CALGARY, May 26, 2016 /PRNewswire/ - SMART Technologies
Inc. (NASDAQ: SMT) (TSX: SMA) ("SMART" or the "Company"), a leading
provider of collaboration solutions, today announced financial
results for its fourth quarter and fiscal year ended March 31, 2016.
Q4 and FY16 Financial Results
|
|
GAAP
Results
|
|
(US$ millions
except
|
Three months ended
Mar. 31,
|
Twelve months ended
Mar. 31,
|
|
per share
amounts)
|
2016
|
2015
|
2016
|
|
2015
|
|
Revenue
|
$
|
68.4
|
$
|
99.6
|
$
|
348.5
|
$
|
492.9
|
|
Net (loss)
income
|
$
|
(0.2)
|
$
|
(9.6)
|
$
|
(60.9)
|
$
|
24.1
|
|
EPS (diluted)
(1)
|
$
|
(0.02)
|
$
|
(0.79)
|
$
|
(4.99)
|
$
|
1.91
|
|
|
|
|
|
|
Non-GAAP
Results
|
|
(US$ millions
except
|
Three months ended
Mar. 31,
|
Twelve months ended
Mar. 31,
|
|
per share
amounts)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Adjusted
Revenue(2)(3)
|
$
|
68.4
|
$
|
85.8
|
$
|
348.5
|
$
|
431.3
|
|
Adjusted Gross
Margin(2)(3)
|
$
|
23.7
|
$
|
35.5
|
$
|
121.9
|
$
|
170.3
|
|
Adjusted
EBITDA(2)(3)
|
$
|
(2.9)
|
$
|
1.8
|
$
|
8.0
|
$
|
34.4
|
|
Adjusted Net (Loss)
Income(2)(3)
|
$
|
(10.0)
|
$
|
(5.2)
|
$
|
(37.4)
|
$
|
0.2
|
|
Adjusted EPS
(diluted)(1)(2)(3)
|
$
|
(0.82)
|
$
|
(0.43)
|
$
|
(3.06)
|
$
|
0.01
|
|
|
|
|
|
|
|
(1)
|
In May 2016, the
Company completed a 1-for-10 share consolidation of its issued and
outstanding Common Shares. All share and per share amounts have
been retroactively adjusted to reflect the share consolidation for
all periods presented.
|
|
(2)
|
These are Non-GAAP
measures. See "Non-GAAP measures" below for additional
information.
|
|
(3)
|
We changed the
definition of Adjusted Revenue in the second quarter of fiscal
2016, and in the third quarter of fiscal 2016 excluded an inventory
charge of $21 million that we recognized in connection with slower
than anticipated kapp sales (the "kapp Inventory Charge"). See
"Non-GAAP measures" below. Amounts presented in respect of prior
periods have been restated to account for these changes to the
definition and the kapp Inventory Charge.
|
Q4 and FY16 Highlights
- Revenue of $68 million in the
fourth quarter of fiscal 2016 and $348
million in fiscal 2016. Adjusted Revenue decreased by
$17 million in the fourth quarter of
fiscal 2016 compared to the prior-year period and decreased by
$83 million in fiscal 2016 compared
to fiscal 2015. The decrease was due to lower revenue from
interactive whiteboards, interactive projectors and attachment
products, partly offset by increases in revenue from interactive
flat panels.
- Hardware and software solutions developed over the past three
years comprised approximately 60% of our revenue in the fourth
quarter and approximately 50% of revenue in fiscal 2016. These
hardware and software solutions include interactive flat panels
("IFPs"), SMART Room Systems ("SRS"), SMART kapp, SMART kapp iQ,
Notebook Advantage and SMART amp.
- Education IFP revenue grew approximately 38% in the fourth
quarter of fiscal 2016 compared to the same quarter last year and
grew approximately 89% in fiscal 2016 compared to fiscal 2015.
- SMART is now the market leader in the education sector in IFPs
in the United States, according to
data from Futuresource Consulting Ltd., an independent global
research company that has tracked interactive display shipments
since 2002. Based on Futuresource data with respect to the shipment
of IFPs to educational institutions in the United States in 2015, SMART holds a 39%
market share in education - the highest share of any IFP provider
tracked by Futuresource.
