GUELPH, ON, Aug. 19 /PRNewswire-FirstCall/ -- BIOREM Inc. (TSX-V: BRM) ("Biorem" or "the Company") today announced its results for the three-month period ended June 30, 2010. Biorem's complete 2010 second quarter financial statements and MD&A have been filed on SEDAR (http://www.sedar.com/).
"We successfully achieved significant new bookings during the quarter and we continue to grow our order backlog, which reached $14.1 million in Q2," said Peter Bruijns, President and CEO. "A portion of these new orders relate to our Volatile Organic Compound and Biogas sweetening market initiatives. These results add to our confidence in building a diversified revenue based business model and our objective of being a leader in global clean technology air emissions control."
Bookings in the second quarter of 2010 were $6,200,000, an increase of approximately 20 percent on a sequential basis over the first quarter of 2010 and an increase of 19% compared to the same period last year. The total orders received in the first two quarters are $11,500,000 resulting in an order backlog of $14,100,000 for the second quarter of 2010, up 40 percent from the beginning of 2010.
Financial Summary: ----------------------------------- Three-months Six-months ended June 30, ended June 30, ------------------------------------------------------------------------- (in thousands of Canadian dollars, except percent and per share data) 2010 2009 2010 2009 ------------------------------------------------------------------------- REVENUE $4,560 $5,678 $7,808 $9,715 ------------------------------------------------------------------------- GROSS PROFIT $1,202 $2,326 $2,349 $3,632 ------------------------------------------------------------------------- GROSS MARGIN 26% 41% 30% 37% ------------------------------------------------------------------------- EBITDA(1) (excluding gains and losses on foreign exchange) $(323) $457 $(809) $430 ------------------------------------------------------------------------- NET LOSS $(514) $(239) $(1,407) $(664) ------------------------------------------------------------------------- BASIC AND DILUTED LOSS PER SHARE $(0.04) $(0.02) $(0.12) $(0.06) ------------------------------------------------------------------------- THREE MONTHS ENDED JUNE 30, 2010
Revenue in the three-month period ended June 30, 2010 (Q2 2010) was $4,560,000 compared to $5,678,000 over the comparative period in the prior year. The Company has increased its Backlog by 40% year-to-date from $10.1 million at December 31, 2009 due to a strong first six months of Bookings.
Gross margin decreased to 26% in Q2 2010 versus 41% in Q2 2009. The Q2 2010 Gross Margin is lower than the previous quarter due to the effect of lower margins accepted by the Company on two strategic projects whose implementation converged into the quarter and constituted more than $1,733,000 of the Q2 revenue as well as the effect of under absorbed overhead costs. The company expects margins to return to historical levels over the next two quarters.
Gross profit in Q2 2010 was $1,202,000 down from $2,326,000 in Q2 2009.
Net loss for the Q2 2010 was $514,000 or $0.04 per basic and diluted share, compared to net loss of $239,000, or $0.02 per basic and diluted share in Q2 2009.
Adjusted EBITDA(1) in the second quarter of 2010 totaled a loss of $323,000, compared to earnings of $457,000 in the second quarter of 2009. The increase in Q2 2010 net loss and Adjusted EBITDA versus Q2 2009 is a result of the lower revenue in Q2 2010 versus Q2 2009, lower gross margin in Q2 2010, and the Company's investment in developing new innovative products in VOC and biogas sweetening. The table below reconciles net loss to Adjusted EBITDA.
----------------------------------- Three-months Six-months ended June 30, ended June 30, ------------------------------------------------------------------------- (in thousands of Canadian dollars) 2010 2009 2010 2009 ------------------------------------------------------------------------- Net Loss $(514) $(239) $(1,407) $(664) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Amortization of long-term assets 128 121 252 220 ------------------------------------------------------------------------- Loss (gain) on foreign exchange (96) 424 30 580 ------------------------------------------------------------------------- Accretion of deferred financing and warrant costs 62 54 121 101 ------------------------------------------------------------------------- Interest expense 97 97 195 193 ------------------------------------------------------------------------- Adjusted EBITDA $(323) $457 $(809) $430 -------------------------------------------------------------------------
As at June 30, 2010, Biorem had total working capital of $6,080,000, cash and short-term investments of $1,247,000 and unbilled revenue of $5,366,000, compared to total working capital of $6,420,000, cash and short-term investments of $3,092,000 and unbilled revenue of $4,130,000 as at March 31, 2010.
BIOREM today also announced that it has withdrawn its previously announced proposed private placement of up to $3 million due to market conditions. The Company currently has a strong financial position that will continue to support its working capital needs and business objectives.
About BIOREM Inc.
Biorem is a leading clean technology company that designs, manufactures and distributes a comprehensive line of high-efficiency air emissions control systems used to eliminate odors, volatile organic compounds (VOCs), and hazardous air pollutants (HAPs). With sales and manufacturing offices across the continent, a dedicated research facility, a worldwide sales representative network and more than 600 installed systems worldwide, Biorem offers state-of-the-art technology-based products and peace of mind for municipalities, industrial companies and their surrounding communities. Additional information on Biorem is available on our website at http://www.biorem.biz/.
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Forward-Looking Statements
This press release contains forward-looking statements based on current expectations. These forward-looking statements contain various risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Risks and uncertainties about the Company's business are more fully discussed in the disclosure materials, financial statements and MD&A filed with the securities regulatory authorities in Canada on http://www.sedar.com/.
Non-GAAP Measures
1. Adjusted EBITDA is a non-GAAP earnings measure, therefore, it does not have any standardized meaning prescribed by Canadian generally accepted accounting principles and may not be similar to measures presented by other companies. Adjusted EBITDA represents earnings before interest, foreign exchange, income taxes, depreciation and amortization. This measure is important to management since it is used by potential lenders to evaluate the ongoing cash generating capability of the Company and thus the amounts those lenders are willing to lend to the Company.
"Order Bookings" and "Order Backlog" do not have any standardized meaning prescribed by Canadian generally accepted accounting principles ("GAAP") and may not be comparable to measures presented by other companies.
Order Bookings and Order Backlog are non-GAAP measures that the Company uses to evaluate its sales performance. Order Bookings are those binding contracts that the Company enters into with a third party for the delivery of our products or services. As Order Bookings are received, the contract value (before any associated sales taxes) is included in the Order Backlog. The Order Backlog is reduced by the revenue that is recognized on each project and then adjusted for any currency changes.
Biorem Inc.
CONTACT: Peter Bruijns, President & CEO, BIOREM Technologies Inc.,
pbruijns@biorem.biz, Tel: (519) 767-9100 x244; James Smith, Investor
Relations, The Equicom Group Inc., jsmith@equicomgroup.com, Tel: (416)
815-0700 x229
