TORONTO, ON--(Marketwired - April 25, 2016) - STT Enviro Corp. ("STT" or the "Company") (TSX VENTURE: STT) today reported financial results for its year ended December 31st, 2015 of approximately $33.8 million of revenue, EBITDA of $1,070,393, and net income after tax of $298,015. For the quarter ended December 31st, 2015, the Company reported approximately $5.9 million of revenue, EBITDA loss of $1,080,649, and net loss after tax of $684,541.
The Company's backlog is $19,809,111 at December 31, 2015. At December 31, 2014, the Company's backlog was $28,169,207.
Financial Highlights for the Year:
| | | | Year ended
December
31st, 2015 | | | Year ended
December
31st, 2014 | %
Change |
| Revenue | | $ | 33,759,950 | | $ | 22,348,399 | +51% |
| EBITDA | | | 1,070,393 | | | 2,238,285 | -52% |
| Net income before tax | | | 438,187 | | | 1,527,181 | -71% |
| Net income after tax | | | 298,015 | | | 1,182,666 | -75% |
| | | | | | | | |
| Earnings per share - basic | | | 0.007 | | | 0.035 | -80% |
| Earnings per share - diluted | | | 0.006 | | | 0.034 | -82% |
| | | | | | | | |
| Closing backlog | | | 19,809,111 | | | 28,169,207 | -30% |
| Closing working capital | | | 4,772,438 | | | 3,616,961 | +32% |
| Closing cash on hand | | | 5,962,361 | | | 2,281,991 | +161% |
| Closing notes payable and term debt | | | 38,791 | | | 2,760,938 | -99% |
Financial Highlights for the Quarter:
| | | | Quarter
ended
December
31st, 2015 | | | Quarter
ended
December
31st, 2014 | %
Change |
| Revenue | | $ | 5,947,147 | | $ | 6,423,264 | -7% |
| EBITDA | | | (1,080,649) | | | 661,691 | |
| Net income (loss) before tax | | | (981,010) | | | 489,309 | |
| Net income after tax | | | (684,541) | | | 301,974 | |
| | | | | | | | |
| Earnings per share - basic & diluted | | | (0.015) | | | 0.008 | |
The Company's profitability was impacted during the fourth quarter as a result of continued cost escalations on one large project, and five smaller ones, all in the Tanks & Industrial group. The majority of the escalation stems from the completion date of the large project being extended significantly beyond what was originally expected.
David Deacon, Chief Executive Officer, commented, "After eight quarters without a loss, we are extremely disappointed to have recorded a loss in the fourth quarter of 2015. However, the Company did achieve positive EBITDA of $1,070,393 for the year, and remains in excellent financial condition with a strong balance sheet, working capital of $4.7 million and $5.9 million of cash in the bank."
Mr. Deacon continued, "We believe that this quarter's loss was to a large extent avoidable. We have brought on board an exceptional executive in Kim Law (the EVP now running the Tanks & Industrial group), who has extensive experience in running major projects. Kim's priority is to improve operations and efficiencies in the Tanks & Industrial group to rebuild margins and position us for successful bids on new work. We have also refined and created a more rigorous approach to monthly monitoring of work in progress, and are applying all of the lessons learned from the past few months to our future bids."
Commenting on new business, Mr. Deacon said, "Our new order intake for the quarter was $3.6 million. While our sales funnel remains quite full, we are experiencing delays in the award of orders due to general economic conditions and continuing weakness in commodity prices. We have submitted bids on a number of projects for which the customers originally expected to award the work during the fourth quarter, but these awards have been delayed, likely to mid-2016."
Mr. Deacon concluded, "As CEO I can assure you that our senior employees and board of directors, which collectively own over 24% of the Company, are committed to moving ahead with the same discipline and vigor we have applied to the last five years, with the same great results and this project and short term setback will simply form part of a learning curve for our continued growth."
The Company will hold a conference call to discuss the financial results on April 27, 2016 at 11:00 am Eastern time. The call-in numbers are: 877-407-9205 (toll free) or 201-689-8054 (international).
About STT Enviro Corp.
