| Key Figures (C$ thousand) | ||
|---|---|---|
| Third quarter ended 31.3 | ||
| 2020 | 2019 | |
| Revenues | 36 061 | 32 325 |
| Cost of Goods Sold | 25 725 | 24 781 |
| Gross Profit | 10 336 | 7544 |
| Selling, General & Admin Expenses | 6777 | 5501 |
| Adjusted EBITDA | 3775 | 2196 |
| Net Profit/(Loss) | (3097) | 532 |
| Nine months ended 31.3 | ||
|---|---|---|
| 2020 | 2019 | |
| Revenues | 97 618 | 86 074 |
| Cost of Goods Sold | 72 308 | 66 780 |
| Gross Profit | 25 310 | 19 294 |
| Selling, General & Admin Expenses | 17 732 | 14 784 |
| Adjusted EBITDA | 7692 | 4839 |
| Net Profit/(Loss) | (5040) | (1003) |
Source: H2O Innovation Q3 2020 results.
COMMENT
Membrane filtration specialist H2O Innovation has posted third quarter fiscal 2020 sales of C$36.1 million, up 11.6% on the year earlier.
The majority of the growth came from the contribution of Genesys, acquired in the prior quarter, that contributed C$3.1 million of revenues during the period. That sales boost helped the company's Speciality Products division increase its year-on-year sales by 60.5% to C$12.9 million. The Operation & Maintenance (O&M) segment also enjoyed growth with its revenues up 7.1% to C$16.4 million, but they were down 24.8% to C$6.7 million in the firm's Projects & Aftermarket division.
The company recorded a net loss for the quarter of C$3.1 million, down from a net gain of C$0.5 million in the year prior. The reversal was primarily attributed to a C$5.3 million impairment charge taken in its Projects & Aftermarket business pillar that followed an assessment of the impact of the Covid-19 pandemic.
Despite the anticipated slowdown in its Project business, H20 Innovation's president and CEO, Frédéric Dugré, said the pandemic was likely to deliver the company new opportunities in the coming months particularly for its Specialty Products division. “We believe that small and mid-size municipalities, private utilities and industries will rely more on contracted operators, such as H2O Innovation,” he said. “Our financial situation remains strong and our balance sheet is not over leveraged, allowing us to navigate through the Covid-19 crisis in a positive manner.”