Savaria Corporation
TSX : SIS

Savaria Corporation

March 12, 2014 16:30 ET

Savaria's Best Year Ever!

LAVAL, QUEBEC--(Marketwired - March 12, 2014) - Savaria Corporation (TSX:SIS), North America's leader in the accessibility industry, discloses its results for its fourth quarter ended December 31, 2013 and for fiscal 2013.

Highlights

  • In the fourth quarter of 2013, revenue is up 7%, from $17.8 million in fourth quarter 2012 to $19.1 million. For fiscal 2013, revenue is up 13.5%, from $66.7 million to $75.7 million;

  • Net income for the fourth quarter of 2013 is up $173,000, from $952,000 in 2012 to $1.1 million in 2013. For fiscal 2013, net income amounts to $5.3 million or 23 cents per share, up from $1.6 million or 7 cents per share in 2012;

  • Earnings before interest, taxes, depreciation and amortization ("EBITDA") for the fourth quarter of 2013 went from $1.8 million to $2 million, up 13.2 %. For fiscal 2013, EBITDA is up by $5 million or 113%, to $9.5 million or 41 cents per share, compared to $4.5 million or 19 cents per share in 2012. This is the highest yearly EBITDA in the history of the Corporation;

  • China operations doubling in size by moving to a new facility in May 2013;

  • Introduction in September 2013 of a new stairlift for curved staircases, the Stairfriend.

A Word from the President

"Savaria realized its best year ever for both sales and EBITDA. This was achieved through market share gains from the closure of a major U.S. competitor in the fall of 2012 in combination with managing sales and administrative costs and productivity efficiencies," declared Marcel Bourassa, President and Chief Executive Officer of Savaria.

"The successful introduction in September 2013 of Stairfriend, a new stairlift for curved staircases, demonstrated to dealers and consumers alike that Savaria offers a complete portfolio of accessibility products, a unique position and competitive advantage unmatched by another manufacturer in the world.

"In May 2013, we doubled the size of our factory in Huizhou, China moving to a new facility of 75,000 square feet. This increased capacity allows the company to respond efficiently to increased demand for both parts and finished products.

"Our strong financial position enables us to fuel our growth and to offer a dividend highly appreciated by our shareholders," concluded Mr. Bourassa.

Operating Results (Comparative Analysis with Fourth Quarter and Fiscal 2012)

  • In the fourth quarter of 2013, revenue is up $1.3 million or 7%, from $17.8 million in fourth quarter 2012 to $19.1 million. For fiscal 2013, revenue is up $9 million or 13.5%, from $66.7 million to $75.7 million.
  • Gross margin for the fourth quarter of 2013 is up $756,000, at 28.7% of revenue, compared to 26.5% in the fourth quarter of 2012. For fiscal 2013, gross margin is up $4.2 million, at 29.4% of revenue compared to 27.1% in 2012. This improvement is due to the increase in revenue and to the cost savings following the relocation of the Brampton plant in the building acquired in 2012.
  • Operating income for the fourth quarter of 2013 is up $106,000, from $1.3 million in 2012 to $1.4 million in 2013. For fiscal 2013, operating income amounts to $7.5 million, an increase of $4.6 million or 156%.
  • Net income for the fourth quarter of 2013 is up $173,000, from $952,000 in 2012 to $1.1 million in 2013, an increase of 18.2%. For fiscal 2013, net income amounts to $5.3 million, an increase of $3.7 million or 236%.
  • EBITDA for the fourth quarter of 2013 went from $1.8 million or 8 cents per share in 2012, to $2 million or 9 cents per share in 2013, an increase of $239,000. For fiscal 2013, EBITDA amounts to $9.5 million or 41 cents per share, compared to $4.5 million or 19 cents per share in 2012, up by $5 million.

Dividend

The Corporation's Board of Directors has declared a dividend of 13 cents ($0.13) per share: a 2 cents ($0.02) fourth quarter dividend plus a special 11 cents ($0.11) year-end dividend. The dividend is payable on April 7, 2014 to shareholders of record of the Corporation at the close of business on March 24, 2014. This is an eligible dividend within the meaning of the Income Tax Act.

Savaria Corporation (savaria.com) is North America's leader in the accessibility industry focused on meeting the needs of people with mobility challenges. Savaria designs, manufactures, installs and distributes primarily elevators for home and commercial use, as well as stairlifts and vertical and inclined platform lifts. In addition, it converts and adapts minivans to be wheelchair accessible. The diversity of its product line, one of the world's most comprehensive, enables the Corporation to stand out by proposing an integrated and customized solution for its customers' mobility needs. Its operations in China have substantially grown and the collaboration with Savaria's other Canadian facilities increases its competitive edge in the market place. The Corporation records some 60% of its revenue outside Canada, primarily in the United States. It has a sales network of some 600 retailers in North America and employs some 360 people at its head office in Laval and at its plants and sales offices in Montreal (Quebec), Brampton and London (Ontario), Calgary (Alberta) and Huizhou (China).

