- Sales increase 23.4% to US$72.2
million, including US$8.6
million from Astellia
- Bookings improve 14.8% to US$73.1
million, including US$7.6
million from Astellia
- Cash flows from operations total US$4.7 million
QUEBEC CITY, July 10, 2018
/PRNewswire/ - EXFO Inc. (NASDAQ: EXFO) (TSX: EXF), the
communications industry's test, monitoring and analytics experts,
reported today financial results for the third quarter ended
May 31, 2018.
IFRS sales, which included a US$8.6
million contribution from recently acquired Astellia,
increased 23.4% to US$72.2 million in
the third quarter of fiscal 2018 from US$58.5 million in the third quarter of 2017.
Astellia's sales were reduced by US$0.9
million to account for acquisition-related fair value
adjustment of deferred revenue.
Bookings, which included a US$7.6
million contribution from Astellia, improved 14.8%
year-over-year to US$73.1 million in
the third quarter of fiscal 2018 from US$63.7 million in the same period of 2017. The
company's book-to-bill ratio was 1.01 in the third quarter of
2018.
Gross margin before depreciation and amortization*
amounted to 59.9% of sales in the third quarter of fiscal 2018
compared to 58.0% in the third quarter of 2017.
IFRS net loss in the third quarter of fiscal 2018 totaled
US$6.0 million, or US$0.11 per share, compared to US$4.3 million, or US$0.08 per share, in the third quarter of 2017.
IFRS net loss in the third quarter of 2018 included US$4.1 million in after-tax amortization of
intangible assets, US$0.4 million in stock-based compensation
costs, US$0.9 million for
acquisition-related fair value adjustment of deferred revenue and a
foreign exchange gain of US$0.2
million.
Adjusted EBITDA* totaled US$2.5 million, or 3.5% of sales, in the third
quarter of fiscal 2018 compared to US$2.3 million, or 3.9% of sales, in the
third quarter of 2017.
"I am pleased our organic business and newly acquired Astellia
delivered healthy growth in the third quarter and after nine months
into fiscal 2018," said Philippe
Morin, EXFO's Chief Executive Officer. "This solid execution
across the combined organization demonstrates that EXFO is on the
right path to profitable growth. Looking ahead, we are
strategically transforming our monitoring and analytics business to
offer a highly differentiated solution as the communications
industry migrates to NFV and 5G architectures."
Selected Financial
Information
|
(In thousands of
US dollars)
|
|
|
|
|
|
|
|
|
|
Three
months
ended
May 31,
2018
|
|
Three
months
ended
May 31,
2017
|
|
Nine
months
ended
May 31,
2018
|
|
Nine
months
ended
May 31,
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Physical-layer
sales
|
$
|
43,760
|
|
$
|
41,007
|
|
$
|
129,734
|
|
$
|
121,061
|
Protocol-layer
sales
|
|
28,278
|
|
|
17,678
|
|
|
69,799
|
|
|
59,784
|
Foreign exchange
gains (losses) on forward exchange contracts
|
|
179
|
|
|
(180)
|
|
|
797
|
|
|
(525)
|
Total
sales
|
$
|
72,217
|
|
$
|
58,505
|
|
$
|
200,330
|
|
$
|
180,320
|
|
|
|
|
|
|
|
|
|
|
|
|
Physical-layer
bookings
|
$
|
44,796
|
|
$
|
47,157
|
|
$
|
134,579
|
|
$
|
125,278
|
Protocol-layer
bookings
|
|
28,115
|
|
|
16,691
|
|
|
69,179
|
|
|
60,692
|
Foreign exchange
gains (losses) on forward exchange contracts
|
|
179
|
|
|
(180)
|
|
|
797
|
|
|
(525)
|
Total
bookings
|
$
|
73,090
|
|
$
|
63,668
|
|
$
|
204,555
|
|
$
|
185,445
|
Book-to-bill ratio
(bookings/sales)
|
|
1.01
|
|
|
1.09
|
|
|
1.02
|
|
|
1.03
|
Gross margin before
depreciation and amortization*
|
$
|
43,254
|
|
$
|
33,950
|
|
$
|
122,752
|
|
$
|
109,963
|
|
|
59.9%
|
|
|
58.0%
|
|
|
61.3%
|
|
|
61.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
Other selected
information:
|
|
|
|
|
|
|
|
|
|
|
|
|
IFRS net earnings
(loss) attributable to the parent interest
