,
2016
|
December 31,
2015
|
|
ASSETS
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
12,071,468
|
$
|
4,585,754
|
|
Trade and other
receivables
|
7,868,594
|
8,987,392
|
|
Inventories
|
10,937,699
|
10,956,524
|
|
Prepaid expenses and
other
|
499,613
|
394,617
|
|
31,377,374
|
24,924,287
|
|
Non-current
assets
|
|
|
|
Property and
equipment, net
|
591,522
|
558,609
|
|
Intangible assets,
net
|
4,280,760
|
4,724,490
|
|
Goodwill
|
4,097,751
|
4,097,751
|
|
Investment tax
credits recoverable
|
4,757,334
|
4,985,139
|
|
Deferred income tax
assets
|
1,366,991
|
2,218,848
|
|
15,094,358
|
16,584,837
|
|
Total
assets
|
$
|
46,471,732
|
$
|
41,509,124
|
|
|
|
|
LIABILITIES
|
|
|
|
Current
liabilities
|
|
|
|
Trade and other
payables
|
$
|
1,961,204
|
$
|
1,906,703
|
|
Accrued
liabilities
|
2,388,052
|
2,375,107
|
|
Provisions
|
907,553
|
947,682
|
|
Taxes
payable
|
-
|
-
|
|
Deferred
revenue
|
1,650,072
|
286,432
|
|
6,906,881
|
5,515,924
|
|
Non-current
liabilities
|
|
|
|
Long-term deferred
revenue
|
4,265
|
45,889
|
|
Total
liabilities
|
6,911,146
|
5,561,813
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
Issued
capital
|
40,010,378
|
39,850,648
|
|
Treasury
shares
|
(431,436)
|
(320,750)
|
|
Contributed
surplus
|
4,207,094
|
4,318,487
|
|
Accumulated other
comprehensive loss
|
(4,480,669)
|
(4,673,811)
|
|
Retained
earnings/(deficit)
|
255,219
|
(3,227,263)
|
|
Total
shareholders' equity
|
39,560,586
|
35,947,311
|
|
Total liabilities
and shareholders' equity
|
$
|
46,471,732
|
$
|
41,509,124
|
|
Norsat
International Inc.
|
|
Condensed Interim
Consolidated Statements of Earnings and Comprehensive
Income
|
|
(Expressed in United
States dollars)
|
|
(Unaudited)
|
|
|
|
|
|
|
Three months ended
September 30
|
Nine months ended
September 30
|
|
2016
|
2015
|
2016
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
$
|
8,855,622
|
$
|
9,278,889
|
$
|
27,368,985
|
$
|
26,639,305
|
|
Cost of
sales
|
4,689,736
|
5,359,040
|
14,914,133
|
15,878,587
|
|
Gross
profit
|
4,165,886
|
3,919,849
|
12,454,852
|
10,760,718
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
Selling and
distributing
|
1,056,730
|
1,183,898
|
3,720,466
|
3,722,686
|
|
General and
administrative
|
1,015,116
|
983,593
|
2,718,274
|
2,742,763
|
|
Product
development
|
728,335
|
674,879
|
2,369,112
|
2,164,587
|
|
Less: Government
contributions
|
(377,057)
|
(322,828)
|
(1,144,235)
|
(966,785)
|
|
Loss/(gain) on
foreign exchange
|
48,283
|
(40,339)
|
130,674
|
348,202
|
|
Interest and bank
charges
|
27,014
|
33,637
|
81,397
|
109,943
|
|
Total
expenses
|
2,498,421
|
2,512,840
|
7,875,688
|
8,121,396
|
|
|
|
|
|
|
Earnings before
income taxes
|
1,667,465
|
1,407,009
|
4,579,164
|
2,639,322
|
|
|
|
|
|
|
Current income tax
expense/(recovery)
|
7,737
|
-
|
11,110
|
(66,068)
|
|
Deferred income tax
expense/(recovery)
|
274,282
|
(67,291)
|
1,085,572
|
(2,706)
|
|
Net
earnings
|
$
|
1,385,446
|
$
|
1,474,300
|
$
|
3,482,482
|
$
|
2,708,096
|
|
|
|
|
|
|
Other
comprehensive income/(loss)
|
|
|
|
|
|
Items that may
subsequently be reclassified to income:
|
|
|
|
|
|
Gain/(loss) on
translation of foreign subsidiaries
|
27,647
|
(501,214)
|
193,142
|
(580,591)
|
|
Total
comprehensive income
|
$
|
1,413,093
|
$
|
973,086
|
$
|
3,675,624
|
$
|
2,127,505
|
|
|
|
|
|
|
Net earnings per
share
|
|
|
|
|
|
Basic earnings per
share
|
$
|
0.24
|
$
|
0.26
|
$
|
0.60
|
$
|
0.47
|
|
Diluted earnings per
share
|
$
|
0.23
|
$
|
0.26
|
$
|
0.59
|
$
|
0.47
|
|
|
|
|
|
|
Weighted average
number of shares outstanding
|
|
|
|
|
|
Basic
|
5,766,571
|
5,747,653
|
5,767,734
|
5,757,688
|
|
Diluted
|
5,909,745
|
5,769,721
|
5,876,595
|
5,778,383
|
|
Norsat
International Inc.