- Education software and services revenue, although a modest
portion of overall revenue, grew 16% in the fourth quarter of
fiscal 2016 over the same quarter last year and grew 26% in fiscal
2016 over fiscal 2015.
- Cash operating expenses were reduced by $9 million in the fourth quarter of fiscal 2016,
from $35 million in the fourth
quarter of fiscal 2015 to $26 million
in the fourth quarter of fiscal 2016, and by $22 million in fiscal 2016, from $139 million in fiscal 2015 to $117 million in fiscal 2016. Our cash operating
expenses are comprised of selling, marketing and administration and
research and development expenses, excluding stock-based
compensation and bad debt expenses.
- Adjusted EBITDA of negative $3
million in the fourth quarter of fiscal 2016 and
$8 million in fiscal 2016. The
decrease over comparative prior periods was due to lower gross
margin, partly offset by lower cash operating expenses.
- As of March 31, 2016, SMART had
access to capital of approximately $40
million, consisting of $20
million in cash and cash equivalents and $20 million of availability from our ABL
facility. We ended the year with $108
million of debt outstanding, excluding the office premises
capital lease, which was $53
million.
- Launched kapp iQ, the most advanced member of the SMART kapp
product family and kapp iQ Pro, which combines kapp iQ's
collaboration features with SMART Meeting Pro software.
- Announced an agreement with the Ministry of Education for
Gauteng province in South Africa
for the installation of 1,800 SMART Board 6065 interactive
displays and equivalent licenses for SMART Notebook
collaborative learning software.
- Announced our expanded agreement with Epson, which extends
globally our existing agreement that bundles our SMART Notebook
software with Epson BrightLink interactive projectors.
- Expanded our portfolio of IFPs designed specifically for the
rigors of both the education and enterprise markets, which
incorporate key differentiating features. The new cost-competitive
models include the SMART Board 6075, the SMART Board 4075 and the
SMART Board 4084.
- Introduced SMART Learning Suite, which bundles the power of our
industry-leading SMART Notebook, the newly enhanced SMART Lesson
Activity Builder (LAB), our game-based learning software, and the
award-winning SMART amp.
- Aligned SMART kapp cost structure with nearer-term sales
opportunities, which are growing at a slower rate than originally
anticipated. We remain committed to kapp and continue to analyze
the appropriate channel, product pricing and business models to
support longer-term sales growth. We are encouraged by our recent
announcement of a deal with China Daheng Beijing Software
Technology Co., Ltd for 4,000 SMART kapp boards to be purchased
from SMART over the next 9 months, for distribution in China.
About SMART
SMART Technologies Inc. (NASDAQ: SMT) (TSX: SMA) is a world
leader in simple and intuitive solutions that enable more natural
collaboration. We are an innovator in interactive touch
technologies and software that inspire collaboration in both
education and business around the globe. To learn more, visit
smarttech.com.
SMT-F
Forward-Looking Statements
This media release includes forward-looking statements within
the meaning of the U.S. federal and applicable Canadian securities
laws. These forward-looking statements relate both to us
specifically and the technology product industry and business,
demographic and other matters generally, and reflect our current
views with respect to future events and our financial performance.
Statements that include the words "expanding", "expect",
"continuing", "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 for purposes of the applicable
securities laws or otherwise. The forward-looking statements in
this media release pertain, among other matters, to our business,
financial condition, financial performance, cost structure, results
of operations, cash flows and plans, including in particular, but
without limitation: (i) the growth in our revenue from sales of our
newly-developed hardware and software solutions, including our
interactive flat panel products for the education market; (ii) our
new position as the market leader in interactive flat panel
products for the education sector in the
United States; (iii) the growth in our revenue from sales of
software and services for the education market; (iv) the reduction
of our operating expenses; (v) the extension globally in the scope
of our agreement with Epson bundling our SMART Notebook software
with Epson's BrightLink interactive projectors; (vi) the expansion
of our portfolio of interactive flat panel products for the
education and enterprise markets; (vii) our commitment to SMART
kapp; and (viii) our deal with China Daheng Beijing Software
Technology Co., Ltd. For 4,000 SMART kapp boards to be purchased
from SMART over the next 9 months.
