- Positive Net Income of $63,699
- Revenue down 26% versus Q1 in 2017
NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA
MISSISSAUGA, Ontario, March 02, 2018 (GLOBE NEWSWIRE) -- Pioneering Technology Corp. (TSXV:PTE) (“Pioneering” or the “Company”), a technology company and North America’s leader in cooking fire prevention technology and products is pleased to report its unaudited Q1 2018 financial results and business highlights for the quarter ended December 31, 2017. Pioneering’s unaudited condensed interim financial statements and MD&A are available on SEDAR (www.sedar.com).
In the three months ended December 31, 2017, revenue was down approximately 26% versus the same quarter in 2016. This revenue decline was largely the result of a delay in a large order delivery for SmartBurner product initiated by a significant, repeat customer. Pioneering had originally expected to ship this order at the end of Q1. The Company now expects this order to ship later in this fiscal year.
Net Income of $63,699 was an increase from a loss of ($1,060,873) for the same period in the prior year.
Financial highlights for the quarter ended December 31, 2017 include:
- Revenue of $1,762,054 – down 26% versus same period year ago (Q1/17 - $2,380,761)
- Gross margins approximately 53%.
- Net Income was $63,699 up versus Q1 2017 of $(1,060,873).
- Strong balance sheet and business fundamentals
Pioneering CEO Kevin Callahan said of the results, “While reported revenue for Q1 was down versus the same period year ago the Company remains very bullish as it pertains to our 2018 plan. We have a significant growth opportunity for our technology solutions in helping prevent cooking fires and we are still in the early stages of market penetration. We will continue to execute against our key strategies to exploit this opportunity, grow our business profitably and create value. The fundamentals of our business remain strong: with positive financial results in 2016 and 2017; a major increase in cash reserves; a strong balance sheet; investments in sales and marketing efforts, human resources and product development; positioning the Company to drive future growth and its leadership position in the cooking fire prevention category.”
Selected financial highlights for the quarters ended December 31, 2017 and 2016
| Quarter Ended December 31, 2017 | Quarter Ended December 31, 2016 | |||||
| Revenue | $1,762,054 | $2,380,761 | ||||
| Income (loss) before other items | $(386,811 | ) | $532,269 | |||
| Net Income (loss) | $63,699 | $(1,060,873 | ) | |||
| Adjusted EBITDA# | $(61,920 | ) | $762,942 | |||
# Adjusted EBITDA is a non-GAAP measure. See “Non-GAAP Measures” below.
Q1 2018 Business Highlights
Strong Balance Sheet
As a result of the $6.6 million private placement completed in April 2017, the subsequent repayment of all third-party indebtedness and cash generated from ongoing operations, the Company now has a very strong balance sheet. As at December 31, 2017, the Company had approximately $8 million in cash and short-term investments and is well positioned for long term growth.
Expansion in Core Channels via Distributor Network
The Company continues to increase its penetration in the multi-family social and rental housing channels, the university and college channel, the hotel and motel channels and in U.S. military housing around the world. The SmartBurner is currently experiencing 100% YOY growth at Home Hardware and is poised for expansion through other retailers in both Canada and the U.S. in 2018. Through its growing distributor relationships in both the U.S. and Canada, the Company continued to create awareness of its products in these channels during the period and will help fuel deeper penetration in 2018 and beyond.
Insurance Premium Reductions
In Q1, the Company began negotiations with another U.S. based insurance provider to offer its clients an annual property premium insurance discount for those clients that equip their properties with the SmartBurner product. The Company expects to successfully complete these negotiations in Q2 and to begin to market the insurance savings to the insurer’s customer base. Insurance incentives are another avenue that the Company is successfully pursuing to create awareness and revenue for its SmartBurner product as insurers become more aware of the product’s success rate in helping prevent cooking fires.
