- Management to Host Conference Call at
8:30 am Pacific Time (11:30 am Eastern Time) -
VANCOUVER, March 4, 2016 /PRNewswire/ - 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 fourth quarter and full year ended
December 31, 2015.
Financial Highlights
For the three months ended December
31, 2015
- $9.5 million in revenue for
the quarter, compared to $9.4
million for the same period last year.
- Gross profit margin of 41% for the quarter, an increase
of 6% from 35% for the same period last year.
- Net earnings for the quarter were $5.9 million, including the deferred income tax
recovery of $3.8 million, or
$1.03 per share, basic and
diluted, an increase of $5.8
million from $51,000, or
$0.01 per share, basic and diluted,
for the same period last year.
- Adjusted EBITDA is a measure 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.
- Adjusted EBITDA of $1.5
million for the quarter, an increase of 97% from
$0.7 million for the same period last
year.
- Deferred income tax recovery for the quarter was
$3.8 million, compared to
$70,000 for the same period last
year. The recovery was based on an assessment of the Company's
history of profitability and its ability to realize deferred income
tax assets.
For the year ended December 31,
2015
- $36.1 million in revenue for
the year, consistent with revenue of $36.2 million in 2014.
- Gross profit margin of 41% for the year, compared to 40%
for 2014.
- Net earnings were $8.7
million, for the year including the deferred income tax
recovery of $3.8 million, or
$1.50 per share, basic and
diluted, an increase of $4.5
million from $4.2 million, or
$0.73 per share, basic and diluted,
for 2014.
- $4.6 million of cash and cash
equivalents at December 31, 2015,
compared to $5.5 million at
December 31, 2014.
- No bank debt outstanding as the Company repaid the
remaining balance during the second quarter in 2015. Bank debt at
December 31, 2014 was $2.4 million.
- $19.4 million of working
capital at December 31, 2015,
compared to $13.8 million at
December 31, 2014.
- Adjusted EBITDA of $5.3
million for the year, an increase of 12% from
$4.7 million for 2014.
- Deferred income tax recovery for the year was $3.8 million, compared to $0.3 million for 2014. The recovery was based on
an assessment of the Company's history of profitability and its
ability to realize deferred income tax assets.
"Fiscal 2015 demonstrated continued solid operating results as
we continued to work through the sizable backlog of orders booked
earlier in the year." said Dr. Amiee
Chan, President and CEO of Norsat. "We have been
experiencing increased demand for components including our
successful and expanding ATOM product line and solutions supplied
to militaries around the globe which is driving improvements in our
Satellite Communications segment. Offsetting the improved results
within the Satellite Communications segment was a continuation of
headwinds within our Land Mobile Radio (LMR) segment both in the
U.S. and particularly in the Canadian public safety markets.
Partially offsetting the softness in LMR was an increase in sales
of our positive train control (PTC) products as railroads worked
toward the December 31, 2015
deadline. In late December
2015, the deadline for certain railroads to install PTC
technologies was extended to December 31,
2018 with a possibility of further extending the deadline to
the 2020 year if railroads meet certain conditions.
Therefore, we believe the program's scope will continue over the
coming years as thousands of locomotives and miles of track still
need equipment to enable PTC to be fully operational, providing
Norsat with a strong backlog of order flow for years to come."
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, March 4, 2016
at 8:30 am Pacific Time (11:30 am Eastern Time) to discuss its financial
results for the fourth quarter and full year ended December 31, 2015. To access the conference call,
please dial toll-free 1-888-886-7786 or 416-764-8658. The
conference call title is: 'Norsat Investor Call'. 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.
