(All dollar amounts are in US dollars)
Highlights from the Quarter:
- 33% increase in Revenue year over year, to $26.6 million
- 20% increase in Purchase Orders year over year, to $25.5 million
- 30% increase in Gross Margin year over year
- Added 105 new customers
CONCORD, ON, Aug. 10, 2011 /CNW/ - RuggedCom Inc. ("RuggedCom") (TSX:RCM), a leading provider of rugged communications networking solutions designed for mission-critical applications in harsh environments, today announced its financial results for the first quarter of fiscal 2012, ended June 30, 2011.
The Company adopted International Financial Reporting Standards ("IFRS") effective April 1, 2011. The accompanying consolidated interim financial statements represent the Company's first set of financial statements prepared in accordance with IFRS.
"The Company continues to experience strong revenue and order growth in spite of today's uncertain economic climate," said Marzio Pozzuoli, President and Chief Executive Officer. "The electric power and transportation markets continue to be the primary drivers of our growth, with transportation achieving a new record in revenues this quarter. The North America and Latin America regions both achieved record revenues in Q1-F12 to complement continued strong growth in the APAC and EMEA regions."
First Quarter Results
Total revenue for the quarter was $26.6 million, representing an increase of 33% from the comparable quarter a year ago. Revenue was primarily driven by the electric power and transportation markets, which grew 28% and 45% respectively, over the same quarter last year.
The Company booked customer purchase orders totaling $25.5 million for the quarter, representing an increase of 20% over the same quarter last year.
Gross margin for the quarter was $15.3 million, an increase of 30% over the comparable period last year. On a percentage of revenue basis, first quarter gross margin was 57.5%, a decrease of 1.2 percentage points over a gross margin of 58.7% for the same period last year. The decrease in gross margin percentage was due to an unfavourable combination of product, sector and geographic mix.
First quarter net income was $1.3 million, compared to a loss of $0.8 million in the comparable period a year ago. Operating expenses declined to 47.7% of revenues compared with 57.1% for the same period a year ago. The significant drop is due to the Company's conversion to a US dollar functional currency as a result of implementing IFRS beginning with this reporting period and the effect this had on the recalculation of operating expenses for the year ago period. The adoption of a US dollar functional currency created a foreign exchange loss of approximately $1.6 million for Q1-F11 due to the foreign exchange effect on the Company's significant Canadian dollar denominated cash balances at that time. For Q1-F12, in order to minimize the foreign exchange effect on the Company's cash balances, the Company converted much of its Canadian dollars to US dollars at the beginning of Q1-F12. The Company recorded a nominal foreign exchange gain in Q1-F12.
The Company also recorded a provision for income taxes of $1.1 million for Q1-F12. This compares to $1.2 million income tax expense in the same period last year. Q1-F11 experienced a large effective tax rate mainly due to the large foreign exchange loss explained above, as well as the inclusion of pre-tax losses from WiNetworks, both of which are not tax effected.
First quarter basic earnings per share were $0.10 compared to ($0.06) for the same quarter last year while fully diluted earnings per share were $0.10 compared to ($0.06) for the same quarter last year.
The Company added 105 new customers in the quarter.
Conference Call and Webcast
Management will host a conference call at 8:30 a.m. (ET) on Thursday, August 11, 2011. Listeners may attend the conference call by dialing 647-427-7450 or 1-888-231-8191. The live audio webcast can be accessed at RuggedCom's web site at
www.RuggedCom.com. The webcast will also be archived on the site. A
taped rebroadcast will be available to listeners following the call
until 11:59 PM (ET) on August 19, 2011. To access the rebroadcast,
please call 416-849-0833 or 1-800-642-1687 and enter passcode 82332260#.
About RuggedCom Inc.
RuggedCom is a leading provider of rugged communications networking
solutions designed for mission-critical applications in harsh
environments. RuggedCom's technology solutions include Ethernet
switches, network routers, wireless devices, serial servers, media
converters, software and professional services. RuggedCom's products
are designed for use in harsh environments such as those found in
electrical power substations and "Smart Grids", intelligent
transportation systems, industrial process control and military
applications. For further information, please visit www.RuggedCom.com.
