Evertz Technologies Reports First Quarter Results for the Quarter Ended July 31, 2024.

Rhea-AI Summary

Evertz Technologies (TSX: ET) reported its Q1 2025 results for the quarter ended July 31, 2024. Key highlights include:

• Revenue of $111.6 million, down from $125.8 million in Q1 2024
• Reoccurring software, services and other software revenue increased by 26% to $55.9 million
• Net earnings of $9.7 million, compared to $15.9 million in Q1 2024
• Fully diluted EPS of $0.13, down from $0.20 in Q1 2024
• Gross margin improved to 59.4% from 57.3% year-over-year
• Cash and cash equivalents increased to $91.0 million
• Purchase order backlog exceeded $302 million at the end of August 2024
• Quarterly dividend of $0.195 per share declared

Positive

• Reoccurring software, services and other software revenue increased by 26% to $55.9 million
• Gross margin percentage improved to 59.4% from 57.3% year-over-year
• Cash and cash equivalents increased to $91.0 million from $86.3 million at April 30, 2024
• Purchase order backlog exceeded $302 million at the end of August 2024
• Quarterly dividend of $0.195 per share maintained

Negative

• Overall revenue decreased to $111.6 million from $125.8 million in Q1 2024
• Net earnings declined to $9.7 million from $15.9 million in Q1 2024
• Fully diluted EPS decreased to $0.13 from $0.20 year-over-year
• Working capital slightly decreased to $197.7 million from $201.4 million at April 30, 2024
• Cash generated from operations decreased to $22.3 million from $60.0 million in Q1 2024

Burlington, Ontario--(Newsfile Corp. - September 11, 2024) - Evertz Technologies Limited (TSX: ET), the leader in Software Defined Video Network ("SDVN") technology, today reported its results for the first quarter ended July 31, 2024.

First Quarter 2025 Highlights

• Revenue of $111.6 million
• Reoccurring software, services and other software revenue of $55.9 million, an increase of $11.5 million or 26% from prior year.
• Earnings from operations of $12.6 million
• Net earnings of $9.7 million for the quarter
• Fully diluted earnings per share of $0.13 for the quarter

Selected Financial Information
Consolidated Statement of Earnings Data
(in thousands of dollars, except earnings per share and share data)

		Q1'25			Q1'24
Revenue	$	111,643		$	125,819
Gross margin		66,262			72,036
Earnings from operations		12,609			22,307
Net earnings		9,711			15,892
Fully-diluted earnings per share	$	0.13		$	0.20
Fully-diluted shares		77,278,156			76,529,150

Selected Financial Information
Consolidated Balance Sheet Data
(in thousands of dollars)

		Q1 ' 25			YE' 24
Cash and Cash Equivalents	$	91,020		$	86,325
Working capital		197,711			201,437
Total assets		481,025			484,722
Shareholders' equity		261,682			263,267

 

Revenue

For the quarter ended July 31, 2024, revenues were $111.6 million, compared to revenues of $125.8 million for the quarter ended July 31, 2023. For the quarter, revenues in the United States/Canada region were $73.9 million, compared to $87.0 million in the same quarter last year. The International region had revenues of $37.7 million, compared to $38.8 million in the same quarter last year.

Gross Margin

For the quarter ended July 31, 2024, gross margin was $66.2 million as compared to $72.0 million in the same quarter last year. Gross margin percentage was approximately 59.4% as compared to 57.3% in the quarter ended July 31, 2023.

Earnings

For the quarter ended July 31, 2024, net earnings were $9.7 million as compared to $15.9 million in the corresponding period last year.

For the quarter ended July 31, 2024, earnings per share on a fully-diluted basis were $0.13 as compared to $0.20 in the corresponding period last year.

Operating Expenses

For the quarter ended July 31, 2024, selling and administrative expenses were $17.6 million as compared to $16.4 million for the quarter ended July 31, 2023.

For the quarter ended July 31, 2024, gross research and development expenses were $37.4 million as compared to $31.9 million for the quarter ended July 31, 2023.

Liquidity and Capital Resources

The Company's working capital as at July 31, 2024 was $197.7 million as compared to $201.4 million on April 30, 2024.

Cash was $91.0 million as at July 31, 2024 as compared to $86.3 million on April 30, 2024.

Cash generated from operations was $22.3 million for the quarter ended July 31, 2024 as compared to $60.0 million cash generated for the quarter ended July 31, 2023. Before taking into account taxes and the changes in non-cash working capital and current taxes, the Company generated $13.3 million from operations for the quarter ended July 31, 2024 compared to $19.9 million for the same period last year.

For the quarter, the Company used $2.0 million for investing activities, which was principally a result of the acquisition of capital assets which amounted to $2.0 million.

For the quarter ended July 31, 2024, the Company used cash in financing activities of $16.8 million which was principally a result of the payment of dividends of $14.9 million.

Shipments and Backlog

At the end of August 2024, purchase order backlog was in excess of $302 million and shipments during the month of August 2024 were $33 million.

