Vigil Reports Profitable Second Quarter


VICTORIA, British Columbia, Nov. 16, 2021 (GLOBE NEWSWIRE) -- Vigil Health Solutions Inc. (“Vigil”) announces the results of operations for the quarter ending September 30, 2021.

Developments in the Quarter

  • Revenue of $1.71 million up 24% from $1.37 in the three month period ended September 30, 2020.
  • Earnings before income taxes were $272 thousand up 31% from $208 thousand in the three month period ended September 30, 2020.
  • Sales bookings for the quarter were $1.03 million compared to $1.57 million in the three months ended September 30, 2020.
  • Adjusted EBITDA of $267 thousand compared to $259 thousand in the three months ended September 30, 2020.

“We are pleased to see strong revenue and earnings reflecting the continuity of service provided by Vigil throughout the pandemic. Senior housing construction remains at the low end of the business cycle and this is reflected in our second quarter sales bookings. Senior living occupancy has shown some recovery in recent quarters and while the immediate future continues to have some uncertainty, we remain optimistic about the senior living market in the longer term,” stated Troy Griffiths, President and CEO of Vigil Health Solutions Inc.

Financial Results

Revenue for the three months ended September 30, 2021 was $1.71 million up 24% from $1.37 million in the three months ended September 30, 2020. The increase in project revenue reflects the completion of a $507 thousand project in the quarter. Project revenue, includes new system installations and upgrades, made up 53% of total revenue compared to 39% in the prior year. The remaining revenue is from follow on one-off sales to existing customers. These sales include software maintenance billings and replacement products including wireless devices and communication equipment.

Sales bookings for the quarter were $1.03 million compared to $1.57 million in the three months ended September 30, 2020. There were 4 project bookings with an average value of $64 thousand compared to 13 project bookings with an average value of $61 thousand in the period ending September 30, 2020. The lower bookings reflect the decline in new construction. Sales bookings include projects closed in the quarter and normally not recognized in revenue until future periods and one-off sales recognized in revenue in the current period.

At September 30, 2021, Vigil had a backlog of approximately $2.65 million (including $1.38 million in deposits and progress billings, recorded as deferred revenue on the balance sheet) compared to approximately $3.99 million (including $2.01 million in deposits and progress billings, recorded as deferred revenue on the balance sheet) at September 30, 2020. The COVID-19 pandemic caused multiple project delays in 2020 resulting in a larger than normal backlog. The Company’s backlog is the total estimated revenue for contracts which are signed and have not been completed (and may not have commenced).

The gross margin percentage for the three months ended September 30, 2021 was 45% compared to 53% for the three months ended September 30, 2020. The decrease reflects the higher amount of project sales relative to one off sales. Project revenue includes lower margin components including travel, labour and occasionally, third party contractor fees, the latter having little mark up. Customers generally purchase these installation services directly however, the quarter included material third party contractor’s fees, which decreased overall margin.

Operating expenditures for the three months ended September 30, 2020 were $530 thousand up 7% from $494 thousand for the period ended September 30, 2019. The increase reflects the decline in Canada Emergency Wage Subsidy (CEWS) received. In the three months ended September 30, 2021 the Company received $47 thousand in CEWS payments, recorded as a reduction in payroll expense, compared to $93 thousand received in the three months ended September 30, 2020. The increase in payroll expense was mitigated by the recognition of $35 thousand relating to an agreement with the Government of Canada to provide funding for specific research and development projects. There were also increases in sales and marketing expenses as COVID-19 restrictions on travel were relaxed.

Earnings before income taxes were $272 thousand up 31% from $208 thousand in the three month period ended September 30, 2020. Net earnings and comprehensive income were $217 thousand or $0.012 per share compared to $145 thousand or $0.008 per share for the three month period ended September 30, 2020.

Detailed financial statements along with Management Discussion and Analysis have been filed with SEDAR (www.sedar.com).

Financial information will be mailed to entitled security holders on November 30, 2021, or, upon notice to the Company, entitled security holders may request a copy of financials in advance.

Summary Financial Information

  Three months ended Six months ended 
  September 30, September 30, September 30, September 30, 
  2021 2020 2021 2020 
      
Revenue$1,708,838 1,372,713 3,410,830 2,624,574 
      
Cost of sales 939,770 645,521 1,769,446 1,227,456 
      
Gross profit 769,068 727,192 1,641,384 1,397,118 
      
Expenses 529,609 493,841 1,109,941 955,691 
      
Earnings before the following items 239,459 233,351 531,443 441,427 
      
Other income (expense) 32,853 (25,638)22,021 (62,099)
      
Earnings before income taxes 272,312 207,713 553,464 379,328 
      
Income taxes (54,930)(62,321)(78,230)(113,182)
      
Net earnings and comprehensive     
earnings for the period$217,382 145,392 475,234 266,146 


Non-IFRS Measure

For the three and six month periods ended September 30, 2021, we are disclosing Adjusted EBITDA, a non-IFRS financial measure, as a supplementary indicator of operating performance. We define Adjusted EBITDA as net income before, interest excluding interest relating to right of use asset for lease on the Company’s head office, income taxes, amortization excluding amortization of right of use asset for the lease on the Company’s head office, stock based compensation and currency gains or losses including derivative foreign exchange differences. We are presenting the non-IFRS financial measure in our filings because we use it internally to make strategic decisions, forecast future results and to evaluate our performance and because we believe that our current and potential investors and analysts use the measure to assess current and future operating results and to make investment decisions. It is a non-IFRS measure, may not be comparable to other companies and it is not intended as a substitute for IFRS measures.

