An anonymous director reports

EVERTZ TECHNOLOGIES REPORTS RECORD QUARTERLY REVENUE OF $129 MILLION, RECORD ANNUAL REVENUE OF $455 MILLION FOR PERIODS ENDING APRIL 30, 2023 AND RECORD BACKLOG OF $392 MILLION

Evertz Technologies Ltd. today released its results for the fourth quarter and year ended April 30, 2023.

Fiscal 2023 highlights

• Record revenue of $454.6-million;
• Record backlog of $392-million as at May 31, 2023;
• Earnings from operations of $95.6-million;
• Net earnings of $64.6-million for the year;
• Fully diluted earnings per share of 84 cents for the year.

Fourth quarter 2023 highlights

• Record quarterly revenue of $128.9-million, an increase of 11.1 per cent from the prior-year earnings from operations, up 13.4 per cent to $30.5-million from the prior year;
• Receipt of a purchase order in excess of $152-million from a major United States-based media company for Evertz Cloud software and services to be provided over a five-year period;
• Receipt of a purchase order in excess of $25-million from an international customer for a hybrid solution with next generation Evertz IP core, control, orchestration and visualizatio-;
• Net earnings of $18.6 million for the quarter;
• Fully diluted earnings per share of 24 cents for the quarter.

Revenue

For the quarter ended April 30, 2023, revenues were $128.9-million compared with revenues of $116.1-million for the quarter ended April 30, 2022. For the quarter, revenues in the United States/Canada region were $98.0-million, an increase of $20.2-million, compared with $77.8-million in the same quarter last year. The international region had revenues of $30.9-million compared with $38.2-million in the same quarter last year.

For the year ended, April 30, 2023, sales were $454.6-million, compared with sales of $441.0-million for the year ended April 30, 2022. For the year, revenues in the United States/Canada region were $337.1-million, an increase of $37.7-million compared with $299.4-million in the prior year. The international region had revenues of $117.5-million compared with $141.7-million in the prior year.

Gross margin

For the quarter ended April 30, 2023, gross margin was $76.6-million as compared with $68.3-million in the same quarter last year. Gross margin percentage was approximately 59.5 per cent as compared with 58.9 per cent in the quarter ended April 30, 2022.

For the year ended April 30, 2023, gross margin was $268.3-million as compared with $255.3-million for the year ended April 30, 2022. Gross margin percentage was approximately 59.0 per cent as compared with 57.9 per cent for the prior year.

Earnings

For the quarter ended April 30, 2023, net earnings were $18.6-million as compared with $19.2-million in the corresponding period last year.

For the year ended April 30, 2023, net earnings were $64.6-million as compared with $72.7-million in the corresponding period last year.

For the quarter ended April 30, 2023, earnings per share on a fully diluted basis were 24 cents as compared with 25 cents in the corresponding period last year.

For the year ended April 30, 2023, earnings per share on a fully diluted basis were 84 cents as compared with 94 cents in the same period in 2022.

Operating expenses

For the quarter ended April 30, 2023, selling and administrative expenses were $17.5-million as compared with $16.1-million for the quarter ended April 30, 2022.

For the year ended April 30, 2023, selling and administrative expenses were $61.5-million as compared with $60.9-million for the year ended April 30, 2022.

For the quarter ended April 30, 2023, gross research and development expenses were $29.9-million as compared with $27.3-million for the quarter ended April 30, 2022.

For the year ended April 30, 2023, gross research and development expenses were $117.1-million as compared with $102.4-million for the year ended April 30, 2022.

Liquidity and capital resources

The company's working capital as at April 30, 2023, was $171.4-million as compared with $158.9-million on April 30, 2022.

Cash was $12.5-million as at April 30, 2023, as compared with $33.9-million on April 30, 2022.

Cash generated from operations was $25.9-million for the quarter ended April 30, 2023, as compared with $21.5-million cash generated for the quarter ended April 30, 2022. Before taking into account taxes and the changes in non-cash working capital and current taxes, the company generated $26.7-million from operations for the quarter ended April 30, 2023, compared with $23.9-million for the same period last year.

Cash provided by operations was $53.8-million for the 2023 fiscal year as compared with cash provided by operations of $68.7-million for the 2022 fiscal year. Before taking into account taxes and the changes in non-cash working capital and current taxes, the company generated $91.5-million from operations for fiscal 2023 as compared with $93.0-million for fiscal 2022.

For the quarter, the company generated $3.0-million from investing activities.

For the year, the company used $17.1-million in investing activities which was principally driven by the acquisition of instruments held for trading of $14.4-million.

For the quarter ended, the company used cash in financing activities of $10.6-million which was principally a result of the payment of dividends of $14.5-million.

For the year ended April 30, 2023, the company used cash in financing activities of $58.0-million which was principally a result of the payment of dividends of $56.4-million.

Shipments and backlog

At the end of May, 2023, purchase order backlog was in excess of $392-million and shipments during the month of May, 2023, were $40-million.

Dividend declared

Evertz board of directors declared a regular quarterly dividend on June 21, 2023, of 19 cents per share.

The dividend is payable to shareholders of record on June 29, 2023, and will be paid on or about July 6, 2023.

Conference call

The company will hold a conference call with financial analysts to discuss the results on June 21, 2023, at 5 p.m. ET. Media and other interested parties are invited to join the conference call in listen-only mode. The conference call may be accessed by dialling 416-764-8646 or toll-free (North America) 1-888-396-8049.

For those unable to listen to the live call, a rebroadcast will also be available until July 21, 2023. The rebroadcast can be accessed at 416-764-8692 or toll-free 1-877-647-7070. The pass code for the rebroadcast is 998178.

About Evertz Technologies Ltd.

Evertz Technologies designs, manufactures and markets video/audio infrastructure solutions for the television, telecommunication and new-media industries. The company's solutions are purchased by content creators, broadcasters, specialty channels and television service providers to support their increasingly complex multichannel digital, high-definition and ultrahigh-definition television, and next-generation, high-bandwidth, low-latency Internet protocol network environments, and by telecommunication and new-media companies. The company's products allow its customers to generate additional revenue while reducing costs through efficient signal routing, distribution, monitoring and management of content, as well as the automation and orchestration of more streamlined and agile workflow processes on premise and in the cloud.

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