Pethealth Inc.
TSX : PTZ

Pethealth Inc.

November 06, 2013 16:00 ET

Pethealth Inc. Announces Record Quarterly Revenue of $11,042,000; Quarterly Profit of $511,000 and Its Full Results for the Quarter and Nine Months Ended September 30, 2013

OAKVILLE, ONTARIO--(Marketwired - Nov. 6, 2013) - Pethealth Inc. (TSX:PTZ) ("Pethealth" or "the Company") today announced its financial results for the quarter and nine months ended September 30, 2013.

For the quarter ended For the nine months ended

($'000 except for per share figures)
Sep 30
2013
Sep 30
2012
Change
%
Sep 30
2013
Sep 30
2012
Change
%
Revenue 11,042 9,303 19 % 31,142 28,014 11 %
EBITDA(1) 1,640 1,237 33 % 4,067 4,230 (4 %)
Profit before taxes 746 462 61 % 1,543 2,200 (30 %)
Basic effective tax rate 32 % (93 %) - 31 % (63 %) -
Profit after taxes 511 892 (43 %) 1,070 3,575 (70 %)
Basic earnings per share 0.02 0.03 - 0.02 0.09 -
Fully diluted earnings per share 0.01 0.02 - 0.01 0.08 -
(1) EBITDA, a non IFRS accounting measure, is profit before amortisation and depreciation, interest and income taxes.

"I am delighted to report our Q3 2013 results," said Mark Warren, President and Chief Executive Officer of Pethealth. "Our top line growth in Q3 continued the trend seen in Q2. EBITDA and pre-tax earnings were both significantly better than Q3 last year. I am particularly pleased with the performance of all of our BtoC business segments where both insurance and non-insurance offerings to pet owners showed significant gains over last year."

Third quarter results:

Consolidated revenue increased by 19% to a record $11.0-million as both the insurance and non-insurance segments recorded double digit revenue growth.

Insurance segment revenues increased 15% to $6.5-million. The increase was the combination of organic growth, where US and UK core commission revenue grew 7% and 15% respectively, and growth by acquisition as the Company, on May 1, 2013, acquired certain assets of Nestle Purina Claims Processing, Inc ("PurinaCare"). The PurinaCare acquisition included the right to administer and renew 12,196 PurinaCare policies from close. As a result of the acquisition, an incremental $380,000 in commission and fee revenue was generated during Q3, 2013.

Non-insurance revenues increased 25% to $4.5-million which included an 10% increase from the sale of microchip technology, a 65% increase from cross sales of products and services to the 24PetWatch database in North America and an aggregate 76% increase from business-to-business and business-to-consumer sales through the PetangoStore.com.

Consolidated EBITDA increased by 33% to $1.64-million, Net income before taxes increased 61% to $746,000 while net income after taxes fell 43% to $511,000 as a result of the recognition of a net tax asset (recovery) of $446,000 during the third quarter of 2012 vs. a tax expense of $235,000 recorded in the current quarter.

Nine months results:

Consolidated revenue increased by 11% to $31.1-million for the first nine months, which was the aggregate of a 10% growth in insurance revenues and a 13% increase in non-insurance revenues.

Consolidated EBITDA decreased by 4% to $4.1-million while Consolidated profit after taxes decreased 70% to $1.07-million as a result of the recognition of a net tax asset (recovery) of $1.5-million during the first nine months of 2012 compared to a tax expense of $473,000 for the current year.

Normal Course Issuer Bid:

On September 20, 2013, the Company's Board of Directors announced its intention to continue its Normal Course Issuer Bid ("NCIB") to repurchase up to 1,544,497 of its common shares from September 24, 2013 through September 23, 2014. Under the previous NCIB, which commenced September 24, 2012 and concluded September 23, 2013, the Company repurchased 1,633,296 common shares representing 5% of the then outstanding common shares at an average price of $1.12. Repurchases commenced on September 24, 2013 and will terminate no later than September 23, 2014.

The Company appointed Industrial Alliance Securities Inc. to purchase the shares on its behalf. As of today's date, the Company has repurchased, since September 24, 2012, 1,901,088 common shares at an average price of approximately $1.21 per common share, for an aggregate of $2,294,000 in cash.

Conference call

The Company is hosting an investor conference call on Wednesday, November 6, 2013, at 4:30PM (EST) which can be accessed at 1-866-226-1792 or on-line at www.pethealthinc.com. For those unable to participate, a replay of the call will be available shortly after the call concludes on the Company's website at www.pethealthinc.com.

About Pethealth

For detailed financial statements for the quarter and nine months ended September 30, 2013, including Management's Discussion and Analysis, please refer to the Company's website or SEDAR at www.sedar.com shortly after November 6, 2013.

Pethealth is North America's second largest provider of medical insurance for dogs and cats to pet owners, operating in the United States, Canada and the United Kingdom. In addition, the Company is the leading provider of management software to North American animal welfare organisations through its SaaS-based application and is the leading provider of pet related database management services to the North American companion animal industry. Pethealth offers a unique range of products and services for veterinarians, shelters and pet owners through a number of wholly owned subsidiaries using a range of brand names including PetCare, 24PetWatch, Pet Protect, Petpals Direct, ShelterCare, PetPoint, Petango.com and ThePetangoStore.com.

Pethealth is based in Oakville, Ontario. To find out more about Pethealth, visit the web site at www.pethealthinc.com.

Forward-Looking Statements

This press release contains information that is forward-looking information within the meaning of applicable 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 the negative of these terms or other similar expressions concerning matters that are not historical facts.

Forward-looking information by its nature necessarily involves risks and uncertainties including, without limitation, the difficulty of predicting the current regulatory and supervisory environment, the timing and conditions to obtaining any regulatory approval, reliance on insurance underwriters for pet insurance policies, market acceptance and demand for existing and new products and services, including PetPoint and EVE Software and the 24PetWatch microchip program, the Company's ability to maintain and service new and existing customers, the protection of intellectual property associated with its products and services, the impact of competition generally and new competitive products, currency and foreign exchange fluctuations, risks associated with the Company's customer care solutions facility, and related risks and uncertainties. Additional risks and uncertainties affecting the Company can be found in the Company's Annual Information Form available on SEDAR at www.sedar.com. If any of these risks or uncertainties were to materialize or if the factors and assumptions underlying the forward-looking information were to prove incorrect, actual results could vary materially from those that are expressed or implied by the forward-looking information contained herein. The Company disclaims any intention or obligation, other than those required by security laws, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information

  • Investor Relations Contacts:
    Pethealth Inc.
    Mark Warren
    President and Chief Executive Officer
    (905) 842-2615

    Pethealth Inc.
    Glen Tennison
    Chief Financial Officer
    (905) 842-2615
    www.pethealthinc.com