Mr. Neil Gaydon reports

SMART REPORTS FULL YEAR AND FOURTH QUARTER 2013 FINANCIAL RESULTS; FULL YEAR REVENUE OF $589.4 MILLION; ANNUAL GROSS MARGIN OF 44.4%; FULL YEAR ADJUSTED EBITDA OF $48.8 MILLION; ANNUAL ADJUSTED NET INCOME OF $11.8 MILLION

SMART Technologies Inc. has released financial results for its full year and fourth quarter ended March 31, 2013.

"During the year we restructured the company to improve our efficiency and customer focus, and we have created a strategy that will leverage our competitive strengths and improve our ability to provide world-class collaboration solutions to our education and enterprise customers," stated Neil Gaydon, president and chief executive officer of SMART. "Our strategy and structure will enable us to address the ongoing challenges we are facing in our core markets, which were reflected in our fiscal 2013 results."

Mr. Gaydon continued, "Looking ahead, we remain committed to delivering on our fiscal 2014 plan while carefully balancing our cost structure with investment in new product development driven by our three-year strategy."

                         Three months ended March 31,  Fiscal year ended March 31,
($ millions)                  2013           2012          2013           2012

GAAP results

Revenue                    $ 105.2        $ 148.0       $ 589.4        $ 745.8      
Net (loss) income          $ (18.7)       $  (2.9)      $ (54.5)       $  31.0      

Non-GAAP results                                                                       

Adjusted EBITDA            $  (8.8)       $  1.7         $ 48.8         $ 127.5      
Adjusted net (loss) income $ (11.5)       $ (5.1)        $ 11.8         $  70.6       

GAAP: generally accepted accounting principles
EBITDA: earnings before interest, taxes, depreciation and amortization

Total revenue for the fourth quarter of fiscal 2013 was $105.2-million compared with $148.0-million in the prior-year period, a decrease of 29 per cent over the prior year. In terms of unit sales, 60,444 interactive displays were sold in the quarter, compared with 81,716 units sold in the prior-year period. Average selling price for the fourth quarter was $1,360, compared with $1,322 in the prior-year period. Total revenue for fiscal 2013 was $589.4-million, a decrease of 21 per cent over the prior year. Revenue during fiscal 2013 decreased in North America by 23 per cent, EMEA (Europe, Middle East and Africa) by 10 per cent and the rest of the world by 33 per cent year over year. Average selling price for fiscal 2013 was $1,371 compared with $1,426 in the prior-year period.

Gross profit for the fourth quarter of fiscal 2013 was $45.5-million compared with $58.8-million in the prior-year period. Gross margin for the fourth quarter was 43 per cent, compared with 40 per cent for the prior-year period. Fiscal 2013 full-year gross margin was $261.6-million, or 44 per cent, compared with $335.6-million, or 45 per cent in fiscal 2012.

Cash operating expenses decreased by $7.7-million, or 13 per cent, from $58.2-million in the fourth quarter of fiscal 2012 to $50.5-million in the fourth quarter of fiscal 2013. In fiscal 2013, cash operating expenses were $212.7-million, compared with $221.7-million in fiscal 2012, which was a decrease of 4 per cent. Cash operating expenses comprise selling, marketing and administrative, and research and development expenses, excluding stock-based compensation and bad-debt expense.

Adjusted EBITDA for the fourth quarter of fiscal 2013 was a loss of $8.8-million, compared with positive adjusted EBITDA of $1.7-million representing a 1-per-cent margin in the prior-year period. Adjusted EBITDA for fiscal 2013 was $48.8-million, representing an adjusted EBITDA margin of 8 per cent compared with 17 per cent or $127.5-million for fiscal 2012. Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by revenue after adding back the net impact of deferred revenue.

GAAP net loss was $18.7-million for the fourth quarter of fiscal 2013 compared with a net loss of $2.9-million in the prior-year period. GAAP loss per share was 15 cents based on 120.5 million weighted average shares outstanding, compared with a GAAP net loss of two cents based on 121.4 million weighted-average shares outstanding during the prior-year period. GAAP net loss during the quarter ended March 31, 2013, includes a $5.0-million foreign exchange loss, compared with a $5.6-million foreign exchange gain in the prior-year period. GAAP net loss for fiscal 2013 was $54.5-million or 45 cents per share, compared with net income of $31.0-million or 25 cents per share for fiscal 2012. GAAP net loss for fiscal 2013 included a $34.2-million goodwill impairment charge and a $5.0-million foreign exchange loss, compared with an $8.5-million foreign exchange loss in the prior-year period.

Adjusted net loss for the fourth quarter of fiscal 2013 was $11.5-million compared with an adjusted net loss of $5.1-million in the same period last year. Adjusted net loss per share was 10 cents based on 120.5 million weighted average shares outstanding, compared with an adjusted net loss per share of four cents based on 121.4 million weighted average shares outstanding for the fourth quarter of fiscal 2012. Adjusted net income for fiscal 2013 was $11.8-million or 10 cents per share compared with $70.6-million or 57 cents per share for fiscal 2012.

As of March 31, 2013, SMART had cash and cash equivalents of $141.4-million and $288.2-million of debt outstanding.

Conference call information

SMART will host a conference call today, May 16, 2013, at 2:30 p.m. MT (4:30 p.m. ET) to discuss the company's financial results and corporate strategy.

To access this call, dial 877-312-5844 (North America) or 253-237-1152 (outside North America) with conference ID No. 44157840. A live webcast of the conference call and supplemental slides will be accessible from the investor relations page of SMART's website, and a replay will be archived and accessible at the website as well.

A replay of this conference call may also be accessed through May 26, 2013, by dialling 855-859-2056 (North America) or 404-537-3406 (outside North America). The replay passcode is 44157840.

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