RDX Reports Record 3QTR Earnings

Third Quarter Revenue Increases 151% to $ 13.2 Million

3QTR Revenue Increases to $ 13.21 Million

3QTR Adjusted EBITDA $ 3.72 Million

3QTR Net Income of $ 904,000

SCOTTSDALE, AZ, Feb. 27, 2014 /CNW/ - RDX TECHNOLOGIES CORPORATION ("RDX" or the "Company") (TSXV: RDX, OTCQX: RGDEF, FSE: RL7) a water treatment and energy technology company, today announced financial results for the fiscal third quarter and nine months ending December 31, 2013.

Recent operating highlights:

• Company now on an annualized revenue run rate greater than $ 50MM.
• Company now on an annualized EBITDA run rate of approximately $ 13MM.
• Strong demand forecast for all business segments for fiscal 2015.
• Announces launch of new BlueDot Industrial Franchise Program with plans to open at least 40 locations in Fiscal 2015 and at 300 locations by 2016
• Sold equipment into additional five operating BlueDot facilities. Now six BlueDots total.
• Worked successfully through seasonality of fuel business and now ready to sign long term energy contracts with existing and new customers beginning in March.
• Delivered profitable results in light of seasonality of energy. Worked to eliminate seasonality in energy sales for fiscal 2015.
• Invested over $ 2MM in four new fuel micro-finishing plants for energy customers.
• Conducted successful trials for planned regional municipal water treatment operations.
• Signed contract and opened escrow on excess real estate in Santa Fe Springs, California.
• Developing RDX Europe business plan. Results to be announced in March.
• Developing RDX Canada business plan. Results to be announced in March.
• Successfully ran new methyl-ester based fuel to produce higher quality fuel product.
• Started remediation program for Santa Fe Springs facility.
  
  

Dennis Danzik, Chief Executive Officer of RDX, stated, "I am pleased to report another solid quarter of both top and bottom line growth.  Our revenues increased over 150 percent from the same period last year and we achieved over $3.7 million of adjusted EBITDA for the quarter.  As a result, we are now pacing at approximately $13 million of EBITDA on an annualized basis.  In addition, we continue to strengthen our balance sheet.

"We are now generating solid cash flow, which has allowed us to begin our company stock buy-back program, purchasing approximately 400,000 shares in the open market during the quarter. Our primary focus is driving shareholder value, and we are succeeding in this mission as evidenced by our strong growth, strict financial discipline, increased profitability and improved balance sheet."

The Company will host a business update conference call today, Thursday, February 27th at 11:00 a.m. Eastern Time. Interested parties can access the conference call by dialing 877-407-0778 for U.S. callers or 201-689-8565 for international callers, or listen via a live Internet webcast on the Company's website at www.rdxh2o.com .

A teleconference replay of the conference call will be available approximately one hour following the call, through midnight Thursday, March 13, 2014, and can be accessed by dialing 877-660-6853 (U.S. callers) or 201-612-7415 (international callers) and entering conference ID: 13577169. A webcast replay of the conference call will be accessible on the Company's website at www.rdxh2o.com for 90 days.

About RDX Technologies Corporation

RDX Technologies Corporation is a water treatment and energy technology company. The Company is applying proprietary technology to treat water generated from industrial and commercial waste water markets. These markets include a wide variety of clients across a broad spectrum of industries. The Company trades on the TSX Venture Exchange under the symbol "RDX", the OTCQX as "RGDEF" and the Frankfurt Stock Exchange as "RL7".

ON BEHALF OF THE BOARD OF DIRECTORS
"Dennis M. Danzik"
Dennis M. Danzik, CEO
[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 news release. This news release may contain forward-looking statements. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. Such information is subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward- looking information. Readers are cautioned not to place undue reliance on forward-looking information, as no assurances can be given as to future results, levels of activity or achievements."

RDX TECHNOLOGIES CORPORATION
(FORMERLY RIDGELINE ENERGY SERVICES, INC)
UNAUDITED SUPPLEMENTAL FINANCIAL INFORMATION
(IN CANADIAN DOLLARS)

Earnings Before Interest, Taxes, and Amortization  

The Company's financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS"). The following table calculates earnings before interest, taxes, and amortization (EBITDA) and Adjusted EBITDA, which are not measures determined in accordance with IFRS or accounting principles generally accepted in the United States ("US GAAP"), for the three and nine months ended December 31, 2013 and 2012:  

							Three Months Ended December 31,					Nine Months Ended December 31,
							2013		2012			2013		2012
Net Income (loss) - continuing operations							$	904,000	$	(1,589,000)		$	(2,530,000)	$	(6,598,000)
	Interest and other finance costs							362,000		22,000			1,036,000		57,000
	Taxes							-		-			-		53,000
	Amortization (in cost of revenue)							1,166,000		178,000			3,152,000		465,000
	Amortization (in operating costs)							864,000		870,000			2,593,000		2,257,000
EBITDA								3,296,000		(519,000)			4,251,000		(3,766,000)
	Share-based payment expense							161,000		405,000			278,000		925,000
	Foreign exchange gain on CWT notes payable							702,000		-			860,000		-
	Change in fair value of PTEC earn-out							49,000		(254,000)			(154,000)		(254,000)
	Gain on forgiveness of indebtedness							(407,000)		-			(528,000)		-
	Other income							(77,000)		(25,000)			(34,000)		(72,000)
Adjusted EBITDA								3,724,000		(393,000)			4,673,000		(3,167,000)

We believe that presenting EBITDA and Adjusted EBITDA are useful to investors because they provide important information concerning our operating performance exclusive of certain non-cash and other costs.  EBITDA and Adjusted EBITDA demonstrate our ability to execute our financial strategy, which includes reinvesting in waste water related capital assets to ensure a high level of product quality, investing in capital assets to facilitate growth in our energy business, repurchasing our common stock, and maintaining and improving our market position through business optimization.  These measures have limitations.  Although amortization and share-based payment expenses are considered operating costs in accordance with IFRS and US GAAP, they represent the allocation of non-cash costs generally associated with long-lived assets acquired or constructed in prior years and non-cash compensation primarily for our employees.  Our definition of EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures presented by other companies.

