YE numbers are terrific, very conservatively stated
CMH CN: Record Revenue And Profit For 2002, 91% Growth and N
2003-03-10 12:26 (New York)
CARMANAH TECHNOLOGIES CORPORATION ("CMH-V")
- Record Revenue And Profit For 2002, 91% Growth and Net
- Profit of $36K
Carmanah Technologies Corporation is pleased to announce its audited
results for the years ended December 31, 2002 and 2001.
Highlights for 2002:
* Annual revenue up 91% over 2001 to $6,468,899
* Net profit of $36,393, as compared to net loss in 2001 of
$676,498
* Q4 revenue of $1.94 million up 127% over Q4 2001
* Q4 revenue up $309,000 (19%) over Q3 2002
* Average gross profit margin of 56%, up from 53% in 2001
* Revenue growth (91%) outpaced expenditure growth (46%)
* Aggressive investment in both R&D and business development for
new markets continued
"Our company has made great strides over the past twelve months, as we
continue to expand into many new market sectors", stated Art Aylesworth,
Carmanah's CEO. "In 2002, we introduced new products into the global
public transportation market, the North American railway market and the
European roadway market. While continuing to increase our international
sales in marine products, we are moving as quickly as we can to meet the
worldwide demand for our core technology in a growing number of markets. I
am proud of the job our team has done in growing the business aggressively
while still managing our bottom line during this "ramp up" year. 2002 was
the most impressive year in Carmanah's history and should provide a strong
platform upon which we will build our future".
SUMMARY OF RESULTS FOR 2002
Carmanah's total revenues for the 12 months ended December 31, 2002
increased 91% to $6,468,899 compared with $3,373,453 for the preceding
year. Revenues were derived from the sale of solar powered light-emitting
diode hazard and safety lights. Sales were sourced through a worldwide
distribution network and direct sales efforts in key market segments and
territories. Revenue growth was achieved through increased investment in
direct sales and marketing resources and activities. Sales increased
throughout the company's existing product lines and through the
introduction of several new products.
Carmanah's gross profit margin increased to 56% of sales, a 3%
increase over previous year's 53% gross profit margin. This increase was
the result of an aggressive direct sales program. Products sold via direct
sales methods were priced at retail, rather than at the wholesale pricing
extended to distributors. Direct sales comprised 43% of total sales in
fiscal 2002, compared with 22% in fiscal 2001.
Wages and benefits expense represents the Sales and Marketing,
Operations and Finance departments. For the year ended December 31, 2002,
wages and benefits increased 34% to $1,517,416, compared with $1,135,033 in
2001. This increase was the result of the implementation of a direct sales
commission plan in 2002, as well as increase in new hires. Carmanah had 47
Full-Time Equivalent's (FTE's) in fiscal 2002, compared with 31 FTE's in
2001.
Office and administration expenses in 2002 were $684,531, representing a
27% increase over 2001 at $539,360. During the 2002 year, the company
moved its sales, operations, and engineering departments into an adjacent
building, resulting in increased rent, utilities and general office costs.
Given the sales growth experienced in 2002 however, the total office and
administration expenses in 2002 were minimal; office and administration
represented only 11% of total sales in 2002, as compared to 16% in 2001.
During 2002, research and development expenses of $543,051 represented
a 100% increase over the previous year's $271,485. However, the company
did not defer any of its research and development expenses in 2002, whereas
it deferred $231,202 in 2001. This adjustment explains the significant
increase R&D expenses for 2002.
Sales and marketing expenses in 2002 were $533,041, representing a
166% increase over 2001 at $200,705. The company continued to increase
sales and marketing activities for new and existing product lines
throughout its worldwide marketplace. Focus was also placed on new market
introduction as well as key trade shows and customer contact.
Net income (loss) for 2002 before income tax, depreciation and
amortization (EBITDA) was $384,393, compared with ($335,652) for 2001. The
2002 EBITDA was primarily the result of increased sales, improved gross
margins and lowered operating costs as a percentage of sales.
Carmanah's cash balance at December 31, 2002 was $679,100, compared to
$1,060,817 at December 31, 2001. Net cash usage from operations and
investing activities for the year was $725,281. Financing for the
company's operations was funded primarily from the reserves of original
funds raised in the 2001 reverse takeover and a private placement during
2002 in the amount of $237,600. Net working capital at year end for 2002
was $2,006,148, with a current ratio of 2.7:1 and $104,705 of non-current
debt obligations.