|
$
|
(5,970)
|
|
$
|
(4,304)
|
|
$
|
(7,951)
|
|
$
|
7
|
|
Amortization of
intangible assets
|
$
|
4,210
|
|
$
|
1,046
|
|
$
|
8,385
|
|
$
|
2,241
|
|
Stock-based
compensation costs
|
$
|
440
|
|
$
|
372
|
|
$
|
1,280
|
|
$
|
983
|
|
Restructuring
charges
|
$
|
–
|
|
$
|
3,813
|
|
$
|
–
|
|
$
|
3,813
|
|
Change in fair value
of cash contingent consideration
|
$
|
–
|
|
$
|
–
|
|
$
|
(716)
|
|
$
|
–
|
|
Acquisition-related
deferred revenue fair value adjustment
|
$
|
913
|
|
$
|
–
|
|
$
|
1,222
|
|
$
|
–
|
|
Income tax expense
for US tax reform
|
$
|
–
|
|
$
|
–
|
|
$
|
1,528
|
|
$
|
–
|
|
Net income tax effect
of the above items
|
$
|
(138)
|
|
$
|
(357)
|
|
$
|
(704)
|
|
$
|
(583)
|
|
Foreign exchange
gain
|
$
|
(160)
|
|
$
|
(1,725)
|
|
$
|
(1,386)
|
|
$
|
(1,965)
|
|
Adjusted
EBITDA*
|
$
|
2,549
|
|
$
|
2,300
|
|
$
|
11,100
|
|
$
|
13,496
|
Operating Expenses
Selling and administrative expenses
totaled US$26.0 million, or 35.9% of
sales in the third quarter of fiscal 2018 compared to US$22.6 million, or 38.6% of sales, in the third
quarter of 2017.
Net R&D expenses totaled US$16.1
million, or 22.3% of sales, in the third quarter of fiscal
2018 compared to US$13.3 million, or 22.7% of sales, in
the same period last year.
Third Quarter Highlights
- Sales. IFRS sales increased 23.4% year-over-year to
US$72.2 million due to a strong
performance from the Protocol-layer product line, revenue
contributions from the Astellia and Yenista Optics acquisitions,
and the positive impact of the decrease in the average value of the
US dollar versus other currencies. Physical-layer sales accounted
for 61% of revenue in the third quarter of 2018, while
Protocol-layer sales totaled 39%. Revenue breakdown among the three
main selling regions amounted to 49% in the Americas, 35% in
Europe, Middle East and Africa (EMEA) and 16% in Asia-Pacific.
EXFO's top customer accounted for 5.7% of sales, while the top
three represented 15.2%.
- Profitability. IFRS net loss totaled US$6.0 million in the third quarter of 2018,
while adjusted EBITDA amounted to US$2.5
million. The company also generated US$4.7 million in cash flows from operations in
the third quarter.
- Innovation. EXFO held its inaugural Innovation Summit in early
May with a focus on artificial intelligence and machine learning.
More than 100 team members from four continents participated in the
three-day event which featured a hackathon and presentations from
distinguished speakers. EXFO launched two products during the third
quarter, including an automated network troubleshooting solution
that links performance measurements to network topology in order to
deliver service degradation diagnosis in record time. The company
also released the CTP10 Component Test Platform, with related
modules, for measuring insertion loss and return loss on a wide
range of passive optical components.
Business Outlook
EXFO forecasts IFRS sales between
US$68.0 million and US$73.0 million for the fourth quarter of fiscal
2018; the company anticipates that IFRS sales will be reduced by
US$0.9 million to account for the
acquisition-related fair value adjustment of deferred revenue.
IFRS net loss is expected to range between US$0.05 and US$0.01
per share. IFRS net loss includes US$0.10 per share in after-tax amortization of
intangible assets, stock-based compensation costs and
acquisition-related fair value adjustment of deferred revenue.
This guidance, which is a forward-looking statement, was
established by management based on existing backlog as of the date
of this news release, seasonality, expected bookings for the
remaining of the quarter, Astellia's preliminary purchase price
allocation (PPA) as well as exchange rates as of the date of this
news release.