All forward-looking statements address matters that involve
known and unknown risks, uncertainties and assumptions, many of
which are beyond our control. Accordingly, there are and will be
important factors and assumptions that could cause our actual
results and other circumstances and events to differ materially
from those indicated in such statements. We believe that these
factors and assumptions include, but are not limited to, those
described under "Risk Factors" in our fiscal 2015 Annual Report on
Form 20-F, including without limitation: (i) our sales to the
education market are in decline and may continue to decline; (ii)
sales of our new products may not be sufficient to offset the
decline in our education sales, and if sales of new products are
not sufficiently robust, our liquidity may be materially and
adversely affected; (iii) our sales and operating results are
difficult to predict; (iv) the level and upcoming maturities of our
current and future debt could have an adverse effect on our
business; and (v) our working capital requirements and cash flows
are subject to fluctuation, which could have a material adverse
effect on our business, financial condition or results of
operations. In addition, we believe that these risk factors and
assumptions include those set out in Management's Discussion and
Analysis for the three and twelve months ended March 31, 2016 ("MD&A") and referenced under
"Forward-Looking Statements" therein, including without limitation
(i) our ability to maintain sales, including sales to the education
market that continue to decline; (ii) sales of our new products and
services may not be sufficient to offset the overall decline in
sales; (iii) difficulty in predicting our sales and operating
results; (iv) our ability to raise additional funds, manage cash
flow, foreign exchange risk and working capital; and (v) our
substantial debt could adversely affect our financial condition.
Both the Annual Report on Form 20-F and the MD&A can be
accessed on the SEDAR website at www.sedar.com or on the
website of the U.S. Securities and Exchange Commission at
www.sec.gov.
Although we believe that the assumptions inherent in the
forward-looking statements contained in this media release are
reasonable, undue reliance should not be placed on these
statements, which only apply as of the date hereof. We
undertake no obligation to publicly update or review any
forward-looking statement, whether as a result of new information,
future developments or otherwise, except as required by law.
Non-GAAP measures
Adjusted Revenue, Adjusted Gross Margin, Adjusted Gross Margin
percentage, Adjusted Net (Loss) Income, Adjusted Net (Loss) Income
per share and Adjusted EBITDA are non-GAAP measures and should not
be considered as alternatives to revenue, gross margin, gross
margin percentage, net (loss) income or any other measure of
financial performance calculated and presented in accordance with
GAAP. Adjusted Revenue, Adjusted Gross Margin, Adjusted Gross
Margin percentage, Adjusted Net (Loss) Income, Adjusted Net (Loss)
Income per share, and Adjusted EBITDA have inherent limitations,
and the reader should therefore not place undue reliance on
them.
In the second quarter of fiscal 2016, we changed our definition
of Adjusted Revenue from revenue adjusted for the change in
deferred revenue balances during the period, to revenue adjusted
for the accelerated deferred revenue recognized as a result of the
change in accounting estimate as discussed below. All Adjusted
Revenue amounts with respect to prior periods presented herein have
been restated to reflect this change.
In the third quarter of fiscal 2016, we recognized the kapp
Inventory Charge of $21 million and
elected to remove this expense from our non-GAAP financial
measures, including Adjusted Gross Margin, Adjusted Gross Margin
percentage, Adjusted Net (Loss) Income, Adjusted Net (Loss) Income
per share, and Adjusted EBITDA. We removed the kapp Inventory
Charge as we believe it is unusual and material, and enables us and
our shareholders to better assess our operating performance in
prior and future periods by improving the comparability of the
financial information presented.
We calculate Adjusted Gross Margin by subtracting cost of sales,
excluding the kapp Inventory Charge, from Adjusted Revenue.
Adjusted Gross Margin percentage is calculated by dividing
Adjusted Gross Margin by Adjusted Revenue.
We define Adjusted Net (Loss) Income as net (loss) income before
stock-based compensation (recovery) expense, restructuring costs,
foreign exchange gains or losses, accelerated deferred revenue
recognized, amortization of intangible assets, gains or losses
related to the liquidation of foreign subsidiaries, gains or losses
related to the sale of long-lived assets and the kapp Inventory
Charge, all net of tax.
We calculate Adjusted Net (Loss) Income per share by dividing
Adjusted Net (Loss) Income by the average number of basic and
diluted shares outstanding during the period.