Adjusted EBITDA Reconciliation

  Three months ended Six months ended 
  Sept 30, Sept 30, Sept 30, Sept 30, 
  2021 2020 2021 2020 
      
Income for the period$217,382 145,392 475,234 266,146 
      
Add / (deduct)     
Foreign exchange (16,907)18,163 (1,585)61,056 
Change in fair value of derivative (5,495)3,171 519 (4,790)
Interest (1,972)(2,903)(3,794)(8,905)
Tax 54,930 62,321 78,230 113,182 
Share based payments 11,115 21,434 23,563 34,146 
Amortization 7,926 11,221 15,462 22,456 
  49,597 113,407 112,395 217,145 
      
Adjusted EBITDA$266,979 258,799 587,629 483,291 


About Vigil Health Solutions Inc.

Vigil offers a proprietary technology platform combining software and hardware to provide comprehensive solutions to the expanding seniors’ housing market. Vigil has established a growing presence in North America and an international reputation for being on the leading edge of systems design and integration. Vigil’s objective is to offer solutions for the full continuum of care. Vigil’s product range includes the innovative wireless Vitality Care System™ featuring discreet 'mini pendants', a nurse call system, mobile fall and incontinence monitoring, resident check in and the award-winning Vigil Memory Care System.

Certain statements contained in this news release that are not based on historical facts may constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws (“forward-looking statements”). These forward-looking statements are not promises or guarantees of future performance but are only predictions that relate to future events, conditions or circumstances or our future results, performance, achievements or developments and are subject to substantial known and unknown risks, assumptions, uncertainties and other factors that could cause our actual results, performance, achievements or developments in our business or in our industry to differ materially from those expressed, anticipated or implied by such forward-looking statements.

Forward-looking statements include all financial guidance, disclosure regarding possible events, conditions, circumstances, or results of operations that are based on assumptions about future economic conditions, courses of action and other future events. We caution you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made. These forward-looking statements appear in a number of different places in this presentation and can be identified by words such as “may”, “estimates”, “projects”, “expects”, “intends”, “believes”, “plans”, “anticipates”, or their negatives or other comparable words. Forward-looking statements include statements regarding the outlook for our future operations, plans and timing for the introduction or enhancement of our services and products, statements concerning strategies or developments, statements about future market conditions, supply conditions, end customer demand conditions, channel inventory and sell through, revenue, gross margin, operating expenses, profits, forecasts of future costs and expenditures, the outcome of legal proceedings, and other expectations, intentions and plans that are not historical fact.

The risk factors and uncertainties that may affect our actual results, performance, achievements or developments are many and include, amongst others, our ability to develop our sales force and generate revenue, the length of the sales cycle, management of the Company’s growth, ability to recruit and retain staff, fluctuations in demand for current and future products, our ability to develop, manufacture, supply and market existing and new products that meet the needs of customers, volatility in the exchange rate, ability to secure financing, ability to secure product liability insurance, the continuous commitment of our customers, increased competition, changes in regulation and reliance on third party suppliers. These risk factors and others, including the updated risks related to the COVID-19 pandemic, are discussed in the Risks and Uncertainties section of our “Management Discussion and Analysis” segment of our fiscal 2020 Annual Report. Many of these factors and uncertainties are beyond the control of the Company. Consequently, all forward-looking statements in this news release are qualified by this cautionary statement and there can be no assurance that actual results, performance, achievements, or developments anticipated by the Company will be realized.

We caution readers that the risks described are not the only ones that could impact the Company. We cannot accurately predict the full impact that COVID-19 will have on our business, results of operations, financial condition or the demand for our services, due in part to the uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, the steps our customers and suppliers may take in current circumstances, including slowing or halting operations, the duration of travel and quarantine restrictions imposed by governments of affected countries and other steps that may be taken by such governments to respond to the pandemic. Additional risks and uncertainties not currently known to us or that are currently deemed to be immaterial may also have a material adverse effect on our business, financial condition, or results of operations.

Forward-looking statements are based on management’s current plans, estimates, projections, beliefs, and opinions and, except as required by law, the Company does not undertake any obligation to update forward-looking statements should the assumptions related to these plans, estimates, projections, beliefs, and opinions change.

For further information please contact:
Troy Griffiths, President and CEO
Tel: (250) 383-6900
Fax: (250) 383-6999
Email: information@vigil.com
Vigil Health Solutions Inc.
2102-4464 Markham Street
Victoria, BC
V8Z 7X8
Website: www.vigil.com
  

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