Mr. Doug Moore reports

EVERTZ TECHNOLOGIES REPORTS FIRST QUARTER RESULTS FOR THE QUARTER ENDED JULY 31, 2023

Evertz Technologies Ltd. has released its results for the first quarter ended July 31, 2023.

First quarter 2024 highlights:

• Revenue of $125.8-million, an increase of 23.9 per cent from the prior year;
• Revenue in the United Sales region up 14 per cent or $10.6-million from the prior year;
• International revenue up 66 per cent or $15.5-million from the prior year;
• Earnings from operations, before foreign exchange, of $24.4-million;
• Earnings from operations of $22.3-million, an increase of 16 per cent from the prior year;
• Net earnings of $15.9-million for the quarter;
• Fully diluted earnings per share of 20 cents for the quarter, an increase of 13.0 per cent from the prior year.

Revenue

For the quarter ended July 31, 2023, revenues were $125.8-million, an increase of 24 per cent compared with revenues of $101.5-million for the quarter ended July 31, 2022. For the quarter, revenues in the United States/Canada region were $87.0-million, an increase of $8.8-million, compared with $78.2-million in the same quarter last year. The international region had revenues of $38.8-million, compared with $23.3-million in the same quarter last year.

Gross margin

For the quarter ended July 31, 2023, gross margin was $72.0-million as compared with $58.5-million in the same quarter last year. Gross margin percentage was approximately 57.3 per cent as compared with 57.6 per cent in the quarter ended July 31, 2022.

Earnings

For the quarter ended July 31, 2023, net earnings were $15.9-million as compared with $13.9-million in the corresponding period last year.

For the quarter ended July 31, 2023, earnings per share on a fully diluted basis were 20 cents as compared with 18 cents in the corresponding period last year.

Operating expenses

For the quarter ended July 31, 2023, selling and administrative expenses were $16.4-million as compared with $12.9-million for the quarter ended July 31, 2022. Selling and administrative expenses in the quarter ended July 31, 2022, included a recovery of $3.8-million, netted against associated fees, that did not reoccur in the current year.

For the quarter ended July 31, 2023, gross research and development expenses were $31.9-million as compared with $28.3-million for the quarter ended July 31, 2022.

Liquidity and capital resources

The company's working capital as at July 31, 2023, was $173.4-million as compared with $171.4-million on April 30, 2023.

Cash was $48.9-million as at July 31, 2023, as compared with $12.5-million on April 30, 2023.

Cash generated from operations was $60.0-million for the quarter ended July 31, 2023, as compared with $19.3-million cash generated for the quarter ended July 31, 2022. Before taking into account taxes and the changes in non-cash working capital and current taxes, the company generated $19.9-million from operations for the quarter ended July 31, 2023, compared with $17.7-million for the same period last year.

For the quarter, the company used $2.4-million for investing activities, which was principally a result of the acquisition of capital assets which amounted to $3.2-million.

For the quarter ended July 31, 2023, the company used cash in financing activities of $22.1-million, which was principally a result of the payment of dividends of $14.5-million and the repayment of line of credit of $6.0-million.

Shipments and backlog

At the end of August, 2023, purchase order backlog was in excess of $343-million, and shipments during the month of August, 2023, were $49-million.

Dividend declared

Evertz board of directors declared a regular quarterly dividend on Sept. 12, 2023, of 19 cents per share.

The dividend is payable to shareholders of record on Sept. 22, 2023, and will be paid on or about Sept. 29, 2023.

Conference call

The company will hold a conference call with financial analysts to discuss the results on Sept. 12, 2023, at 5 p.m. EDT. 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 Oct. 11, 2023. The rebroadcast can be accessed at 416-764-8692 or toll-free 1-877-674-7070. The passcode for the rebroadcast is 374933.

About Evertz Technologies Ltd.

Evertz Technologies designs, manufactures and markets video and audio infrastructure solutions for the television, telecommunications 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, and high- and ultrahigh-definition television (HDTV and UHD), and next-generation, high-bandwidth, low-latency IP (Internet protocol) network environments, and by telecommunications 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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