The overall performance of Carmanah for 2002 was consistent with the
objectives setout in the company's business plan. Carmanah's revenue
growth (91%) outpaced expenditures (46%), resulting in a net profit for
2002 in the amount of $36,393 - without any capitalization of development
costs. The company's performance confirms that the planned investment in
2001 in areas of development, sales, marketing, and infrastructure
supported its ability to meet 2002 objectives.
About Carmanah Technologies Inc.
Carmanah is an award winning alternative energy manufacturer
specializing in patented solar-powered LED lighting solutions for the
marine, transit, roadway, railway, aviation and mining markets. The
company has more than 50,000 units installed in 110 countries. The shares
of Carmanah Technologies Corporation (parent company) are publicly traded
on the TSX Venture Exchange under the symbol "CMH" and on the Berlin and
Frankfurt Stock Exchanges under the symbol "QCX". For more information,
please visit www.carmanah.com.
On Behalf of the Board of Directors,
Carmanah Technologies Corporation
Praveen Varshney, Director
This release contains forward-looking statements within the meaning of
the "safe harbor" provisions of the U.S. Private Securities Litigation
Reform Act of 1995. These statements are based on management's current
expectations and beliefs and are subject to a number of risks and
uncertainties that could cause actual results to differ materially from
those described in the forward-looking statements. These risks and
uncertainties are described under the caption "Note Regarding
Forward-looking Statements" and "Key Information - Risk Factors" and
elsewhere in our Annual Report for the fiscal year ended December 31, 2001,
as filed with the U.S. Securities and Exchange Commission and which are
incorporated herein by reference. These risks and uncertainties are also
described under the caption "Risk Factors" in our Annual Information Form
dated December 31, 2001, as filed with the British Columbia Securities
Commission and which are incorporated herein by reference. We do not
assume any obligation to update the forward-looking information contained
in this press release.
//st
CARMANAH TECHNOLOGIES CORPORATION
Consolidated Balance Sheets
(Expressed in Canadian dollars)
December 31, 2002 and 2001
2002 2001
Assets
Current assets:
Cash and cash equivalents $ 679,100 $ 1,060,817
Accounts receivable 1,366,780 382,846
Inventories 1,057,666 587,439
Prepaid expenses and deposits 43,513 26,777
Current portion of advances receivable 26,844 49,472
3,173,903 2,107,351
Advances receivable 111,500 111,500
Deferred development costs - 216,895
Equipment and leasehold improvements 471,079 279,873
Patents 34,154 29,487
$ 3,790,636 $ 2,745,106
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued liabilities
$ 947,014 $ 340,876
Bank loan 140,000 30,000
Deferred revenue 11,042 -
Current portion of long-term debt 21,684 27,790
Current portion of obligations under capital leases
48,015 25,800
Future income taxes - 18,000
1,167,755 442,466
Long-term debt 55,139 17,143
Obligations under capital leases 49,566 30,304
1,272,460 489,913
Shareholders' equity:
Share capital 3,256,336 3,029,746
Contributed surplus 26,188 26,188
Deficit (764,348) (800,741)
2,518,176 2,255,193
$ 3,790,636 $ 2,745,106
CARMANAH TECHNOLOGIES CORPORATION
Consolidated Statements of Operations and Deficit
(Expressed in Canadian dollars)
Years ended December 31, 2002 and 2001
2002 2001
Sales $ 6,468,899 $ 3,373,453
Cost of sales 2,808,745 1,549,306
3,660,154 1,824,147
Operating expenses:
Wages and benefits 1,517,416 1,135,033
Office and administration 684,531 539,360
Research and development 543,051 271,485
Sales and marketing 533,041 200,705
Bank charges and interest 49,086 38,912
Amortization of:
Equipment and leasehold
improvements 140,014 111,129
Deferred development costs 216,895 217,588
Patents and other intangible assets 9,091 12,129
3,693,125 2,526,341
Operating loss (32,971) (702,194)
Interest and other income 51,364 25,696
Earnings (loss) before income taxes 18,393 (676,498)
Income tax expense (recovery):
Future (18,000) -
Net earnings (loss) 36,393 (676,498)
Deficit, beginning of year (800,741) (124,243)
Deficit, end of year $ (764,348) $ (800,741)
Earnings (loss) per share - basic and diluted
$ 0.00 $ (0.04)
Weighted average number of shares outstanding
19,650,884 15,460,951
//et
TEL: (604) 629-0264 Praveen Varshney, Director
TEL: (866) 629-0264
EMAIL: investors@carmanah.com
TEL: (250) 382-4332 Media Contact: David Davies
EMAIL: ddavies@carmanah.com
TEL: (604) 608-0824 Investor Relations Contact:
TEL: 1-866-801-0777 Vanguard Shareholder Solutions
EMAIL: vanguard@carmanah.com |
