Pacific Safety Products Inc.
TSX VENTURE : PSP

Pacific Safety Products Inc.

May 30, 2016 17:29 ET

Pacific Safety Products Reports Financial Results for the Third Quarter of Fiscal 2016

ARNPRIOR, ONTARIO--(Marketwired - May 30, 2016) - Pacific Safety Products Inc. ("PSP" or the "Company") (TSX VENTURE:PSP), a leading North American manufacturer of advanced armour and personal protection solutions, today reported financial results for the three and nine months ended March 31, 2016.

Highlights:

  • Revenues for the third quarter were $5.2 million, an increase of 4.6% compared to revenues of $5.0 million during the third quarter of fiscal 2015.

  • Revenues in GH Armor Systems, PSP's wholly owned US operation, increased 115% quarter over quarter and for the nine months ended March 31, 2016 were $7.0 million, representing an increase of $2.8 million or 66.7% compared to the same period in fiscal 2015.

  • Revenues from Canadian customers for the three and nine months ended March 31, 2016 were $2.4 million and $7.6 million, respectively, representing a decrease from the same periods in fiscal 2015 of $1.3 million (35.1%) and $0.5 million (6.2%), respectively.

  • The Company reported net income for the third quarter of $0.004 million compared to net income of $0.079 million during the third quarter of fiscal 2015.

  • Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") was $0.165 million compared to Adjusted EBITDA of $0.252 million during the third quarter of the prior year.

  • Gross margin as a percentage of revenues for the third quarter was 25.2%, compared to 27.4% for the third quarter of fiscal 2015.

  • Expenses for the third quarter were $1.2 million, an increase of 5.1% compared to expenses of $1.1 during the third quarter of the prior year.

"PSP is continuing to focus its effort on growing revenue but not at the expense of profitability", says CEO Terry Vaudry. "Sales growth in our US business is beginning to take hold due to the introduction of new products and the addition of more sales representatives. In Canada we continue to win new contracts and expect significantly larger opportunities that we have bid on to be awarded soon. The Company has higher margin revenue that should offset some of the short term drag on gross margin in Q3."

About PSP: The mission statement of PSP is ..."we bring everyday heroes home safely"®. PSP is an established industry leader in the production, distribution and sale of high-performance and high-quality safety products for the defence and security market. These products include body armour to protect against ballistic, stab and fragmentation threats, ballistic blankets to reduce blast effects, tactical clothing, and protective products against chemical and biological hazards. PSP is the largest body armour manufacturer in Canada, directly supplying the Canadian Department of National Defence, Federal Government Agencies and major Canadian law enforcement organizations. The Company, through its U.S. subsidiary Sentry Armor Systems Inc., provides body armour products under the GH Armor Systems® brand to U.S. based law enforcement and private security firms. The Company also produces tactical clothing. Pacific Safety Products is a reporting issuer in British Columbia, Alberta and Ontario, Canada and publicly trades under the symbol PSP on the TSX Venture Exchange.

Non-IFRS Financial Measures. PSP's financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). PSP also uses certain non-IFRS measures, such as Adjusted EBITDA, to measure its financial performance. Adjusted EBITDA consists of earnings before interest expense, income taxes, share-based compensation, depreciation and amortization, foreign exchange, and other one-time charges and gains. PSP believes Adjusted EBITDA is a useful measure in the evaluation of performance. Adjusted EBITDA is not a recognized performance measure under IFRS and does not have a standardized meaning as prescribed by IFRS. Therefore, Adjusted EBITDA may not be comparable to similar measures presented by other entities.

Forward-Looking Information: This news release contains certain statements which may constitute "forward-looking information" within the meaning of applicable securities laws. These statements relate to anticipated or assumed events or results and, in some cases, can be identified by words or phrases such as "may", "will", "expect", "plan", "anticipate", "intend", "potential", "estimate", "believe" or the negative of these terms. The forward-looking events and circumstances discussed in this news release, including the anticipated future growth in sales and revenue of the Company and anticipated new contract wins, may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Company. No forward-looking statement can be guaranteed. Forward-looking statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statement or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information. The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. Any forward-looking statement speaks only as of the date of this news release and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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