Conference Call and Webcast
EXFO will host a
conference call today at 5 p.m. (Eastern
time) to review third quarter results for fiscal 2018.
To listen to the conference call and participate in the
question period via telephone, dial 1-323-994-2093. Please
take note the following participant passcode will be required:
7503033. Germain Lamonde, founder
and Executive Chairman, Philippe
Morin, Chief Executive Officer, and Pierre Plamondon, Vice-President of Finance and
Chief Financial Officer, will participate in the call. An audio
replay of the conference call will be available two hours after the
event until 8:00 p.m. on July 17,
2018. The replay number is 1-719-457-0820 and the required
participant passcode is 7503033. The audio Webcast and replay
of the conference call will also be available on EXFO's Website
at www.EXFO.com, under the Investors section.
About EXFO
EXFO (NASDAQ: EXFO) (TSX: EXF) develops
smarter test, monitoring and analytics solutions for fixed and
mobile network operators, webscale companies and equipment
manufacturers in the global communications industry. Our customers
count on us to deliver superior network performance, service
reliability and subscriber insights. They count on our unique blend
of equipment, software and services to accelerate digital
transformations related to fiber, 4G/LTE and 5G deployments. They
count on our expertise with automation, real-time troubleshooting
and big data analytics, which are critical to their business
performance. We've spent over 30 years earning this trust, and
today more than 2,000 EXFO employees in over 25 countries work side
by side with our customers in the lab, field, data center and
beyond. For more information, visit EXFO.com and follow us on the
EXFO Blog.
Forward-Looking Statements
This news release contains
forward-looking statements within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995, and we intend that such
forward-looking statements be subject to the safe harbors created
thereby. Forward-looking statements are statements other than
historical information or statements of current condition.
Words such as may, expect, believe, plan, anticipate, intend,
could, estimate, continue, or similar expressions or the
negative of such expressions are intended to identify
forward-looking statements. In addition, any statements that
refer to expectations, projections or other characterizations of
future events and circumstances are considered forward-looking
statements. They are not guarantees of future performance
and involve risks and uncertainties. Actual results may differ
materially from those in forward-looking statements due to various
factors including, but not limited to, macroeconomic uncertainty,
including trade wars, as well as capital spending and network
deployment levels in the telecommunications industry (including our
ability to quickly adapt cost structures to anticipated levels of
business and our ability to manage inventory levels with market
demand); future economic, competitive, financial and market
conditions; consolidation in the global telecommunications test,
service assurance and analytics solutions markets and increased
competition among vendors; our ability to successfully
integrate businesses that we acquire; capacity to adapt our future
product offering to future technological changes; limited
visibility with regard to the timing and nature of customer orders;
delay in revenue recognition due to longer sales cycles for complex
systems involving customers' acceptance; fluctuating exchange
rates; concentration of sales; timely release and market acceptance
of our new products and other upcoming products; our ability to
successfully expand international operations and to conduct
business internationally; and the retention of key technical
and management personnel. Assumptions relating to the
foregoing involve judgments and risks, all of which
are difficult or impossible to predict and many of which are
beyond our control. Other risk factors that may affect our future
performance and operations are detailed in our Annual Report, on
Form 20-F, and our other filings with the U.S. Securities and
Exchange Commission and the Canadian securities commissions. We
believe that the expectations reflected in the forward-looking
statements are reasonable based on information currently available
to us, but we cannot assure you that the expectations will prove to
have been correct. Accordingly, you should not place undue reliance
on these forward-looking statements. These statements speak only as
of the date of this document. Unless required by law or applicable
regulations, we undertake no obligation to revise or update
any of them to reflect events or circumstances that occur
after the date of this document. This discussion and analysis
should be read in conjunction with the consolidated financial
statements.
*Non-IFRS Measures
EXFO provides non-IFRS measures
(non-IFRS sales, gross margin before depreciation and amortization
and adjusted EBITDA) as supplemental information regarding its
operational performance. Non-IFRS sales represent total sales plus
acquisition-related deferred revenue fair value adjustment. Gross
margin before depreciation and amortization represents sales, less
cost of sales, excluding depreciation and amortization. Adjusted
EBITDA represent net earnings (loss) attributable to the parent
interest before interest, income taxes, depreciation and
amortization, stock-based compensation costs, change in fair value
of cash contingent consideration, acquisition-related deferred
revenue fair value adjustment, share in net loss of an associate,
gain on the deemed disposal of the investment in an associate, and
foreign exchange gain or loss.
