MISSISSAUGA, ONTARIO--(Marketwired - Aug. 30, 2017) -
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Pioneering Technology Corporation (TSX VENTURE:PTE) ("Pioneering" or the "Company"), a technology company and North America's leader in cooking fire prevention technologies and products, is pleased to report its unaudited financial results for the third quarter and the nine months ended June 30, 2017. The Company's unaudited financial statements and Management's Discussion and Analysis ("MD&A") are available for review at www.sedar.com.
Relative to the same period in the prior year:
|•||Revenue increased 58% in Q3 and approximately 71% for the nine months ended June 30, 2017|
|•||Net income is up 270% for the quarter and 363% for the nine months ended June 30, 2017.|
|•||Income from operations increased 81% for the quarter and 151% for the nine months ended June 30, 2017.|
|•||Adjusted EBITDA declined 25% for the quarter but is up 60% for the nine months ended June 30, 2017|
|•||The Company completed a $6.6 million equity financing.|
|•||The Company repaid its outstanding loan from Roynat Capital of $1.75 million.|
Pioneering CEO Kevin Callahan said of the results, "We continue to grow our business profitably. We are ahead of our plan year-to-date and believe our forecast of 50% revenue growth in 2017 is achievable. The market for our product solutions is massive, awareness is growing and we are just in the early stages of market penetration. We are also pursuing new opportunities that we believe will enable the Company to expand its product offering and further penetrate additional sales channels. We expect to deliver continued growth and shareholder value."
Selected Financial Highlights for the Third Quarter & Nine Months Ended June 30, 2017 & 2016:
|Three Months Ended June 30, 2017||Three Months Ended June 30, 2016||Nine Months Ended June 30, 2017||Nine Months Ended June 30, 2016|
|Income from Operations||563,768||310,573||1,844,903||735,603|
|Income from Operations per share||0.01||0.01||0.04||0.03|
|Total Comprehensive Income (loss)†||1,163,675||240,601||57,435||516,970|
|Total Comprehensive Income per share†||0.03||0.01||0.00||0.02|
|†||Includes non-cash (fair value movement/derivative liability of warrants). See below and the MD&A for further explanation.|
|#||Adjusted EBITDA is a non-GAAP measure. See "Non-GAAP Measures" below and the MD&A for further explanation.|
Derivative Liability of Warrants
In accordance with IFRS and is described in greater detail in the MD&A, the Company's financial statements includes a derivative liability (non-cash item) related to the Company's outstanding warrants issued in 2016 (expiring in September 2017) because the Company's share price has increased substantially and is now significantly higher than the exercise price of the warrants. This "non-cash" item significantly affects the Company's reported comprehensive net income and liabilities. Thus, the Company believes that "Income from Operations" and "Adjusted EBITDA" are the best measures of Company performance and therefore the Company will continue to report on these measures quarterly going forward.
Q3 2017 Highlights
Pioneering Completes $6.6 Million Bought Deal Private Placement - In March and April of 2017, the Company completed a private placement of 5,995,631 Common Shares and 2,997,815 Warrants for gross proceeds of $6,595,194.10.
Pioneering's SmartBurner Disrupts Industry - First to Meet New Industry Standard - Pioneering announced that the new UL858 industry standard for electric coiled cooktops and ranges which now includes a new cooking fire prevention requirement, has been published and that Pioneering's SmartBurner has passed this new testing requirement and is now listed as meeting the new industry standard for sale in the United States. As of April 2019, electric coil ranges that don't meet the new standard can't be listed for sale. SmartBurner is believed to be the only solution to meet the new industry standard. This is a significant milestone for the Company and the industry and has set a new benchmark for household cooking fire safety.
Hotel/Motel Channel Expansion - During the period, Pioneering announced that another major suite style hotel chain in North America will equip approximately 5,700 hotel rooms with Pioneering's SmartBurner product. The sale was led by one of Pioneering's new distribution partners. This new order is further validation of the successful execution of the Company's new distributor strategy and its expansion and deeper sales penetration into this new, large and relevant channel. The Company plans to announce further hotel opportunities soon.
Finalized Distribution Partnership with Innohome - In June the Company announced that it had finalized its definitive partnership agreement with Innohome Oy of Finland. Based on this partnership, Pioneering intends to introduce a new product to the North American marketplace that will include Innohome's award winning Stove Guard heat sensor technology. This new product is a strategic fit for Pioneering complementing its current family of cooking fire prevention solutions and will be available as an aftermarket application for electric smooth top ranges through Pioneering's existing distribution network and eventually at retail. Innohome's intelligent heat sensor technology is engineered to alert the user to imminent danger via a low frequency alarm and, if the stovetop remains unattended, shut the stove off to help prevent auto-ignition from occurring.
