LITE ACCESS TECHNOLOGIES REPORTS 2020 Q4 AND YEAR END FINANCIAL RESULTS – REVENUES UP 55% YEAR OVER YEAR
January 28, 2021 – Vancouver, British Columbia. LITE ACCESS TECHNOLOGIES INC. (the “Company”) (TSX VENTURE: LTE)(PINK: LTCCF), a world leader in the use of innovative and proven micro/narrow trenching technologies, alternate methods of deployment and specialist products which transform the cost of fibre optic network deployment for telecommunications operators, reports its financial results for the fourth quarter and fiscal year ended September 30, 2020. The financial statements and related management’s discussion and analysis (“MD&A”) can be viewed on SEDAR at www.sedar.com.
Carlo Shimoon, President and CEO of Lite Access, stated, “Execution of operations was proving to be increasingly challenging in the UK with continuing tighter COVID-19 restrictions and UK lockdowns and the Company was working closely with its UK customer for several months to seek additional support related to operational inefficiencies related to COVID-19 and other contractual challenges, but with limited progress.
In November 2020, the Company announced that it was unable to meet targets with the continuing conditions and was implementing a mitigation strategy. Accordingly, the UK operations were suspended temporarily to allow the Company time to consult with stakeholders to optimize both its current operations and existing contracts in a COVID-19 environment. In December 2020, the Company resumed partial UK operations, based on good faith discussions with its customer that certain contractual challenges would be addressed, and was working to build a pathway to increase the ramp-up of operations and was working with stakeholders to create a sustainable path forward incorporating planning and operational efficiencies and optimizing existing contracts. However, shortly after the continued discussions, the Company received a notice from its customer that the Company had allegedly committed a repudiatory breach of its contracts for FTTP installation in Cambridge, Lowestoft and Bury St Edmunds (the “contracts”) by its suspension of works. Based on the alleged repudiatory breaches, the customer has purported to terminate its engagement of the Company under all of the contracts. Notwithstanding the notices to terminate, the Company intends to vigorously defend its position that it was not in repudiatory breach of the contracts at the time of its receipt of the notices and is actively engaged with its UK legal counsel regarding this matter, as well as potential remedies.”
Mr. Shimoon continued, “Consequently, the Company took immediate steps to mitigate any unnecessary cash burn for its UK operations and elected to file a notice of intent to appoint an administrator (the “NOI”) to create a moratorium over the Company in order to protect the assets of Lite Access UK. Subsequent to the fiscal year-end, in January 2021, the UK business officially appointed FRP Advisory Trading Limited as administrators. As a result, our year-end results were negatively impacted by a number of factors, including non-cash impairment charges of $4,736,127 and an accrual of $3,315,147 related to an onerous contract provision.”
“The Company continues with business development activities with other network operators in the UK and various government municipalities in Canada, with the intention being to diversify and de-risk the business. Business conditions in Canada continue to improve and provide a real, sustainable opportunity for our Company’s growth. As stated recently, proposal activity in Canada has been busier than normal and shows no signs of slowing down.”
Mr. Shimoon concluded, “Although multiple developments impacted our year-end results, we have taken some important steps to position Lite Access to have a strong fiscal 2021. We are confident that the Company will be able to take advantage of the market opportunity for fibre optics.”
FINANCIAL HIGHLIGHTS FOR FISCAL 2020:
- Total fiscal 2020 revenue of $18,867,242 representing an increase of 55% compared to revenue of $12,194,874 for fiscal 2019;
- Gross margin for the year ended September 30, 2020 was $(1,368,640) compared to $1,061,926 over the same period last year;
- EBITDA* for fiscal 2020 was $(7,531,135) compared to $(3,827,369) for fiscal 2019;
- Operating expenses for 2020 fiscal year of $16,098,692 includes non-cash impairment charges of $4,736,127 and an accrual of $3,315,147 related to an onerous contract provision;
- Comprehensive net loss of $(17,272,126) for fiscal 2020 compared to $(5,440,890) for fiscal 2019;
About Lite Access
Lite Access Technologies Inc. is a world leader in the use of innovative and proven micro/narrow trenching technologies, alternate methods of deployment and specialist products which transform the cost the network deployment for telecommunications operators.
As part of its suite of services, Lite Access provides clients with integrated solutions or select components for the design and implementation of fibre optic networks. Lite Access’ products have been deployed in many high-profile communication networks including Olympic facilities, military and government, numerous communities throughout the United Kingdom, the USA and Canada as well as global telecommunications companies that have adopted Lite Access as the “solution of choice” for the least invasive, most cost effective and future-proof fibre optic connectivity available.
Lite Access’ installation technology and proprietary products extend a network provider’s ability to deliver true broadband connectivity directly to end-users, such as homes, businesses, government and educational institutions, and emergency response facilities. Lite Access remains flexible and innovative in its commitment to provide global clients and partners with the most cost effective and proven fibre connectivity solutions available.
For further information please contact:
Lite Access Technologies Inc.
Carlo Shimoon, CEO
Unit 5 – 20678 Duncan Way
Langley, BC V3A 7A3
For investor relations please contact:
Contact Financial Corp.
810 – 609 Granville St.
Vancouver, BC V7Y 1G5
EBITDA is a measure not recognized under IFRS. However, management of Lite Access believes that most shareholders, creditors, other stakeholders and investment analysts prefer to have these measures included as reported measures of operating performance, a proxy for cash flow, and to facilitate valuation analysis. EBITDA is defined as earnings before interest income, taxes, depreciation and amortization, stock based compensation, restructuring costs, impairment charges, other non-recurring gains or losses, and onerous contract provision. Management believes EBITDA is a useful measure that facilitates period-to-period operating comparisons.
EBITDA does not have any standardized meanings prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers. Readers are cautioned that EBITDA is not an alternative to measures determined in accordance with IFRS and should not, on its own, be construed as indicators of performance, cash flow or profitability. References to the Lite Access’ EBITDA should be read in conjunction with the financial statements and management’s discussion and analysis of Lite Access posted on SEDAR (www.sedar.com).
Forward Looking Information
This news release contains statements that, to the extent they are not recitations of historical fact, may constitute “forward-looking statements” within the meaning of applicable Canadian securities laws. Lite Access uses words such as “may”, “would”, “could”, “will”, “likely”, “expect”, “believe”, “intend” and similar expressions to identify forward-looking statements. Any such forward-looking statements are based on assumptions and analyses made by Lite Access in light of its experience and its perception of historical trends, current conditions and expected future developments. However, whether actual results and developments will conform to Lite Access’ expectations and predictions is subject to any number of risks, assumptions and uncertainties. Many factors could cause Lite Access’ actual results to differ materially from those expressed or implied by the forward-looking statements contained in this news release. Such factors include, among other things: risks and uncertainties described in Lite Access’s most recent Management Discussion & Analysis (MD&A) for the financial year ended September 30, 2020 which can be accessed at www.sedar.com. The “forward-looking statements” contained herein speak only as of the date of this press release and, unless required by applicable law, Lite Access undertakes no obligation to publicly update or revise such information, whether as a result of new information, future events or otherwise.
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