- Full year revenue of $790.1 million, up 22% year-over-year
- Strong sales of attachment products, up 47% year-over-year
- Annual gross margin of 49.5%
- Full year Adjusted EBITDA of $185.8 million; Adjusted EBITDA margin of 23%
- Annual Adjusted Net Income of $85.5 million, up 44% year-over-year
CALGARY, Alberta, May 18, 2011 (GLOBE NEWSWIRE) -- SMART Technologies Inc. (Nasdaq:SMT) (TSX:SMA), a leading provider of collaboration solutions, today announced financial results for its full year and fourth quarter ended March 31, 2011.
"2011 was an important year for SMART," stated Nancy Knowlton, President and CEO of SMART. "During our first year as a public company, we strengthened our global leadership position, expanded our suite of collaboration solutions and continued to see increased adoption of our solutions by businesses and government organizations worldwide. Revenue during fiscal 2011 increased 22%, supported by solid interactive whiteboard unit volume growth, healthy average selling prices and a 47% increase in attachment products sales, despite the challenging education funding backdrop in the second half of the year. The breadth of our product portfolio and the strength of our brand remain significant competitive advantages, resulting in the increased adoption of SMART solutions in the classroom."
Knowlton continued, "Our high level of execution also translated into solid top-line performance in the fourth quarter, as we once again benefitted from robust sales of attachment products, totaling 35% of overall revenues. While fourth quarter profitability was impacted by additional costs related to strengthening our research and development capabilities, ecosystem and global infrastructure, we believe it is critical to make these investments now to maintain our long-term competitive edge in the market and to take advantage of emerging opportunities. Regarding our outlook for fiscal 2012, we currently expect revenue to be flat to 5% down compared to fiscal 2011, and we expect Adjusted Net Income to be consistent with fiscal 2011. We intend to provide an update on our full-year growth targets each quarter as we gain increased visibility into state and federal funding trends."
Total revenue for the fourth quarter of fiscal 2011 was $167.3 million, an increase of 8% compared to $155.6 million in the prior-year period. In terms of unit sales, 82,964 SMART Board™ interactive whiteboards were sold in the quarter, compared to 82,331 units sold in the prior-year period. Total revenue for fiscal 2011 was $790.1 million, an increase of 22% over fiscal 2010. Revenue in fiscal 2011 was strong in both North America and EMEA, with growth of 22% and 17%, respectively.
Gross profit for the fourth quarter of fiscal 2011 was $77.7 million compared to $79.7 million in the prior-year period. Gross margin for the fourth quarter was 46.4%, compared to 51.2% for the prior-year period. Gross margin during the quarter was impacted by a $3.5 million warranty provision on certain attachment products. Gross margin for fiscal 2011 was 49.5%, compared to 49.6% for fiscal 2010.
Adjusted EBITDA for the fourth quarter of fiscal 2011 was $16.4 million, representing an Adjusted EBITDA margin of 10%, compared to $31.3 million in the prior-year period. Adjusted EBITDA includes an increase in operating expenses related to investments in product development, ecosystems and infrastructure to support global expansion, as well as a negative foreign exchange impact due to the strong Canadian dollar. Adjusted EBITDA for fiscal 2011 was $185.8 million, representing an Adjusted EBITDA margin of 23% compared to 25% for fiscal 2010. Foreign exchange movements throughout the year negatively impacted Adjusted EBITDA by $17.7 million compared to fiscal 2010. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by revenue after adding back the net impact of deferred revenue.
GAAP net income was $7.6 million for the fourth quarter of fiscal 2011 compared to $10.5 million in the prior-year period. GAAP EPS was $0.06 based on 123.8 million weighted average shares outstanding, compared to $0.06 based on 180.8 million weighted average shares outstanding during the prior-year period. GAAP net income during the quarter ended March 31, 2011, includes a $13.6 million foreign exchange gain, partly due to the conversion of our U.S. dollar-denominated long-term debt into the company's functional currency of Canadian dollars, compared to an $8.2 million foreign exchange gain during the prior-year period. GAAP net income for fiscal 2011 was $69.4 million or $0.53 per share compared to $142.0 million or $0.81 per share for fiscal 2010. GAAP net income during fiscal 2011 includes a $10.5 million foreign exchange gain compared to a gain of $91.8 million for fiscal 2010.
Adjusted Net Income for the fourth quarter of fiscal 2011 was $0.8 million compared to $5.7 million in the same period last year. Adjusted EPS was $0.01 based on 123.8 million weighted average shares outstanding, compared to $0.03 based on 180.8 million weighted average shares outstanding for the fourth quarter of fiscal 2010. Adjusted net income for fiscal 2011 was $85.5 million or $0.65 per share compared to $59.5 million or $0.34 per share for fiscal 2010.
