Eurocontrol Reports Second Quarter 2017 Results
Test and Measurement Innovators
Focused on Key Growth Markets
Eurocontrol ranked
on Profit500 in three
consecutive years
365 Bay Street, Suite 400
Toronto, Ontario, Canada M5H 2V1
T 416 361 2808 | F 416 361 2519
eurocontrol.ca
Eurocontrol Reports Second Quarter 2017 Results
- 82% Increase in Revenue and 186% Increase in Gross Profit -
Toronto, CANADA, August 29, 2017 - Eurocontrol Technics Group Inc. (TSX Venture: EUO; OTCQB: EUCTF)
(“Eurocontrol” or the “Company”), a Canadian public company specializing in the acquisition, development and
commercialization of innovative test and measurement technologies for industry with application systems focused on
the energy security, semiconductor and precision agriculture sectors, announces that it has filed its financial
statements and Management’s Discussion and Analysis (“MD&A”) for the quarter ended June 30, 2017.
The second quarter results reflect an 82% increase in fiscal year revenue, excluding discontinued operations, to
$1,268,811 compared to $696,853 for the six month period ended June 30, 2016. EBITDA for the six month period
decreased by $18,573,866 to $(2,774,406) compared to $15,799,460 as at June 30, 2016 which amount reflected the
gain on the sale of the Company’s former subsidiary. The Company had a gross profit of $594,108 for the current
period compared to $208,003 for the six months ended June 30, 2016, representing an increase of 186% . Included
below is a summary table outlining earnings for the second quarter of 2017 compared to the corresponding 2016
period. Subsequent to the end of the second quarter, the Company received the third of the guara nteed earn-out
payments of $750,000 from SICPA SA, bringing the total payments to date to $2,250,000.
Included in the financial statements are discontinued operations relating to the Company’s sale of its former wholly
owned subsidiary, Global Fluids Int ernational (GFI) S.A. (GFI), to SICPA S.A. (“SICPA”), a private Swiss company
that is a global leader in the provision of secured identification, traceability and authentication solutions and services,
on January 4, 2016 in exchange for $16 million in cas h (less transaction payments) and post closing earn -out
payments equal to 5% of the net revenues earned by SICPA GFI from contracts entered into (between January 4,
2016 ending January 4, 2022), with a minimum guaranteed of $1.5 million per year for the si x year earn -out period
(total payment of at least $9,000,000). The Company, through its wholly owned subsidiary, Xenemetrix, entered into
a strategic exclusive long term supply, maintenance and support agreement, pursuant to which Xenemetrix will
continue to supply to SICPA GFI, Xenemetrix products and services for the oil and gas marking and monitoring field.
Further details relating to this sale transaction can be obtained from the Company’s continuous disclosure documents
including the MD&A for the quarter ended June 30, 2017.
Bruce Rowlands, Chairman and Chief Executive Officer stated: “This is the third reporting period that our revenue
numbers have improved quarter over quarter. The increase in revenues from Xenemetrix for the first half of the y ear
clearly reflects that our investment s in updating and marketing the Xenemetrix product line is continuing to increase
sales. The strong interest in the Xenemetrix product line and the solid advancements we’ve made in marketing
XwinSys’s ONYX metrology system to the semiconductor industry and commercialization and continued
advancements at Croptimal, bodes well for a strong second half.”
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Financial and Operating Highlights *
Achieved second quarter revenue of $1,268,811 from continuing operations, an 82% increase from June 30,
2016 revenue of $696,853.
Recognized $594,108 in gross profit, an increase of 186% from June 31, 2016.
Recognized second quarter net loss excluding discontinued operations of $2,350,277 compared to a net loss of
$2,752,753 in 2016.
2017 investment in R&D of ~$1.6 million.
* Certain comparative figures have been reclassified to conform to the current year’s presentation. These
reclassifications did not affect prior years’ net losses.