Compliance with International Financial Reporting Standards ("IFRS")

The information appearing in this press release has been prepared in accordance with IFRS. However, the Corporation uses EBITDA for analysis purposes to measure its financial performance. This measure has no standardized definition in accordance with IFRS and is therefore regarded as a non-IFRS measure. This measure may therefore not be comparable to similar measures reported by other companies. Reconciliation between net income for the period and EBITDA is provided in the Financial Highlights section below.

Cautionary Notice Regarding Forward-Looking Statements

Certain information in this press release may constitute "forward-looking statements" regarding Savaria, including, without being limited thereto, understanding of the elements that might affect the Corporation's future, relating to its financial or operating performance, the costs and schedule of future acquisitions, supplementary capital expenditure requirements and legislative matters. Most frequently, but not invariably, forward-looking statements are identified by the use of such terms as "plan", "expect", "should", "could", "budget", "expected", "estimated" "forecast", "intend", "anticipate", "believe", variants thereof (including negative variants) or statements that certain events, results or shares "could", "should" or "will" occur or be achieved. Such statements involve known and unknown risks, uncertainties and other factors liable to cause Savaria's actual results, performance or achievements to differ materially from those set forth in or underlying the forward-looking statements. Such factors notably include general, economic, competitive, political and social uncertainties. Although Savaria has attempted to identify the key elements liable to cause actual measures, events or results to differ from those described in the forward-looking statements, other factors could have an impact on the reality and produce unexpected results. The forward-looking statements contained herein are valid at the date of this press release. As there can be no assurance that these forward-looking statements will prove accurate, actual future results and events could differ materially from those anticipated therein. Accordingly, readers are strongly advised not to unduly rely on these forward-looking statements.

Complete financial statements and the management's report for fiscal 2013 will be available shortly on Savaria's website and on SEDAR (www.sedar.com).

Financial Highlights

(in thousands, except per-share amounts and percentages)
Quarters Ended
December 31,
(Unaudited)
Years Ended
December 31,
2013 2012 Change 2013 2012 Change
Revenue $19,120 $17,865 7 % $75,739 $66,734 13.5 %
Gross margin as a % of revenue 28.7 % 26.5 % n/a 29.4 % 27.1 % n/a
Operating costs $4,110 $3,457 18.9 % $15,085 $14,135 6.7 %
As a % of revenue 21.5 % 19.4 % n/a 19.9 % 21.2 % n/a
Operating income $1,375 $1,269 8.4 % $7,509 $2,930 156 %
As a % of revenue 7.2 % 7.1 % n/a 9.9 % 4.4 % n/a
Gain (loss) on foreign exchange $236 $48 392 % $330 $(69 ) 578 %
Net income $1,125 $952 18.2 % $5,299 $1,578 236 %
Earnings per share - basic and diluted $0.05 $0.04 25 % $0.23 $0.07 229 %
EBITDA (1) $2,045 $1,806 13,2 % $9,538 $4,488 113 %
EBITDA per share - basic and diluted $0.09 $0.08 12,5 % $0.41 $0.19 116 %
Dividends declared per share $0.02 - n/a $0.14 $0.094 n/a
Weighted average number of common shares outstanding - diluted 23,855 23,132 n/a 23,444 23,116 n/a
As at
Dec. 31,
2013
As at
Dec. 31,
2012
Total assets $49,013 $49,380
Total liabilities $28,780 $30,156
Shareholders' equity $20,233 $19,224
(1) Reconciliation of EBITDA with net income provided in the following table.

Although EBITDA is not recognized according to IFRS, it is used by management, investors and analysts to assess the Corporation's financial and operating performance.

Reconciliation of EBITDA with Net Income

(in thousands of dollars - unaudited) Quarters Ended
December 31,
Years Ended
December 31,
2013 2012 2013 2012
Net income $1,125 $952 $5,299 $1,578
Plus :
Interest on long-term debt 135 210 612 732
Interest expense and banking fees 36 28 127 96
Income tax expense 319 222 1,920 571
Depreciation of fixed assets 230 201 831 789
Amortization of intangible assets 204 196 765 752
Less:
Interest income 4 3 16 30
EBITDA $2,045 $1,806 $9,538 $4,488

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