|
|
Condensed Interim
Consolidated Statements of Cash Flows
|
|
(Expressed in United
States dollars)
|
|
(Unaudited)
|
|
|
|
|
|
|
Three months ended
September 30
|
Nine months ended
September 30
|
|
2016
|
2015
|
2016
|
2015
|
|
|
|
|
|
|
Cash and cash
equivalents provided by/(used in)
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
Net earnings for the
period
|
$
|
1,385,446
|
$
|
1,474,300
|
$
|
3,482,482
|
$
|
2,708,096
|
|
Income taxes
paid
|
(7,737)
|
-
|
(11,110)
|
(43,270)
|
|
Adjustments for items
not affecting cash:
|
|
|
|
|
|
Depreciation and
amortization
|
201,479
|
320,716
|
632,726
|
978,507
|
|
Write-off of
intangible assets and property and equipment
|
30,873
|
-
|
30,873
|
31,139
|
|
Unrealized foreign
exchange loss/(gain)
|
37,388
|
(40,339)
|
181,813
|
348,202
|
|
Acquisition loan cost
amortization
|
-
|
-
|
-
|
2,262
|
|
Other
income
|
-
|
-
|
-
|
(198,997)
|
|
Current income tax
expense/(recovery)
|
7,737
|
-
|
11,110
|
(66,068)
|
|
Deferred income tax
expense/(recovery)
|
274,282
|
(67,291)
|
1,085,572
|
(2,706)
|
|
Share-based
payments
|
65,002
|
61,899
|
194,409
|
180,260
|
|
Vesting of
RSUs
|
-
|
-
|
-
|
(14,632)
|
|
Government
contributions
|
(377,057)
|
(322,828)
|
(1,144,235)
|
(966,785)
|
|
Changes in non-cash
working capital
|
831,909
|
986,521
|
2,119,722
|
(1,901,965)
|
|
Net cash flows
provided by operating activities
|
2,449,322
|
2,412,978
|
6,583,362
|
1,054,043
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
Purchase of
intangible assets, property and
|
|
|
|
|
|
equipment, net of
SADI
|
(152,460)
|
(58,037)
|
(287,100)
|
(157,586)
|
|
Net cash flows
used in investing activities
|
(152,460)
|
(58,037)
|
(287,100)
|
(157,586)
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
Repayment of
acquisition loan
|
-
|
-
|
-
|
(2,286,762)
|
|
Proceeds from
exercise of share purchase options
|
9,149
|
-
|
9,149
|
-
|
|
Purchase of treasury
shares, including purchase costs
|
-
|
-
|
(265,907)
|
(273,298)
|
|
Government
contributions
|
448,807
|
-
|
1,460,236
|
833,211
|
|
Net cash flows
provided by/(used in) financing activities
|
457,956
|
-
|
1,203,478
|
(1,726,849)
|
|
|
|
|
|
|
Effect of foreign
currency translation on
|
|
|
|
|
|
cash and cash
equivalents
|
(1,598)
|
(13,167)
|
(14,026)
|
253,645
|
|
|
|
|
|
|
Increase/(decrease)
in cash and cash equivalents
|
2,753,220
|
2,341,774
|
7,485,714
|
(576,747)
|
|
Cash and cash
equivalents, beginning of period
|
9,318,248
|
2,595,212
|
4,585,754
|
5,513,733
|
|
Cash and cash
equivalents, end of period
|
$
|
12,071,468
|
$
|
4,936,986
|
$
|
12,071,468
|
$
|
4,936,986
|
|
Norsat
International Inc.
