Avante Logixx Inc. (TSX.V: XX) (OTC: ALXXF) (“Avante” or the
“Company”) is pleased to announce its results for the year ended
March 31, 2021 (all amounts in Canadian dollars thousands, unless
otherwise indicated).
RESULTS FOR THE THREE-MONTH PERIOD &
YEAR ENDED MARCH 31, 2021
|
Year Ended |
Three Months Ended |
$ in thousands, unless
otherwise noted |
31-Mar-19(2) |
|
31-Mar-20 |
|
31-Mar-21 |
|
31-Mar-20 |
|
31-Dec-20 |
|
31-Mar-21 |
|
Revenues |
$32,081 |
|
$49,849 |
|
$91,716 |
|
$17,030 |
|
$25,204 |
|
$24,706 |
|
Gross
profit (1) |
$9,575 |
|
$11,688 |
|
$20,834 |
|
$3,095 |
|
$5,584 |
|
$5,353 |
|
Gross
profit margin (1) |
29.8% |
|
23.4% |
|
22.7% |
|
18.2% |
|
22.2% |
|
21.7% |
|
Direct
Operating Expenses (1) |
$10,500 |
|
$12,374 |
|
$14,919 |
|
$3,539 |
|
$3,880 |
|
$3,537 |
|
EBITDA
(1) |
($1,804) |
|
($463) |
|
$3,170 |
|
$744 |
|
$108 |
|
$1,660 |
|
Adjusted
EBITDA from Continuing Operations (1) |
($220) |
|
($331) |
|
$6,044 |
|
($450) |
|
$1,633 |
|
$2,055 |
|
Comprehensive income (loss) attributed to Avante shareholders |
($2,532) |
|
($3,192) |
|
($2,951) |
|
($256) |
|
($1,493) |
|
$166 |
|
Basic
and fully diluted income per share |
($0.119) |
|
($0.124) |
|
($0.150) |
|
($0.012) |
|
($0.070) |
|
$0.010 |
|
Basic
and fully diluted Adjusted EBITDA per share (1) |
($0.010) |
|
($0.016) |
|
$0.285 |
|
($0.021) |
|
$0.077 |
|
$0.097 |
|
Cash
Flow from Operations before Working Capital |
($536) |
|
($2,885) |
|
$4,909 |
|
($1,893) |
|
$1,236 |
|
$1,779 |
|
“Our fiscal 2021 was a pivotal year for Avante
as we achieved scale, leveraging our initial investments in people,
processes and technology to achieve record revenues and adjusted
EBITDA,” said Craig Campbell, CEO & Director of Avante. “During
uncertain times caused by the global pandemic we were laser focused
on organic growth (50.0% YoY), reducing our senior funded debt, and
building out prospects for future quarters, which included entering
into an expanded credit agreement with The Bank of Nova Scotia. I
am very proud of our results, continued momentum and all of our
team members for continuing to provide exceptional service to our
clients, and growing our businesses organically during the last
year.”
The Company reported year-over-year revenue
growth of 84.0% and 45.1% on an annual and Q4 basis respectively.
Adjusted EBITDA grew from negative $0.331 million in Fiscal 2020 to
positive $6.044 million during fiscal 2021. Avante also continued
to deliver strong and growing recurring monthly revenue (“RMR”) and
contractual revenue streams, representing $17.0 million of revenue
during the fourth quarter of this year from $14.6 million in the
prior year’s fourth quarter, representing growth of 16.3%.
|
|
Q4 F20 |
Q1 F21 |
Q2 F21 |
Q3 F21 |
Q4 F21 |
Recurring Monthly Revenue |
|
$ 2,055 |
$ 2,094 |
$ 2,137 |
$ 2,194 |
$ 2 ,380 |
Contractual Revenue |
|
$ 12,586 |
$ 12,102 |
$ 13,263 |
$ 15,019 |
$ 14,643 |
Total recurring/
contractual revenue |
|
$ 14,641 |
$ 14,196 |
$ 15,400 |
$ 17,213 |
$ 17,023 |
“We continued our focus on organic revenue
growth and improving internal processes to limit operating
expenses,” said Steve Rotz, CFO. “Throughout fiscal 2021 we worked
hard on improving cash collection cycles and overall liquidity,
with reduced senior funded debt combined with a positive swing to
profitability leading to much improved leverage metrics. After year
end, we modernized our banking arrangements, with extended maturity
dates, increased capacity, improved covenant flexibility and longer
amortization requirements. We are now well positioned to focus on
operations, organic growth and strategic initiatives.”
