Canadian alarm monitoring services provider Alarmforce reports strong financial growth in 2013 Q2

Alarmforce Industries, Canada's largest manufacturer and installer of live two-way voice home alarm systems, announced results for the six months ended April 30, 2013. "For the six months ended April 30, 2013, Alarmforce revenues increased to $24.0 million, reflecting an annualized growth rate of 9 percent,” said Joel Matlin, President and CEO of Alarmforce. “Total subscribers for the same period increased to 137,700 accounts, reflecting an annualized growth rate of 6 percent."

Gross profit for the six month period increased by US$2.0 million, which is a 12 percent increase over the comparative period. Gross margin increased from 73 percent to 76 percent, reflecting a favorable trend in economies of scale, as more customers are adopting video technology, resulting in higher revenue per subscriber. Net income for the six month period increased to $2.7 million, an increase of 484 percent over the comparative period.

EBITDA increased by $3.1 million in the first six months, an increase of 100 percent over 2012. Excluding the impact of marketing, the company's EBITDA increased by $1.6 million, a 14 percent increase over 2012.

Dividends of $0.6 million were paid to shareholders in the six month period, compared with nil in the comparative period of 2012. Cash flows from operations, which is net of working capital requirements increased to $3.7 million, an increase of $1.4 million or 59 percent over 2012. Operating cash flows before working capital adjustments increased to $4.9 million for the six months, an increase of $2.3 million, compared to 89 percent in 2012.

The company continues to grow without adding debt, funding the costs of marketing, research and development expenses, as well as dividends to our shareholders, from the company's operating cash flows.

In the second quarter the company installed 1,150 Videorelay systems, representing over 20 percent of all the two-way voice alarms installed compared with approximately 10 percent a year ago. The increasing proportion of home video surveillance subscribers compared to the total subscriber base will result in an increase in the company's future average revenue per subscriber. The company expects this favorable trend to continue over the next several years.

Alarmforce is optimistic that VideoRelay proprietary technology will continue to contribute to the overall growth in subscribers, allowing them to remotely control their homes using both visual and audible features of our technology.

The company's innovative two-way voice monitored home technology, CellWave, that allows an Alarmforce system to be installed in any home without a phone line or internet connectivity. The product has been recently introduced and systems installed in Canada with very positive initial response. It is expected to be introduced in the U.S. shortly. Alarmforce anticipate that the new technology will open up new market opportunities in both Canada and the U.S. in the near future.