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|
|
Consolidated
Statements of Financial Position
|
|
|
(Expressed in United
States dollars, except when otherwise indicated)
|
|
|
|
|
|
|
|
December 31,
2015
|
December 31,
2014
|
ASSETS
|
|
|
Current
assets
|
|
|
Cash and cash
equivalents
|
$
4,585,754
|
$
5,513,733
|
Trade and other
receivables
|
8,987,392
|
7,570,110
|
Inventories
|
10,956,524
|
10,120,374
|
Prepaid expenses and
other
|
394,617
|
435,433
|
|
24,924,287
|
23,639,650
|
Non-current
assets
|
|
|
Property and
equipment, net
|
558,609
|
855,978
|
Intangible assets,
net
|
4,724,490
|
6,360,336
|
Goodwill
|
4,097,751
|
4,736,470
|
Investment tax
credits recoverable
|
4,985,139
|
1,910,040
|
Deferred income tax
assets
|
2,218,848
|
1,360,959
|
|
16,584,837
|
15,223,783
|
Total
assets
|
$
41,509,124
|
$
38,863,433
|
|
|
|
LIABILITIES
|
|
|
Current
liabilities
|
|
|
Trade and other
payables
|
$
1,906,703
|
$
2,831,911
|
Accrued
liabilities
|
2,375,107
|
2,601,163
|
Provisions
|
947,682
|
766,371
|
Taxes
payable
|
-
|
120,038
|
Deferred
revenue
|
286,432
|
1,169,816
|
Current liabilities
before acquisition loan
|
5,515,924
|
7,489,299
|
Acquisition
loan
|
-
|
2,371,266
|
|
5,515,924
|
9,860,565
|
Non-current
liabilities
|
|
|
Long-term deferred
revenue
|
45,889
|
18,426
|
Total
liabilities
|
5,561,813
|
9,878,991
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
Issued
capital
|
39,850,648
|
39,850,648
|
Treasury
shares
|
(320,750)
|
(326,527)
|
Contributed
surplus
|
4,318,487
|
4,371,778
|
Accumulated other
comprehensive loss
|
(4,673,811)
|
(3,033,963)
|
Deficit
|
(3,227,263)
|
(11,877,494)
|
Total
shareholders' equity
|
35,947,311
|
28,984,442
|
Total liabilities
and shareholders' equity
|
$
41,509,124
|
$
38,863,433
|
|
|
|
Norsat
International Inc.
|
|
|
|
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Consolidated
Statements of Earnings and Comprehensive Income
|
|
|
|
|
(Expressed in United
States dollars, except when otherwise indicated)
|
|
|
|
|
|
|
|
|
Three months ended
December 31
|
Year ended
December 31
|
|
2015
|
2014
|
2015
|
2014
|
|
|
|
|
|
Revenue
|
$
9,460,306
|
$
9,370,908
|
$
36,099,611
|
$
36,179,180
|
Cost of
sales
|
5,574,566
|
6,109,777
|
21,453,153
|
21,800,384
|
Gross
profit
|
3,885,740
|
3,261,131
|
14,646,458
|
14,378,796
|
|
|
|
|
|
Expenses:
|
|
|
|
|
Selling and
distributing
|
1,153,893
|
1,526,622
|
4,876,579
|
5,413,026
|
General and
administrative
|
1,347,995
|
918,238
|
4,090,758
|
4,028,640
|
Product
development
|
708,467
|
749,120
|
2,873,054
|
2,845,898
|
|
Less: Government
contributions
|
(342,886)
|
(374,947)
|
(1,309,671)
|
(1,266,824)
|
(Gain)/loss on
foreign exchange
|
(1,141,356)
|
362,405
|
(793,154)
|
(586,020)
|
Interest and bank
charges
|
30,272
|
95,783
|
140,215
|
242,844
|
Total
expenses
|
1,756,385
|
3,277,221
|
9,877,781
|
10,677,564
|
|
|
|
|
|
Earnings/(loss)
before income taxes
|
2,129,355
|
(16,090)
|
4,768,677
|
3,701,232
|
|
|
|
|
|
Current income tax
expense/(recovery)
|
-
|
3,178
|
(66,068)
|
(214,355)
|
Deferred income tax
recovery
|
(3,812,780)
|
(69,792)
|
(3,815,486)
|
(279,168)
|
Net
earnings
|
$
5,942,135
|
$
50,524
|
$
8,650,231
|
$
4,194,755
|
|
|
|
|
|
Other
comprehensive income
|
|
|
|
|
Exchange differences
on translation of operations
|
|
|
|
|
|
in currencies other
than United States dollars
|
(1,059,257)
|
48,816
|
(1,639,848)
|
(1,718,485)
|
Total
comprehensive income
|
$
4,882,878
|
$
99,340
|
$
7,010,383
|
$
2,476,270
|
|
|
|
|
|
Net earnings per
share
|
|
|
|
|
|
Basic earnings per
share
|
$
1.03
|
$
0.01
|
$
1.50
|
$
0.73
|
|
Diluted earnings per
share
|
$
1.03
|
$
0.01
|
$
1.50
|
$
0.73
|
|
|
|
|
|
Weighted average
number of shares outstanding
|
|
|
|
|
|
Basic
|
5,759,400
|
5,763,897
|
5,758,179
|
5,757,518
|
|
Diluted
|
5,775,035
|
5,770,099
|
5,777,619
|
5,761,472
|
|
|
|
|
|
|
Norsat
International Inc.