FISCAL YEAR 2021 HIGHLIGHTS
- Generated
record revenues of $91.7 million for the year ended March 31, 2021,
which represented 84.0% YoY growth (50.0% YoY Pro-Forma organic
growth).
- Revenue1 by
segment during the year and fourth quarter was as follows:
|
For the Year Ended |
For the Quarter Ended |
|
31-Mar-21 |
31-Mar-21 |
$ in thousands |
Revenue |
% of Total |
Revenue |
% of Total |
Logixx Security |
$74,581 |
81.3% |
$20,053 |
81.2% |
Avante Security |
$17,134 |
18.7% |
$4,653 |
18.8% |
Total |
$91,716 |
100.0% |
$24,706 |
100.0% |
- Generated
gross profit of $20.8 million for the year ended March 31, 2021,
which represented 78.2% YoY growth.
- Direct
Operating Expenses from continuing operations improved to 16.3% of
revenue during F2021 from 24.0% in F2020. It was 14.3% of revenue
during Q4 2021.
- Generated
Adjusted EBITDA during F2021 of $6.0 million, or 6.6% of revenue,
and a YoY improvement of $6.4 million. Adjusted EBITDA for Q4 2021
was $2.05 million, or 8.3% of revenue and a YoY improvement of $2.5
million. Q4 2021 benefitted from a gain in foreign exchange of $0.2
million versus a loss of $0.002 million for the full year.
- Generated Adj.
EBITDA per share of $0.285 in F2021 and $0.097 for Q4 F2021.
- Generated $4.9
million in cash flow from operations (before changes in working
capital) during F2021. For the three months ended March 31, 2021,
the Company generated $1.8 million of cash flow from operations
before changes in working capital.
- The Company
reduced senior funded debt by $2.4 million over the year and by
$0.9 million sequentially during Q4.
- IFRS reported
net loss and EBITDA reflected a loss on the derivative component of
the Convertible Debentures of $2.1 million during the year. IFRS
reported net loss during the year also reflected amortization of
intangible assets of $3.6 million, which expenses will decline
significantly starting next fiscal year after Logixx Security’s
trade name assets were fully amortized as of March 31, 2021.
- Board and
Named Executive Officers (“NEOs”) increased ownership by 14.8%
since March 31, 2020 2.0% since December 31, 2020) to 3,510,350
shares or 16.6% of total shares outstanding.
Subsequent Events
- On June 30, 2021, the Company
entered into a credit agreement with The Bank of Nova Scotia
replacing its credit facilities with another institution. The new
facility provides an $8.0 million revolving credit facility, a
$10.0 million non-revolving term loan, and a $3.0 million
delayed-draw non-revolving term loan, each with a maturity date
ending May 19, 2024.
CONFERENCE CALL
Avante will be hosting a conference call to discuss the above
financial results on Wednesday, July 21, 2021, at 8:30 AM EDT.
Dial in details are as follows:
Local: (+1)
416-764-8658 Toll
Free: (+1) 888-886-7786
Conference ID: 00760379
Playback details below, available until August 21,
2021:
Local: (+1)
416-764-8692 Toll
Free: (+1)
877-674-7070 Playback
Pin: 760379#
This news release shall not constitute
an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of the securities described herein in any
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. This news release does
not constitute an offer of securities for sale in the United
States. The securities described herein have not been, nor will
they be, registered under the United States Securities Act of 1933,
as amended, and such securities may not be offered or sold within
the United States absent registration under U.S. federal and state
securities laws or an applicable exemption from such U.S.
registration requirements.
About Avante Logixx Inc.
Avante Logixx Inc. (TSXV: XX) is a Toronto based
provider of high-end security services. We acquire, manage and
build industry leading businesses which provide specialized,
mission-critical solutions that address the needs of our customers.
Our businesses continuously develop innovative solutions that
enable our customers to achieve their objectives. With an
experienced team and a proven track record of solid growth, we are
taking steps to establish a broad portfolio of security businesses
to provide our customers and shareholders with exceptional returns.