We define Adjusted EBITDA as Adjusted Net (Loss) Income before
interest expense, income taxes, depreciation and other income.
Due to the change in accounting estimate as a result of the
reduction in the support period for previously sold products, as
discussed in Note 1 in the audited consolidated financial
statements, and the kapp Inventory Charge, as discussed in Note 4
in the audited consolidated financial statements, we chose to use
the non-GAAP measures of Adjusted Revenue and Adjusted Gross
Margin. Although the significant impact related to the change in
accounting estimate for previously sold products ended in the
fourth quarter of fiscal 2015, we will continue adjusting for this
change for comparative purposes. We use Adjusted Revenue and
Adjusted Gross Margin as key measures to provide additional
insights into the operational performance of the Company and to
help clarify trends affecting the Company's business.
We use Adjusted Net (Loss) Income to assess the performance of
the business after removing the after-tax impact of stock-based
compensation (recovery) expense, restructuring costs, foreign
exchange gains and losses, accelerated deferred revenue recognized,
amortization of intangible assets, gains or losses related to the
liquidation of foreign subsidiaries, gains or losses related to the
sale of long-lived assets and the kapp Inventory Charge. We also
use Adjusted EBITDA as a key measure to assess the core operating
performance of our business after removing the after-tax effects of
both our leveraged capital structure and the volatility associated
with the foreign currency exchange rates on our U.S.
dollar-denominated debt. 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 to
ours. In addition to its use by management in the assessment of
business performance, Adjusted EBITDA is used by our Board of
Directors in assessing management's performance and is a key metric
in the determination of payments made under our incentive
compensation plans. We believe Adjusted Net (Loss) Income and
Adjusted EBITDA may be useful to investors in evaluating our
operating performance because securities analysts use metrics
similar to Adjusted Net (Loss) Income and Adjusted EBITDA as
supplemental measures to evaluate the overall operating performance
of companies.
We compensate for the inherent
limitations associated with using Adjusted
Revenue, Adjusted Gross Margin, Adjusted Gross Margin percentage,
Adjusted Net (Loss) Income, Adjusted Net (Loss) Income per share
and Adjusted EBITDA through disclosure of such limitations,
presentation of our financial statements in accordance with GAAP,
and reconciliation of Adjusted Revenue, Adjusted Gross Margin,
Adjusted Gross Margin percentage, Adjusted Net (Loss) Income per
share, Adjusted Net (Loss) Income, and Adjusted EBITDA to the most
directly comparable GAAP measures: revenue, gross margin, gross
margin percentage, net (loss) earnings per share and net (loss)
income.
See the "Reconciliation of GAAP and Non-GAAP Results"
section.
SMART Technologies Inc.
Consolidated Condensed
Statements of Operations
(millions of U.S. dollars, except for shares and per share
amounts)
|
For the years ended
March 31,
|
|
|
|
|
2016
|
2015
|
2014
|
|
|
|
|
|
Revenue
|
348.5
|
492.9
|
589.2
|
|
Cost of
sales
|
247.2
|
261.1
|
340.1
|
|
Gross
margin
|
101.3
|
231.9
|
249.1
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
Selling, marketing
and administration
|
78.1
|
103.9
|
116.9
|
|
Research and
development
|
36.0
|
43.3
|
40.1
|
|
Depreciation and
amortization of property and equipment
|
8.1
|
11.3
|
16.4
|
|
Amortization of
intangible assets
|
0.1
|
0.1
|
22.4
|
|
Restructuring
costs
|
5.1
|
6.1
|
5.9
|
|
Gain on sale of
long-lived assets
|
-
|
(0.1)
|
(4.2)
|
|
127.3
|
164.5
|
197.4
|
|
Operating (loss)
income
|
(26.0)
|
67.3
|
51.7
|
|
|
|
|
|
Non-operating
expenses (income)
|
|
|
|
|
Interest
expense
|
18.3
|
20.0
|
21.4
|
|
Foreign exchange
loss
|
1.2
|
11.1
|
9.9
|
|
Other
income
|
(0.7)
|
(0.7)
|
(0.8)
|
|
18.8
|
30.4
|
30.6
|
|
(Loss) income before
income taxes
|
(44.9)
|
37.0
|
21.1
|
|
|
|
|
|
Income tax expense
(recovery)
|
|
|
|
|
Current
|
3.5
|
(1.9)
|
5.1
|
|
Deferred
|
12.5
|
14.8
|
(4.6)
|
|
16.0
|
12.9
|
0.5
|
|
Net (loss)
income
|
$
|
(60.9)
|
$
|
24.1
|
$
|
20.5
|
|
|
|
|
|
(Loss) earnings per
share
|
|
|
|
|
Basic
|
$
|
(4.99)
|
$
|
1.98
|
$
|
1.70
|
|
Diluted
|
$
|
(4.99)
|
$
|
1.91
|
$
|
1.62
|
|
Amounts in this table
may not add up due to rounding.
