Advantex Announces Fiscal 2016 Third Quarter Results
EBITDA (1) of $1.1 million after restructuring of Fiscal year 2015
/EINPresswire.com/ -- TORONTO, ONTARIO -- (Marketwired) -- 05/30/16 -- Advantex Marketing International Inc. (CSE: ADX), a specialist in marketing loyalty-reward programs, announced its results for the three and nine months ended March 31, 2016.
The financial performance is in line with the Company's expectation of a gradual recovery after over- coming the structural and competitive challenges of the previous Fiscal year. The Company is reporting an improvement in its financial performance for the three and nine months ended March 31, 2016.
Highlights of Fiscal 2016 Third Quarter results are tabulated (2) below. Additional details are available in the Fiscal 2016 Third Quarter Consolidated Financial Statements and the Management Discussion and Analysis available under the Company's profile on www.sedar.com.
Q3 Fiscal Q3 Fiscal YTD Fiscal YTD Fiscal
2016 2015 2016 2015
----------------------------------------------------
$ $ $ $
----------------------------------------------------
Revenue $ 2,435,120 $ 2,718,764 $ 8,526,797 $10,048,351
Direct Expenses - Cost
of cardholder rewards
and marketing
merchants to
cardholders 650,440 805,284 2,251,596 2,738,918
Direct Expenses -
Expense for provision
against delinquent
accounts 102,577 1,156,219 411,071 1,381,147
Gross profit $ 1,682,103 $ 757,261 $ 5,864,130 $ 5,928,286
Selling and General &
Administrative 1,536,776 1,979,153 4,726,477 6,114,672
Restructuring cost - 805,892 - 805,892
----------------------------------------------------
Earnings from operations
before depreciation,
amortization and
interest $ 145,327 $(2,027,784) $ 1,137,653 $ (992,278)
Cash interest on loan
payable and
debentures 480,596 373,051 1,260,932 1,215,125
----------------------------------------------------
Earnings from operations
before depreciation,
amortization and non-
cash interest on
debentures (accretion
charges) $ (335,269) $(2,400,835) $ (123,279) $(2,207,403)
Depreciation and
amortization 117,069 125,187 351,221 328,646
Non cash interest
expense on debentures 58,832 56,133 174,444 170,379
----------------------------------------------------
Net (loss) and
Comprehensive (loss) $ (511,170) $(2,582,155) $ (648,944) $(2,706,428)
(1) EBITDA is a non-GAAP financial measure which does not have any
standardized meaning prescribed by the issuer's GAAP and is unlikely to
be comparable to similar measures presented by other issuers. It is
provided as additional information to assist readers in understanding a
component of the Company's financial performance. In case of the
Company, nine months ended March 31, 2016, the EBITDA of $1,137,653 is
equivalent to Earnings from operations before depreciation, amortization
and interest per the statements of (loss) and comprehensive (loss) which
is a part of the interim consolidated financial statements for the three
and nine months ended March 31, 2016.
(2) The tabulation is a non-GAAP presentation and is provided to assist
readers in understanding the Company's financial performance. The
information is extracted from consolidated financial statements for the
three and nine months ended March 31, 2016.
About Advantex:
Advantex provides specialized marketing programs that enable members of affinity groups to earn frequent-flyer miles and other loyalty rewards through purchases at participating merchants.
Through our partnerships with Aeroplan, Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and Caesars Entertainment, we have contractual access to millions of consumers with above-average personal and household income. We also have partnerships with about 1,600 merchants in Canada and the US.
Advantex shares trade on the Canadian Securities Exchange under the symbol ADX. For more information, go to www.advantex.com.
Advantex Marketing International Inc.
Consolidated Statements of Financial Position (unaudited)
(expressed in Canadian dollars)
Note March 31, June 30,
2016 2015
$ $
------------------------------
Assets
Current assets
Cash and cash equivalents $ 648,325 $ 1,162,609
Accounts receivable 396,430 460,446
Transaction credits 5 8,483,704 7,819,647
Inventory 6 37,100 144,874
Prepaid expenses and sundry assets 181,524 173,777
------------------------------
$ 9,747,083 $ 9,761,353
Non-current assets
Property, plant and equipment $ 120,847 $ 165,735
Intangible assets 227,374 477,992
------------------------------
$ 348,221 $ 643,727
Total assets $ 10,095,304 $ 10,405,080
Liabilities
Current liabilities
Loan payable 7 $ 6,221,134 $ 5,711,525
Accounts payable and accrued liabilities 3,949,533 4,294,418
12% Non-convertible debentures payable 8 5,039,246 -
------------------------------
$ 15,209,913 $ 10,005,943
Non-current liabilities
12% Non-convertible debentures payable 8 $ - $ 4,864,802
Total liabilities $ 15,209,913 $ 14,870,745
Shareholders' deficiency
Share capital 9 $ 24,530,555 $ 24,530,555
Contributed surplus 4,090,382 4,090,382
Accumulated other comprehensive loss (47,383) (47,383)
Deficit (33,688,163) (33,039,219)
------------------------------
Total deficiency $ (5,114,609) $ (4,465,665)
Total liabilities and deficiency $ 10,095,304 $ 10,405,080
Economic and Financial dependence (note 2a), Going concern (note 2b), Commitments and contingencies (note 12)
The accompanying notes are an integral part of these consolidated financial statements
Approved by the Board Director: Signed "William Polley" Director: Signed "Kelly Ambrose" William Polley Kelly Ambrose
Advantex Marketing International Inc.
