Victoria, British Columbia, Canada – (August 10, 2010) – Carmanah Technologies Corporation (TSX: CMH) today announces its second quarter financial results for the three-month period ending June 2010.
Sales for the quarter were $8.0 million, up $0.5 million from the same period last year. Second quarter Systems & Other sales increased by $0.7 million over the second quarter of the prior year, mainly due to a significant increase in mobile systems sales.
|To view full financials, click here.|
The second quarter of 2010 showed an overall slight decline in sales of our EverGEN™ products over the first quarter of 2010, due to the lumpiness in EverGEN™ lighting sales caused by the project-based nature of this product line. Revenue for the EverGEN™ product declined from $1.6 million in the first quarter of 2010 to $1.2 million in the second quarter of 2010, with trends suggesting an increase in growth again during the second half of 2010. The newest EverGEN™ product, the 1710 series, which was launched recently at Lightfair in Las Vegas, Nevada, has shown a very positive market reception to its performance, high level of industrial design and integration, and its net price per value. Through the second quarter of 2010, in conjunction with the release to market of the 1710 series, a “See the Light” time limited marketing program was launched to provide lighting agents, distributors and customers the opportunity to procure a 1710 at a discounted price in order to seed the market with deployed installations, allowing a demonstration base for the product and its performance.
“On a year over year basis we are pleased with the upward revenue trend as our traditional markets regain some strength and the lighting market adopts our new outdoor illumination products” said Ted Lattimore, Carmanah CEO. “Within 2010, quarter over quarter revenue was steady as we have yet to feel the positive impact of the Ontario Feed in Tariff program in our Grid-tie business; and with the product mix change from quarter one to quarter two, a 5.4% lower gross margin was realized vs. the uncharacteristically high quarter one gross margin.”
“During the second quarter of 2010, Carmanah continued to maintain its strong working capital position and have zero debt,” said Roland Sartorius, Carmanah CFO. “Throughout the year we are focused on executing several growth strategies for the Company while not jeopardizing our liquidity. As well, our revenues to date, although slightly higher than 2009, are expected to increase during the second half of 2010.”
Sales for the second quarter of 2010 were $8.0 million, up from $7.5 million in 2009. This increase is due to higher sales in Illumination products, Grid-tie systems and Mobile systems sales during this period. A summary of revenues from each of the Company’s Signals & Illumination and Systems & Other business segments is displayed below:
|Sales Summary||For the three months ended June 30,|
|Signals & Illumination|
|Total Signals & Illumination||5,730||72.0%||5,930||79.2%||(200)||(3)%|
|Systems & Other|
|Solar Power Systems and Grid-Tie||2,226||28.0%||1,530||20.4%||696||45%|
|Total Systems & Other||2,226||28.0%||1,559||20.8%||667||(43)%|
The Company uses certain non-GAAP measures to assist in assessing its financial performance. Non-GAAP measures do not have any standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other companies. One such non-GAAP measure used for assessing financial performance is Adjusted EBITDA, defined as net income before interest, income taxes, amortization, restructuring charges, goodwill, intangible impairments and discontinued operations.
|Adjusted EBITA Reconciliation||For the three months ended|
|($ thousands)||June 30, 2010||June 30, 2009|
|Adjusted EBITA||$ (739)||$ (671)|
Highlights During the Quarter
Throughout the second quarter, we continued to focus on supporting the success and growth of our key partnerships, which include Sabik Oy (“Sabik”) for marine globally, ADB Airfield Solutions, LLC (“ADB”) for aviation globally, and Semex S.A. (“Semex”) for traffic products in Mexico. Under the Sabik partnership agreement, we are expanding our marine product families to include Sabik’s marine lighting solutions, and we will continue to leverage our sales and distribution channels to deliver a complete range of marine lights to our global customer base. Sabik product sales have commenced in the third quarter of 2010, and we anticipate further sales growth in this area for the fourth quarter of 2010 as we continue to strategically target to increase our collective marine market penetration. With ADB, we continue to focus on the launch and release of ADB branded and co-branded solar power aviation lighting solutions to grow our collective aviation market share. With Semex, we continue to focus on both local Mexican lighting and traffic signaling opportunities to penetrate into this region.
Other highlights during this quarter included:
Complete set of Financial Statements and Management Discussion & Analysis
A complete set of Q1 2010 Financial Statements and Management’s Discussion & Analysis are available on Carmanah’s corporate website. To view full financials, visit: www.carmanah.com/Company/Investors/Financial_Reports.aspx.
About Carmanah Technologies Corporation
As one of the most trusted names in solar technology, Carmanah has earned a reputation for delivering strong and effective products for industrial applications worldwide. Industry proven to perform reliably in some of the world’s harshest environments, Carmanah solar LED lights and solar power systems provide a durable, dependable and cost effective energy alternative. Carmanah is a publicly traded company, with common shares listed on the Toronto Stock Exchange under the symbol “CMH”. For more information, visit carmanah.com.
Carmanah Technologies Corporation
Chief Financial Officer
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Public Relations: David Davies
Forward Looking Statements
This release may contain forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as “expects,” “plans,” “estimates,” “intends,” “believes,” “could,” “might,” “will” or variations of such words and phrases. Forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of Carmanah to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. These statements are based on management’s current expectations and beliefs and are subject to a number of risks and uncertainties which are described under the caption “Note Regarding Forward-looking Statements” and “Key Information – Risk Factors” and elsewhere in Carmanah’s Annual Report for the fiscal year ended December 31, 2009, as filed on SEDAR at www.sedar.com. The risk factors identified in Carmanah’s Annual Report are not intended to represent a complete list of factors that could affect Carmanah. Accordingly, readers should not place undue reliance on forward-looking statements. Carmanah does not assume any obligation to update the forward-looking information contained in this press release.