TORONTO, ONTARIO -- (Marketwired) -- 05/30/13 -- Loyalist Group Limited ("Loyalist") (TSX VENTURE: LOY) is pleased to announce record financial results for the three months ended March 31, 2013.
In the first quarter, revenue rose 50% year over year to $5 million. Net income grew 67% to $833,799 compared to the same period last year. Income from operations increased 94% to over $1 million.
Revenue and earnings rose as a result of four acquisitions made during 2012 and 2013, as well as organic growth arising from higher enrolment and increased tuition fees.
Gross margin improved by 820 basis points to 43.2% of revenue. Operating income margin improved 490 basis points to 22% of revenue.
The following table summarizes Loyalist's results and compares first quarter results from 2012 to 2013:
Q1 2013 Q1 2012 % ChangeRevenue $ 4,932,219 $ 3,299,922 50%Gross profit $ 2,131,524 $ 1,155,701 84%Net income $ 833,799 $ 498,593 67%Costs relating to acquisitions $ 231,457 - -Other items $ (35,101) $ 32,511 -Income from operations $ 1,030,155 $ 531,104 94%
"We're pleased with these numbers," said CEO Andrew Ryu. "Of particular interest are our margins. Operating margin improved by two percentage points over last year and gross margin by eight percentage points. Growing our revenue increases our profits, but we're also benefiting from economies of scale. Each additional dollar of revenue going forward should contribute additional profits for shareholders. It's also important to note that we improved our operating margin even as we staffed up in advance of the bigger acquisitions we're anticipating. We feel it's prudent to invest in staff and systems prior to growing aggressively, even if it means higher costs that temporarily hold back earnings growth. We are now poised to make significantly bigger acquisitions, and we are in advanced negotiations on several of them."
Loyalist is also pleased to announce that it has begun to investigate ways in which to monetize student lodging opportunities. The Company currently does not earn revenue from the rent paid by its 1,500 foreign students, but believes it is possible to do so. Management has begun studying the most efficient way to do this.
"We can unlock tremendous value by tapping into this revenue source. We don't currently profit from student rentals but we should, and we will, once we determine the best approach for our shareholders. With 1,500 students now, and, we anticipate, significantly more in the months to come, the numbers are extremely compelling as our students spend millions of dollars on accommodation while enrolled in our programs." Mr. Ryu added that Loyalist intends to apply for listing on the TSX.
Loyalist owns and operates private education schools in Toronto, Vancouver, and Victoria offering (i) English as a Second Language Courses for international students; (ii) Training programs for teachers, commonly known as TESL; (iii) Professional Development Courses; and (iv) Corporate English for Professionals.
This news release includes certain forward-looking statements within the meaning of Canadian securities laws. Such forward-looking information and statements are not representative of historical facts or information or current condition, but instead represent only the Corporation's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of the Corporation's control. Generally, such forward-looking information or statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken, "will continue", "will occur" or "will be achieved". The forward-looking information contained herein includes, but is not limited to, information with respect to prospective financial performance, anticipated capital funding and sources, proposed or potential acquisitions, estimated operating and sales costs, estimated market drivers and demand, business prospects and strategy, new markets for growth and financial position. By identifying such information and statements in this manner, the Corporation is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Corporation to be materially different from those expressed or implied by such information and statements. Any number of important factors could cause actual results to differ materially from these forward-looking statements as well as future results, including but not limited to: risks related to any of the Corporation's announced or proposed acquisitions failing to close or becoming delayed before closing; the Corporation's reliance on its South Korean contract;; any loss of certain key personnel; levels of student enrolment; delays in rolling out the online education programs; competition in the educational services market; and currency fluctuations. Although the Corporation has attempted to identify important factors that could cause actual results to differ materially from those contained in the forward-looking information and statements, there may be other factors that cause results not to be as anticipated, estimated or intended.
Although the Corporation believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Accordingly, readers should not place undue reliance on any forward-looking information or statements contained in this press release. The forward-looking information contained in this press release is made as of the date hereof, and the Corporation does not undertake to update any forward-looking information that is contained or referenced herein, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws. All subsequent written and oral forward looking information and statements attributable to the Corporation or persons acting on its behalf is expressly qualified in its entirety by this notice.
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Loyalist Group Limited
(416) 977-9800 X225
Loyalist Group Limited