Please visit our website at www.avantelogixx.com and consider
joining our investor email list.
Avante Logixx Inc.
Craig CampbellCEO(416)
923-6984craig@avantelogixx.com
Forward-Looking Information
All statements in this press release, other than
statements of historical fact, may constitute “forward looking
information” with respect to Avante within the meaning of
applicable securities laws. Forward-looking information is often,
but not always, identified by the use of words such as “seek”,
“anticipate”, “plan”, “continue”, “planned”, “expect”, “project”,
“predict”, “potential”, “targeting”, “intends”, “believe”,
“potential”, and similar expressions, or describes a “goal”, or a
variation of such words and phrases or state that certain actions,
events or results “may”, “should”, “could”, “would”, “might” or
“will” be taken, occur or be achieved. This forward-looking
information includes statements with respect to, among other
things, the intention to create a platform capable of supporting a
business with significantly greater scale, Avante’s strategic plan,
Avante’s intentions to engage in mergers and acquisitions in the
near term, Avante’s intentions to identify, acquire and integrate
suitable targets for mergers and acquisitions, the ability to
achieve operational efficiencies and provide a better overall
customer experience, Avante’s run-rate, opportunities to grow
Avante’s revenue and Adjusted EBITDA profile, investments in
corporate infrastructure, Avante’s ability to execute and integrate
larger acquisitions, and the expected trajectory of corporate costs
as a percentage of revenue. Forward-looking information is subject
to a variety of known and unknown risks, uncertainties and other
factors that could cause actual events or results to differ from
those expressed or implied by the forward looking information,
including, without limitation, the ability to identify, acquire and
integrate suitable targets for mergers and acquisitions, the
ability to control corporate costs, and the list of risk factors
identified in Avante’s Management Discussion & Analysis
(MD&A), Annual Information Form (AIF) and other continuous
disclosure, which list is not exhaustive of the factors that may
affect any of Avante’s forward-looking information. In connection
with the forward-looking statements contained in this and
subsequent press releases, Avante has made certain assumptions
about its business and the industry in which it operates and has
also assumed that no significant events occur outside of Avante’s
normal course of business. Although management believes that the
assumptions inherent in the forward-looking statements are
reasonable as of the date the statements are made, forward-looking
statements are not guarantees of future performance and,
accordingly, undue reliance should not be put on such statements
due to the inherent uncertainty therein. Avante’s forward-looking
information is based on the beliefs, expectations and opinions of
management on the date the statements are made, and Avante does not
assume any obligation to update forward-looking information,
whether as a result of new information, future events or otherwise,
other than as required by applicable law. For the reasons set forth
above, readers should not place undue reliance on forward-looking
information.
Non-IFRS Financial Measures
This press release includes certain measures which have not been
prepared in accordance with IFRS such as EBITDA and Adjusted
EBITDA. These non-IFRS measures are not recognized under IFRS and,
accordingly, users are cautioned that these measures should not be
construed as alternatives to net income determined in accordance
with IFRS. The non-IFRS measures presented are unlikely to be
comparable to similar measures presented by other
issuers.References to EBITDA are to net income before interest,
taxes, depreciation and amortization. References to Adjusted EBITDA
are to net income before interest, taxes, depreciation,
amortization of intangibles & capitalized commissions,
share-based payments, acquisition, integration and / or
reorganization costs, deferred financing costs, loss (gain) in fair
value of derivative liability, expensing of CWL fair value
adjustment per IFRS less non-controlling interest’s share. Neither
EBITDA nor Adjusted EBITDA is an earnings measure recognized by
International Financial Reporting Standards (“IFRS”) and do not
have a standardized meaning prescribed by IFRS. Management believes
that Adjusted EBITDA is an appropriate measure in evaluating
Avante’s performance. Readers are cautioned that neither EBITDA nor
Adjusted EBITDA should be construed as an alternative to net income
(as determined under IFRS), as an indicator of financial
performance or to cash flow from operating activities (as
determined under IFRS) or as a measure of liquidity and cash flow.
Avante’s method of calculating Adjusted EBITDA may differ from
methods used by other issuers and, accordingly, Avante’s Adjusted
EBITDA may not be comparable to similar measures used by other
issuers.
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 or accuracy of this release.
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