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Avante Corp. achieved 21% year-over-year revenue growth in the fiscal third quarter with Recurring Monthly Revenues improving by 25%.
The Company expects continued growth to conclude Fiscal 2025, driven by the NSSG acquisition and strong momentum across its services including Avante Black, Halo, Avante Verified, and WALL-E.
The Company achieved Adjusted EBITDA from continuing operations of $0.77 million in fiscal Q3-2025, an increase of 74% as compared to Q3-2024. This quarter marks the first quarter with no reorganization expenses since the leadership transition, while ongoing backend efficiencies are expected to further strengthen the Company’s financial performance.
TORONTO-Ontario, Feb. 26, 2025 (GLOBE NEWSWIRE) -- Avante Corp. (TSX.V: XX) (OTC: ALXXF) (“Avante” or the “Company”) is pleased to announce its financial results for its third fiscal quarter ended December 31, 2024 (all amounts in Canadian dollars thousands, unless otherwise indicated).
Manny Mounouchos, Founder, Chief Executive Officer and Board Chair of Avante, commented, “Our latest results reflect the transformation Avante has undergone since we streamlined operations and refocused on our core strengths. The third quarter of fiscal 2025 was another period of strong growth for Avante, with quarterly revenue increasing by 21% year-over-year and improving profitability, reflected in a 74% increase in Adjusted EBITDA. Our core business remains robust, driving a 25% increase in Recurring Monthly Revenue. With a growing portfolio of innovative security solutions, we are setting a new standard in the industry. Our proprietary Halo technology continues to expand, now installed in nearly 200 locations, with next-generation advancements like Halo-Track in testing. WALL-E is shaping the future of autonomous surveillance, offering unmatched flexibility and precision, while Avante Verified is gaining momentum as schools seek enhanced safety measures. Meanwhile, Avante Black’s elite security services now contribute over 10% of our total revenue, further solidifying our leadership in high-end protection. With strong demand for Homeworxx and the upcoming commercialization of Argus, Avante is well-positioned for continued growth. We remain committed to investing in cutting-edge technology, expanding our service offerings, and delivering world-class security solutions to our clients worldwide.”
Raj Kapoor, Avante’s Chief Financial Officer, added, “I am pleased to report a robust balance sheet with positive cash flows from operations, positioning us for continued innovation and strategic investments. The Company remains bank debt-free, with $5 million in cash on hand and access to $12 million in unused credit facilities. We have achieved positive Adjusted EBITDA in 10 of the past 12 quarters while consistently maintaining strong gross margins. This quarter marks a significant milestone for Avante as it is our first with no reorganization expenses since the leadership transition. While we continue to see strong momentum across our growing product lineup, we are also making meaningful progress in streamlining our operations. By driving efficiencies on the backend, we expect to further enhance our financial performance in the quarters ahead. The outlook for the remainder of fiscal 2025 is highly positive, supported by our strong financial position, which enables us to pursue strategic acquisitions and advance key internal developments.”
QUARTERLY FINANCIAL HIGHLIGHTS FOR THE THIRD FISCAL QUARTER ENDED DECEMBER 31, 2024:
Within continuing operations, the Company reported revenue of $8,412 during the third quarter of fiscal 2025, representing year-over-year revenue growth of 21%, or $1,471, compared to $6,941 for the prior fiscal year third quarter. The increase was due to the acquisition of NSSG, Avante Black growth and organic growth of its domestic business.
Total gross profit from continuing operations increased by $493 in the third quarter of fiscal 2025 compared to the same quarter in fiscal 2024. Gross profit margins within continuing operations remained relatively stable at 41% compared to 42% during the prior year’s third quarter, indicating a consistent level of profitability.
The Avante Security segment delivered recurring monthly revenues (“RMR”) of $3,606 during the third quarter of fiscal 2025, up from $2,889 during the Company’s third quarter in the prior year, a year-over-year growth of 25%. The increase was due to net growth in monitoring customers and the introduction of new recurring revenue services to the existing client base.
The Company achieved Adjusted EBITDA from continuing operations of $770 during the third quarter, compared to Adjusted EBITDA of $442 for the prior fiscal year third quarter.
The Company made the decision to incur an impairment expense of $383 for software expenses relating to an ERP system in the period due to the lack of functional requirements that were promised through customization. The Company is seeking reimbursement from the vendor and has also referred the matter to it’s legal counsel.
