Welcome!

News Feed Item

Prism Medical Reports First Quarter Results

TORONTO, ONTARIO -- (Marketwired) -- 04/22/14 -- Prism Medical Ltd., ("Prism Medical" or "the Company") (TSX VENTURE: PM), a leading provider of durable medical equipment and related services to the mobility challenged, today reported financial results for the first quarter (Q1) ended February 28, 2014.

Financial Summary


                                Three months ended
                                       February 28
--------------------------------------------------
                                  2014        2013
                                     $           $
--------------------------------------------------
Revenues                        19,927      16,897
Gross margin                     8,115       6,791
 As a % of revenues              40.7%       40.2%
Net income                         668          59
 As a % of revenues               3.4%        0.3%
Adjusted EBITDA                  2,064       1,314
 As a % of revenues              10.4%        7.8%
Earnings per share
Basic                             0.08        0.01
Diluted                           0.08        0.01
--------------------------------------------------
--------------------------------------------------

Expressed in thousands of Canadian dollars except for earnings per share and where otherwise noted.

First Quarter Highlights


--  The acquisition of the remaining 51% interest in MedCare in Minneapolis,
    USA in February 2014
--  Growth in North American revenues as the company expands its install
    base in new geographic markets

Financial Review

United Kingdom (UK)

UK revenues for the three months ended February 28, 2014 increased $1,311 or 15% compared to the same period last year. The improvement in the British pound by over 13% over the prior year's quarter positively impacted revenues in the current quarter. Revenues remained stable on a year over year basis despite the continued impact of fiscal restraints in the UK, the healthcare market remains solid.

United States (US)

US revenues for the three months ended February 28, 2014 increased $1,235 or 24% compared to the same period last year due to incremental sales in our hospital group business, homecare and sales to institutional dealers. US revenues were positively impacted by the improvement in the US dollar over the prior year's quarter representing over a 9% appreciation.

Canada

Canada revenues for the three months ended February 28, 2014 increased $484 or 16% compared to the same period last year. New provincial program spending in Saskatchewan has led the increase. Continued market share improvements are being achieved in Ontario offset by declines in provincial spending in British Columbia. New distributed product sales also contributed to the increase.

Gross Margin

Gross margin for the three months ended February 28, 2014 increased $1,324 or 19.5% compared to the same period last year due to higher revenues across all businesses. Gross margin rates remained constant at 40.7%.

Selling, General and Administrative

Selling, general and administrative expenses for the three months ended February 28, 2014 were $6,940 compared to $6,306 for the same period last year, an increase of $634 or 10.1%. The Company has strengthened its human capital particularly in the US positioning itself for growth in the North American market. UK selling, general and administrative expenses remained constant excluding the impact of the improvement in the British pound.

Adjusted EBITDA

The first quarter adjusted EBITDA performance was $2,064 compared to $1,314, an increase of $750 or 57% over the prior year.

Net Income

Net Income for the quarter increased by $609 or to $668 compared to $59 for the comparable period last year and earnings per share for the same periods increased from $0.01 per share to $0.08 per share. The North American market has demonstrated strong growth for the quarter compared to the prior year.

Liquidity

As at February 28, 2014, the Company had cash of $1,149 and bank indebtedness of $9,759 compared to cash of $2,069 and bank indebtedness of $8,789 respectively, as at November 30, 2013.

EVENTS AFTER THE REPORTING PERIOD

On April 11, 2014, the Company announced the share sale of its UK subsidiary for cash consideration of GBP 30 million or CAD $54.9 million. The sale occurred pursuant to a Sale and Purchase Agreement ("Purchase Agreement") entered into and completed on April 11,2014 with a new company backed by LDC (Managers) Limited, a UK mid-market private equity firm that is a subsidiary of Lloyds Banking Group. Pursuant to the Purchase Agreement, the Purchaser acquired all of the shares of the Company's UK holding company, Prism UK Medical Limited ("Prism UK"). The CAD $54.9 million gross proceeds is expected to result in CAD $49.5 million in net cash proceeds after deducting transaction expenses, related taxes and head office restructuring costs. The Purchase Agreement contains customary representations and warranty obligations with a further GBP 314,000 (CAD $575,000) to be placed in escrow for two years as security for the Company's indemnity and warranty obligations. The Company is also entitled to certain additional "earn out" payments to a maximum of GBP 500,000 and additional consideration based on future sales by Prism UK in North America, Central and South America and Japan for the 3 years following the close of the transaction. The Company has also agreed not to compete with Prism UK in the UK, Europe and the Middle East for a period of 3 years from closing of the transaction.