2017 2016 2017 2016
$ $ $ $
Revenue 708,563 394,180 1,268,811 696,853
Cost of sales
Cost of sales - direct production costs (213,248) (227,616) (586,006) (400,153)
Cost of sales - amortization and other non cash items (44,348) (44,348) (88,697) (88,697)
(257,596) (271,964) (674,703) (488,850)
Gross profit 450,967 122,216 594,108 208,003
Expenses (1,704,124) (1,746,322) (3,470,054) (3,701,353)
Other (expense) income 244,679 164,599 430,669 532,597
Income tax recovery 37,000 208,000 95,000 208,000
Gain on sale of subsidiary - discontinued operations - - - 16,484,172
Net loss - continuing operations (971,478) (1,251,507) (2,350,277) (2,752,753)
Net income - discontinued operations - - - 16,484,172
Net income (loss) (971,478) (1,251,507) (2,350,277) 13,731,419
Basic loss per share
- from continuing operations (0.01) (0.01) (0.03) (0.03)
- from discontinued operations 0.00 - - 0.18
- net income (loss) (0.01) (0.01) (0.03) 0.15
Diluted loss per share
- from continuing operations (0.01) (0.01) (0.03) (0.03)
- from discontinued operations - - - 0.17
- net income (loss) (0.01) (0.01) (0.03) 0.14
EBITDA (1,208,687) (1,589,489) (2,774,406) 15,799,460
EBIT (1,273,472) (1,646,376) (2,900,211) 15,686,304
Three Months Ended
June 30,
Six Months Ended
June 30,
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About Eurocontrol Technics Group Inc.
Eurocontrol is a TSX Venture and OTCQB traded company that specializes in the acquisition, development and
commercialization of innovative test and measurement technologies for industry with application technologies
focused on the energy securi ty, semiconductor and precision farming sectors based on Xenemetrix’s core
technological platform of ED -XRF. Eurocontrol has three wholly owned subsidiaries, Xenemetrix Ltd., XwinSys
Technology Development Ltd. and Croptimal Ltd. and an agreement with SICP A S.A. for semi -annual earn -out
payments of 5% (minimum $9 million over six years) on revenues generated from the oil and gas marking and
monitoring field relating to the sale of its former subsidiary Global Fluids International (GFI) S.A. Xenemetrix is a
leading designer, manufacturer and marketer of ED -XRF systems, a technology that is the most accurate and
economic method for determining the chemical composition of many types of materials, including the analysis of
petroleum oils and fuel. Xenemetrix has a long-term supply, maintenance and support agreement with SICPA/GFI to
supply SICPA/GFI with Xenemetrix products and services related to the oil and gas marking and monitoring field.
XwinSys has developed a patented, fully automated metrology system fo r the semiconductor industry that combines
2D and 3D image processing technology with Xenemetrix’s ED -XRF technology. Croptimal, is introducing a new
mobile ED -XRF spectroscopic material analysis laboratory for the precision agriculture industry that coul d
dramatically change agricultural testing methodology and increase crop yields.
For further information on Eurocontrol, please visit the Company's website at www.eurocontrol.ca or contact Bruce
Rowlands, Chairman and CEO at (416) 361-2809 or [email protected].
Neither 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. No stock exchange,
securities commission or other regulatory authority has approved or disapproved the information contained herein.
Forward-Looking Statements: This press release contains forward-looking statements. More particularly, this press
release contains statements. Forward -looking statements are frequently characterized by words such as "plan",
"expect", "project", "intend", "believe", anticipate", "estimate", "may", "will", "would", "potential", "proposed" and other
similar words, or statements that certain events or conditions "may" or "will" occur. The forward -looking statements
are based on certain key expectations and assumptions made by Eurocontrol. Although Eurocontrol believes that
the expectations and assumptions on which the forward -looking statements are based are reasonable, undue
reliance should not be placed on the forward -looking statements because Eurocontrol can give no assurance that
they will prove to be correct. Since forward -looking statements address future events and conditions, by their very
nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently
anticipated due to a number of factors and risks. In addition to other risks that may affect the forward -looking
statements in this press release are those set out in Eurocontrol’s management discussion and analysis of the
financial condition and results of operations for the year ended December 31, 2016 which is available on the
Corporation’s profile at www.sedar.com. The forward -looking statements contained in this press release are made
as of the date hereof and Eurocontrol undertakes no obligation to update publicly or revise any fo rward-looking
statements or information, whether as a result of new information, future events or otherwise, unless so required by
applicable securities laws.