The unaudited consolidated interim financial statements and management's discussion and analysis of the results of operations and financial condition for the three month periods ended June 30, 2011 and June 30, 2010 can be found under the Company's profile at www.sedar.com. They can also be found in the Investor Relations section of the Company's website at www.RuggedCom.com.
RuggedCom Inc.
First Quarter 2012 Consolidated Interim Financial Statements and Results
of Operations
(Unaudited)
RuggedCom Inc.
Consolidated Interim Balance Sheets
(In thousands of US dollars)
(Unaudited)
|
June 30 2011 $ |
March 31 2011 $ |
April 1 2010 $ |
|||||||
| Assets | |||||||||
| Current assets | |||||||||
| Cash and cash equivalents (note 6) | 36,269 | 38,106 | 33,145 | ||||||
| Trade receivables (note 7) | 18,704 | 18,265 | 13,494 | ||||||
| Inventories (note 8) | 16,770 | 14,509 | 10,301 | ||||||
| Prepaid expenses | 3,679 | 2,184 | 1,825 | ||||||
| Income taxes recoverable | - | - | 1,043 | ||||||
| 75,422 | 73,064 | 59,808 | |||||||
| Non-current assets | |||||||||
| Prepaid expenses | 848 | 272 | 520 | ||||||
| Deferred income taxes | 718 | 676 | 1,197 | ||||||
| Property and equipment (note 9(a)) | 10,657 | 10,299 | 10,952 | ||||||
| Intangible assets (note 9(b)) | 9,965 | 10,311 | 10,836 | ||||||
| Goodwill | 3,133 | 3,133 | 1,640 | ||||||
| 25,321 | 24,691 | 25,145 | |||||||
| Total assets | 100,743 | 97,755 | 84,953 | ||||||
| Liabilities | |||||||||
| Current liabilities | |||||||||
| Trade and other payables (note 10) | 8,720 | 7,835 | 7,494 | ||||||
| Income taxes payable | 349 | 1,299 | 280 | ||||||
| Provisions (note 11) | 1,082 | 921 | 719 | ||||||
| Other liabilities (note 12) | 271 | 351 | 316 | ||||||
| Total current liabilities | 10,422 | 10,406 | 8,809 | ||||||
| Non-current liabilities | |||||||||
| Provisions (note 11) | 702 | 697 | 678 | ||||||
| Other liabilities (note 12) | 4,002 | 3,221 | 2,775 | ||||||
| Total non-current liabilities | 4,704 | 3,918 | 3,453 | ||||||
| Total liabilities | 15,126 | 14,324 | 12,262 | ||||||
| Equity | |||||||||
| Share capital | 50,427 | 49,574 | 48,963 | ||||||
| Contributed surplus | 5,209 | 5,147 | 3,695 | ||||||
| Retained earnings | 29,981 | 28,710 | 20,033 | ||||||
| Total equity | 85,617 | 83,431 | 72,691 | ||||||
| Total liabilities and equity | 100,743 | 97,755 | 84,953 | ||||||
| Contingencies and guarantees (note 15) | |||||||||
| Peter Crombie - Director J. Ian Giffen - Director |
The accompanying notes form an integral part of these consolidated interim financial statements.
RuggedCom Inc.
