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Message: Route1 earns $306,000 in Q3

Very good results, if trend continues the stock is going much higher.

 

Route1 earns $306,000 in Q3

 

2016-11-22 10:14 ET - News Release

 

Mr. Tony Busseri reports

ROUTE1 REPORTS 2016 THIRD QUARTER FINANCIAL RESULTS

Route1 Inc. has provided its third quarter (Q3) and year-to-date (YTD) financial results for the period ended Sept. 30, 2016.

 

                      In thousands of dollars

                          Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015

Revenue
Device                       $221     $51     $69      $9     $42
Services                    1,808   1,760   1,648   1,616   1,572
Other                           2       1       1       0       0
Total revenue               2,031   1,812   1,718   1,625   1,614
Cost of revenue               448     341     348     284     320
Gross profit                1,583   1,471   1,370   1,341   1,294
Operating expenses          1,243   1,299   1,332   1,189   1,170
Operating profit (1)          340     172      38     152     124
Total other expenses          (34)     27    (304)    225     (22)
Comprehensive net income      306     199    (266)    377     102

(1) Note: before stock-based compensation
                
            

 

During the third quarter of 2016, Route1 realized growth in revenue from MobiKEY application software subscribers (recurring revenue). Revenue from services includes MobiKEY application software, the MobiNET (DEFIMNET) platform and other appliance licensing or yearly maintenance.

 

                        SERVICES REVENUE

                               Q3 2016  Q2 2016  Q1 2016  Q4 2015  Q3 2015
                
Closing number of subscribers   17,344   16,800   16,490   16,286   15,989
Revenue per subscriber            $383     $383     $367     $361     $362
Subscriber revenue *            $1,639   $1,591   $1,496   $1,467   $1,424
Other services revenue *          $169     $169     $152     $149     $148
Total services revenue *        $1,808   $1,760   $1,648   $1,616   $1,572
                
* Note: Figures are in Canadian thousands.

 

Earnings before interest, taxes, depreciation, amortization and stock-based compensation (adjusted EBITDA) during the third quarter of 2016 amounted to approximately $447,000 compared with $242,000 in Q3 2015.

 

        
            (in thousands of Canadian dollars)    
                
                          Q3 2016  Q2 2016  Q1 2016  Q4 2015  Q3 2015

Gross profit               $1,583   $1,471   $1,370   $1,341   $1,294
Adjusted EBITDA               447      278      172      279      242
Amortization                  107      106      134      127      118
Operating profit before 
stock-based compensation      340      172       38      152      124
                

 

Route1 used cash in operating activities of approximately $700,000 during Q3 2016 compared with cash used of $900,000 in Q3 2015. As at Sept. 30, 2016, the company had no bank debt and a cash balance of $2.9-million.

 

                                    BALANCE SHEET EXTRACTS
                               (thousands of Canadian dollars)

                            Sept. 30,   June 30,   March 31,   Dec. 31,   Sept. 30,
                              2016        2016       2016        2015       2015
                
Cash                         $2,898      $3,735       $407      $1,251     $2,433
Total current assets          3,938       4,765      3,880       2,112      3,161
Total current liabilities     3,555       4,719      3,814       1,948      3,155
Net working capital             383          46         66         164          6
Total assets                  5,230       6,116      5,296       3,656      4,466                
Bank debt                         0           0          0           0          0
Total liabilities             3,656       4,820      3,919       2,059      3,256
                
            

 

Route1's cash position is at its highest level during the second quarter of the fiscal year as a direct result of the timing of annual enterprise user subscription renewal payments.

Share repurchase program

On Sept. 16, 2016, the company announced with approval from the TSX Venture Exchange its intention to make another NCIB. The NCIB permits the company to purchase for cancellation up to 5 per cent of the common shares in the public float. The maximum number of shares allowed for repurchase is 17,563,870. Purchases under the NCIB may occur during the 12-month period commencing Sept. 27, 2016, and ending Sept. 26, 2017, or the date upon which the maximum number of common shares have been purchased by the company.

For the nine months ended Sept. 30, 2016, the company in aggregate repurchased for cancellation 11,582,000 of its common shares for a consideration of $543,710, at an approximate average price of 4.7 cents per share under the NCIB. For the nine months ended Sept. 30, 2015, the company repurchased for cancellation 7,691,500 of its common shares for a consideration of $361,927 at an average price of 4.7 cents per share under the NCIB.

Business and product development highlights

Route1 provided a Q3 2016 operations update via an investor presentation and conference call on Oct. 18, 2016. The investor presentation was filed on SEDAR and is also available on Route1's website.

We seek Safe Harbor.

© 2016 Canjex Publishing Ltd. All rights reserved.

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