Prism Medical Ltd.
TSX VENTURE : PM

Prism Medical Ltd.

July 26, 2016 17:07 ET

Prism Medical Reports Results for the Second Quarter Ended May 31, 2016

TORONTO, ONTARIO--(Marketwired - July 26, 2016) - Prism Medical Ltd., ("Prism Medical" or "the Company") (TSX VENTURE:PM), a leading provider of durable medical equipment and related services to the mobility challenged, today reported financial results for the second quarter (Q2) ended May 31, 2016.

Highlights for the three months ending May 31, 2016:

  • Revenues of $15.7 Million, up $1.6 Million or 11% from the prior year
  • Gross Margin of $6.3 Million, up $0.5 Million or 9% from the prior year
  • Adjusted EBITDA (1) of $1.6 Million, up 9% from Q1 2016

Chief Executive's message:

Ross Scavuzzo, Chief Executive Officer stated "We are pleased with the sales growth in all facets of our Canadian operations. Further positive results should result from the acquisition of our distributors business in Ontario, Saskatchewan and Alberta which closed on May 31, 2016. Our USA Homecare and company owned dealer segments achieved above average sales growth.

The Company intends to grow sales and profitability with a focus on the North American market. The Company believes that performance will be positively affected by a continued North American institutional and homecare demand for our products, improved manufacturing efficiencies, greater geographic coverage, and revenues and profits from new product introductions.

During the past year the Company's North American operations have materially improved, driven by the additions of quality people and new customers and products. Management believes that there are significant growth opportunities within the expanding North American health care industry both through organic growth and acquisitions consistent with Prism Medical's key growth strategies of vertical integration, product diversification and the application of relevant knowledge by its services oriented personnel. The 2015 focus on building a strong foundation for growth will continue in 2016.

The demand for our core products and services, in management's estimation, continues to experience growth at different rates in the geographic markets in which we participate. Government funding for our products in Canada is a key driver of sales. Although government policies related to healthcare in the markets we operate continue to change, we believe that the long term trend for our product solutions will be favourable.

Management believes that the US market holds the greatest long-term potential to provide above-average revenue growth both in the institutional and home care markets. Budget constraints and the cyclical nature of the institutional order causes variability in USA revenue pipeline, which mask our efforts to gain market share.

Financial Results for Second Quarter (Q2) ended May 31, 2016:


Three months ended May 31

Six months ended May 31
(Expressed in thousands of Canadian dollars except for earnings per share and where otherwise noted) 2016
$
2015
$
2016
$
2015
$
Revenues 15,676 14,148 30,354 26,329
Gross margin 6,313 5,777 12,336 10,454
(as % of revenues) 40.3 % 40.8 % 40.6 % 39.7 %
Net income (loss) 674 430 731 832
(as % of revenues) 4.3 % 3.0 % 2.4 % 3.2 %
Non-IFRS Adjusted EBITDA 1,646 1,877 3,161 3,139
(as % of revenues) 10.5 % 13.3 % 10.4 % 11.9 %
Basic earnings per share
From continuing operations 0.14 0.09 0.15 0.09
Diluted earnings per share
From continuing operations 0.14 0.09 0.15 0.09
As at May 31, 2016
$
As at November 30, 2015
$
Total Assets 53,327 51,001
Total Liabilities 29,793 26,969
Cash and Cash Equivalents 5,204 600
Bank indebtedness 4,776 3,236
Long Term Debt 11,048 12,325
Shareholders' Equity 23,534 24,032
Common Shares (In thousands) 4,939 4,939

Dividend Declaration

On July 26, 2016, the Board of Directors approved the payment of $0.125 per common share to shareholders of record on August 12, 2016 to be paid on August 25, 2016. This is an eligible dividend within the Income Tax Act.

About Prism Medical Ltd.

Prism Medical is a vertically integrated manufacturer and leading provider of equipment and services used to move and handle mobility challenged individuals in a safe and dignified manner. Prism Medical's products are marketed under the brand names of Prism Medical, ErgoSafe, Waverly Glen and Nightingale in the homecare, acute care and long-term care markets throughout North America. The Company offers solutions that encourage improved care, quality of life and mobility, while seeking to lower the overall cost of the caregiving function in a number of ways, including reducing the incidence of handling-related injuries among caregivers. In addition, the Company through its network of Nightingale dealers provides an integrated suite of products and services that make home care a viable option for many people. For further information visit Prism Medical's website at www.prismmedicalltd.com or www.sedar.com.

Non-IFRS Financial Measures

Management uses Non-IFRS measures described herein to assess operating performance, to provide more meaningful period-to-period comparisons of operating results and provide investors understanding of core business operations.

We believe the non-IFRS measures presented herein are useful to investors as they enable investors to evaluate and compare our results by excluding specific items that we do not consider to reflective of our ongoing operating results largely from management's determination that the facts and circumstances surrounding the excluded charges or recoveries are not indicative of the ordinary course of the ongoing operations of our business.

We believe investors use both IFRS and non-IFRS measures to assess operations and financial results. Starting in Q1 2016, management determined that the definition of Non-IFRS Adjusted EBITDA would be revised and Pro-forma Adjusted EBITDA would no longer be disclosed. The newly revised definition of Non-IFRS Adjusted EBITDA now excludes the following items from IFRS Net Income (loss), where applicable: Amortization and depreciation, interest expense, income tax expense (recovery), stock-based compensation expense, gains or losses from discontinued operations (including gains or losses on the sale of business), foreign exchange gains or losses, restructuring costs, qualifying strategic initiatives, and acquisition and integration costs. We believe these costs are not directly related to ongoing operating results and do not reflect expected future operating expenses after completion of these activities.

Acquisition and integration costs may include the cost of legal, due diligence, external consultant and other costs relating to acquisitions and their integration into the Company within one year of the date of acquisition. Strategic initiatives may include various non-recurring activities of the company that contribute to long-term growth and profitability including valuations, system implementations, and market studies. Restructuring is a program planned and controlled by management that materially changes the scope of the business or the manner in which it is conducted. Restructuring costs include charges relating to workforce reductions, site consolidations and costs associated with exiting businesses. Restructuring costs include employee severance and benefit costs, gains, losses or impairments related to owned sites and equipment we no longer use and which are available for sale, impairment of related intangible assets, and costs related to leased sites and equipment we no longer use.

Forward-Looking Information

This document contains forward-looking statements relating to our operations and to the environment in which we operate and our strategy, action plans and investments, which may involve estimates, forecasts and projections. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict and/or are beyond our control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in these forward-looking statements. These factors include those set forth in our recent Management's Discussion & Analysis reports and our other public filings. Consequently, readers should not place any undue reliance on such forward-looking statements. These forward-looking statements are made as of the date of this report. Prism Medical is under no obligation to update any forward-looking statements contained herein should material facts change due to new information, future events or other factors. All forward-looking statements attributable to Prism Medical are expressly qualified by these cautionary statements.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Complete financial statements and management's discussion and analysis for 2016 are available at www.PrismMedicalLtd.com and Sedar web-site.

(1) See Non-IFRS Financial Measures section

Contact Information