Clearford Announces Second Quarter 2013 Financial Results, progress on Cayunda Construction, and increase in Long-Term Funding
Ottawa, Ontario – (July 31, 2013) – Clearford Industries Inc. (“Clearford” or the “Company”), (TSX-V:CLI) today issued its second quarter financial results for the period ended June 30, 2013. The statements are presented in accordance with IFRS (all figures in Canadian dollars unless otherwise noted).
During the quarter Clearford continued to market its patented Small Bore Sewer (SBS™) based solution focusing primarily on international markets including Colombia, India, Peru, the Philippines and the Caribbean.
As a result of these efforts, as previously announced, Clearford signed and started the construction of its first contract in Colombia in May of this year. At the end of the quarter, the Company recorded revenue of $158,000 related to Phase I of this contract. It is expected that the remainder of this phase will be completed on or before September 30, 2013. In addition to this project, the implementation of projects in Peru and India are ongoing. The company expects that all ongoing implementation projects will be completed in 2013 which will provide the company with reference sites in three international markets.
“Cayunda is a very exciting assignment for Clearford as it represents our first integrated water infrastructure project”, said Clearford CEO & President Kevin Loiselle.
Clearford Colombia S.A. is currently responsible for the installation of all water services in the Cayunda development just outside of Bogota. These services include: potable water supply & treatment; waste water collection & treatment; recycled water system; and storm water management.
“We believe that this holistic approach to water infrastructure is the direction that the industry is moving towards and this project provides us with the opportunity to be at the forefront of this trend “, continued Mr. Loiselle “Cayunda will demonstrate Clearford’s capacity to provide complete water services worldwide”.
During the quarter, the Company’s Long Term Project Financing and Working Capital loan agreement was amended to increase the available funds under the agreement by $1.34 million to $8.5 million at the end of the quarter. Subsequent to the quarter end, and as previously announced on July 10, 2013, the loan was amended to increase the facility by $0.3 million to $8.8 million which additional funding has been received in full.
Today, the Company also announced that it has increased the available funding amount on its previously announced 20 year term loan with Mundaun Financial Design AG of Switzerland (the “Lender”) by $0.4 million to C$9.2 million through an amendment dated July 26, 2013 (the “Amendment”). As previously announced on March 16, 2012, the Company entered into a C$5.5 million term loan with the Lender (the “Loan”), which was increased to C$8.8 million through amendments to the principal amount of the Loan, as previously announced.
In connection with the Amendment, Clearford will grant 864,000 non-transferrable warrants entitling the Lender to purchase one treasury common share of Clearford for each warrant, at a price of $0.20 per share, until three years from the closing date of the Amendment, the warrant component of which is subject to the approval of the TSX Venture Exchange.
Clearford will pay a 10% fee to an arm’s length third party on the amounts advanced.
For the quarter ended June 30, 2013 the Company recorded a net loss of $922,691 or $0.02 per share as compared to a net loss of $1,038,255 or $0.02 per share for the prior year. The Company reported $207,228 of revenue $96,734 of gross margin, $876,988 of operating expenses and $142,347 of net financing costs in the current quarter compared to $Nil revenue, $Nil gross margins, $933,038 of operating expenses of, and $105,217 of net financing costs in the prior year. The decrease in loss relates primarily to the increase in revenues and margins in the quarter and reduced operating costs, offset by the additional financing costs incurred on the long-term debt negotiated in the first quarter of the prior year. For the 6 months ended June 30, 2013, the company recorded a net loss of $1,888,760, or $0.03 per share as compared to a net loss of $1,892,273, or $0.03 per share in the prior year comparative period. The Company reported $279,080 of revenue, $95,029 of gross margin, $1,632,977 of operating expenses and $255,783 of net financing costs for the first 6 months ended June 30, 2013 compared to $Nil revenue, $Nil gross margins, $1,768,114 of operating expenses, and $124,159 of net financing costs in the prior year.
For the quarter ended June 30, 2013, cash used in operations was $1,575,878 compared to cash used in operations of $1,188,827 for the prior year.
While Clearford believes that significant and near term opportunities exist for the Company’s solution, there can be no assurance that customer agreements will be reached or that such agreements will be profitable should they be implemented.
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 Industries Inc.
Clearford Industries Inc. (TSX-V: CLI) is the developer of the patented Small Bore Sewer ™ (SBS™) based solution, which enables the efficient collection and treatment of sewage. Superior operational and environmental performance is achieved at a significantly lower cost when compared to historic gravity sewers. Clearford’s SBS™ technology and industry expertise provide the enabling platform to deliver, on a global basis, turnkey, fixed-price wastewater collection, treatment and energy generation solutions that are ideally suited for water-scarce regions, those with unreliable water distribution networks, and new developments seeking a greener approach to water and wastewater management. For more information on Clearford, please visit www.clearford.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 managements 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:
Clearford Industries Inc.
Phone: (613) 762-8402