Avante Logixx Inc.

July 27, 2012 16:32 ET

Avante Logixx Inc. Announces Fiscal 2012 Year End Results with Gross Margins up 49%

TORONTO, ONTARIO--(Marketwire - July 27, 2012) -

Avante Logixx Inc. (TSX VENTURE:XX), through its primary operating division Avante Security Inc., provides best in class residential and commercial security services including system design and installation, rapid alarm response, alarm monitoring and secure transport through the use of advanced technology and a focus on client service. The Company is pleased announce annual results for the year ended March 31, 2012:

Year ended
March 31, 2012 March 31, 2011 Variance (%)
Total revenues $5,537,616 $5,654,286 (2.1%)
Revenues - Recurring Monitoring and Response(1) 2,626,642 2,486,296 5.6%
Revenues from other security services and transport 2,910,974 2,842,023 2.4%
Revenues from other non-core ventures (energy/utility solution trial in previous fiscal year) -nil- 325,967 (100.0%)
Total gross profit 1,703,153 1,140,430 49.3%
Adjusted EBITDA(2) (454,404) (1,601,848) 71.6%
Net income (loss) before discontinued operations (634,179) (3,468,485) 81.7%
Net income (loss) for the period (630,689) (3,457,064) 81.7%
Basic and diluted income (loss) per share (0.011) (0.069) 84.1%

(1) Revenues - Recurring Monitoring and Response includes Alarm Response along with Digital, Analog and Video Monitoring services

(2) Adjusted EBITDA = Net income (loss) + (Depreciation / amortization + Share based payments expense - costs capitalized (FY2011) now expensed in FY2012). This is used to evaluate the Company's performance and help Management make decisions with respect to its operations. This is also used for comparison with other players in the security industry. Since this is not defined under IFRS, it is unlikely to be comparable with similar measures presented by other issuers.

Co-CEOs Emmanuel Mounouchos and George Rossolatos announced that the client base of Avante Logixx Inc. grew by 10% for the fiscal year ended March 31, 2012. Revenue from response, monitoring, transport and other security services amounted to $5.53 million as compared to $5.33 million for the previous fiscal year, a net growth of 4%. The growth was attributable to the sale of more response and monitoring packages and transport, as well as the addition of its international security travel advisory offering.

Co-CEO George Rossolatos said that "significant structural changes were implemented with respect to cost structure in order to put Avante on the path to profitability including a 13% reduction in headcount. The company refocused on the security side of its business, while limiting further additional investment in development in other ventures. This resulted in improvements in gross margin of 49.3% and in Adjusted EBITDA of 71.6%." Management believes that staying this course will lead to profitability in the near future. This combined with the focus on building recurring revenues will result in increased shareholder value.

The growth in gross margin was higher than the revenue growth, largely due to: a) focus on higher margin lines of business; b) various cost and margin efficiencies; and c) process improvements in the systems installations division.

Net loss decreased from $3.46 million in fiscal year 2011 to $0.63 million in fiscal year 2012. Approximately 71% of the loss for the fiscal year 2012 was incurred in the first two quarters. The trend over Q3 and Q4 of 2012 and Q1-13 provide indications that the Company's operations are significantly improving.

The company has no debt and better working capital management has ensured that the Company has not had to utilize its operating line of credit for over 18 months. This along with growth in revenues and profitability should put the Company in a sound financial position in the near term, one that would provide enough leverage to help the Company expand further and consider other strategic growth opportunities.

Speaking about its newest service offering, the Co-CEO Manny Mounouchos added that, "for corporations, Avante has the infrastructure in place to deliver value on its international travel advisory and concierge service as well as the corporate 911 offering, (which provides one number to client's employees for real time management of major incidents and / or disasters), making Avante a one-stop shop for all of their security requirements. We facilitate corporations exercising their duty of care to protect their employees whether they are working domestically or travelling abroad."

Forward looking information: The information set forth in the Company's MD&A and this press release to readers may contain statements concerning Avante's future results, future performance, intentions, objectives, plans and expectations that are, or may be deemed to be, forward-looking statements or information within the meaning of securities laws. In some cases, forward-looking information can be identified by the use of terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Forward-looking statements are not guarantees of future performance.

These forward-looking statements are based on current expectations that involve numerous risks and uncertainties, including, but not limited to, those identified in the Risks Factors section of the Filing Statement the Company filed with regulatory authorities on February 28, 2008. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond Avante's control. Although Avante believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate. These factors should be considered carefully, and readers should not place undue reliance on forward-looking statements. Avante has no intention and undertakes no obligation to update or revise any forward-looking statements, whether written or oral that may be made by or on the Company's behalf.

Avante Logixx Inc. (TSX VENTURE:XX) is a Toronto based security and technology company. Its primary operating division, Avante Security Inc. (www.avantesecurity.com), provides best in class security response and other security services for residential and commercial applications as well as being an industry leader in designing and installing complex security systems, access control, and video analytics. The company continuously develops innovative products and applications within its core competencies. Please visit www.avantelogixx.com.

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