(1888PressRelease)
March 11, 2008 - TORONTO, ONTARIO -- AlarmForce Industries Inc. (TSX: AF) -
Joel Matlin, President and CEO is pleased to announce annual results for the year ended October 31, 2007.
Announcing the annual results for 2007, Mr. Matlin said: " Revenues in 2007 surpassed the $25 million mark, which represents a record annual increase of $4,171,000 from the preceding year, up 20%. The AlarmForce subscriber base increased to over 79,000 monitored accounts, up by 20% which is the largest net increase in our account size ever recorded. We realized economies of scale and higher gross profit margins, and as a result Gross Profit increased by 22% to $20,006,000, representing 80% of Revenue in 2007."
"In 2007, we added 18,000 new accounts, the highest figure in the 19 year history of the company. Our budgeted marketing expenses increased from the 2006 level by over $3 million, including expenses in both Canada and the US. In both market segments, subscriber growth was record-setting. The impact of the higher marketing program expenses, which are charged against income in the period, is reflected in the decrease in operating bottom line results. The increase in expenses was somewhat offset by the 20% annual growth rate and higher gross margins, as a result Income before Taxes decreased by $405,000 and Net Income decreased by $212,000 relative to 2006. Against the increase in marketing expenses in 2007 of over $3 million, the Company's EBITDA decreased to $4,748,000 in 2007 from $5,217,000 in 2006. Excluding the marketing expenses, EBITDA increased to $14,111,000, up by 24% from 2006. This is an important and key factor given that our marketing expenses are discretionary as well as a driver of growth in recurring revenue."
"Looking ahead, the convergence of several market trends and industry factors are creating attractive opportunities to propel the company to new heights. We have achieved a significant position in major centres in Canada and in the three US States, in which our brand has gained a critical mass providing traction to sustain growth from our existing subscriber base. As a result, we expect to grow in 2008 with a much lower operational drag than that in prior years, which reflected the startup of new markets in the US. In addition, social and demographic trends as well as technology-driven innovation in product development promise to provide opportunities for new incremental revenues in the existing markets.
Mr. Matlin concluded by saying: "We have solidified the foundation for our subscriber base expansion program for the next five years, which promises to be the most exciting period to come. The two most salient trends reflected in our report this year are consistently strong revenue growth on the one hand, and an expanded marketing budget on the other. Our track record has continually proven the effectiveness of AlarmForce's marketing model in directly generating new subscriber growth and we expect that the subscriber base will continue to grow and revenues and cash flows will continue to increase."
AlarmForce Industries Inc. is Canada's largest manufacturer and installer of two-way voice homes alarm systems and line-cut protection with offices across Canada and in the United States.
Contacts:
AlarmForce Industries Inc.
Investor Relations Dept.
(416) 445-2001 ext#225
(416) 445-9381 (FAX)
Email: investor ( @ ) alarmforce dot com