These non-IFRS measures eliminate the effect on IFRS results of
non-cash and/or non-operating statement of earnings elements, as
well as elements subject to significant volatility such as foreign
exchange gain or loss. EXFO uses these measures for evaluating
historical and prospective financial performance, as well as its
performance relative to competitors. These non-IFRS measures are
also the financial measures used by financial analysts to evaluate
and compare EXFO's performance against competitors and industry
players in the company's sector. Finally, these measures help EXFO
plan and forecast future periods as well as make operational and
strategic decisions. EXFO believes that providing this information,
in addition to the IFRS measures, allows investors to see the
company's results through the eyes of management, and to better
understand historical and future financial performance. More
importantly, it enables the comparison of EXFO's performance on a
relatively similar basis against other public and private companies
in the industry worldwide.
The presentation of this additional information is not prepared
in accordance with IFRS. Therefore, the information may not
necessarily be comparable to that of other companies and should be
considered as a supplement to, not a substitute for, the
corresponding measures calculated in accordance with IFRS.
The following table summarizes the reconciliation of non-IFRS
sales to IFRS sales, in thousands of US dollars:
Non-IFRS
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months
ended
May 31,
2018
|
|
Three
months
ended
May 31,
2017
|
|
Nine
months
ended
May 31,
2018
|
|
Nine
months
ended
May 31,
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
IFRS sales
|
$
|
72,217
|
|
$
|
58,505
|
|
$
|
200,330
|
|
$
|
180,320
|
Acquisition-related
deferred revenue fair value adjustment
|
|
913
|
|
|
–
|
|
|
1,222
|
|
|
–
|
Non-IFRS
sales
|
$
|
73,130
|
|
$
|
58,505
|
|
$
|
201,552
|
|
$
|
180,320
|
The following table summarizes the reconciliation of adjusted
EBITDA to IFRS net earnings (loss) attributable to the parent
interest, in thousands of US dollars:
Adjusted
EBITDA
|
|
|
Three
months
ended
May 31,
2018
|
|
Three
months
ended
May 31,
2017
|
|
Nine
months
ended
May 31,
2018
|
|
Nine
months
ended
May 31,
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
IFRS net earnings
(loss) attributable to the parent interest for the
period
|
$
|
(5,970)
|
|
$
|
(4,304)
|
|
$
|
(7,951)
|
|
$
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
Add
(deduct):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation of
property, plant and equipment
|
|
1,555
|
|
|
1,029
|
|
|
3,972
|
|
|
2,894
|
Amortization of
intangible assets
|
|
4,210
|
|
|
1,046
|
|
|
8,385
|
|
|
2,241
|
Interest and other
expense
|
|
198
|
|
|
57
|
|
|
870
|
|
|
28
|
Income
taxes
|
|
1,363
|
|
|
2,012
|
|
|
5,424
|
|
|
5,495
|
Stock-based
compensation costs
|
|
440
|
|
|
372
|
|
|
1,280
|
|
|
983
|
Restructuring
charges
|
|
–
|
|
|
3,813
|
|
|
–
|
|
|
3,813
|
Change in fair value
of cash contingent consideration
|
|
–
|
|
|
–
|
|
|
(716)
|
|
|
–
|
Acquisition-related
deferred revenue fair value adjustment
|
|
913
|
|
|
–
|
|
|
1,222
|
|
|
–
|
Share in net loss of
an associate
|
|
–
|
|
|
–
|
|
|
2,080
|
|
|
–
|
Gain on deemed
disposal of the investment in an associate
|
|
–
|
|
|
–
|
|
|
(2,080)
|
|
|
–
|
Foreign exchange
gain
|
|
(160)
|
|
|
(1,725)
|
|
|
(1,386)
|
|
|
(1,965)
|
Adjusted EBITDA for
the period (1)(2)
|
$
|
2,549
|
|
$
|
2,300
|
|
$
|
11,100
|
|
$
|
13,496
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA as a
percentage of sales
|
|
3.5%
|
|
|
3.9%
|
|
|
5.5%
|
|
|
7.5%
|
|
|
(1)
|
Astellia negatively
impacted adjusted EBITDA by $2.2 million and $3.4 million
respectively for the three and nine months ended May 31, 2018 (nil
in 2017).
