STT Enviro Corp. Announces Significant Improvement in Its Balance Sheet
April 01 2014 - 5:00AM
Marketwired Canada
STT Enviro Corp. ("STT" or the "Company") (TSX VENTURE:STT) is pleased to
announce the positive results from the maturity on April 1, 2014 of $2.3 million
in convertible debentures (the "Debentures") which resulted in new equity for
the Company of $1.2 million. The conversion of some of the Debentures and
subsequent exercise of warrants will result in the issue of 8,808,210 common
shares today. This means the Company was able to reduce its debt, net of an
anticipated additional draw of an existing loan facility to assist with the
retirement of the remaining debentures, from approximately $3.9 million to $2.8
million.
David Deacon, Chief Executive Officer, commented, "I am happy to announce that
as of April 1st, 2014 we removed the potential overhang of 26.7 million shares
from the Company. A manageable 8,808,210 shares are being issued today.
Following their issue, the gross number of issued common shares will be
35,337,154."
He continued, "Removing the cloud of potential dilution means that we are now
able to move forward with a clear understanding of the Company's outstanding
share balance and investors will now be able to come to a valuation based on our
results over the past couple of years:
-- Annual revenue up 115% since 2010 to $28.4 million in 2013;
-- Increased EBITDA to $2.6 million in 2013, up from a negative $1.5
million in 2010;
-- Expected 53% reduction of term debt from $6.0 million at March 31, 2011
to $2.8 million by the end of April 2014;
-- Launch of STT Solutions, a high margin new aftermarket and service
business; and
-- Expansion of STT Tanks, almost doubling year-over-year 2011 sales."
The Company has received instructions from the holders of the final $169,722 of
Debentures maturing April 25, 2014 which would result in a further 853,369
shares being issued, representing $119,472 of new equity, for a total of
9,661,579 new common shares and $1,352,621 of new equity. Please see the chart
below for full details.
After April 25, 2014 the total expected number of common shares issued by the
Company is 36,190,523.
Summary of the Convertible Debenture Maturity:
# of Per
Shares Share
--------------------
Total amount matured April 1, 2014 $ 2,328,120.00
Amount held by STT through subsidiary
retired at maturity $ 937,520.00
----------------
Net amount outstanding $ 1,390,600.00
================
Amount converted to common shares $ 874,766.34 6,248,331 $ 0.14
Amount retained at investor's request
and used to exercise warrants $ 233,333.24 1,666,666 $ 0.14
Amount repaid $ 282,500.42
---------------------------
$ 1,390,600.00 7,914,997
===========================
Other warrants exercised $ 125,049.82 893,213 $ 0.14
===========================
Summary:
Amount converted from debt to common
shares $ 874,766.34 6,248,331
Proceeds from exercise of warrants $ 358,383.06 2,559,879
---------------------------
Total increase in shareholders' equity $ 1,233,149.40 8,808,210
===========================
Expected Result for Final Tranche
Maturing April 25, 2014:
Total amount maturing April 25, 2014 $ 169,722.00
Amount expected to be repaid $ 66,500.28
----------------
Amount expected to convert from debt to
common shares $ 103,221.72 737,298
Proceeds expected from exercise of
warrants $ 16,249.94 116,071
---------------------------
Total expected increase in shareholders'
equity $ 119,471.66 853,369
===========================
Total for Both Tranches
Increase in shareholders' equity $ 1,352,621.06
New common shares issued 9,661,579
The Debentures were issued by the Company as part of the private placement
financing announced on April 15th, 2011 (click here to view press release).
About STT Enviro Corp.
STT Enviro Corp. (TSX VENTURE:STT) is an international supplier of industrial
processes and environmental solutions. We work with the biggest and most
respected names in the mining, oil & gas and utility sectors by assisting them
in reducing their environmental footprint and improving their operational
efficiency.