|
|
|
|
|
|
|
SMART Technologies Inc.
Consolidated Condensed
Balance Sheets
(millions of U.S. dollars)
|
|
|
|
March 31,
2016
|
March 31,
2015
|
|
ASSETS
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
20.0
|
$
|
54.5
|
|
Trade receivables,
net of allowance for receivables of $4.2 and $4.4
|
46.6
|
61.6
|
|
Income taxes
recoverable
|
5.3
|
7.4
|
|
Inventory
|
42.7
|
51.6
|
|
Other current
assets
|
6.7
|
6.5
|
|
121.2
|
181.6
|
|
|
|
|
Inventory
|
5.2
|
-
|
|
Property and
equipment
|
44.1
|
54.7
|
|
Deferred income
taxes
|
3.2
|
16.4
|
|
Deferred financing
fees
|
1.5
|
2.5
|
|
Other long-term
assets
|
0.5
|
0.6
|
|
$
|
175.7
|
$
|
255.8
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' (DEFICIT) EQUITY
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
|
8.9
|
$
|
18.7
|
|
Accrued and other
current liabilities
|
36.6
|
44.3
|
|
Deferred
revenue
|
16.5
|
13.1
|
|
Current portion of
capital lease obligation
|
1.2
|
1.1
|
|
Current portion of
long-term debt
|
12.5
|
10.2
|
|
75.6
|
87.4
|
|
|
|
|
Long-term
debt
|
95.4
|
96.3
|
|
Capital lease
obligation
|
51.5
|
53.8
|
|
Deferred
revenue
|
13.6
|
11.8
|
|
Deferred income
taxes
|
0.2
|
-
|
|
Other long-term
liabilities
|
0.6
|
0.9
|
|
237.0
|
250.3
|
|
|
|
|
Shareholders'
(deficit) equity
|
|
|
|
Share
capital
|
695.7
|
695.3
|
|
Accumulated other
comprehensive income
|
0.6
|
2.7
|
|
Additional paid-in
capital
|
44.5
|
48.6
|
|
Accumulated
deficit
|
(802.1)
|
(741.2)
|
|
(61.3)
|
5.5
|
|
$
|
175.7
|
$
|
255.8
|
|
Amounts in this table
may not add up due to rounding.
|
|
|
|
|
SMART Technologies Inc.
Consolidated Condensed
Statements of Cash Flows
(millions of U.S. dollars)
|
For the years ended
March 31,
|
|
2016
|
2015
|
2014
|
|
Cash (used in)
provided by
|
|
|
|
|
Operations
|
|
|
|
|
Net (loss)
income
|
$
|
(60.9)
|
$
|
24.1
|
$
|
20.5
|
|
Adjustments to
reconcile net (loss) income to net cash (used in) provided by
operating activities
|
|
|
|
|
|
Depreciation and
amortization of property and equipment
|
12.2
|
16.6
|
25.9
|
|
|
Amortization of
intangible assets
|
0.1
|
0.1
|
22.4
|
|
|
Amortization of
deferred financing fees
|
0.9
|
1.0
|
3.5
|
|
|
Amortization of
long-term debt discount
|
1.6
|
1.3
|
0.4
|
|
|
Non-cash (recovery)
expense in other liabilities
|
(0.1)
|
0.1
|
(3.9)
|
|
|
Stock-based
compensation (recovery) expense
|
(3.8)
|
5.9
|
3.6
|
|
|
Unrealized (gain)
loss on foreign exchange
|
(1.0)
|
12.5
|
10.6
|
|
|
Deferred income tax
expense (recovery)
|
12.5
|
14.8
|
(4.6)
|
|
|
Gain on liquidation
of foreign subsidiary
