H2O Innovation Inc. (TSX VENTURE: HEO)(ALTERNEXT: MNEMO:ALHEO)
- Sales of $9,546,009, up from $1,876,157 in 2007-2008.
- Gross margin up to 25.6%, from 22.7% in 2007-2008.
- EBITDA increases to $1,206,766 compared to ($618,460) in
2007-2008.
- Net income of $727,148, compared to a net loss of $748,867 in
2007-2008.
- Operating activities generated $742,146 in cash for the period
compared to a $515,112 use of cash in 2007-2008.
H2O Innovation Inc. ("H2O Innovation" or the "Company")
announces its second quarter results for fiscal year 2008-2009.
During this period, H2O Innovation recorded strong sales
growth-fueled by organic and acquisitions related growth-and a net
income of $727 148, a first in the Company's history.
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CONSOLIDATED RESULTS
(Unaudited)
Three-month period Six-month period ending
ending December 31 ending December 31
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2008 2007 2008 2007
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$CAD $CAD $CAD $CAD
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Sales 9,546,009 1,876,157 15,095,466 4,332,377
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Gross margin 2,441,668 426,660 3,794,594 923,673
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Gross margin 25.6% 22.7% 25.1% 21.3%
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EBITDA 1,206,766 (618,460) 1,236,693 (1,482,466)
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Net income (loss) for
the period and
comprehensive results 727,148 (748,867) 317,877 (1,726,675)
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Basic and diluted
net income (loss)
per share 0.015 (0.021) 0.007 (0.049)
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For the three-month period ended December 31, 2008, sales
increased significantly to reach $9,546,009 compared to $1,876,157
for the same three-month period ended December 31, 2007. A 52.2%
proportion of this increase comes from organic growth; the
remaining 47.8% is related to acquisitions. Gross margin amounted
to 25.6%, compared to a gross margin of 22.7% for the corresponding
quarter of the previous fiscal year, which represents a 13%
increase. EBITDA (Earnings Before Interest, Taxes, Depreciation and
Amortization) for the quarter was $1,206,766, compared to
($618,460) for the same period ended December 31, 2007. During the
quarter, H2O Innovation has recorded a net income of $727,148
($0.015 per share), compared to a net loss of $748,867 ($0.021 per
share) for the corresponding quarter of 2007-2008, a first in the
Company's history. The sales backlog stood at $26,504,877 as at
December 31, 2008.
Before the change in operating working capital, operating
activities generated $742,146 in cash for the period ended December
31, 2008 compared to a $515,112 use of cash for the comparable
period ended December 31, 2007.
For the six-month period ended December 31, 2008, sales reached
$15,095,466 compared to $4,332,377 for the comparable six-month
period ended December 31, 2007. Gross margin has also noticeably
increased to 25.1% for the first six months of 2008-2009, up from
21.3% for the corresponding six months of 2007-2008, representing a
17.8% increase. EBITDA for the six-month period ended December 31,
2008 was $1,236,693, compared to a $1,482,466 loss before interest,
taxes, depreciation and amortization for the same period ended
December 31, 2007. The Company recorded a net income of $317,877
($0.007 per share) for the first half of the 2008-2009 fiscal year,
compared to a net loss of $1,726,675 ($0.049 per share) for the
same period in 2007-2008.
Before the change in operating working capital, operating
activities generated $780,811 in cash for the six-month period
ended December 31, 2008 compared to a $1,295,676 use of cash for
the comparable period ended December 31, 2007.
"These are H2O Innovation's best ever results. They reflect the
concerted efforts of employees, management, and directors in
implementing the Company's strategic plan, as well as gains in
operational efficiency. These results are proof of the soundness of
the Company's business plan and of the steps taken throughout the
years to diversify markets, applications and territories and
improve project execution processes" stated Frederic Dugre,
President and CEO.
RECENT HIGHLIGHTS
Services and consumable products sales growth
Sales of services and consumable products (replacement parts,
membranes, cartridges, conditioners, cleaning products and
services), which first increased noticeably in the previous
quarter, continued to trend upwards in the second quarter, making a
positive contribution to quarterly results. Sales of services and
consumable products, which are usually recurrent, progressed from
$1,389,011 in the first quarter of this fiscal year to $1,793,617
in the second quarter. Management intends to continue its efforts
throughout the organization to ensure that recurring sales make up
a growing share of total sales and contribute to increasing the
gross margin.
Increased competitiveness
H2O Innovation continued to pursue the cost control efforts
initiated in the previous quarter in order to have an optimal cost
structure that corresponds to its needs and activity levels and
allows it to be well positioned to face increased competition and
the anticipated slowdown in the global economy. Management is aware
of the challenges posed by current economic conditions and intends
to redouble its efforts to improve its competitiveness.
"H2O Innovation is more than ever emerging as a leading player
in the water treatment industry at a time when infrastructure
investment is again becoming a priority. With a balanced technology
portfolio, acknowledged resources and expertise, along with a solid
presence in Canada and the United States, H2O Innovation is well
placed to meet its growth and profitability targets" concluded
Frederic Dugre.
The second quarter financial report is available on the
Company's Website (www.h2oinnovation.com) and on Alternext's site
(www.alternext.fr). Additional information on the Company is also
available on SEDAR (www.sedar.com).
Conference call and webcast
H2O Innovation will hold a conference call at 10:00 A.M. EST, on
Friday, February 13, 2009 to review the financial results for the
second quarter. The call will begin by a short presentation by
Management which will be followed by a question period.
Shareholders, analysts and institutional investors are invited to
participate. The numbers to dial for access are 514-861-1531 in the
Montreal area or the toll-free number 1-877-922-4773 in North
America. Overseas callers dial 001-514-861-1531 for access. Media
representatives and other interested parties may participate in
listen only mode or may listen to the live webcast of the call
accessible through H2O Innovation's Website at
www.h2oinnovation.com. The webcast will remain available for replay
on the Company's website for 90 days in the Investors section.
Prospective disclosures
This press release may contain prospective disclosures
representing current expectations of H2O Innovation and are subject
to certain risks and uncertainties. For details of these risks and
uncertainties please refer to the Company's Annual Information Form
dated September 26, 2008 available on SEDAR (www.sedar.com). H2O
Innovation rejects any obligation to revise or update the
prospective disclosures contained in this press release.
About H2O Innovation
Exclusively dedicated to water treatment, H2O Innovation is
establishing itself as a key player in sustainable development and
the field of clean technologies. H2O Innovation designs, develops,
produces and integrates state-of-the-art water treatment systems
for the production of drinking water, the treatment of wastewater
and industrial processed water in the municipal, commercial,
pharmaceutical, industrial, mining and energy markets. H2O
Innovation has over 100 employees and eight offices including two
manufacturing and assembly plants in Canada and the United States.
Shares of H2O Innovation are listed on the TSX Venture Exchange
(HEO) as well as on the Alternext Exchange (MNEMO: ALHEO).
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) nor the Alternext Exchange accepts responsibility
for the adequacy or accuracy of this release.
Contacts: H2O Innovation Inc. Guillaume Ducharme 418-688-0170
ext. 329 guillaume.ducharme@h2oinnovation.com
www.h2oinnovation.com
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