Our three primary areas of business are in providing engineering, project
management and installation of bulk material/chemical handling systems for the
neutralization of pollutants; supplying bolted steel tanks and glass fused to
steel tanks for liquid storage projects; and sales of parts and aftermarket
services to our customers to help them in maintaining their systems and
increasing overall efficiency.
The Company is focused on becoming a leading supplier of environmental solutions
by continuing to grow its business organically and, longer term, to make
strategic acquisitions at prices that are financially accretive.
For more information, please visit our website at www.sttenvirocorp.com.
Caution Regarding Forward-Looking Information and Non-IFRS Measures
Forward-Looking Information
This news release contains certain forward-looking statements. These statements
relate to future events or future performance and reflect management's current
expectations and assumptions regarding the growth, results of operations,
performance, and business prospects and opportunities. Such forward-looking
statements reflect management's current beliefs and expectations and are based
on information currently available to management of the Company. In particular,
statements regarding the future operating results and economic performance are
forward-looking statements. Forward-looking statements involve significant risks
and uncertainties. A number of factors could cause actual events or results to
differ materially from the events and results discussed in the forward- looking
statements, including risks outlined under "Risk Factors" in our Annual
Information Form, which is posted at www.sedar.com. In evaluating these
statements, investors should specifically consider various factors, including
such risks as Investment Risk; Business Valuations; Condition of Capital
Markets; Dependence on Key Personnel; General Economic Factors; Interest Rate
Risk; Competition; and Reliance on Key Suppliers. One or more of these "Risk
Factors" could cause actual events or results to differ materially from any
forward-looking statement. These factors should not be considered exhaustive.
Although the forward-looking statements contained in this press release are
based on what management of the Company considers to be reasonable assumptions
based on information currently available to them, there can be no assurance that
actual events or results will be consistent with these forward -looking
statements, and management's assumptions may prove to be incorrect. These
forward-looking statements are made as of the date of this press release, and
none of STT nor its directors assume any obligation to update or revise them to
reflect new events or circumstances. Undue reliance should not be placed on
forward-looking statements.
Non-IFRS Measures
The term "EBITDA" is a financial measure used in this document which is not a
standard measure under International Financial Reporting Standards ("IFRS"). The
Company's method of calculating EBITDA may differ from the methods used by other
issuers. Therefore, STT's measure of EBITDA, as presented in this press release,
may not be comparable to similar measures presented by other issuers. EBITDA
refers to net earnings determined in accordance with IFRS before depreciation,
amortization of intangible assets, gain or loss on disposal of property and
equipment, interest expense, accretion expense, special charges and recoveries,
stock compensation expense and income tax expense. Management believes that
EBITDA is a useful supplemental measure of cash available for debt service,
working capital, capital expenditures, income taxes, and distribution. Investors
are cautioned that EBITDA, as a non -IFRS measure, is not an alternative to
measures under IFRS and should not, on its own, be construed as an indicator of
performance or cash flows, a measure of liquidity or as a measure of actual
return.
The term "backlog" is a financial measure used in this document which is not a
standard measure under IFRS. The Company's method of calculating backlog may
differ from the methods used by other issuers. Therefore, STT's measure of
backlog, as presented in this press release, may not be comparable to similar
measures presented by other issuers. Backlog is the value of revenue remaining
to be earned from purchase orders received from customers. The projects
represented in backlog are executed according to a schedule agreed with each
customer, which could range in duration from one month to eighteen months.
Revenues are earned on a percentage of completion basis. Management uses this
measure to i) monitor the Company's success in securing new orders, and ii)
gauge the likelihood of meeting revenue objectives in future periods.
Investors are cautioned that backlog, as a non-IFRS measure, is not an
alternative to measures under IFRS and should not, on its own, be construed as
an indicator of performance or cash flows, a measure of liquidity or as a
measure of actual return.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy of this release.
FOR FURTHER INFORMATION PLEASE CONTACT:
Investor Relations: STT Enviro Corp.
Holly Hendershot
Director of Corporate Affairs
+1 905-875-5584
hhendershot@sttenvirocorp.com
www.sttenvirocorp.com
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