|
(2)
|
Includes
acquisition-related costs of $2.1 million for the nine months ended
May 31, 2018 and $0.1 million and $0.8 million
respectively for the three and nine months ended May 31,
2017.
|
EXFO
Inc.
|
Unaudited
Condensed Interim Consolidated Balance Sheets
|
|
(in thousands of US
dollars)
|
|
|
|
|
|
|
|
As
at
May
31,
2018
|
|
As
at
August
31,
2017
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash
|
$
|
18,489
|
|
$
|
38,435
|
Short-term
investments
|
|
990
|
|
|
775
|
Accounts
receivable
|
|
|
|
|
|
|
Trade
|
|
46,756
|
|
|
41,130
|
|
Other
|
|
4,997
|
|
|
3,907
|
Income taxes and tax
credits recoverable
|
|
8,401
|
|
|
4,955
|
Inventories
|
|
37,883
|
|
|
33,832
|
Prepaid
expenses
|
|
5,185
|
|
|
4,202
|
Other
assets
|
|
1,776
|
|
|
‒
|
|
|
124,477
|
|
|
127,236
|
|
|
|
|
|
|
Tax credits
recoverable
|
|
47,988
|
|
|
38,111
|
Property, plant
and equipment
|
|
44,661
|
|
|
40,132
|
Intangible
assets
|
|
27,775
|
|
|
11,183
|
Goodwill
|
|
41,021
|
|
|
35,077
|
Deferred income
tax assets
|
|
4,615
|
|
|
6,555
|
Other
assets
|
|
666
|
|
|
947
|
|
|
|
|
|
|
|
$
|
291,203
|
|
$
|
259,241
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Bank loan
|
$
|
10,982
|
|
$
|
‒
|
Accounts payable and
accrued liabilities
|
|
50,702
|
|
|
36,776
|
Provisions
|
|
471
|
|
|
3,889
|
Income taxes
payable
|
|
968
|
|
|
663
|
Deferred
revenue
|
|
17,142
|
|
|
11,554
|
Other
liabilities
|
|
4,651
|
|
|
‒
|
Current portion of
long-term debt
|
|
2,938
|
|
|
‒
|
|
|
87,854
|
|
|
52,882
|
|
|
|
|
|
|
Provisions
|
|
1,510
|
|
|
‒
|
Deferred
revenue
|
|
6,235
|
|
|
6,257
|
Long-term
debt
|
|
6,579
|
|
|
‒
|
Deferred income
tax liabilities
|
|
5,074
|
|
|
3,116
|
Other
liabilities
|
|
568
|
|
|
196
|
|
|
107,820
|
|
|
62,451
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Share
capital
|
|
91,910
|
|
|
90,411
|
Contributed
surplus
|
|
18,007
|
|
|
18,184
|
Retained
earnings
|
|
118,857
|
|
|
127,160
|
Accumulated other
comprehensive loss
|
|
(45,391)
|
|
|
(38,965)
|
|
|
183,383
|
|
|
196,790
|
|
|
|
|
|
|
|
$
|
291,203
|
|
$
|
259,241
|
EXFO
Inc.
