AZCAR Technologies Incorporated

AZCAR Technologies Incorporated

November 06, 2009 10:36 ET

AZCAR Announces Results for the Third Quarter of 2009

MARKHAM, ONTARIO--(Marketwire - Nov. 6, 2009) - Stephen F. Pumple, Chairman and CEO of AZCAR Technologies Incorporated (TSX:AZZ) today announced third quarter revenue of $16.6 million compared to revenue of $18.6 million in the third quarter of 2008. Despite the drop in revenue resulting from customer capital project delays related to the current global recession, AZCAR continues to focus on improving project execution as evidenced by its gross margin which rose in the third quarter to 23.6% of revenue versus 22.5% of revenue in Q3 2008.

2009 2008 2009 2008
Three Months Ended Nine Months Ended
September 30 September 30
(CDN $000) (unaudited) (unaudited) (unaudited) (unaudited)

Revenues 16,603 18,611 43,195 54,462
Cost of goods sold 12,677 14,422 33,969 44,096
Gross Margin 3,926 4,189 9,226 10,366
Gross Margin % 23.6% 22.5% 21.4% 19.0%
Operating expenses 3,015 3,399 9,991 9,051
Interest expense 43 64 56 221
Foreign exchange loss
(gain) 94 (49) 88 (248)
Stock-based compensation 15 17 47 48
Amortization 327 138 584 345
Subtotal 3,494 3,569 10,766 9,417
Income (loss) before
income taxes and
Minority Interest 432 620 (1,540) 949
% of revenues 2.6% 3.3% (3.6%) 1.7%
Income tax provision
(recovery) 22 19 (157) 34
Net Income (Loss) before
Minority Interest 410 601 (1,383) 915
Minority Interest (76) - (76) -

Net Income (Loss) 486 601 (1,307) 915

Earnings per share
Basic (cents) 3.1 3.9 (8.4) 5.9
Fully Diluted (cents) 3.1 3.9 (8.4) 5.9
Cash dividends per share
(cents) 0.0 0.0 0.0 0.0

Cost control measures taken in the first and second quarter and the improved utilization of our professional staff in the third quarter have resulted in lower operating expenses compared to the third quarter of the previous year. However, on a year to date basis, the impact of the global recession and subsequent drop in client ad revenues in the broadcast industry deferred customer capital projects which we had staffed for. This resulted in the under utilization of our professional staff over the first two quarters and an overall increase in operating expenses.

Year to date, the Company recorded a net loss of $1.3 million compared to a profit of $0.9 million in the previous year. The decrease in net income was primarily the result of the continuing deterioration in market conditions worldwide and the deferral of capital projects by our customers. Secondary factors contributing to the net loss was the strengthening Canadian dollar and increase in amortization expense as a result of the assets acquired in the Matchframe acquisition.

AZCAR is an independent technology integration company providing the broadcast and communications industries with value-driven solutions, consulting, engineering, systems design, integration, project management and the supply of related materials and equipment. The stock trades on the Toronto Stock Exchange under the symbol: AZZ.

Except for historical information, this news release may contain certain "forward looking statements". Forward looking statements are statements that are not historical facts and are subject to a variety of risks, uncertainties and other factors that may cause the actual results, level of activity and performance to be materially different from the Company's expectations and projections.

This review contains Management's discussion of AZCAR's operational results and financial condition, and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2008, and the related "Management's Discussion and Analysis" (MD&A).

The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.

Contact Information

  • AZCAR Technologies Incorporated
    Roger Miller
    Chief Financial Officer
    (905) 470-2545 ext. 244