Consolidated Interim Statements of Operations and Comprehensive Income
(Loss)
(In thousands of US dollars, except share and per share amounts)
(Unaudited)
| Three months ended | ||
|
June 30 2011 |
June 30 2010 |
|
| $ | $ | |
| Revenues | 26,562 | 19,990 |
| Cost of sales | 11,291 | 8,252 |
| Gross profit | 15,271 | 11,738 |
| Operating expenses | ||
| Sales and marketing | 5,888 | 4,312 |
| Research and product development | 3,647 | 2,904 |
| General and administrative | 3,141 | 4,204 |
| 12,676 | 11,420 | |
| Income from operations | 2,595 | 318 |
| Finance income (expenses), net | ||
| Interest income | 36 | 39 |
| Interest expense | (24) | (26) |
| Other finance income (expenses) | (215) | 95 |
| Finance income (expenses), net | (203) | 108 |
| Income before income taxes | 2,392 | 426 |
| Income tax expense | 1,121 | 1,181 |
|
Net income (loss) and comprehensive income (loss) for the period |
1,271 | (755) |
| Income per common share (note 16) | ||
| Basic | $0.10 | $(0.06) |
| Diluted | $0.10 | $(0.06) |
| Weighted average number of common shares outstanding (note 16) | ||
The accompanying notes form an integral part of these consolidated interim financial statements.
RuggedCom Inc.
Consolidated Interim Statements of Changes in Equity
(In thousands of US dollars, except share and per share amounts)
(Unaudited)
| Share capital | Contributed | Retained | ||||||||||||
| Number | Amount | surplus | earnings | Total equity | ||||||||||
|
|
$ | $ | $ | $ | ||||||||||
| Balance at April 1, 2010 | 12,144,458 | 48,963 | 3,695 | 20,033 | 72,691 | |||||||||
| Comprehensive loss for the period | - | - | - | (755) | (755) | |||||||||
| Employee stock options: | ||||||||||||||
| Value of services recognized | - | 32 | (32) | - | - | |||||||||
| Proceeds from issuing common shares | 12,480 | 57 | - | - | 57 | |||||||||
| Expense for the period | - | - | 445 | - | 445 | |||||||||
| Balance at June 30, 2010 | 12,156,938 | 49,052 | 4,108 | 19,278 | 72,438 | |||||||||
| Balance at April 1, 2011 | 12,241,495 | 49,574 | 5,147 | 28,710 | 83,431 | |||||||||
| Comprehensive income for the period | 1,271 | 1,271 | ||||||||||||
| Employee stock options: | ||||||||||||||
| Value of services recognized | 284 | (284) | - | |||||||||||
| Proceeds from issuing common shares | 128,140 | 569 | 569 | |||||||||||
| Expense for the period | 346 | 346 | ||||||||||||
| Balance at June 30, 2011 | 12,369,635 | 50,427 | 5,209 | 29,981 | 85,617 | |||||||||
The accompanying notes form an integral part of these consolidated interim financial statements.
RuggedCom Inc.
Consolidated Interim Statements of Cash Flows
(In thousands of US dollars)
(Unaudited)
| Three months ended | |||||||
|
June 30 2011 $ |
June 30 2010 $ |
||||||
| Cash and cash equivalents provided by (used in) | |||||||
| Operating activities | |||||||
| Net income (loss) for the period | 1,271 | (755) | |||||
| Items not affecting cash | |||||||
| Amortization and depreciation | 1,298 | 1,206 | |||||
| Unrealized finance (gain) loss | 215 | (95) | |||||
| Stock-based compensation | 346 | 445 | |||||
| Deferred income tax expense | (42) | 242 | |||||
| Net change in non-cash working capital (note 18(a)) | (4,114) | (334) | |||||
| Cash provided by (used in) operating activities | (1,026) | 709 | |||||
| Investing activities | |||||||
| Purchase of property and equipment | (1,068) | (832) | |||||
| Proceeds from disposal of property and equipment | - | 23 | |||||
| Purchase of intangibles | (312) | (224) | |||||
| Cash used in investing activities | (1,380) | (1,033) | |||||
| Financing activities | |||||||
| Common shares issued for options exercised | 569 | 57 | |||||
| Cash provided by financing activities | 569 | 57 | |||||
| Decrease in cash and cash equivalents during the period | (1,837) | (267) | |||||
| Cash and cash equivalents - Beginning of period | 38,106 | 33,145 | |||||
| Cash and cash equivalents - End of period | 36,269 | 32,878 | |||||
| Supplemental disclosure (note 18(b)) | |||||||
The accompanying notes form an integral part of these consolidated interim financial statements.