|
Unaudited
Condensed Interim Consolidated
Statements of Earnings
|
|
(in thousands of US
dollars, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months
ended
May 31,
2018
|
|
Nine
months
ended May 31, 2018
|
|
Three
months
ended
May 31,
2017
|
|
Nine
months
ended
May 31,
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
|
72,217
|
|
$
|
200,330
|
|
$
|
58,505
|
|
$
|
180,320
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
(1)
|
|
28,963
|
|
|
77,578
|
|
|
24,555
|
|
|
70,357
|
Selling and
administrative
|
|
25,957
|
|
|
74,066
|
|
|
22,572
|
|
|
65,422
|
Net research and
development
|
|
16,101
|
|
|
40,440
|
|
|
13,263
|
|
|
35,841
|
Depreciation of
property, plant and equipment
|
|
1,555
|
|
|
3,972
|
|
|
1,029
|
|
|
2,894
|
Amortization of
intangible assets
|
|
4,210
|
|
|
8,385
|
|
|
1,046
|
|
|
2,241
|
Change in fair value
of cash contingent consideration
|
|
‒
|
|
|
(716)
|
|
|
‒
|
|
|
‒
|
Interest and other
expense
|
|
198
|
|
|
870
|
|
|
57
|
|
|
28
|
Foreign exchange
gain
|
|
(160)
|
|
|
(1,386)
|
|
|
(1,725)
|
|
|
(1,965)
|
Share in net loss of
an associate
|
|
‒
|
|
|
2,080
|
|
|
‒
|
|
|
‒
|
Gain on deemed
disposal of the investment in an associate
|
|
‒
|
|
|
(2,080)
|
|
|
‒
|
|
|
‒
|
Earnings (loss)
before income taxes
|
|
(4,607)
|
|
|
(2,879)
|
|
|
(2,292)
|
|
|
5,502
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
taxes
|
|
1,363
|
|
|
5,424
|
|
|
2,012
|
|
|
5,495
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) for the period
|
|
(5,970)
|
|
|
(8,303)
|
|
|
(4,304)
|
|
|
7
|
Net loss for the
period attributable to non-controlling interest
|
|
‒
|
|
|
(352)
|
|
|
‒
|
|
|
‒
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) for the period attributable to parent interest
|
$
|
(5,970)
|
|
$
|
(7,951)
|
|
$
|
(4,304)
|
|
$
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
net earnings (loss) attributable to parent interest per
share
|
$
|
(0.11)
|
|
$
|
(0.14)
|
|
$
|
(0.08)
|
|
$
|
0.00
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted
average number of shares outstanding (000's)
|
|
55,099
|
|
|
54,959
|
|
|
54,593
|
|
|
54,328
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average number of shares outstanding (000's)
|
|
55,099
|
|
|
54,959
|
|
|
54,593
|
|
|
55,479
|
|
(1) The cost of sales
is exclusive of depreciation and amortization, shown
separately.
|
EXFO
Inc.
|
Unaudited
Condensed Interim Consolidated
Statements of Comprehensive Loss
|
|
(in thousands of US
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended May 31,
2018
|
|
Nine
months ended May 31,
2018
|
|
Three
months ended May 31,
2017
|
|
Nine
months ended May 31,
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) for the period
|
$
|
(5,970)
|
|
$
|
(8,303)
|
|
$
|
(4,304)
|
|
$
|
7
|
Other comprehensive
income (loss), net of income taxes
|
|
|
|
|
|
|
|
|
|
|
|
Items that may be
reclassified subsequently to net earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
(3,189)
|
|
|
(5,033)
|
|
|
(2,568)
|
|
|
(4,766)
|
|
Unrealized
gains/losses on forward exchange contracts
|
|
(486)
|
|
|
(971)
|
|
|
(127)
|
|
|
(362)
|
|
Reclassification of
realized gains/losses on forward exchange contracts
in net earnings
|
|
(232)
|
|
|
(840)
|
|
|
39
|
|
|
359
|
|
Deferred income taxes
on gains/losses on forward exchange contracts
|
|
155
|
|
|
418
|
|
|
39
|
|
|
31
|
Other comprehensive
loss
|
|
(3,752)
|
|
|
(6,426)
|
|
|
(2,617)
|
|
|
(4,738)
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss
for the period
|
|
(9,722)
|
|
|
(14,729)
|
|
|
(6,921)
|
|
|
(4,731)
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss
for the period attributable to non-controlling
interest
|
|
‒
|
|
|
(352)
|
|
|
‒
|
|
|
‒
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss
for the period attributable to parent interest
|
$
|
(9,722)
|
|
$
|
(14,377)
|
|
$
|
(6,921)
|
|
$
|
(4,731)
|
EXFO
Inc.