OUTLOOK
Management maintains a positive outlook for Fiscal 2025. The Company’s long-term financials serve as a guide to developing and executing long-term corporate strategy. Management is pleased to reiterate the Company’s long-term financial objectives:
Build recurring monthly revenues;
Achieve consolidated Adjusted EBITDA margins consistent with its industry;
Achieve growth in Adjusted Net Income per share;
Reinvest cashflow in future business growth.
SUMMARY FINANCIAL RESULTS FOR THE THIRD FISCAL QUARTER ENDED DECEMBER 31, 2024:
Readers should refer to the Company’s financial statements and MD&A in respect of its third fiscal quarter ended December 31, 2024, for additional risk factors, accounting policies, detailed financial disclosures, reconciliation of non-IFRS financial measures to the most directly comparable IFRS financial measures, related party transactions, contingencies, and reporting of subsequent events. Such financial statements and MD&A are incorporated by reference into this news release and are filed electronically through the System for Electronic Document Analysis and Retrieval (“SEDAR+”), which can be accessed at www.sedarplus.ca.
Three Months Ended
$ thousands unless otherwise noted
Dec. 31, 2024
Sept. 30, 2024
June 30, 2024
INCOME STATEMENT INFORMATION:
Q3 F25
Q2 F25
Q1 F25
RMR in the period, continuing operations (1)
$3,606
$3,666
$3,261
Revenues, continuing operations (1)
$8,412
$8,089
$7,915
Gross profit, continuing operations (1)
$3,441
$3,477
$3,006
Gross profit margin, continuing operations (1)
40.9%
43.0%
38.0%
Adjusted EBITDA, continuing operations (1)
$770
$338
$363
Net Income (loss), continuing operations (1)
$(155)
$(909)
$(128)
Net Income (loss)
$(155)
$(909)
$(128)
Average Common Shares during the quarter
26,643,739
26,643,739
26,643,739
As At
BALANCE SHEET INFORMATION:
Dec. 31, 2024
Sept. 30, 2024
June 30, 2024
Cash balances & GIC investments (1)
$5,039
$3,914
$6,236
Total funded debt as reported, IFRS
$0
$0
$0
Total funded debt & lease obligations, IFRS (1)
$1,392
$1,392
$1,358
Common Shares at period end
26,643,739
26,643,739
26,643,739
(1)Adjusted EBITDA and Recurring Monthly Revenues (“RMR”) are non-IFRS financial measures that have no standard meaning under IFRS and as a result may not be comparable to the calculation of similar measures by other companies. See Description of Non-IFRS Financial Measures. Reconciliations of Adjusted EBITDA and RMR to Net Income or Revenues, as applicable, are provided in the Company’s Management Discussion & Analysis (“MD&A”).
Three months ended
RECONCILIATION OF ADJUSTED EBITDA
Dec 31, 2024
Dec 31, 2023
Total comprehensive income (loss) from continuing operations
$(155)
$3
Deferred income tax expense (recovery)
(2)
(8)
Interest expense
64
4
Depreciation and amortization
428
336
Amortization on capitalized commission
2
-
Share based payments
50
44
Reorganization and acquisition expense
-
63
Software cost Impairment
383
Adjusted EBITDA from continuing operations
$770
$442
The Company’s (“RMR”) from continuing operations during the last eight quarters are summarized below. Gross profit margins over the last eight quarters ranged between 37.7% and 44.2%, and were 41.0% on a trailing twelve-month basis to December 31, 2024:
Avante Security
F23(1)
F24(1)
F25
$thousands
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
RMR in the period
$2,691
$2,648
$2,834
$2,889
$3,019
$3,261
$3,666
$3,605
Other revenue
2,675
2,762
2,505
4,052
4,240
4,653
4,423
4,805
Total revenue
$5,366
$5,410
$5,339
$6,941
$7,259
$7,915
$8,089
$8,412
Total Gross Profit
$2,029
$2,039
$2,118
$2,948
$3,211
$3,006
$3,477
$3,441
Gross Profit %
37.8%
37.7%
39.7%
42.5%
44.2%
38.0%
43.0%
40.9%
(1)The Company’s fiscal year end is on March 31 of each year. “F24” means the fiscal year ended March 31, 2024; and “F25” means the fiscal year ended March 31, 2025.