Dividend Declared

Evertz Board of Directors declared a regular quarterly dividend on September 11, 2024 of $0.195 per share.

The dividend is payable to shareholders of record on September 17, 2024 and will be paid on or about September 25, 2024.

Selected Consolidated Financial Information
(in thousands of dollars, except earnings per share and percentages)

		Three months ended July 31, 2024			Three months ended July 31, 2023
Revenue	$	111,643		$	125,819
Cost of goods sold		45,381			53,783
Gross margin		66,262			72,036
Expenses
Selling and administrative		17,604			16,398
General		1,281			1,158
Research and development		37,374			31,990
Investment tax credits		(3,760	)		(3,395	)
Share based compensation		1,175			1,525
Foreign exchange (gain) loss		(21	)		2,052
		53,653			49,729
Earnings before undernoted		12,609			22,307
Finance income		705			124
Finance costs		(309	)		(244	)
Net loss on investments through profit and loss		-			(212	)
Other income and expenses		210			(94	)
Earnings before income taxes		13,215			21,881
Provision for (recovery of) income taxes
Current		5,563			7,761
Deferred		(2,059	)		(1,772	)
		3,504			5,989
Net earnings for the period	$	9,711		$	15,892
Net earnings attributable to non-controlling interest	$	42		$	299
Net earnings attributable to shareholders		9,669			15,593
Net earnings for the period	$	9,711		$	15,892
Earnings per share
Basic	$	0.13		$	0.21
Diluted	$	0.13		$	0.20

Consolidated Balance Sheet Data
		As At July 31, 2024			As At April 30, 2024
Cash and cash equivalents	$	91,020		$	86,325
Inventory	$	212,238		$	206,154
Working capital	$	197,711		$	201,437
Total assets	$	481,025		$	484,722
Shareholders' equity	$	261,682		$	263,267
Number of common shares outstanding:
Basic		76,114,100			76,164,322
Fully-diluted		81,693,075			81,614,447
Weighted average number of shares outstanding:
Basic		76,152,101			76,088,691
Fully-diluted		77,278,156			77,044,858

Forward-Looking Statements

The report contains forward-looking statements reflecting Evertz's objectives, estimates and expectations. Such forward looking statements use words such as "may", "will", "expect", "believe", "anticipate", "plan", "intend", "project", "continue" and other similar terminology of a forward-looking nature or negatives of those terms.

Although management of the Company believes that the expectations reflected in such forward-looking statements are reasonable, all forward-looking statements address matters that involve known and unknown risks, uncertainties and other factors. Accordingly, there are or will be a number of significant factors which could cause the Company's actual results, performance or achievements, or industry results to be materially different from any future results performance or achievements expressed or implied by such forward-looking statements.

Conference Call

The Company will hold a conference call with financial analysts to discuss the results on
September 11, 2024 at 5 p.m. (EDT). Media and other interested parties are invited to join the conference call in listen-only mode. The conference call may be accessed by dialing 289-514-5100 or toll-free (North America) 1-800-717-1738.

For those unable to listen to the live call, a rebroadcast will also be available until
October 11, 2024. The rebroadcast can be accessed at 289-819-1325 or toll-free 1-888-660-6264. The pass code for the rebroadcast is 92246.

About Evertz

Evertz Technologies Limited (TSX: ET) designs, manufactures and markets video and audio infrastructure solutions for the television, telecommunications and new-media industries. The Company's solutions are purchased by content creators, broadcasters, specialty channels and television service providers to support their increasingly complex multi-channel digital, and high and ultra-high definition television ("HDTV" and "UHD") and next generation high bandwidth low latency IP network environments and by telecommunications and new-media companies. The Company's products allow its customers to generate additional revenue while reducing costs through efficient signal routing, distribution, monitoring and management of content as well as the automation and orchestration of more streamlined and agile workflow processes on premise and in the "Cloud".

For further information please contact:

Doug Moore, CPA, CA
Chief Financial Officer
(905) 335-3700
ir@evertz.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/223018

FAQ

What was Evertz Technologies' (EVTZF) revenue for Q1 2025?

Evertz Technologies reported revenue of $111.6 million for Q1 2025, which ended on July 31, 2024.

How did Evertz Technologies' (EVTZF) earnings per share (EPS) change in Q1 2025?

Evertz Technologies' fully diluted earnings per share (EPS) decreased to $0.13 in Q1 2025, compared to $0.20 in the same quarter of the previous year.

What was the growth in Evertz Technologies' (EVTZF) reoccurring software and services revenue?

Evertz Technologies' reoccurring software, services and other software revenue increased by 26% to $55.9 million in Q1 2025 compared to the prior year.

What is Evertz Technologies' (EVTZF) current purchase order backlog as of August 2024?

Evertz Technologies reported a purchase order backlog in excess of $302 million at the end of August 2024.

Did Evertz Technologies (EVTZF) declare a dividend for Q1 2025?

Yes, Evertz Technologies declared a regular quarterly dividend of $0.195 per share on September 11, 2024, payable to shareholders of record on September 17, 2024.