|
Unaudited
Condensed Interim Consolidated
Statements of Changes in Shareholders'
Equity
|
|
(in thousands of US
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended
May 31, 2017
|
|
Share
capital
|
|
Contributed
surplus
|
|
Retained
earnings
|
|
Accumulated
other
comprehensive
loss
|
|
Total
shareholders'
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as at
September 1, 2016
|
$
|
85,516
|
|
$
|
18,150
|
|
$
|
126,309
|
|
$
|
(48,574)
|
|
$
|
181,401
|
Issuance of share
capital
|
|
3,490
|
|
|
–
|
|
|
–
|
|
|
–
|
|
|
3,490
|
Reclassification of
stock-based compensation costs
|
|
1,370
|
|
|
(1,370)
|
|
|
–
|
|
|
–
|
|
|
–
|
Stock-based
compensation costs
|
|
–
|
|
|
941
|
|
|
–
|
|
|
–
|
|
|
941
|
Net earnings for the
period
|
|
–
|
|
|
–
|
|
|
7
|
|
|
–
|
|
|
7
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
–
|
|
|
–
|
|
|
–
|
|
|
(4,766)
|
|
|
(4,766)
|
|
Changes in unrealized
gains/losses on forward exchange contracts, net of deferred income
taxes of $31
|
|
–
|
|
|
–
|
|
|
–
|
|
|
28
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive
loss for the period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,731)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as at May 31,
2017
|
$
|
90,376
|
|
$
|
17,721
|
|
$
|
126,316
|
|
$
|
(53,312)
|
|
$
|
181,101
|
|
Nine months ended
May 31, 2018
|
|
Share capital
|
|
Contributed
surplus
|
|
Retained
earnings
|
|
Accumulated
other comprehensive loss
|
|
Non-controlling
interest
|
|
Total shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as at
September 1, 2017
|
$
|
90,411
|
|
$
|
18,184
|
|
$
|
127,160
|
|
$
|
(38,965)
|
|
$
|
‒
|
|
$
|
196,790
|
Reclassification of
stock-based compensation costs
|
|
1,499
|
|
|
(1,499)
|
|
|
‒
|
|
|
‒
|
|
|
‒
|
|
|
‒
|
Stock-based
compensation costs
|
|
‒
|
|
|
1,322
|
|
|
‒
|
|
|
‒
|
|
|
‒
|
|
|
1,322
|
Business
combination
|
|
‒
|
|
|
‒
|
|
|
‒
|
|
|
‒
|
|
|
(3,662)
|
|
|
(3,662)
|
Acquisition of
non-controlling interest
|
|
‒
|
|
|
‒
|
|
|
(352)
|
|
|
‒
|
|
|
4,014
|
|
|
3,662
|
Net loss for the
period
|
|
‒
|
|
|
‒
|
|
|
(7,951)
|
|
|
‒
|
|
|
(352)
|
|
|
(8,303)
|
Other comprehensive
loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
‒
|
|
|
‒
|
|
|
‒
|
|
|
(5,033)
|
|
|
‒
|
|
|
(5,033)
|
|
Changes in unrealized
gains/losses on forward exchange contracts, net of deferred income
taxes of $418
|
|
‒
|
|
|
‒
|
|
|
‒
|
|
|
(1,393)
|
|
|
‒
|
|
|
(1,393)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss
for the period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(14,729)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as at May 31,
2018
|
$
|
91,910
|
|
$
|
18,007
|
|
$
|
118,857
|
|
$
|
(45,391)
|
|
$
|
‒
|
|
$
|
183,383
|
EXFO
Inc.