|
|
|
|
|
|
Reconciliation of
IFRS to non-IFRS Measures
|
|
|
|
|
(Expressed in United
States dollars)
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30
|
Nine months ended
September 30
|
|
2016
|
2015
|
2016
|
2015
|
|
Net earnings for the
period
|
$
|
1,385,446
|
$
|
1,474,300
|
$
|
3,482,482
|
$
|
2,708,096
|
|
Interest
income
|
(4,967)
|
(344)
|
(8,783)
|
21,300
|
|
Depreciation and
amortization
|
201,479
|
320,716
|
632,726
|
978,507
|
|
Tax
expense/(recovery)
|
282,019
|
(67,291)
|
1,096,682
|
(68,774)
|
|
EBITDA(2)
|
$
|
1,863,977
|
$
|
1,727,381
|
$
|
5,203,107
|
$
|
3,639,129
|
|
Loss/(gain) on
foreign exchange
|
48,283
|
(40,339)
|
130,674
|
348,202
|
|
Other
income
|
-
|
-
|
-
|
(198,997)
|
|
Corporate development
costs
|
19,160
|
-
|
19,160
|
-
|
|
Adjusted
EBITDA(2)
|
$
|
1,931,420
|
$
|
1,687,042
|
$
|
5,352,941
|
$
|
3,788,334
|
|
|
(2) We
disclose non-IFRS measures as we believe they provide useful
information on actual operating results and assist in comparisons
from one period to another. Readers are cautioned that non-IFRS
measures do not have any standardized meaning prescribed by IFRS
and therefore may not be comparable to similar measures presented
by other companies. For a more detailed description of
non-IFRS measures, please refer to Management's Discussion and
Analysis for the three and nine months ended September 30, 2016
posted on Norsat's website and SEDAR.
|
About Norsat International Inc.
Founded in 1977, Norsat International Inc. is a provider of
unique and customized communication solutions for remote and
challenging applications. Norsat's products and services include
leading-edge product design and development, production,
distribution and infield support and service of fly-away satellite
terminals, microwave components, antennas, Radio Frequency (RF)
conditioning products, maritime based satellite terminals and
remote network connectivity solutions. More information is
available at www.norsat.com, via email at investor@norsat.com or by
phone at 1-604-821-2800.
Forward Looking Statements
The discussion and analysis of this news release contains
forward-looking statements concerning anticipated developments in
Norsat's operations in future periods, the adequacy of its
financial resources and other events or conditions that may occur
in the future. Forward-looking statements are frequently, but not
always, identified by words such as "expects," "anticipates,"
"believes," "intends," "estimates,", "predicts," "potential,"
"targeted," "plans," "possible" and similar expressions, or
statements that events, conditions or results "will," "may,"
"could" or "should" occur or be achieved. These forward-looking
statements include, without limitation, statements about Norsat's
market opportunities, strategies, competition, expected activities
and expenditures as it pursues its business plan, the adequacy of
available cash resources and other statements about future events
or results. Forward-looking statements are statements about the
future and are inherently uncertain, and actual achievements of the
Company or other future events or conditions may differ materially
from those reflected in the forward-looking statements due to a
variety of risks, uncertainties and other factors, such as business
and economic risks and uncertainties. The forward-looking
statements are based on the beliefs, expectations and opinions of
management on the date the statements are made. Consequently, all
forward-looking statements made in this news release are qualified
by this cautionary statement and there can be no assurance that
actual results or anticipated developments will be realized. For
the reasons set forth above, investors should not place undue
reliance on forward-looking statements. These forward-looking
statements are made as of the date of this news release and Norsat
assumes no obligation to update or revise them to reflect new
events or circumstances, other than as required by law.
SOURCE Norsat International Inc.