Pacific Safety Products Inc. Reports Fourth Quarter Fiscal 2016 and Year End Fiscal 2016 Financial Results

ARNPRIOR, ONTARIO--(Marketwired - Sept. 28, 2016) - Pacific Safety Products Inc. ("PSP" or, the "Company") (TSX VENTURE:PSP), a leading North American manufacturer of advanced armour and personal protection solutions, today reported financial results for the three month period and year ended June 30, 2016.

Highlights:

Fiscal Year 2016

• Revenues for the year were $20.1 million, an increase of $2.4 million or 13.7% as compared to the prior year.
• Gross margin as a percentage of revenues for the year was 24.6%, which was a decrease over gross margin of 28.9% during the prior year, largely due to the one time effects of a settlement with the Company's landlord in fiscal 2015.
• The Company reported net income for the year of $2.1 million compared to net income of $1.1 million during the prior year, including of a write up of tax losses of $ 1.6 million.
• Expenses were $4.4 million, an increase of $0.7 million or 18.5% as compared to the prior year, largely due to PSP expensing $200,000 in financial advisory, legal and other fees and expenses incurred to date in connection with an ongoing strategic review process and a reduction in expenses in 2015 due to the one time landlord settlement.
• Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") was $0.7 million compared to Adjusted EBITDA of $1.5 million during the prior year, largely due to the one time landlord settlement. Adjusted EBITDA would have been $0.9 million had PSP not expensed the strategic review fees.
• Working Capital increased $0.6 million or 17.5% to $4.0 million compared to $3.4 million in the prior year.

Fourth Quarter

• Revenues for the fourth quarter were $5.6 million, an increase of $0.1 million or 1.8% as compared to the fourth quarter of the prior year.
• Gross margin as a percentage of revenues for the fourth quarter was 27.0%, which was a decrease over gross margin of 31.5% during the fourth quarter of the prior year.
• The Company reported net income for the fourth quarter of $1.8 million compared to net income of $1.0 million during the fourth quarter of the prior year.
• Adjusted EBITDA for the fourth quarter was $0.4 million compared to Adjusted EBITDA of $1.1 million during fourth quarter of 2015 largely due to the one time landlord settlement

"Fiscal 2016 was a solid year for PSP. We continue to see excellent growth from our US operations and, with manufacturing set to begin and with an expected shortened delivery schedule of 10-12 months for the delivery of the initial order of $ 11.2 million firm quantity on our Canadian military contract, we expect fiscal 2017 to be an outstanding year," remarked CEO Terry Vaudry.