IRD Announces Record Results for Fiscal 2015

SASKATOON, SASKATCHEWAN--(Marketwired - Feb. 22, 2016) - International Road Dynamics Inc. (TSX:IRD), one of the world's leading providers of systems and solutions for the global Intelligent Transportation Systems (ITS) market, today announced record financial and operating results for the three and twelve months ended November 30, 2015.

FISCAL 2015 HIGHLIGHTS:

• Net earnings increased 85% to $2.5 million or $0.18 per common share
• Revenue up 29% to $58.0 million on growth in key geographic markets and product segments
• EBITDA rises 59% to $4.4 million on revenue growth and strong gross margin
• Solid financial position with working capital increasing to $11.3 million
• Outlook for continued growth with strong confirmed order backlog and near-term business opportunities

INVESTOR CONFERENCE CALL

An investor conference call hosted by IRD's management team to discuss the Company's fiscal 2015 results will be held on Tuesday, February 23, 2016 at 11:00 am ET. The telephone numbers to participate in the conference call are North America Toll Free: (866) 223-7781 and Local Toronto / International: (416) 340-2218. The telephone numbers to listen to the call after it is completed (Instant Replay) are North American Toll Free (800) 408-3053 or Local Toronto / International (905) 694-9451. The Passcode for the Instant Replay is 6738086#. A webcast of the call will also be archived on the Company's web site at www.irdinc.com.

OPERATIONS COMMENTARY

"We generated record results in fiscal 2015, the result of strong growth in all of our major markets and product lines," commented Terry Bergan, President and CEO. "Looking ahead, we believe our solid operating performance will continue. Our backlog of confirmed orders and identified near-term opportunities are at an all-time high, and we expect further positive fundamentals in our business as governments and the private sector around the world continue to invest in ITS solutions to enhance highway and roadway infrastructure."

For the three months and year ended November 30, 2015, consolidated revenue increased 43.5% and 28.6%, respectively, compared to the same prior year periods due primarily to the Company's successful execution of an increased number of contracted projects, improved service revenues and growth in product sales into other international markets, as well as an increase in the value of the U.S. dollar.

Revenue in the Company's Canada and United States segment increased 59.6% and 34.3% for the three months and year ended November 30, 2015, respectively, compared to the same prior-year periods primarily due to an increase in contracted project revenues, higher service revenues, increased product sales into other international markets, and changes in the value of the U.S. dollar which increased revenues by approximately $6.2 million in fiscal 2015. In fiscal 2016, the Company expects to sustain its strong revenues based on the current value of orders on hand and near-term project and product opportunities.

Latin America and Mexico segment revenue increased 2.3% for the three months ended November 30, 2015 and 16.5% year-to-date compared to the same prior-year periods. For fiscal 2015, the significant increase related to growth in projects and service revenues offset by some decline in product sales due to changes in customer requirements. For fiscal 2016, the Company expects further revenue growth arising from existing and new project and product sales identified in the region.

India segment revenue has decreased in fiscal 2015 reflecting the Company's decision to reduce the level of business activity in this geographic segment. Despite the revenue decline, gross margins as a percentage of revenue increased to 45.6% of revenues for the year ended November 30, 2015 compared to 35.2% of revenues in the prior-year as current project and service revenues delivered improved profitability. For fiscal 2016 the Company expects only limited activity in the India segment as it remains committed to accepting only revenue opportunities with acceptable gross margins and payment terms.

Gross margin in the fourth quarter and year ended November 30, 2015 increased 38.4% and 25.8%, respectively, compared to the prior-year periods due primarily to higher sales volumes. As a percentage of revenue, gross margin decreased marginally for the three months and year ended November 30, 2015 due to variability in margins on projects currently underway and changes in product mix, partially offset by increases in the value of the U.S. dollar compared to the prior year.

Administrative and marketing expenses increased in fiscal 2015 compared to the prior year primarily due to higher performance-based compensation costs, higher bad debt provisions, and increased sales costs related to higher levels of business activity. R&D costs increased in fiscal 2015 as the Company continues to allocate increased resources to accelerate near term business opportunities and advance the development and introduction of new products to the market.

The Company recorded foreign exchange losses of $113,398 (2014 - gain of $254,029) in the fourth quarter of fiscal 2015 due primarily to a decrease in accrued embedded derivative gains as the related U.S. revenues were realized offset by increases in the carrying value of U.S. dollar net assets due to a rise in the value of the U.S. dollar compared to the Canadian dollar and Chilean peso. For the year ended November 30, 2015, the Company recorded a gain of $478,751 (2014 - $943,690). The Company continues its strategy of reducing its exposure to currency volatility by maintaining a portion of its bank indebtedness in U.S. funds.