In conjunction with the transaction, the Company has renegotiated its senior credit facilities. The key terms such as covenants, interest rates and margin ratios have remained unchanged. However, the overall credit limits decreased due to the lower asset base going forward. The Company's operating line has decreased from $17.5 million to $10 million and its acquisition line has decreased from $27.5 million to $10 million.

The Company will use its reasonable commercial efforts to complete a share buy back through a substantial issuer bid ("SIB") within the next four months to return to shareholders CAD $35 million to CAD $40 million of the net cash proceeds of the sale. The completion of the SIB will be subject to customary conditions and the satisfaction of all necessary legal and regulatory requirements. The Company intends to retain the remainder of the proceeds to reduce debt levels to be well within approved bank credit limits and to fund growth opportunities.

On April 22, 2014, the Board of Directors approved a dividend payment of $0.08 per common share to shareholders of record on May 14, 2014 payable on May 22, 2014.

OUTLOOK

The Company intends to grow sales and profitability and provide a reasonable return on shareholders' equity with a focus on the North American market. The Company believes that performance will be positively affected by a continued North American institutional and homecare demand for our products, improved manufacturing efficiencies, greater geographic coverage, and revenues and profits from new product introductions. During the past year the Company's North American operations have materially improved. Management believes that there are significant growth opportunities within the expanding North American health care industry both through organic growth and acquisitions that offer the potential to significantly increase shareholder value, while remaining consistent with Prism Medical's key growth strategies of vertical integration, product diversification and the application of relevant knowledge by its service oriented personnel.

About Prism Medical Ltd.

Prism Medical is a vertically integrated manufacturer and leading provider of equipment and services used to move and handle mobility challenged individuals in a safe and dignified manner. Prism Medical's products are marketed under the brand names of Prism Medical, ErgoSafe, Waverly Glen and Nightingale in the homecare, acute care and long-term care markets throughout North America. The Company offers solutions that encourage improved care, quality of life and mobility, while seeking to lower the overall cost of the caregiving function in a number of ways, including reducing the incidence of handling-related injuries among caregivers. In addition, the Company through its network of Nightingale dealers provides an integrated suite of products and services that make home care a viable option for many people. For further information visit Prism Medical's website at www.prismmedicalltd.com or www.sedar.com.

(1)Non-IFRS Financial Measures

Prism Medical's consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). The Company also uses non-IFRS measures such as Adjusted EBITDA to measure its financial performance. Adjusted EBITDA consists of earnings before interest, income taxes, depreciation, amortization, stock-based compensation. Adjusted EBITDA is a financial metric used by many investors to compare companies on the basis of operating results, asset value and the ability to incur and service debt. Management believes that Adjusted EBITDA is a useful measure for evaluating the performance of the Company. Adjusted EBITDA is not a recognized measure under IFRS and does not have a standardized meaning prescribed by IFRS and may not be comparable to similarly titled financial metrics reported by other companies.

