MARKHAM, ONTARIO, May 15, 2018 – Sangoma Technologies Corporation (TSX VENTURE:STC), a trusted leader in delivering Unified Communications solutions for SMBs, Enterprises, OEMs, and Service Providers, both on-premises and in the cloud, today announced highlights of its third quarter financial results and interim unaudited consolidated financial statements for the third quarter of fiscal 2018, ended March 31, 2018.
For the third quarter of fiscal 2018, sales were $16.24 million, 138% more than in the same quarter last year and the thirteenth quarter in row of higher revenue versus the prior year.
| Q3 FY2018 | Q3 FY2017 | Change | Q2 FY2018 | Change | |
| Sales | $16.24 m | $6.81 m | 138% | $11.74 m | 38% |
| Gross profit | $8.90 m | $4.48 m | 99% | $5.99 m | 49% |
| Operating Expense | $7.56 m | $4.03 m | 88% | $5.08 m | 49% |
| Operating Income1 | $1.41 m | $0.45 m | $0.91 m | ||
| Net Income | $0.75 m | $0.28 m | $0.61 m | ||
| Net earnings per share (fully diluted) | $0.015 | $0.008 | $0.017 | ||
| EBITDA1 | $1.90 m | $0.73 m | 160% | $1.27 m | 49% |
1 Operating Income and EBITDA are metrics used by the Company to monitor its performance and the definitions may be found in the accompanying MDu0026amp;A posted today at www.sedar.com.
“I am pleased that the results of our third quarter, the first one since our latest acquisition, surpassed our expectations with strong revenue momentum and with EBITDA approaching $2 million,” said Bill Wignall, President and CEO. “When acquiring a business via a ‘carve-out’, there is always a very significant integration effort. We have now transitioned the CCD customers and have mostly closed down the prior systems to move the business to Sangoma’s infrastructure. To have done so in short order was no small feat, and I’d like to personally thank all the people in the combined company who were involved in making that happen. And I’d also like to express my gratitude to all the CCD staff for a very positive contribution this quarter from the newly acquired business.”
Gross profit of $8.90 million for the third quarter was double that of the third quarter of fiscal 2017, with gross margin percent at 55% of sales reflecting the addition of the newly acquired customer sales.
Operating expenses were $7.56 million in the third quarter, up 88% from the same quarter in fiscal 2017, reflecting the addition of the two acquisitions and their associated staffs..
EBITDA was $1.90 million for the quarter ended March 31, 2018 up 160% from the $0.73 million in the same quarter of fiscal 2017 and at over 10% of revenue, was above our fiscal 2018 target.
Sangoma generated almost $2 million in cash from operations in the quarter, boosting an already healthy balance sheet that was also strengthened by the approximately $12 million from the recent private placement. The company finished the quarter with a cash balance of $14.03 million and working capital of $16.40 million.
Outlook for fiscal year 2018
Sangoma’s Board of Directors considers that year-to-date performance indicates that we will exceed previously issued guidance. It is now anticipated that revenue for fiscal 2018 will exceed $55 million, with approximately $6 million of EBITDA.
Conference Call
President and CEO, Bill Wignall, and CFO, David Moore will host a conference call on Friday, May 18, 2018 at noon Eastern Standard Time, to discuss the quarterly results. The dial-in number for the call is 1-800-319-4610 (International 1-604-638-5340). Investors are requested to dial in 5 to 10 minutes before the scheduled start time and ask to join the Sangoma call. If you are unable to listen to the call a recording of the prepared remarks will be posted on Sangoma’s website in the Investor Relations section.