STT Enviro Corp. (TSX VENTURE: STT) supplies cost effective, incremental, environmental improvements to traditional industrial products. The Company's two operating groups, STT Enviro Corp. Systems & Solutions and STT Enviro Corp. Tanks & Industrial, work to reduce their customers' environmental footprint, cost efficiently.
STT Systems & Solutions engineers and supplies chemical make-down systems to neutralize pollutants (usually acid water) created in the ore or oil recovery process; and aftermarket services including optimization of chemical use for our customers to lower costs and reduce their carbon footprint.
STT Tanks & Industrial engineers and supplies bolted tanks with a smaller environmental footprint for both dry and liquid storage applications.
Environmental considerations are prerequisites in modern industrial expansion and STT Enviro Corp. is focused on being a leader and innovator on incremental environmental improvements. The Company's strategy is to grow organically and, longer term, to acquire companies at prices which are strategically and financially accretive.
For more information, please visit our website at www.sttenvirocorp.com
Caution Regarding Forward-Looking Information and Non-IFRS Measures
Forward-Looking Information
This news release contains certain forward-looking statements. These statements relate to future events or future performance and reflect management's current expectations and assumptions regarding the growth, results of operations, performance, and business prospects and opportunities. Such forward-looking statements reflect management's current beliefs and expectations and are based on information currently available to management of the Company. In particular, statements regarding the future operating results and economic performance are forward-looking statements. Forward-looking statements involve significant risks and uncertainties. A number of factors could cause actual events or results to differ materially from the events and results discussed in the forward-looking statements, including risks outlined under "Risk Factors" in our Annual Information Form, which is posted at www.sedar.com. In evaluating these statements, investors should specifically consider various factors, including such risks as Investment Risk; Business Valuations; Condition of Capital Markets; Dependence on Key Personnel; General Economic Factors; Interest Rate Risk; Competition; and Reliance on Key Suppliers. One or more of these "Risk Factors" could cause actual events or results to differ materially from any forward-looking statement. These factors should not be considered exhaustive. Although the forward-looking statements contained in this press release are based on what management of the Company considers to be reasonable assumptions based on information currently available to them, there can be no assurance that actual events or results will be consistent with these forward-looking statements, and management's assumptions may prove to be incorrect. These forward-looking statements are made as of the date of this press release, and none of STT nor its directors assume any obligation to update or revise them to reflect new events or circumstances. Undue reliance should not be placed on forward-looking statements.
Non-IFRS Measures
The term "EBITDA" is a financial measure used in this document which is not a standard measure under International Financial Reporting Standards ("IFRS"). The Company's method of calculating EBITDA may differ from the methods used by other issuers. Therefore, STT's measure of EBITDA, as presented in this press release, may not be comparable to similar measures presented by other issuers. EBITDA refers to net earnings determined in accordance with IFRS before depreciation, amortization of intangible assets, gain or loss on disposal of property and equipment, interest expense, accretion expense, special charges and recoveries, stock compensation expense and income tax expense. Management believes that EBITDA is a useful supplemental measure of cash available for debt service, working capital, capital expenditures, income taxes, and distribution. Investors are cautioned that EBITDA, as a non-IFRS measure, is not an alternative to measures under IFRS and should not, on its own, be construed as an indicator of performance or cash flows, a measure of liquidity or as a measure of actual return.
The term "backlog" is a financial measure used in this document which is not a standard measure under IFRS. The Company's method of calculating backlog may differ from the methods used by other issuers. Therefore, STT's measure of backlog, as presented in this press release, may not be comparable to similar measures presented by other issuers. Backlog is the value of revenue remaining to be earned from purchase orders received from customers. The projects represented in backlog are executed according to a schedule agreed with each customer, which could range in duration from one month to eighteen months. Revenues are earned on a percentage of completion basis. Management uses this measure to i) monitor the Company's success in securing new orders, and ii) gauge the likelihood of meeting revenue objectives in future periods.
Investors are cautioned that backlog, as a non-IFRS measure, is not an alternative to measures under IFRS and should not, on its own, be construed as an indicator of performance or cash flows, a measure of liquidity or as a measure of actual return.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy of this release.