Consolidated Statements of (loss) and Comprehensive (loss) (unaudited)
For the three and nine months ended March 31, 2016 and 2015
(expressed in Canadian dollars)
Three months ended Nine months ended
Note March 31 March 31
--------------------------------------------------
2016 2015 2016 2015
$ $ $ $
--------------------------------------------------
Consolidated
Statements of
(loss)
Revenues 15 $2,435,120 $ 2,718,764 $8,526,797 $10,048,351
Direct expenses 14/15 753,017 1,961,503 2,662,667 4,120,065
--------------------------------------------------
1,682,103 757,261 5,864,130 5,928,286
Operating expenses
Selling and
marketing 14/15 594,977 841,932 2,026,725 2,664,869
General and
administrative 14/15 941,799 1,137,221 2,699,752 3,449,803
Restructuring cost - 805,892 - 805,892
--------------------------------------------------
Earnings from
operations before
depreciation,
amortization and
interest 145,327 (2,027,784) 1,137,653 (992,278)
Interest expense:
Stated interest
expense - loan
payable, and
debentures 7,8 480,596 373,051 1,260,932 1,215,125
Non-cash interest
expense on
debentures 8 58,832 56,133 174,444 170,379
--------------------------------------------------
(394,101) (2,456,968) (297,723) (2,377,782)
Depreciation of
property, plant
and equipment, and
amortization of
intangible assets 117,069 125,187 351,221 328,646
--------------------------------------------------
Net (loss) and
comprehensive
(loss) $ (511,170) $(2,582,155) $ (648,944) $(2,706,428)
Earnings per share
Basic and Diluted 13 $ (0.00) $ (0.02) $ (0.00) $ (0.02)
The accompanying notes are an integral part of these consolidated financial statements
Advantex Marketing International Inc.
Consolidated Statements of Changes in Shareholders' Deficiency (unaudited)
For the three and nine months ended March 31, 2016 and 2015
(expressed in Canadian dollars)
Class A
preference Common Contributed
shares shares surplus
$ $ $
---------------------------------------------
Balance - July 1, 2014 $ 3,815 $ 24,526,740 $ 4,090,382
Net (loss) and comprehensive
(loss) - - -
---------------------------------------------
Balance - March 31, 2015 $ 3,815 $ 24,526,740 $ 4,090,382
Balance - July 1, 2015 $ 3,815 $ 24,526,740 $ 4,090,382
Net (loss) and comprehensive
(loss) - - -
---------------------------------------------
Balance - March 31, 2016 $ 3,815 $ 24,526,740 $ 4,090,382
Accumulated
other
comprehensive
loss Deficit Total
$ $ $
---------------------------------------------
Balance - July 1, 2014 $ (47,383) $(29,968,616) $ (1,395,062)
Net (loss) and comprehensive
(loss) - (2,706,428) (2,706,428)
---------------------------------------------
Balance - March 31, 2015 $ (47,383) $(32,675,044) $ (4,101,490)
Balance - July 1, 2015 $ (47,383) $(33,039,219) $ (4,465,665)
Net (loss) and comprehensive
(loss) - (648,944) (648,944)
---------------------------------------------
Balance - March 31, 2016 $ (47,383) $(33,688,163) $ (5,114,609)
The accompanying notes are an integral part of these consolidated financial statements
Advantex Marketing International Inc.
Consolidated Statements of Cash Flow (unaudited)
For the nine months ended March 31, 2016 and 2015
(expressed in Canadian dollars)
Note March 31, March 31,
2016 2015
$ $
------------------------------
Operational activities
Net (loss) for the period $ (648,944) $(2,706,428)
Adjustments for:
Depreciation of property, plant and
equipment, and amortization of
intangible assets 351,221 328,646
Accretion charge for debentures 8 174,444 170,379
------------------------------
(123,279) (2,207,403)
Changes in items of working capital
Accounts receivable 64,016 378,145
Transaction credits (664,057) 2,084,164
Inventory 107,774 (84,451)
Prepaid expenses and sundry assets (7,747) (76,756)
Accounts payable and accrued
liabilities (344,885) 16,518
------------------------------
(844,899) 2,317,620
Net cash provided by operating
activities $ (968,178) $ 110,217
Investing activities
Purchase of property, plant and
equipment, and intangible assets $ (55,715) $ (305,750)
------------------------------
Net cash (used in) investing activities $ (55,715) $ (305,750)
Financing activities
Proceeds from loan payable 7 $ 509,609 $ (470,115)
Transaction costs respecting debentures
financing - (24,206)
------------------------------
Net cash generated from / (used in)
financing activities $ 509,609 $ (494,321)
Increase / (decrease) in cash and cash
equivalents during the period $ (514,284) $ (689,854)
Cash and cash equivalents at beginning
of period 1,162,609 1,815,805
------------------------------
Cash and cash equivalents at end of
period $ 648,325 $ 1,125,951
Additional information
Interest paid $ 1,002,132 $ 1,352,224
For purposes of the cash flow statement,
cash comprises
Cash $ 643,325 $ 1,120,951
Term deposits 5,000 5,000
------------------------------
$ 648,325 $ 1,125,951
------------------------------
The accompanying notes are an integral part of these consolidated financial statements
Contacts:
Advantex Marketing International Inc.
Mukesh Sabharwal
Vice-President and Chief Financial Officer
905-470-9558 ext. 249
mukesh.sabharwal@advantex.com
www.advantex.com
