WINNIPEG, Manitoba, May 29, 2019 (GLOBE NEWSWIRE) -- Empire Industries Ltd. (TSX-V: EIL) (“Empire”, “EIL” or the “Company”) today reported its unaudited consolidated financial results for the first quarter ended March 31, 2019. The unaudited consolidated financial statements and MD&A have been filed on SEDAR and can be viewed at sedar.com or at empind.com.
“The break-even quarter on $31 million of revenue was in line with the expectations we set out in our 2018 year-end MD&A,” said Guy Nelson, Executive Chairman and Chief Executive Officer of Empire. “Our contract backlog remains healthy, and the proportion of first generation work within the backlog has dropped to under 10%. We continue to expect revenues to average in excess of $40 million per quarter in the final 3 quarters of the year and our cost reduction program is starting to positively impact our bottom line. These factors all combine to give us a high degree of confidence in our ability to deliver strong financial results for the remainder of 2019 and beyond.”
Update on $8.5 million convertible preferred share offering
Empire has closed on three tranches ($5,050,000) of its previously announced $8,500,000 convertible preferred share offering. The Company expects to close further tranches in due course. The offering is up to 850,000 convertible preferred shares at an issue price of $10.00 per share for gross proceeds to the Company of up to $8,500,000. Dividends accrue at 8% per annum. The shares are convertible into common shares at $0.45 per share for thirty-six months, and at $0.75 per share before sixty months from the date of issue. The preferred shares may be redeemed by the Company in certain circumstances, and may be retracted by the holder any time after thirty-six months. The Company intends to use the proceeds for general working capital purposes.
Update on Co-ventures
Empire continues to finalize its first co-venture project to be located at The Island theme park in Pigeon Forge, Tennessee in the heart of the Smoky Mountains. Negotiations are also proceeding with several other co-venture opportunities, with negotiations underway at various stages of completion. The co-venture business model would see Empire’s subsidiary, Dynamic Entertainment Group Ltd., having the right to co-own attractions in high traffic tourist areas, thereby generating steady, recurring revenue and profit that are predominantly self-financed.
Summary of First Quarter 2019 Consolidated Results
- Contract Backlog as of March 31, 2019 was $233 million, down 7.5% from $252 million at December 31, 2018, with over 90% being non-first generation contract backlog.
- Revenues decreased by $2.4 million (7%), to $31.1 million, from $33.7 million in 1Q18.
- Adjusted EBITDA decreased by $1.1 million, to $0.2 million from $1.3 million in 1Q18.
- Net loss decreased by $0.9 million (80%) to $0.1 million from net loss of $1.0 million in 1Q18.
Summary of First Quarter 2019 Consolidated Financial Results
| For the quarter ended March 31 ($ millions except share price and per share amounts) | Q1 2019 | Q1 2018 | ||||
| Revenue | 31.1 | 33.5 | ||||
| Adjusted EBITDA ($)1 | 0.2 | 1.3 | ||||
| Adjusted EBIT ($)1 | (1.6 | ) | (0.1 | ) | ||
| Net loss | (0.1 | ) | (1.0 | ) | ||
| Per Share Information | ||||||
| Loss per share – basic & diluted | (0.00 | ) | (0.01 | ) | ||
1Adjusted earnings (loss) before interest, tax, depreciation and amortization (Adjusted EBITDA) is not defined by IFRS. The definition of Adjusted EBITDA does not take into account the Company’s share of profit of an associate investment, gains and losses on the disposal of assets, fair value changes in foreign currency forward contracts and non-cash components of stock-based compensation. Adjusted EBIT is the result of the Company’s Adjusted EBITDA less depreciation and amortization expenses. While not IFRS measures, Adjusted EBITDA and Adjusted EBIT are used by management, creditors, analysts, investors and other financial stakeholders to assess the Company’s performance and management from a financial and operational perspective.
Conference Call Information
Empire’s management team will be holding an investor/analyst conference call to discuss the first quarter 2019 results and the outlook for the company. The call-in details are as follows:
| Time/Date: | Friday, May 31, 2019 at 10:00 am Eastern Time |
| Dial-in Number: | 1-800-319-4610 (Canada/USA toll-free) |
| 1-416-915-3239 (Toronto) |
Callers should dial in 5 – 10 minutes prior to the scheduled start time and ask to join the Empire Industries First Quarter 2019 Results Conference Call. This call will be available for replay on our website (http://empind.com/document_type/presentations/) or on the conference call provider’s website for 30 days:
| International Toll (replay): | +1-604-638-9010 |
| Canada/USA Toll-free (replay): | 1-800-319-6413 |
| Replay Access Code: | 3309 |
About Empire Industries Ltd.
Empire focuses on designing, supplying, and installing iconic media-based attractions and ride systems for the global theme park industry. Empire also uses these same turn-key integration services for special projects such as large optical telescopes and enclosures. Empire also has commenced an initiative to leverage its world class flying theater and attraction development capability on a co-venture ownership basis. Empire’s common shares are listed on the TSX Venture Exchange under the symbol EIL. Empire’s common shares are listed on the TSX Venture Exchange under the symbol EIL.
For more information about the Company, visit empind.com or contact:
| Guy Nelson Chief Executive Officer Phone: (416) 366-7977 Email: gnelson@empind.com |
| Allan Francis Vice President – Corporate Affairs and Administration Phone: (204) 589-9301 Email: afrancis@empind.com |
Reader Advisory
This news release contains forward-looking statements, within the meaning of applicable securities legislation, concerning Empire’s business and affairs. In certain cases, forward-looking statements can be identified by the use of words such as ‘‘plans’’, ‘‘expects’’ or ‘‘does not expect’’, ‘‘budget’’, “booked”, ‘‘scheduled’’, “positions”, ‘‘estimates’’, “forecasts’’, ‘‘intends’’, ‘‘anticipates’’, “believes” or variations of such words and phrases or state that certain actions, events or results ‘‘may’’, “may be”, ‘‘could’’, “should”, ‘‘would’’, ‘‘might’’ or ‘‘will’’, ‘‘occur’’ or ‘‘be achieved’’. Such statements include statements with respect to: (i) the Company’s belief that revenues will increase in the balance of the fiscal year, (ii) the enhanced liquidity provided by the recent debt financing and preferred share offer and the expected positive impact on performance therefrom; and (iii) the development of the co-ventures positioning the Company for a stream of long term, recurring revenue and profit. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Although Empire believes these statements to be reasonable, no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this news release should not be unduly relied upon. Such statements include statements with respect to the expected execution of the theme park agreements and the shipping dates of the three rides. Actual results could differ materially from those anticipated in these forward-looking statements as a result of prevailing economic conditions, and other factors, many of which are beyond the control of Empire. The forward-looking statements contained in this news release represent Empire’s expectations as of the date hereof, and are subject to change after such date. Empire disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as may be required by applicable securities regulations.
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.