Repayment of Roynat Loan - Strong balance sheet and debt free -- During the quarter the Company repaid its outstanding long-term loan with Roynat Capital Inc. using a portion of the proceeds raised in the recently completed private placement financing. The Company is now debt free and continues to have access to a low interest LOC facility with TD Bank.
Analyst Coverage Initiated - Echelon Private Wealth initiated research coverage on Pioneering.
Additions to Senior Management Team. Pioneering is pleased to announce that it has hired James McEwen as Chief Financial Officer and Michael Quast as Vice-President, Marketing and Communications.
Mr. McEwen is a strategic finance and operations leader with over 15 years' experience in corporate finance, treasury, manufacturing and supply chain management. James received his Certified Public Accountant designation from the State of Colorado and has a Bachelor of Commerce degree from the University of Guelph and an MBA from the University of Toronto's Rotman School of Management. James has held senior leadership positions with BASF Canada and CGC Inc. Most recently James was an owner/operator of a manufacturing business in the commercial and residential construction industry.
Mr. Quast is a strategic, business-focused communications and marketing leader with more than 25 years of experience in the areas of strategic branding, marketing, communications, public relations and award-winning content generation. Michael was instrumental in creating one of North America's most trusted and iconic brands in contractor Mike Holmes ("Holmes On Homes"). Michael is a passionate advocate for homeowner safety and education. He has extensive experience in the new homebuilding, renovation and home inspection industries. He has a proven track record of building successful partnerships with business, government and not-for-profit organizations. Michael currently serves as a Director with Habitat for Humanity, Halton-Mississauga. Michael has a B.A. (Hons) from Queen's University and a M.A. from the University of Manchester, UK.
In connection with these new hires and to recognize the many other men and women that have been instrumental in contributing to Pioneering's recent success and going forward the Company has issued a number of new stock options. The stock options are exercisable into common shares of the Company for a period of five years at a price of $1.07 per share. 1,350,000 options were issued to new hires, directors and officers. The options have been granted pursuant to the Company's stock option plan and are all subject to time and/or performance vesting conditions.
About Pioneering Technology Corp: Pioneering, based in Mississauga, Ontario is an "energy smart" technology company and North America's leader in innovative cooking fire prevention technologies. Pioneering engineers and brings to market energy-smart solutions for everyday consumer appliances making them safer, smarter, and more efficient. The company's patented technologies/products address a multi-billion-dollar problem - cooking fires. According to the National Fire Protection Association, stovetop cooking is the number one cause of household fire and fire injuries in North America (48% of all household fires - up from 20% in 1980). Pioneering's temperature limiting control (TLC) technology is now installed in over 200,000 multi-residential housing units across North America without a single cooking fire being reported and delivering a return on investment for its customers. Pioneering has proprietary cooking fire prevention solutions, including its trademarked Safe-T-element, SmartBurner, RangeMinder & Safe-T-sensor, for the majority of the more than 140 million stoves/ranges and over 140 million microwave ovens throughout North America. For more info, go to www.pioneeringtech.com.
Forward Looking Statements
The statements made in this press release include forward-looking statements that involve a number of risks and uncertainties. These statements relate to future events or future performance and reflect management's current expectations and assumptions. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, such as the economy, generally, competition in Pioneering's target markets, the demand for Pioneering's products, the availability of funding and the efficacy of Pioneering's technology and governmental regulation. These forward-looking statements are made as of the date hereof an, except as required by applicable law, Pioneering does not assume any obligation to update or revise them to reflect new events or circumstances. Actual events or results could differ materially from Pioneering's expectations and projections.
Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization ("Adjusted EBITDA) is a measure not recognized under Canadian generally accepted accounting principles ("GAAP"). However, management of Pioneering believes that most shareholders, creditors, other stakeholders and investment analysts prefer to have these measures included as reported measures of operating performance, a proxy for cash flow, and to facilitate valuation analysis. Adjusted EBITDA is defined as earnings before interest income, taxes, depreciation and amortization, impairment losses, stock-based compensation, restructuring costs included in general and administration expense, fair value movement - derivative liability and other non-recurring gains or losses including transaction costs related to acquisition. Management believes Adjusted EBITDA is a useful measure that facilitates period-to-period operating comparisons. Adjusted EBITDA does not have any standard meanings prescribed by GAAP and therefore may not be comparable to similar measures presented by other issuers. Readers are cautioned that Adjusted EBITDA is not an alternative to measures determined in accordance with GAAP and should not, on its own, be construed as indicators of performance, cash flow or profitability. References to the Pioneering's Adjusted EBITDA should be read in conjunction with the financial statements and management's discussion and analysis of Pioneering posted on SEDAR (www.sedar.com).
This news release contains certain forward-looking statements reflecting the Company's current views or expectations on its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly.
The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy and accuracy of this release.
Pioneering Technology Corp.
President & CEO
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