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|
|
|
|
Consolidated
Statements of Cash Flows
|
|
|
|
|
(Expressed in United
States dollars, except when otherwise indicated)
|
|
|
|
|
|
|
|
|
|
|
Three months ended
December 31
|
Year ended
December 31
|
|
2015
|
2014
|
2015
|
2014
|
|
|
|
|
|
Cash and cash
equivalents (used in)/provided by
|
|
|
|
|
Operating
activities:
|
|
|
|
|
Net earnings for the
period
|
$ 5,942,135
|
$ 50,524
|
$ 8,650,231
|
$ 4,194,755
|
Income taxes
(paid)/recovered
|
-
|
-
|
(43,270)
|
57,549
|
Adjustments for items
not affecting cash:
|
|
|
|
|
|
Depreciation and
amortization
|
317,127
|
375,027
|
1,295,634
|
1,274,536
|
|
Write-off of property
and equipment
|
-
|
46,708
|
31,139
|
46,708
|
|
Unrealized foreign
exchange (gain)/loss
|
(910,533)
|
362,405
|
(562,331)
|
(586,020)
|
|
Acquisition loan cost
amortization
|
-
|
6,786
|
2,262
|
27,146
|
|
Other
expenses/(income)
|
161,292
|
-
|
(37,705)
|
-
|
|
Current income tax
expense/(recovery)
|
-
|
3,178
|
(66,068)
|
(214,356)
|
|
Deferred income tax
recovery
|
(3,812,780)
|
(69,792)
|
(3,815,486)
|
(279,168)
|
|
Share-based
payments
|
67,616
|
105,076
|
247,876
|
272,064
|
|
Vesting of
RSUs
|
-
|
(10,895)
|
-
|
(69,495)
|
|
Government
contributions
|
(342,886)
|
(374,947)
|
(1,309,671)
|
(1,266,824)
|
|
Changes in non-cash
working capital
|
(1,802,646)
|
1,095,383
|
(3,704,611)
|
463,711
|
Net cash flows
(used in)/provided by operating activities
|
(380,675)
|
1,589,453
|
688,000
|
3,920,606
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
Purchase of
intangible assets, property and equipment
|
(35,700)
|
(216,788)
|
(193,286)
|
(623,286)
|
Government
contributions for
|
|
|
|
|
|
acquisition of
property and equipment
|
-
|
22,492
|
-
|
49,043
|
Net cash flows
used in investing activities
|
(35,700)
|
(194,296)
|
(193,286)
|
(574,243)
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
Repayment of
acquisition loan
|
-
|
(480,000)
|
(2,286,762)
|
(1,920,000)
|
Purchase of treasury
shares, including purchase costs
|
(7,460)
|
(6,121)
|
(295,390)
|
(117,906)
|
Government
contributions
|
438,437
|
-
|
1,271,648
|
997,783
|
Net cash flows
provided by/(used in) financing activities
|
430,977
|
(486,121)
|
(1,310,504)
|
(1,040,123)
|
|
|
|
|
|
Effect of foreign
currency translation on
|
|
|
|
|
|
cash and cash
equivalents
|
(365,834)
|
207,052
|
(112,189)
|
(65,102)
|
|
|
|
|
|
(Decrease)/increase
in cash and cash equivalents
|
(351,232)
|
1,116,088
|
(927,979)
|
2,241,138
|
Cash and cash
equivalents, beginning of period
|
4,936,986
|
4,397,645
|
5,513,733
|
3,272,595
|
Cash and cash
equivalents, end of period
|
$ 4,585,754
|
$ 5,513,733
|
$ 4,585,754
|
$ 5,513,733
|
|
|
|
|
|
Norsat
International Inc.
|
|
|
|
|
Reconciliation of
IFRS to non-IFRS Measures
|
|
|
|
|
(Expressed in United
States dollars, except when otherwise indicated)
|
|
|
|
|
|
|
|
|
|
|
Three months ended
December 31
|
Year ended
December 31
|
|
2015
|
2014
|
2015
|
2014
|
Net earnings for the
period
|
$
5,942,135
|
$
50,524
|
$
8,650,231
|
$
4,194,755
|
Interest
(income)/expense
|
(728)
|
20,798
|
20,572
|
114,602
|
Depreciation and
amortization
|
317,127
|
375,027
|
1,295,634
|
1,274,536
|
Tax
recovery
|
(3,812,780)
|
(66,614)
|
(3,881,554)
|
(493,523)
|
EBITDA(1)
|
$
2,445,754
|
$
379,735
|
$
6,084,883
|
$
5,090,370
|
(Gain)/loss on
foreign exchange
|
(1,141,356)
|
362,405
|
(793,154)
|
(586,020)
|
Other
expenses/(income)
|
161,292
|
-
|
(37,705)
|
-
|
Acquisition
costs
|
-
|
-
|
-
|
180,000
|
Adjusted
EBITDA(1)
|
$
1,465,690
|
$
742,140
|
$
5,254,024
|
$
4,684,350
|
|
|
|
|
|
(1)
|
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 2015 Annual Management's Discussion and
Analysis 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.