Carmanah Technologies: Q3 Results
VICTORIA, British Columbia - Carmanah Technologies Corporation (CMH.TO) reported its third quarter financial results for nine and three months ended September 30, 2014.
For the quarter ended September 30, 2014, the Company recorded revenues of $12.2 million, net income of $0.2 million and EBITDA of $0.4 million. This is an increase from the same period in 2013 which had revenues of $4.9 million, a net loss of $1.4 million and an EBITDA loss of $1.3 million.
“Our positive momentum continued in the third quarter with revenues up 149% compared to 2013’s third quarter,” stated John Simmons, CEO. “While some of the gain was attributed to the inclusion of revenues from our acquisition of Sol, Inc., our traditional Carmanah revenues were up 105% on a comparative basis. Naturally, we are delighted with the results.”
Added Mr. Simmons, “For the first time in Carmanah’s history we have produced operating profit in three successive quarters. As we enter our final quarter for 2014 we do so with an order backlog that continues to grow. At the end of the third quarter our order backlog totalled $11.7 million which is up from $7.7 million at the end of the second quarter.”
Financial Condition at September 30, 2014 compared to December 31, 2013
Cash and cash equivalents of $10.7 million, up from $5.2 million
Working capital of $16.0 million, up from $8.1 million
Continued debt-free operations
Business and operational highlights
During the third quarter the following events were announced and completed in the quarter or subsequent to quarter end:
On July 2, 2014, we completed the acquisition of SOL Inc. (“Sol”), a Florida based solar outdoor lighting competitor. The acquisition was completed through a merger, under which we acquired 100% ownership of Sol in exchange for the issuance of 3,785,860 post consolidated shares which were issued from treasury and a cash payment of $0.06 million. This was a related party transaction, as our Chairman of the Board and largest shareholder, Michael Sonnenfeldt was also the majority shareholder of Sol. Sol contributed approximately $2.0 million in reported revenue in the third quarter of 2014.
On July 18, 2014, we announced our intention to complete a consolidation of our common shares on the basis of one (1) post-consolidation Common Share for every ten (10) pre-consolidation Common Shares (the “Consolidation”). The Consolidation received approval from the TSX in early August and the post-consolidation shares began trading on the Toronto Stock Exchanges on August 14, 2014. Prior to the consolidation we had 169,770,617 shares outstanding. Fractional shares that might have been created by the consolidation were rounded down and as a result the total post consolidation shares outstanding on August 14, 2014 was 16,977,000.
On July 17, 2014, we closed a placement which raised proceeds of approximately $3.0 million CDN from the issuance of 1,200,000 post consolidated shares at a price of $2.50 CDN a share. This private placement was subscribed by members of our board of directors and was completed in an effort to bolster our working capital and balance sheet to position ourselves to take advantage of future growth opportunities.
In September 2014, we secured a long term U.S. Coast Guard contract under which we will fulfill with our new M800 series marine lantern. The contract has no guaranteed financial value for purchases, but the solicitation provided a target for purchases of $3.4 million over the life of the contract, which may be up to 5 years if all option years are exercised.
About Carmanah Technologies Corporation.
Since it’s founding in 1996, Carmanah has become one of the most trusted names in solar technology, delivering reliable and cost-effective solar powered products and systems for industrial applications worldwide. To date, Carmanah's solutions for marine navigation, airfield ground lighting, aviation obstruction, roadway illumination, parking lot lighting, as well as on and off-grid power generation, have been successfully deployed in over 400,000 installations in 110 countries with proven performance in conditions ranging from desert heat to arctic cold.
In 2013, through shareholder led initiatives, the company was restructured under the leadership of CEO John Simmons, while the Company’s largest shareholder, Michael W. Sonnenfeldt, became non-executive Chairman. Carmanah’s current board members demonstrate their belief in Carmanah's future by having been the largest investors in each financing since the restructuring and now, as a group, own the majority of Carmanah's issued and outstanding shares.
Carmanah markets its products through three distinct divisions. Carmanah’s Signals Division produces products and systems for marine aids to navigation, airfield ground lighting, obstruction and traffic control. Carmanah’s Power Division designs and builds systems that provide solar power in both grid connected and off-grid applications. Carmanah’s Illumination Division produces solar powered lighting solutions for street, parking lot and pathway applications.
Carmanah is publicly traded with common shares listed on the Toronto Stock Exchange under the symbol "CMH”. For more information, visit www.carmanah.com.