INVESTOR WEBINAR SCHEDULED FOR WEDNESDAY, FEBRUARY 26, 2025 at 11:00 am ET (8:00 am PT)
The Company will also host an investor webinar to provide a corporate update and review its fiscal third quarter of fiscal 2025 financial results, on Wednesday, February 26, 2025, at 11:00 am ET (8:00 am PT). The call will be hosted by: Emmanuel Mounouchos, CEO, Chairman, and Founder of Avante, and Raj Kapoor, CFO of Avante.
Avante Corp Inc. is a Toronto based leading provider of security operatives and technology enabled security solutions to residential and commercial clients. Avante’s mission is to deliver an elevated level of security globally, with white-glove mentality to high- net-worth families and corporations alike, through advanced solutions and methods of detecting conditions that require immediate response. The Company has developed a diversified security platform that leverages advanced technology solutions to provide a superior level of security services. With an experienced team and proven track record of solid growth, Avante is taking steps to establish a broad portfolio of security businesses and solutions for its customers through organic growth complemented by strategic acquisitions. Avante acquires, manages and builds industry leading businesses which provide specialized, mission-critical solutions that address the security risks of its clients. Avante is listed on the TSX Venture Exchange under the ticker “XX”. For more information, please visit www.avantecorp.ca and consider joining our investor email list.
This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities described herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This news release does not constitute an offer of securities for sale in the United States. The securities described herein have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and such securities may not be offered or sold within the United States absent registration under U.S. federal and state securities laws or an applicable exemption from such U.S. registration requirements.
Non-IFRS Financial Measures
This press release includes certain measures which have not been prepared in accordance with International Financial Reporting Standards (“IFRS”) such as EBITDA, Adjusted EBITDA and Recurring Monthly Revenue (“RMR”). These non-IFRS measures are not recognized under IFRS and and do not have a standardized meaning prescribed by IFRS. Accordingly, users are cautioned that these measures should not be construed as alternatives to net income determined in accordance with IFRS. The non-IFRS measures presented are unlikely to be comparable to similar measures presented by other issuers.
References to EBITDA are to net income before interest, taxes, depreciation and amortization. References to Adjusted EBITDA are to net income before interest, taxes, depreciation, amortization of intangibles & capitalized commissions, share-based payments, acquisition, integration and / or reorganization costs, deferred financing costs, loss (gain) in fair value of derivative liability and expensing of fair value adjustments per IFRS. Recurring Monthly Revenues, or RMR, represent revenue during the fiscal period that benefited from contractual periodic billing to customers, typically monthly, quarterly or annually.
Management believes that Adjusted EBITDA and Recurring Monthly Revenues are appropriate additional measures for evaluating Avante’s performance. Readers are cautioned that neither EBITDA, Adjusted EBITDA nor Recurring Monthly Revenues should be construed as an alternative to net income or revenues (as such financial measures are determined under IFRS), as an indicator of financial performance or to cash flow from operating activities (as determined under IFRS) or as a measure of liquidity and cash flow. Avante’s method of calculating EBITDA, Adjusted EBITDA and Recurring Monthly Revenues may differ from methods used by other issuers and, accordingly, Avante’s reported Non-IFRS measures may not be comparable to similar measures used by other issuers.
Forward-Looking Information
This news release may contain forward-looking statements (within the meaning of applicable securities laws) relating to the business of the Company and the environment in which it operates. Forward-looking statements are identified by words such as “believe”, “anticipate”, “project”, “expect”, “intend”, “plan”, “will”, “may” “estimate”, “pro-forma” and other similar expressions. These statements are based on the Company’s expectations, estimates, forecasts and projections. The forward-looking statements in this news release are based on certain assumptions. They are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the Company’s ability to achieve the benefits expected as a result of the sale of Logixx Security Inc., anticipated growth from acquisitions, new service offerings and from development and deployment of new technologies and the list of risk factors identified in the Company’s Management Discussion & Analysis (MD&A), Annual Information Form (AIF) and other continuous disclosure documents available at www.sedar.com. There can be no assurance that forward-looking statements will prove to be accurate as actual outcomes and results may differ materially from those expressed in these forward-looking statements. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, these forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, the Company assumes no obligation to publicly update any such statement, whether as a result of new information, future events or otherwise.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