|
-
|
(0.4)
|
-
|
|
|
Gain on sale of
long-lived assets
|
-
|
(0.1)
|
(4.2)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
Trade
receivables
|
14.2
|
19.8
|
(26.4)
|
|
|
Inventory
|
(0.4)
|
19.3
|
(18.6)
|
|
|
Other current
assets
|
(0.2)
|
2.2
|
1.1
|
|
|
Income taxes payable
(recoverable)
|
1.2
|
(5.9)
|
21.8
|
|
|
Accounts payable,
accrued and other current liabilities
|
(13.0)
|
(40.2)
|
7.4
|
|
|
Deferred
revenue
|
5.7
|
(53.6)
|
(29.5)
|
|
|
Other long-term
assets
|
-
|
-
|
(0.5)
|
|
Cash (used in)
provided by operating activities
|
(31.0)
|
17.7
|
29.6
|
|
Investing
|
|
Capital
expenditures
|
(2.8)
|
(6.7)
|
(11.4)
|
|
Proceeds from sale of
long-lived assets
|
-
|
0.1
|
4.2
|
|
Proceeds from
sale-leaseback, net
|
-
|
-
|
76.2
|
|
Cash (used in)
provided by investing activities
|
(2.8)
|
(6.6)
|
69.1
|
|
Financing
|
|
|
Proceeds from
long-term debt
|
10.0
|
5.0
|
128.0
|
|
Repayment of
long-term debt
|
(10.2)
|
(14.4)
|
(302.9)
|
|
Financing fees
paid
|
-
|
(0.0)
|
(4.8)
|
|
Repayment of capital
lease obligation
|
(1.1)
|
(1.2)
|
(1.4)
|
|
Participant equity
loan plan, net
|
0.0
|
0.2
|
0.6
|
|
Other
|
-
|
0.0
|
0.0
|
|
Cash used in
financing activities
|
(1.2)
|
(10.3)
|
(180.6)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
0.4
|
(4.5)
|
(1.3)
|
|
Net decrease in cash
and cash equivalents
|
(34.5)
|
(3.7)
|
(83.2)
|
|
Cash and cash
equivalents, beginning of year
|
54.5
|
58.1
|
141.4
|
|
Cash and cash
equivalents, end of year
|
$
|
20.0
|
$
|
54.5
|
$
|
58.1
|
|
Amounts in this table
may not add up due to rounding.
|
|
|
|
|
|
|
SMART Technologies Inc.
Reconciliation of GAAP and
Non-GAAP Results
(millions of U.S. dollars)
|
The following table
shows the reconciliation of revenue to Adjusted Revenue and gross
margin to Adjusted Gross Margin.
|
|
|
|
|
|
2016
|
2015
|
2014
|
|
Adjusted
Revenue
|
|
|
|
|
Revenue
|
$
|
348.5
|
$
|
492.9
|
$
|
589.2
|
|
|
Deferred revenue
recognized – accelerated amortization
|
-
|
(61.6)
|
(33.8)
|
|
Adjusted
Revenue
|
$
|
348.5
|
$
|
431.3
|
$
|
555.3
|
|
|
|
|
|
Adjusted Gross
Margin
|
|
|
|
|
Gross
margin
|
$
|
101.3
|
$
|
231.9
|
$
|
249.1
|
|
|
Deferred revenue
recognized – accelerated amortization
|
-
|
(61.6)
|
(33.8)
|
|
|
kapp Inventory
Charge
|
20.6
|
-
|
-
|
|
Adjusted Gross
Margin
|
$
|
121.9
|
$
|
170.3
|
$
|
215.2
|
|
|
|
|
|
The following table
shows the reconciliations of net (loss) income to Adjusted Net
(Loss) Income and Adjusted EBITDA and basic and diluted
(loss)
earnings per share to
Adjusted Net (Loss) Income per share.
