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Avante Logixx Inc. Announces Results for the Three-Month Period Ended June 30, 2018

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TORONTO, Aug. 24, 2018 (GLOBE NEWSWIRE) -- Avante Logixx Inc. (TSX.V: XX) (OTC:ALXXF) ("Avante" or the "Company") is pleased to announce its results for the three-month period ended June 30, 2018 (all amounts in Canadian dollars, unless otherwise indicated).

"I am pleased with the results for the quarter as our efforts to streamline technical operations have resulted in efficiencies in our delivery systems, the full effect of which will be seen over the next two quarters. Initiatives to expand the geographies in which we operate continue organically and through acquisitions." said Craig Campbell, CEO and director of Avante. "Consistent with our strategic initiatives, we have made significant investments in building a platform to support organic growth that is capable of handling acquisitions of varying sizes in the next one to three years. This quarter, we focused on promoting our offerings to a larger customer base through brand awareness campaigns, which is beginning to have a positive impact on our topline growth. Further, our capital markets activities resulted in a fully underwritten offering in June 2018 and Avante, as a result, is well positioned to realize our ambitions to grow the business several-fold in the coming years. Our acquisition pipeline includes numerous opportunities to enter lines of business which are very well aligned with our growth objectives".

Q1 2019 Highlights

  • Generated revenues of $5,574,984 for the three-month period ended June 30, 2018 which represented 3.5% YoY growth
  • Recurring revenue grew by 10.4%; number of alarm response packages sold grew by 10.4%
  • Increase in operating expenditure of $420K, due to investment in infrastructure to support future growth initiatives
  • Generated adjusted EBITDA of $351,085 which reflects platform investments for future growth
  • Strong balance sheet; cash on hand $11.3 M and shareholders' equity $19.3 M

RESULTS FOR THE THREE-MONTH PERIOD ENDED JUNE 30, 2018

  Three-month period ended  
   June 30, 2018  June 30, 2017 Variance (%)
       
Total revenues 5,574,984   5,385,006 3.5 %
Revenues - Recurring Monitoring and Response 1 1,740,571   1,576,863 10.4 %
Revenues - Other Security Services 3,834,413   3,808,143 0.7 %
Total gross profit 1,861,924   1,949,079 (4.5 %)
Adjusted EBITDA2 351,085   617,927 (43.2 %)
Net income before tax   (12,088 ) 306,341  
Net income for the year   (77,088 ) 201,341  
Basic income per share   (0.00 )   0.00  
Diluted income per share   (0.00 )   0.00  

1 Revenues – Recurring Monitoring and Response includes Alarm Response and Monitoring services

2 Adjusted EBITDA – Net income before taxes + Depreciation + Amortization of intangibles + Share Based Payments + Acquisition and integration costs + Expensing of CWL fair value adjustment per IFRS (-) Non-controlling interest's share

Avante Logixx generated revenues of $5,574,984 for the three-month period ended June 30, 2017 which represents a 3.5% growth over $5,385,006 of revenues registered for the three-month period ended June 30, 2017. Gross profit for the period ended June 30, 2018 was $1,861,924 as compared to $1,949,079 for the period ended June 30, 2017.

Recurring revenues grew by 10.4%, due primarily to a 12.2% increase in alarm response revenues and 5.2% growth in revenues from monitoring and electronic building management. The number of alarm response packages grew by 10.4%, while the number of video analytics packages sold grew by 19.2% year over year. Other non-recurring revenues, locks and hardware revenues increased by 18% and home and commercial automation increased by 8.4%.

Gross margin for the three-month period ended June 30, 2018 was 33.4% as compared to 36.2% for the three-month period ended June 30, 2017. The decrease in margins was largely due to the commercial installation business, which is likely to rebound in the coming quarters, owing to changes in the Company's delivery model. Gross margins on residential installations and locks and fine hardware were slightly better than the three-month period ended June 30, 2017. 

Adjusted EBITDA for the three-month period amounted to $351,085 as compared to $617,927 for the three-month period ended June 30, 2017. This was largely due to an increase in operating expenses of $420,123, related to investments in platform investments to support future growth including newly created departments such as marketing, corporate development and human resources, and an increase in sales promotion expenses, including advertising and increased expenditure in digital media. With significant M&A activity completed subsequent to June 30, 2018, and more expected to follow in the next three to four months, the Company is uniquely positioned to accommodate additional acquisitions without incremental back-office costs.

Net loss before taxes amounted to $12,088, as compared to a profit of $306,341 for the same period last year.

Following the recent capital offering, resulting in gross proceeds of $8,625,000, the Company's Balance Sheet is healthy and robust with no debt other than vehicle and leasehold loans. Cash and cash equivalents on hand as of June 30, 2018 is in excess of $11 million which is expected to support organic growth initiatives and strategic acquisition opportunities.

CONFERENCE CALL

Avante will be hosting a conference call to discuss the aforementioned results on Monday, August 27, 2018, at 8:30 AM EST.

Dial in details are as follows:  

Local: (+1) 416-764-8658            Toll Free: (+1) 888-886-7786                   Conference ID: 42162319

Playback details below, available until September 7, 2018:

Local: (+1) 416-764-8692            Toll Free: (+1) 877-674-7070                   Playback Pin: 162319 #

This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities described herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This news release does not constitute an offer of securities for sale in the United States. The securities described herein have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and such securities may not be offered or sold within the United States absent registration under U.S. federal and state securities laws or an applicable exemption from such U.S. registration requirements.

About Avante Logixx Inc.

Avante Logixx Inc. (TSXV:XX) is a Toronto based provider of high end security services. We acquire, manage and build industry leading businesses which provide specialized, mission-critical solutions that address the needs of our customers. Our businesses continuously develop innovative solutions that enable our customers to achieve their objectives. With an experienced team and a proven track record of solid growth, we are taking steps to establish a broad portfolio of security businesses to provide our customers  and shareholders with exceptional returns. Please visit our website at www.avantelogixx.com and consider joining our investor email list.

Avante Logixx Inc.

Craig Campbell
CEO
(416) 923-6984
craig@avantelogixx.com

Forward-Looking Information

All statements in this press release, other than statements of historical fact, may constitute "forward looking information" with respect to Avante within the meaning of applicable securities laws. Forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "planned", "expect", "project", "predict", "potential", "targeting", "intends", "believe", "potential", and similar expressions, or describes a "goal", or a variation of such words and phrases or state that certain actions, events or results "may", "should", "could", "would", "might" or "will" be taken, occur or be achieved.

Forward-looking information is subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those expressed or implied by the forward looking information, including, without limitation, the list of risk factors identified in Avante's Management Discussion & Analysis (MD&A), Annual Information Form (AIF) and other continuous disclosure, which list is not exhaustive of the factors that may affect any of Avante's forward-looking information. In connection with the forward-looking statements contained in this and subsequent press releases, Avante has made certain assumptions about its business and the industry in which it operates and has also assumed that no significant events occur outside of Avante's normal course of business. Although management believes that the assumptions inherent in the forward-looking statements are reasonable as of the date the statements are made, forward-looking statements are not guarantees of future performance and, accordingly, undue reliance should not be put on such statements due to the inherent uncertainty therein. Avante's forward-looking information is based on the beliefs, expectations and opinions of management on the date the statements are made, and Avante does not assume any obligation to update forward-looking information, whether as a result of new information, future events or otherwise, other than as required by applicable law. For the reasons set forth above, readers should not place undue reliance on forward-looking information.

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.

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