Laval, Quebec, May 5, 2016– Savaria Corporation (TSX: SIS), one of North America’s leaders in the accessibility industry, discloses its results for its first quarter ended March 31, 2016.
Q1 results broke all of the Corporation’s records for a first quarter.
Quarter ended March 31, 2016
- Record revenue for a 1st quarter of $26.2 million, up $6 million or 29.6%;
- Record gross margin for a 1st quarter of $8.5 million, up $2.4 million or 39.5%;
- Record operating income for a 1st quarter of $3.7 million, up $1.9 million or 108%;
- Record EBITDA(1) for a 1st quarter of $3.9 million, up $1 million or 35.9%;
- Relocation of the Montreal division of the AdaptedVehicles segment, enabling to double capacity for side entry van conversions while integrating the activities of head office and direct sales for the Montreal region.
A Word from the President
"The first quarter of 2016 has been significant, both in revenue and profitability. Our record revenue for a first quarter reached $26.2 million, up 29.6% compared to the first quarter of 2015 and our record EBITDA for a first quarter of $3.9 million is up 35.9%. All our business segments contributed to this increase, despite the relocation of Montreal's Vehicles division, which was affected by relocation costs of some $250,000 and a temporary production shutdown," declared Marcel Bourassa, President and Chief Executive Officer of Savaria.
"Our constant focus on cost control and productivity optimization reflected on our gross margin which went from 30% of revenue in the first quarter of 2015 to 32% in 2016, and on our operating costs, which went from 21% of revenue in 2015 to 18.5% in 2016.
"The development of a complementary product, a patient lift, in our research and development center in Magog (Quebec), progresses according to plans; this new product is expected to be launched in September 2016 and will be an exciting addition to our product line, which is one of the most comprehensive on the market.
"Adding to all of this is the signature of an agreement to purchase the assets of the automotive division of Shoppers Home Health Care which will translate into the addition of direct sales stores for the conversion of vehicles in New Brunswick, Ontario, Alberta and British Columbia. This strategic acquisition, which is expected to be completed in May 2016, is very promising for our Adapted Vehicles segment.
"With 10,000 people turning 65 each day in North America and a strong desire to age-in-place, Savaria is well positioned for market growth.The Corporation continues to hold a strong balance sheet allowing it to fund internal growth and pursue growth by acquisitions," concluded Mr. Bourassa.
The Corporation maintains its forecast revenue for the twelve-month period ending December 31, 2016, of approximately $107 million and EBITDA in the range of $16.5-$17.5 million, excluding the potential results related to the operations of the automotive division of Shoppers Home Health Care.
As per the Corporation’s dividend policy, the Board of Directors has declared a dividend of 5 cents ($0.05) per common share for the first quarter of 2016. The dividend is payable on May 30, 2016, to shareholders of record of the Corporation at the close of business on May 16, 2016. This is an eligible dividend within the meaning of the Income Tax Act.
Savaria Corporation (savaria.com) is one of North America’s leaders in the accessibility industry. It provides accessibility solutions for the elderly and physically-challenged to increase their mobility and independence. The diversity of its product line is one of the most comprehensive on the market. Savaria designs, manufactures, distributes and installs accessibility equipment, such as stairlifts for straight and curved stairs, vertical and inclined wheelchair lifts, as well as elevators for home and commercial use. In addition, it converts and adapts vehicles to be wheelchair accessible. It also operates a network of franchisees and corporate stores through which new and recycled accessibility equipment is sold. Savaria operates a plant located in Huizhou (China), which increases its competitive edge. The Corporation records more than 60% of its revenue outside Canada, primarily in the United States. It operates a sales network of some 400 active retailers in North America and employs some 440 people at its head office and plant in Laval (Quebec) and at its plants and sales offices in 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 Reconciliation of EBITDA with Net Income 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.
For further information:
Hélène Bernier, CPA, CA
Vice President, Finance
1-800-931-5655, ext. 248
President and Chief Executive Officer
Reconciliation of EBITDA with net income provided below.
Complete financial statements and the management’s report for quarter ended March 31, 2016 will be available shortly on Savaria’s website and on SEDAR (www.sedar.com).