All figures are stated in Canadian dollars unless otherwise noted. Fourth Quarter 2011 Highlights
• Revenue was $18.8 million in Q4 2011, an increase of 86% over Q4 2010 revenue of $10.2 million.
• Gross margin was 51%, compared to 46% in Q4 2010.
• EBITDA was $2.3 million, an increase of $1.9 million from $0.4 million in Q4 2010. (See “Non-IFRS Measures” below.)
• Net income was $1.6 million, compared to a net loss of $0.2 million in Q4 2010.
Fiscal Year 2011 Highlights:
• Revenue was $60.0 million in fiscal 2011, an increase of 86% from $32.3 million in 2010.
• Gross margin was 46%, compared to 45% the prior year.
• EBITDA was $6.6 million, up 132% from $2.8 million in 2010.
• Net income was $3.8 million, compared to $1.0 million in 2010.
• In November 2011, Avigilon completed a $26 million financing transaction, raising gross proceeds of $21 million in an Initial Public Offering (IPO) and proceeds of $5 million in a Secondary
• Offering, and listed its shares on the Toronto Stock Exchange.
“Our strong growth is a testament to Avigilon’s innovative and industry-leading technology in the growing global HD video surveillance market,” said Alexander Fernandes, president and chief executive officer, Avigilon. “In keeping with the strategy we outlined during our IPO last fall, we are actively investing in sales, marketing and R&D in 2012 to accelerate our growth.”
Avigilon’s revenue was $60.0 million for the year ended December 31, 2011, an increase of $27.7 million or 86% compared to $32.3 million of revenue in fiscal 2010. The increase in revenue was a result of new product offerings, expansion into new markets, and ever increasing customer awareness and acceptance in existing markets. In 2011, the Company expanded the North American, EMEA (Europe, Middle East and Africa) and Latin American sales teams to meet the growing demand for the Company’s high-definition surveillance solution. Avigilon also added a global gaming security expert to the team to target the substantial and fast-growing casino surveillance market. Key customer wins in the casino, retail, stadium, transportation, hospitality and critical infrastructure industries also contributed to increased revenue in 2011.
In addition to growing personnel to keep up with customer demand, Avigilon expanded its product portfolio to include:
The industry’s highest resolution HD surveillance camera. The 29MP can replace up to 95 analog cameras and integrates seamlessly with the Avigilon Control Center software. Avigilon now offers the broadest range of HD surveillance cameras.
Two new cameras in the popular H.264 HD camera series for greater coverage, enhanced performance in low-light conditions and a smaller form factor.
The award-winning H.264 Analog Video Encoder that delivers the industry’s most cost-effective upgrade path to HD surveillance.
Avigilon Control Center Core designed specifically for small and medium businesses a growing HD video surveillance segment.
Avigilon Control Center Mobile allowing security professionals remote access to HD surveillance video via Apple and Android phone and tablet devices.
Gross margin was $27.6 million in fiscal 2011, an increase of $13.0 million or 90% from $14.6 million the previous year. As a percentage of revenue, gross margins were 46% in 2011 compared to 45% in 2010, largely due to a change in sales mix towards higher margin products.
Selling and marketing expenses were $12.8 million in 2011, a $6.0 million increase from $6.8 million the previous year. The increase was primarily due to higher sales volumes, additional personnel and their related expenses, and an expanded marketing program launched partway through the year.
Research and development expenses, net of related income tax credits, were $3.1 million for the year, a $0.7 million increase compared to 2010.
General and administrative expenses were $5.9 million in 2011, up $2.9 million from $2.9 million of G&A expense in 2010. The increase was primarily due to additional personnel and their related expenses to support Avigilon’s growth.
EBITDA was $6.6 million in 2011, an increase of $3.8 million or 132% compared to $2.8 million in 2010. The increase was largely due to the increased revenues during the year.
Net income for the year was $3.8 million, an increase of $2.9 million compared to net income of $1.0 million in 2010. Earnings per share were $0.20 (basic) or $0.14 (diluted) in 2011, compared to $0.06 (basic) or $0.05 (diluted) the previous year. Avigilon’s basic share count at December 31, 2011 was 31,021, 287.
Financial statements can be downloaded from the Avigilon website at ir.avigilon.com or SEDAR at sedar.com/.
Avigilon has scheduled a conference call to discuss these results on Wednesday, February 29, 2012, beginning at 5:00 pm. EST (2:00 pm. PST). To access the call, dial 647-427-7450 or 1-888-231-8191, or view the webcast at ir.avigilon.com. A replay will be available for one year on the Company’s website, and for one week by dialing 416-849-0833 or 1-855-859-2056, reference number 53775188.
The term "EBITDA" refers to earnings before deducting interest, taxes, depreciation, amortization, foreign exchange gain or loss, and stock-based compensation. Management believes that EBITDA is a useful measure as it provides an indication of the operational results of the business prior to taking into consideration how those activities are financed and taxed and also prior to taking into consideration asset amortization. EBITDA does not have a standardized meaning prescribed by International Financial Reporting Standards (IFRS) and is not necessarily comparable to similar measures provided by other companies. Accordingly, investors are cautioned that EBITDA should not be construed as an alternative to operating income or net income determined in accordance with IFRS as an indicator of the Company’s financial performance or as a measure of its liquidity and cash flows.
Avigilon is a leader in the design, manufacturing and marketing of high-definition, network-based video surveillance systems and equipment for the global security market. The Avigilon surveillance system has been designed to provide high quality video capture, transmission, recording and playback. The components of the Avigilon system include cameras, recording hardware and software which may be sold separately or in combination to provide customers with a customizable, open, end-to-end video surveillance solution.