Earnings before interest, taxes, depreciation and amortization (EBITDA) for the three months and year ended November 30, 2015, increased to $1,194,193 and $4,399,866, respectively, compared to $551,853 and $2,762,989 in the comparable prior-year periods.

Net earnings increased to $779,143 ($0.05 per common share) in the fourth quarter of fiscal 2015 from $465,246 ($0.03 per common share) in fiscal 2014. For the year ended November 30, 2015, net earnings were $2,531,585 ($0.18 per common share) compared to $1,372,103 ($0.10 per common share) in the prior year.

The Company owns a 50% joint venture interest in XPCT, an ITS products and manufacturing service provider in China. XPCT reported earnings of $444,705 in fiscal 2015 (2014 - $326,050), including an after-tax gain on sale of land and a building of $167,577 realized in the third quarter of fiscal 2015.

The Company's financial position remained solid at November 30, 2015 with working capital of $11.3 million, up from $9.5 million at November 30, 2014.

Financial Highlights (financial statements are available on the Company's web site at www.irdinc.com)

	Three Months Ended				Year Ended
	November 30				November 30
	2015		2014		2015		2014
(in $000's except per share amounts)	$		$		$		$
Revenue	16,244		11,319		57,990		45,102
Gross margin	4,990		3,604		17,617		14,003
Gross margin percentage of revenue (%)	30.7	%	31.8	%	30.4	%	31.05	%
EBITDA	1,194		552		4,400		2,763
Net earnings	779		465		2,532		1,372
Net earnings per common share (basic)	0.05		0.03		0.18		0.10
Net earnings per common share (diluted)	0.05		0.03		0.17		0.09
Working capital					11,301		9,547
Shareholders' equity per share					1.58		1.36
Common shares outstanding					14,398		14,149

This news release contains forward-looking statements about the Company, including its business operations, strategy and expected financial performance and conditions. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or contain words such as "expects", "anticipates", "plans", "believes", "estimates", "intends", "forecasts", or negative versions thereof and other similar expressions, or future or conditional future financial performance, on-going business strategies or prospects, and possible future action by the Company. Forward looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Company, the general economic environment and ITS industry, business conditions in all geographic areas where the Company carries on business, interest and foreign exchange rates, changes in accounting policies and methods used to report financial condition, including uncertainties associated with critical accounting assumptions and estimates, the effect of applying future accounting changes, business competition, technological changes, changes in government regulation and legislation, changes in tax laws, unexpected judicial or regulatory proceedings, catastrophic events, and the Company's success in managing the foregoing risks. Readers are cautioned, to consider these and other factors carefully and not place undue reliance on forward-looking statements. Forward-looking information contained in this report is based on management's current estimates, expectations and projections, which management believes are reasonable as of November 30, 2015. However, actual future operating results and economic performance could differ materially from what is currently expected. While the Company may elect to, it is under no obligation and does not undertake to update any forward-looking statements at any particular time, unless required by applicable securities law. Additional information on the Company, including our most recently filed Annual Information Form can be found on SEDAR at www.sedar.com.

As used herein, "EBITDA" means earnings before interest, income taxes, depreciation and amortization, and includes gains or losses from foreign exchange and derivatives and earnings or losses from the Company's equity investments. EBITDA is not a recognized measure under International Financial Reporting Standards ("IFRS"). Management believes that EBITDA is a useful supplemental measure to net earnings, as it provides investors with an indication of operating performance prior to debt service, capital expenditures and income taxes. Investors should be cautioned, however, that EBITDA should not be construed as an alternative to net earnings determined in accordance with IFRS as an indicator of the Company's performance or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. The Company's method of calculating EBITDA may differ from the methods by which other companies calculate EBITDA and, accordingly, EBITDA may not be comparable to measures used by other companies.

IRD is a highway traffic management technology company specializing in supplying products and systems to the global Intelligent Transportation Systems (ITS) industry. IRD is a North American company based in Saskatoon, Saskatchewan Canada with sales and service offices throughout the United States and overseas. Private corporations, transportation agencies and highway authorities around the world use IRD's products and advanced systems to manage and protect their highway infrastructures.

The Company's shares trade on the Toronto Stock Exchange under the symbol IRD.

www.irdinc.com