CALGARY, ALBERTA — Blackline Safety Corp. (TSX Venture: BLN, “Blackline Safety” or “Blackline”), a leading manufacturer of connected worker safety monitoring solutions announced results for its first quarter ended January 31, 2017 with a 22% surge in quarterly revenue.
“While Blackline prepares for first deliveries of our G7 safety monitor with gas detection, customers continue to embrace our current solutions as a best practice to keep their teams safe,” says Cody Slater, CEO and Chairman at Blackline Safety. “Our leasing program has made it easy for customers to adopt our worker safety technology, resulting in a nearly 300% increase in our contracted future service revenue.” He added, “The upcoming addition of gas detection to our portfolio will dramatically broaden the value we can deliver to customers, allowing them to respond in real-time to employee safety incidents, including the unexpected presence of toxic or explosive gases.”
Highlights
Key Financial Information
Values in this release are in thousands, except for percentages and per share data
First quarter revenue was $2,515, an increase of $452 from $2,063 in same three-month period of the prior fiscal year. Service revenue was $1,714, an increase of 28% compared to $1,344 in the first quarter of the prior fiscal year. These increases were driven by customers adopting the Blackline Complete leasing program that eliminates up-front capital costs and provides customers with a comprehensive product for a monthly fee during a three-year term.
Contracted future service revenue, representing the discounted present value of future lease revenue commitments from the Blackline Complete program, was $2,520 as at January 31, 2017 up from $1,854 at the prior year end.
Gross margin for the quarter was $1,251 compared to $1,001 in the comparable three-month period of the prior year, resulting in a gross margin of 50% in first quarter of fiscal 2017 compared to 49% in the same quarter of fiscal 2016 — the increase being attributable to the shift in revenue to a service-dominant business model.
Adjusted EBITDA was $(119) for the period ended January 31, 2017 compared to $(83) in the comparable period of the prior year. The decrease in the Adjusted EBITDA in the period is a result of an increase in selling, general and administrative expenses offset by increased revenue in the current quarter compared to the prior year quarter.
Financial Highlights
| Quarter Ended January 31 | |||
| 2017 | 2016 | Change | |
| Revenue | $2,515 | $2,063 | 22% |
| Gross Margin | $1,251 | $1,001 | 25% |
| Gross Margin Percentage | 50% | 49% | 2% |
| Adjusted EBITDA | ($119) | ($83) | (43)% |
| Net Loss | ($2,065) | ($1,339) | (54)% |
| Loss per Share | ($0.07) | ($0.05) | |
Post-Quarter Highlights
The Company announced on March 22, 2017 that it had entered into an underwritten private placement for aggregate gross proceeds of $10,500. On the same date, Blackline announced that it also intends to complete a concurrent non-brokered private placement for gross proceeds of $6,000. The offerings are expected to close on or about April 12, 2017 and are subject to the receipt of all necessary approvals, including the approval of the TSX Venture Exchange. The completion of the brokered private placement is not conditional upon completion of the concurrent private placement.
Blackline intends to use the net proceeds of the offerings to support the development of the Company’s manufacturing capabilities, the expansion of its international sales network, ongoing research & development and general working capital purposes.
Certifications
Blackline’s G7c safety monitoring device achieved the following intrinsically safety certifications for use in potentially explosive environments throughout North America.
Blackline expects to start delivering G7c wireless gas detector systems in late Q2.
Blackline’s unaudited condensed consolidated interim financial statements and management’s discussion and analysis on financial condition and results of operations for the period ended January 31, 2017 are available at www.sedar.com. All results are reported in Canadian dollars. To learn more about Blackline Safety, visit www.blacklinesafety.com and follow Blackline on Twitter @blacklinesafety.
About Blackline Safety: Blackline Safety is a global connected safety technology leader. We help businesses respond to emergencies in real-time and manage efficient evacuations, accounting for everyone’s safety along the way. With millions invested in technology research and development, Blackline Safety is recognized for quality and innovation. Our strong team of designers and engineers create and manufacture everything in-house — from wearable technology and personal gas detection to cloud-hosted infrastructure and web-based interfaces in Calgary for global industry. With service in over 200 countries, we are the only provider of industrial-grade, turn-key, work-anywhere connected safety monitoring solutions that delivers a seamless solution to meet demanding safety monitoring challenges of organizations throughout the world. Alert. Locate. Respond.™ For more information, visit www.BlacklineSafety.com.
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.