|
|
|
|
|
|
2016
|
2015
|
2014
|
|
Net (loss)
income
|
(60.9)
|
24.1
|
20.5
|
|
Adjustments to net
(loss) income
|
|
|
|
|
|
Amortization of
intangible assets
|
0.1
|
0.1
|
22.4
|
|
|
Foreign exchange
loss
|
1.2
|
11.1
|
9.9
|
|
|
Accelerated deferred
revenue recognized
|
-
|
(61.6)
|
(33.8)
|
|
|
Stock-based
compensation
|
(3.8)
|
5.9
|
3.6
|
|
|
Restructuring
costs
|
5.1
|
6.1
|
5.9
|
|
|
Gain on liquidation
of foreign subsidiary(1)
|
-
|
(0.4)
|
-
|
|
|
Gain on sale of
long-lived assets
|
-
|
(0.1)
|
(4.2)
|
|
|
kapp Inventory
Charge
|
20.6
|
-
|
-
|
|
23.1
|
(38.9)
|
3.7
|
|
Tax impact on
adjustments(2)
|
(0.4)
|
(15.0)
|
(0.7)
|
|
Adjustments to net (loss) income, net of tax
|
23.5
|
(23.9)
|
4.4
|
|
Adjusted
Net (Loss) Income
|
(37.4)
|
0.2
|
24.9
|
|
Additional
adjustments to Adjusted Net (Loss) Income
|
|
|
|
|
Income tax expense
(recovery)(3)
|
15.6
|
(2.1)
|
(0.1)
|
|
Depreciation in cost
of sales
|
4.1
|
5.4
|
9.5
|
|
Depreciation of
property and equipment
|
8.1
|
11.3
|
16.4
|
|
Interest
expense
|
18.3
|
20.0
|
21.4
|
|
Other
income(1)
|
(0.7)
|
(0.3)
|
(0.8)
|
|
Adjusted
EBITDA
|
8.0
|
34.4
|
71.4
|
|
As a percent of
revenue(4)
|
2.3%
|
8.0%
|
12.9%
|
|
Adjusted
Net Income per share
|
|
|
|
|
(Loss)
earnings per share - basic(5)
|
$
|
(4.99)
|
$
|
1.98
|
$
|
1.70
|
|
Adjustments to
net (loss) income, net of tax, per share
|
1.93
|
(1.97)
|
0.36
|
|
Adjusted Net
(Loss) Income per share – basic(5)
|
$
|
(3.06)
|
$
|
0.01
|
$
|
2.06
|
|
|
|
|
|
(Loss)
earnings per share – diluted(5)
|
$
|
(4.99)
|
$
|
1.91
|
$
|
1.62
|
|
Adjustments to
net (loss) income, net of tax, per share
|
1.93
|
(1.90)
|
0.35
|
|
Adjusted Net
(Loss) Income per share –
diluted(5)
|
$
|
(3.06)
|
$
|
0.01
|
$
|
1.97
|
|
(1)
|
Included in Other
income in the consolidated statements of operations.
|
|
(2)
|
Reflects the tax
impact on the adjustments to net (loss) income. A key driver of our
foreign exchange gain is the conversion of our U.S.
dollar-denominated debt that was originally incurred at an average
rate of 1.03 into our functional currency of Canadian dollars. When
the unrealized foreign exchange amount on the U.S.
dollar-denominated debt is in a net gain position as measured
against the original exchange rate, the gain is tax-effected at
current rates. When the unrealized foreign exchange amount on the
U.S. dollar- denominated debt is in a net loss position as measured
against the original exchange rate and the loss cannot be carried
back to a previous year, a valuation allowance is taken against it
and as a result no net tax effect is recorded.
|
|
(3)
|
Income tax expense of
$16 million (2015 – $13 million; 2014 – $1 million) per
consolidated statement of operations, net of tax impact on
adjustments to Adjusted Net (Loss) Income of $0.4 million for the
year ended March 31, 2016 (2015 – $15 million; 2014 – $0.7
million).
|
|
(4)
|
Adjusted EBITDA as a
percent of revenue is calculated by dividing Adjusted EBITDA by
Adjusted Revenue.
|
|
(5)
|
All share and per
share amounts have been retroactively adjusted to reflect the share
consolidation for all periods presented.
|
© 2016 SMART Technologies. SMART kapp, kapp iQ, kapp iQ Pro,
SMART Board 6065, SMART amp, Notebook Advantage, SMART Room System,
the SMART logo and smarttech are trademarks or registered
trademarks of SMART Technologies in the U.S. and/or other
countries.
SOURCE SMART Technologies Inc.