 

RDX TECHNOLOGIES CORPORATION
(FORMERLY RIDGELINE ENERGY SERVICES INC.)
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(IN CANADIAN DOLLARS)
							December 31,			March 31,
							2013			2013
				Assets
Current assets:
	Cash						$	998,093		$	1,336,478
	Trade and other receivables, net							14,117,810			7,695,442
	Accrued revenue							-			539,395
	Inventory, net							2,355,749			1,154,134
	Prepaid expenses and other current assets							1,290,483			663,401
	Total current assets							18,762,135			11,388,850
Restricted cash								85,225			159,771
Property, plant and equipment, net								50,325,505			27,548,066
Intangible assets								16,459,913			18,404,007
Goodwill								8,407,525			2,668,952
Other assets								6,549,879			5,715,018
Total assets							$	100,590,182		$	65,884,664
				Liabilities and Equity
Current liabilities:
	Accounts payable						$	3,696,467		$	5,715,945
	Accrued expenses							6,752,589			6,323,559
	Income tax payable							-			5,067
	Notes payable, current portion							5,456,454			151,069
	Obligations under finance lease, current portion							91,040			92,328
	Total current liabilities							15,996,550			12,287,968
Notes payable, non-current portion								17,600,150			1,248,116
Obligations under finance lease, non-current portion								229,619			289,379
Santa Fe Springs purchase price payable								5,771,550			5,513,251
Environmental remediation liability								5,849,800			5,588,000
PTEC earn-out								176,250			330,000
Asset retirement obligations								-			58,234
	Total liabilities							45,623,919			25,314,948
Commitments and contingencies
Equity:
	Share capital							79,926,718			66,732,800
	Warrants							2,543,829			2,162,794
	Contributed surplus							2,569,866			2,348,691
	Treasury stock, at cost (150,000 and nil common shares, respectively)							(36,780)			-
	Accumulated other comprehensive income							2,350,514			106,144
	Accumulated deficit							(32,387,794)			(30,780,713)
Total equity								54,966,263			40,569,716
Total liabilities and equity							$	100,590,182		$	65,884,664

 

RDX TECHNOLOGIES CORPORATION
(FORMERLY RIDGELINE ENERGY SERVICES INC.)
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(IN CANADIAN DOLLARS)
						Three Months Ended December 31,						Nine Months Ended December 31,
						2013			2012			2013			2012
Revenue						$	13,211,269		$	5,272,854		$	31,985,182		$	7,966,400
Cost of revenue:
	Direct expenses						8,260,066			3,564,118			21,953,641			4,981,800
	Amortization						1,166,356			177,879			3,151,831			465,545
Total cost of revenue							9,426,422			3,741,997			25,105,472			5,447,345
Gross profit							3,784,847			1,530,857			6,879,710			2,519,055
Operating expenses:
	General and administrative						1,227,277			2,101,624			5,358,560			6,152,060
	Share-based payment expense						161,499			405,256			278,487			924,444
	Amortization						863,476			869,536			2,593,142			2,257,656
Total operating expenses							2,252,252			3,376,416			8,230,189			9,334,160
Income (loss) from operations							1,532,595			(1,845,559)			(1,350,479)			(6,815,105)
Other income (expense):
	Finance costs						(362,000)			(21,680)			(1,036,232)			(56,653)
	Foreign exchange loss on CWT notes payable						(702,000)			-			(860,000)			-
	Change in fair value of PTEC earn-out						(48,750)			253,800			153,750			253,800
	Gain on forgiveness of indebtedness						407,466			-			528,039			-
	Other income, net						76,749			24,847			35,398			72,432
Total other income (expense)							(628,535)			256,967			(1,179,045)			269,579
Income (loss) before tax							904,060			(1,588,592)			(2,529,524)			(6,545,526)
Income tax expense							-			-			-			52,635
Income (loss) from continuing operations							904,060			(1,588,592)			(2,529,524)			(6,598,161)
Income from discontinued operations							-			807,459			922,443			1,278,827
Net income (loss)						$	904,060		$	(781,133)		$	(1,607,081)		$	(5,319,334)
Basic and diluted income (loss) per share - continuing operations						$	0.01		$	(0.02)		$	(0.02)		$	(0.05)
Basic and diluted income (loss) per share - discontinued operations							-			0.01			-			0.01
Basic and diluted income (loss) per share						$	0.01		$	(0.01)		$	(0.01)		$	(0.04)
Weighted average number of common shares outstanding							169,275,016			132,968,849			167,714,674			125,705,621
Comprehensive income (loss):
	Net income (loss)					$	904,060		$	(781,133)		$	(1,607,081)		$	(5,319,334)
	Other comprehensive income (loss) - Item that may be reclassified subsequently to earnings:
	Foreign currency translation adjustments						1,839,677			60,830			2,244,370			(100,292)
	Comprehensive income (loss)					$	2,743,737		$	(720,303)		$	637,289		$	(5,419,626)

 

 

SOURCE: RDX Technologies Corporation

David Waldman at Crescendo Communications
Investor Relations
[phone]
[email protected]