Forward-Looking Information

This document contains forward-looking statements relating to our operations and to the environment in which we operate and our strategy, action plans and investments, which may involve estimates, forecasts and projections. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict and/or are beyond our control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in these forward-looking statements. These factors include those set forth in this report and our other public filings. Consequently, readers should not place any undue reliance on such forward-looking statements. These forward-looking statements are made as of the date of this report. Prism Medical is under no obligation to update any forward-looking statements contained herein should material facts change due to new information, future events or other factors. All forward-looking statements attributable to Prism Medical are expressly qualified by these cautionary statements.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
In IT, we sometimes coin terms for things before we know exactly what they are and how they’ll be used. The resulting terms may capture a common set of aspirations and goals – as “cloud” did broadly for on-demand, self-service, and flexible computing. But such a term can also lump together diverse and even competing practices, technologies, and priorities to the point where important distinctions are glossed over and lost.
"We're a cybersecurity firm that specializes in engineering security solutions both at the software and hardware level. Security cannot be an after-the-fact afterthought, which is what it's become," stated Richard Blech, Chief Executive Officer at Secure Channels, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
All clouds are not equal. To succeed in a DevOps context, organizations should plan to develop/deploy apps across a choice of on-premise and public clouds simultaneously depending on the business needs. This is where the concept of the Lean Cloud comes in - resting on the idea that you often need to relocate your app modules over their life cycles for both innovation and operational efficiency in the cloud. In his session at @DevOpsSummit at19th Cloud Expo, Valentin (Val) Bercovici, CTO of Soli...
"Once customers get a year into their IoT deployments, they start to realize that they may have been shortsighted in the ways they built out their deployment and the key thing I see a lot of people looking at is - how can I take equipment data, pull it back in an IoT solution and show it in a dashboard," stated Dave McCarthy, Director of Products at Bsquare Corporation, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Everyone knows that truly innovative companies learn as they go along, pushing boundaries in response to market changes and demands. What's more of a mystery is how to balance innovation on a fresh platform built from scratch with the legacy tech stack, product suite and customers that continue to serve as the business' foundation. In his General Session at 19th Cloud Expo, Michael Chambliss, Head of Engineering at ReadyTalk, discussed why and how ReadyTalk diverted from healthy revenue and mor...
Whether your IoT service is connecting cars, homes, appliances, wearable, cameras or other devices, one question hangs in the balance – how do you actually make money from this service? The ability to turn your IoT service into profit requires the ability to create a monetization strategy that is flexible, scalable and working for you in real-time. It must be a transparent, smoothly implemented strategy that all stakeholders – from customers to the board – will be able to understand and comprehe...
What happens when the different parts of a vehicle become smarter than the vehicle itself? As we move toward the era of smart everything, hundreds of entities in a vehicle that communicate with each other, the vehicle and external systems create a need for identity orchestration so that all entities work as a conglomerate. Much like an orchestra without a conductor, without the ability to secure, control, and connect the link between a vehicle’s head unit, devices, and systems and to manage the ...
You have great SaaS business app ideas. You want to turn your idea quickly into a functional and engaging proof of concept. You need to be able to modify it to meet customers' needs, and you need to deliver a complete and secure SaaS application. How could you achieve all the above and yet avoid unforeseen IT requirements that add unnecessary cost and complexity? You also want your app to be responsive in any device at any time. In his session at 19th Cloud Expo, Mark Allen, General Manager of...
The Internet of Things (IoT) promises to simplify and streamline our lives by automating routine tasks that distract us from our goals. This promise is based on the ubiquitous deployment of smart, connected devices that link everything from industrial control systems to automobiles to refrigerators. Unfortunately, comparatively few of the devices currently deployed have been developed with an eye toward security, and as the DDoS attacks of late October 2016 have demonstrated, this oversight can ...
SYS-CON Events has announced today that Roger Strukhoff has been named conference chair of Cloud Expo and @ThingsExpo 2017 New York. The 20th Cloud Expo and 7th @ThingsExpo will take place on June 6-8, 2017, at the Javits Center in New York City, NY. "The Internet of Things brings trillions of dollars of opportunity to developers and enterprise IT, no matter how you measure it," stated Roger Strukhoff. "More importantly, it leverages the power of devices and the Internet to enable us all to im...
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smar...
"ReadyTalk is an audio and web video conferencing provider. We've really come to embrace WebRTC as the platform for our future of technology," explained Dan Cunningham, CTO of ReadyTalk, in this SYS-CON.tv interview at WebRTC Summit at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Financial Technology has become a topic of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 20th Cloud Expo at the Javits Center in New York, June 6-8, 2017, will find fresh new content in a new track called FinTech.
Bert Loomis was a visionary. This general session will highlight how Bert Loomis and people like him inspire us to build great things with small inventions. In their general session at 19th Cloud Expo, Harold Hannon, Architect at IBM Bluemix, and Michael O'Neill, Strategic Business Development at Nvidia, discussed the accelerating pace of AI development and how IBM Cloud and NVIDIA are partnering to bring AI capabilities to "every day," on-demand. They also reviewed two "free infrastructure" pr...
Without lifecycle traceability and visibility across the tool chain, stakeholders from Planning-to-Ops have limited insight and answers to who, what, when, why and how across the DevOps lifecycle. This impacts the ability to deliver high quality software at the needed velocity to drive positive business outcomes. In his general session at @DevOpsSummit at 19th Cloud Expo, Phil Hombledal, Solution Architect at CollabNet, discussed how customers are able to achieve a level of transparency that e...