As of March 31, 2011, SMART had cash and cash equivalents of $119.0 million and $339.3 million of debt outstanding.
Conference call information
SMART will host a conference call today, May 18, 2011, at 2:30 p.m. MT (4:30 p.m. ET) to discuss the company's financial results. To access this call, dial 877.312.5844 (North America) or 253.237.1152 (outside North America) with conference ID #63038039. A live webcast of the conference call and supplemental slides will be accessible from the investor relations page of SMART's website at , and a replay will be archived and accessible at . A replay of this conference call may also be accessed through May 28, 2011, by dialing 800.642.1687 (North America) or 706.645.9291 (outside North America). The replay pass code is 63038039.
SMART Technologies Inc. is a leading provider of collaboration solutions that transform the way the world works and learns. We believe that collaboration and interaction should be easy. As the global leader in interactive whiteboards, we bring more than two decades of collaboration research and development to a broad range of easy-to-use, integrated solutions that free people from their desks and computer screens, so collaborating and learning with digital resources are more natural.
The SMART Technologies logo is available at .
Certain statements made in this press release are forward-looking statements within the meaning of the U.S. federal and applicable Canadian securities laws. Statements that include the words "expanding," "expect," "increasing," "intend," "plan," "believe," "project," "estimate," "anticipate," "may," "will," "continue," "further," "seek," and similar words or statements of a future or forward-looking nature identify forward-looking statements. In particular and without limitation, this press release contains forward-looking statements pertaining to the continuing adoption of our core solutions, the attainment of financial objectives, the execution of our growth strategy, the expansion of our presence with business and government organizations and the investment in our sales and research and development activities.
All forward-looking statements address matters that involve risks, uncertainties and assumptions. Accordingly, there are or will be important factors and assumptions that could cause our actual results and other circumstances and events to differ materially from those indicated in these statements. We believe that these factors and assumptions include, but are not limited to, those described under "Risk Factors" in our Registration Statement on Form F-1, our final Canadian prospectus and in our management's discussion and analysis for the year ended March 31, 2011.
The forward-looking statements speak only as of the date they are made. Except as may be required by applicable law, we do not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.
Non-GAAP financial measures
This release includes the non-GAAP financial measures Adjusted EBITDA and Adjusted Net Income. We define Adjusted EBITDA as net income before interest, income taxes, depreciation and amortization, as well as adjusting for the following items: foreign exchange gains or losses, net change in deferred revenue, stock-based compensation, acquisition costs and other income. We define Adjusted Net Income as net income before stock-based compensation, acquisition costs, foreign exchange gains or losses, net change in deferred revenue and amortization of intangible assets, all net of tax.
Adjusted EBITDA and Adjusted Net Income are non-GAAP measures and should not be considered as an alternative to net income or any other measure of financial performance calculated and presented in accordance with GAAP. Adjusted EBITDA, Adjusted Net Income and other non-GAAP measures have inherent limitations and therefore you should not place undue reliance on them.
We use Adjusted EBITDA as a key measure to assess the core operating performance of our business removing the effects of our leveraged capital structure and the volatility associated with the foreign exchange on our U.S. dollar-denominated debt. We also use Adjusted Net Income to assess the performance of the business removing the after-tax impact of stock-based compensation, acquisition costs, foreign exchange gains and losses, revenue deferral and amortization of intangible assets. We use both of these measures to assess business performance when we evaluate our results in comparison to budgets, forecasts, prior-year financial results and other companies in our industry. Many of these companies use similar non-GAAP measures to supplement their GAAP disclosures but such measures may not be directly comparable. In addition to its use by management in the assessment of business performance, Adjusted EBITDA is used by our Board of Directors and by our lenders in assessing management's performance and is a key metric in the determination of incentive plan payments. We believe Adjusted EBITDA and Adjusted Net Income may be useful to investors in evaluating our operating performance because securities analysts use metrics similar to Adjusted EBITDA and Adjusted Net Income as supplemental measures to evaluate the overall operating performance of companies.
© 2011 SMART Technologies. The SMART Board, SMART logo and smarttech are trademarks or registered trademarks of SMART Technologies in the U.S. and/or other countries.
Please note that SMART is written in all capital letters.
CONTACT: Media contact Marina Geronazzo Manager, Public Relations SMART Technologies Inc. Phone 1.403.407.5088 E-mail MarinaGeronazzo@smarttech.com Investor contact Seth Potter ICR Phone 1.877.320.2241 E-mail firstname.lastname@example.org