Clearford Announces Results for the first quarter of fiscal 2016
Ottawa, Ontario – (May 31, 2016) – Clearford Water Systems Inc. (“Clearford” or the “Company”), (TSX-V:CLI), a TSX Venture 50 Company, today released results for its three months ended March 31, 2016. The unaudited consolidated financial statements are presented in accordance with IFRS (all figures in Canadian dollars).
During the quarter, the Company continued to focus on the marketing and sales of Clearford One™ in Ontario and India and the continued growth and profitability of its subsidiary UV Pure Technologies Inc. (UV Pure). To support expanded market scope UV Pure continued to invest in its next generation product to provide more robust systems with the capability of processing up to 1 million gallons per day of water or wastewater effluent.
Kevin Loiselle, President and CEO of Clearford, expressed enthusiasm for the future of Clearford: “We are very pleased with our progress in the quarter. With Clearford One™ systems currently in operation in Ontario and India, we feel that the basis for strong sales growth is being put in place for the South Asian market and our P4P™ offering in Ontario. “With the RFP issued in Adjala-Tosorontio we anticipate that our long-term economical solution will be considered by other municipalities in Ontario as a solution to the immediate needs of servicing new developments within their communities”, he said.
“International opportunities for Clearford, particularly in India where public policy has set priority on sanitation and clean water continue to look very positive, Mr. Loiselle continued. “With our first Clearford One™ system in Prime Minister Modi’s home state of Gujarat now operational, our subsidiary Clearford India Pvt. Ltd. has a live demonstration site of our technology. We believe the operational system in Gujarat will lead to additional contract signings in India”, he concluded.
Revenue for the quarter was $920,779 compared with $776,149 for the prior year’s quarter. Operating loss before net financing costs were $940,031 for the quarter compared with $805,245 for the prior year’s quarter. Net financing costs for the quarter were $653,329 compared with $532,895 for the prior year’s quarter, with net loss for the year of $1,593,360 or $0.02 per share compared with $1,343,659 or $0.02 per share for the prior year’s quarter.
Costs of sales increased to $594,067 during the quarter from $414,227 in the prior year’s quarter due to continued Clearford OneTM project implementations in Ontario and India.
Sales and marketing costs increased to $413,509 from $318,718 in the prior year’s quarter reflecting additional sales efforts for Clearford OneTM in Ontario and the addition of new sales resources in UV Pure.
Costs of engineering and research and development decreased to $205,983 from $213,861 in the prior year’s quarter reflecting a decrease in spending on the Clearford OneTM System and additional capitalized development costs for new product development in the UV Pure segment.
General and administration costs decreased to $634,282 from $674,387 in the prior year’s quarter primarily reflecting reduced spending in on legal counsel and external consultants.
Clearford ended the March 31, 2016 quarter with unrestricted cash of $427,207 compared with $585,885 on December 31, 2015. The Company’s quarterly unaudited consolidated financial statements and MD&A are available at www.SEDAR.com.
Subsequent to its quarter end, the Company announced that it has entered into a US$5.25 million new long-term loan agreement and closed $0.5 million of that loan. Additionally, it also entered into an option with the lender to acquire and renegotiate the existing long-term debt into a new US dollar denominated long-term debt as previously announced on April 29th, 2016 for additional details on these proposed transactions. The option to acquire and restructure the current long-term debt expires on September 19, 2016.
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 or accuracy of this release.
About Clearford Water Systems Inc.
Clearford Water Systems Inc. (TSX-V: CLI) is a provider of unified water management and sanitation systems based on Clearford One™. Clearford One™ is a proprietary system comprised of ClearDigest™ smart digester, ClearConvey™ small bore sewer, and ClearRecover™ final treatment facility. For more information on Clearford Water Systems, please visit www.clearford.com .
About UV Pure Technologies Inc.
UV Pure Technologies manufactures technically advanced UV water purification systems. The Company has won an Artemis Top 50 Clean Tech Company award, two Frost and Sullivan Best Practices awards, a Canadian Drinking Water Association award for innovation, and is a Going Green Global Top 200 company.
There are currently over 15,000 UV Pure systems in residential, commercial, industrial, public and municipal applications, with flow rates up to 1 million gallons per day. An aerospace version of UV Pure’s system is being used by Boeing to purify water on its new 787 Dreamliner.
UV Pure’s patented Crossfire Technology® is dramatically advantaged compared to conventional UV systems. Lamps are mounted in air surrounded by elliptical reflectors providing more effective deactivation of pathogens, facilitating easy lamp changes and visual quartz inspection. They are self-cleaning, smart – with multiple sensors and on-board diagnostics guiding maintenance, engineered to be fail-safe, virtually maintenance free, and are plug-in ready for remote monitoring. For more information on UV Pure Technologies, please visit www.uvpure.com.
Forward Looking Statements
This news release contains certain statements that constitute forward-looking statements as they relate to the Company and its management. Forward-looking statements are not historical facts but represent management’s current expectation of future events, and can be identified by words such as “believe”, “expects”, “will”, “intends”, “plans”, “projects”, “anticipates”, “estimates”, “continues” and similar expressions. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that they will prove to be correct.
By their nature, forward-looking statements include assumptions and are subject to inherent risks and uncertainties that could cause actual future results, conditions, actions or events to differ materially from those in the forward-looking statements. If and when forward-looking statements are set out in this news release, Clearford will also set out the material risk factors or assumptions used to develop the forward-looking statements. Except as expressly required by applicable securities law, the Company assumes no obligation to update or revise any forward looking statements. The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: industry cyclicality; the ability to secure third party agreements; successful integration of Clearford’s system with third party technology; competition; reduction in demand for products; collection from customers; relationships with suppliers; product liability; intellectual property; reliance on key personnel; environmental; interest rates; uninsured and underinsured losses; operating hazards; risks of future legal proceedings; income tax matters; credit facilities; availability and terms of financing; distribution of securities; restrictions on potential growth; effect of market interest rates on price of securities; and potential dilution.
For more information contact:
Kevin Loiselle, President & CEO
Clearford Water Systems Inc.
Phone: (613) 599-6474 ext. 303