|
Unaudited
Condensed Interim Consolidated
Statements of Cash Flows
|
|
(in thousands of US
dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended May 31,
2018
|
|
Nine
months ended May 31,
2018
|
|
Three
months ended May 31,
2017
|
|
Nine
months ended May 31,
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings (loss)
for the period
|
$
|
(5,970)
|
|
$
|
(8,303)
|
|
$
|
(4,304)
|
|
$
|
7
|
Add (deduct) items
not affecting cash
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation costs
|
|
440
|
|
|
1,280
|
|
|
372
|
|
|
983
|
|
Depreciation and
amortization
|
|
5,765
|
|
|
12,357
|
|
|
2,075
|
|
|
5,135
|
|
Write-off of capital
assets
|
|
77
|
|
|
325
|
|
|
‒
|
|
|
‒
|
|
Change in fair value
of cash contingent consideration
|
|
‒
|
|
|
(716)
|
|
|
‒
|
|
|
‒
|
|
Deferred
revenue
|
|
(552)
|
|
|
1,682
|
|
|
79
|
|
|
3,026
|
|
Deferred income
taxes
|
|
389
|
|
|
2,533
|
|
|
704
|
|
|
1,163
|
|
Share in net loss of
an associate
|
|
‒
|
|
|
2,080
|
|
|
‒
|
|
|
‒
|
|
Gain on deemed
disposal of the investment in an associate
|
|
‒
|
|
|
(2,080)
|
|
|
‒
|
|
|
‒
|
|
Changes in foreign
exchange gain/loss
|
|
(603)
|
|
|
(239)
|
|
|
(524)
|
|
|
(955)
|
|
|
(454)
|
|
|
8,919
|
|
|
(1,598)
|
|
|
9,359
|
Changes in non-cash
operating items
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
2,353
|
|
|
7,693
|
|
|
(901)
|
|
|
1,701
|
|
Income taxes and tax
credits
|
|
172
|
|
|
(2,787)
|
|
|
(842)
|
|
|
(1,232)
|
|
Inventories
|
|
1,162
|
|
|
(12)
|
|
|
315
|
|
|
(9)
|
|
Prepaid
expenses
|
|
16
|
|
|
205
|
|
|
(863)
|
|
|
(761)
|
|
Other
assets
|
|
(245)
|
|
|
(769)
|
|
|
(103)
|
|
|
(127)
|
|
Accounts payable,
accrued liabilities and provisions
|
|
1,821
|
|
|
5
|
|
|
1,169
|
|
|
1,756
|
|
Other
liabilities
|
|
(109)
|
|
|
101
|
|
|
‒
|
|
|
‒
|
|
|
4,716
|
|
|
13,355
|
|
|
(2,823)
|
|
|
10,687
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
|
|
|
Additions to
short-term investments
|
|
‒
|
|
|
(482)
|
|
|
(2,571)
|
|
|
(2,887)
|
Proceeds from
disposal and maturity of short-term investments
|
|
‒
|
|
|
234
|
|
|
3,298
|
|
|
3,596
|
Purchases of capital
assets
|
|
(3,431)
|
|
|
(7,680)
|
|
|
(2,555)
|
|
|
(5,448)
|
Investment in an
associate
|
|
‒
|
|
|
(12,530)
|
|
|
–
|
|
|
–
|
Business
combinations, net of cash acquired
|
|
‒
|
|
|
(19,120)
|
|
|
(7,479)
|
|
|
(12,479)
|
|
|
(3,431)
|
|
|
(39,578)
|
|
|
(9,307)
|
|
|
(17,218)
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
|
|
|
|
Bank loan
|
|
9,184
|
|
|
11,250
|
|
|
–
|
|
|
–
|
Repayment of
long-term debt
|
|
(757)
|
|
|
(1,027)
|
|
|
(1,480)
|
|
|
(1,480)
|
Acquisition of
non-controlling interest
|
|
(3,657)
|
|
|
(3,657)
|
|
|
–
|
|
|
–
|
|
|
4,770
|
|
|
6,566
|
|
|
(1,480)
|
|
|
(1,480)
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign
exchange rate changes on cash
|
|
(119)
|
|
|
(289)
|
|
|
(360)
|
|
|
(824)
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in cash
during the period
|
|
5,936
|
|
|
(19,946)
|
|
|
(13,970)
|
|
|
(8,835)
|
Cash – Beginning
of the period
|
|
12,553
|
|
|
38,435
|
|
|
48,343
|
|
|
43,208
|
Cash – End of the
period
|
$
|
18,489
|
|
$
|
18,489
|
|
$
|
34,373
|
|
$
|
34,373
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplementary
information
|
|
|
|
|
|
|
|
|
|
|
|
Income taxes
paid
|
$
|
426
|
|
$
|
1,695
|
|
$
|
627
|
|
$
|
2,188
|
Additions to capital
assets
|
$
|
3,371
|
|
$
|
8,959
|
|
$
|
1,779
|
|
$
|
5,441
|
EXFO-F
View original
content:http://www.prnewswire.com/news-releases/exfo-reports-third-quarter-results-for-fiscal-2018-300678935.html
SOURCE EXFO Inc.