New Trial Installation with Innohome product
In June 2017, the Company announced that it had finalized a definitive partnership agreement with Innohome OY with the objective of generating incremental revenue and profit by enabling sales of each company’s products in the other’s markets while reducing duplication of effort in R&D, sales/marketing, manufacturing and logistics. Pioneering executed an initial trial installation of an Innohome product at an Ivy League university in Q4 2017. The product has performed well during the trial period and the Company is looking forward to the opportunity to expand placements of the product with this customer in 2018. In Q1 the Company initiated another trial installation at a prominent school in upstate New York. The Company is receiving strong interest in this new product as an aftermarket solution for glass cooktops and expects to initiate a full marketing launch in Q3. This new product is strategic in nature, filling a current product portfolio need and providing the Company with another solution to offer to its customers to help address the cooking fire problem.
About Pioneering Technology Corp.: Based in Mississauga, Ontario, Pioneering is an "energy smart" technology company and North America's leader in innovative cooking fire prevention technologies and products. Our mission is simple: Protecting people and property from the number one cause of household fire – cooking fires. We do this by engineering and bringing to market energy-smart solutions that make consumer appliances safer, smarter, and more efficient. Our patented cooking-fire prevention products address the multi-billion-dollar problem of cooking fires. According to the National Fire Protection Association, stovetop cooking is the number one cause of household fire and fire injuries in North America. Pioneering’s temperature limiting control™ (TLC) technology is now installed in over 250,000 multi-residential housing units across North America without a single cooking fire being reported, delivering peace of mind and a solid return on investment for its customers. Pioneering’s proprietary cooking fire prevention solutions include Safe-T-element, SmartBurner, RangeMinder & Safe-T-sensor and are suitable for the majority of the more than 140 million stoves/ranges and over 140 million microwave ovens in use throughout North America. For more information, visit www.pioneeringtech.com.
For more information, please contact:
Pioneering Technology Corp.
Kevin Callahan, CEO
Direct: 647-945-7515
1-800-433-6026 ext. 101
Email: kcallahan@pioneeringtech.com
For investor relations please contact:
Contact Financial Corp.
Rob Gamley
Phone: 604-689-7422
Email: rob@contactfinancial.com
Forward Looking Statements
The statements made in this press release include forward-looking statements that involve a number of risks and uncertainties. These statements relate to future events or future performance and reflect management's current expectations and assumptions. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, such as the economy, generally, competition in Pioneering’s target markets, the demand for Pioneering’s products, the availability of funding and the efficacy of Pioneering’s technology and governmental regulation. These forward-looking statements are made as of the date hereof an, except as required by applicable law, Pioneering does not assume any obligation to update or revise them to reflect new events or circumstances. Actual events or results could differ materially from Pioneering’s expectations and projections.
Non-IFRS Measures
Adjusted EBITDA is a measure not recognized under International Financial Reporting Standards (“IFRS”). However, management of Pioneering believes that most shareholders, creditors, other stakeholders and investment analysts prefer to have these measures included as reported measures of operating performance, a proxy for cash flow, and to facilitate valuation analysis. Adjusted EBITDA is defined as earnings before interest income, taxes, depreciation and amortization, impairment losses, stock-based compensation, restructuring costs included in general and administration expense, fair value movement – derivative liability and other non-recurring gains or losses including transaction costs related to acquisition. Management believes Adjusted EBITDA is a useful measure that facilitates period-to-period operating comparisons. Adjusted EBITDA does not have any standard meanings prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers. Readers are cautioned that Adjusted EBITDA is not an alternative to measures determined in accordance with IFRS and should not, on its own, be construed as indicators of performance, cash flow or profitability. References to the Pioneering’s Adjusted EBITDA should be read in conjunction with the financial statements and management's discussion and analysis of Pioneering posted on SEDAR (www.sedar.com). For a reconciliation of Adjusted EBITDA as presented by Pioneering to net income, please refer to Pioneering’s management’s discussion and analysis.
This news release contains certain forward-looking statements reflecting the Company’s current views or expectations on its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly.
The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy and accuracy of this release.