REGINA, SK, Feb. 11, 2025 /CNW/ – SSC Security Services Corp. (“SSC” or the “Company) (TSXV: SECU) (OTCQX: SECUF), a national provider of cyber, physical and electronic security services to commercial, industrial and public sector clients across Canada, is pleased to release its results for the first quarter ended December 31, 2024. All figures are presented in Canadian dollars.
“Our first quarter results came in as expected. We are seeing improved profitability from stronger margins as a result of careful expense management. We continue to buy back our shares and take a disciplined approach to acquisitions. Our objective is always to protect our cash and be opportunistic in our efforts to grow the company. We continue to be well capitalised and debt free”, said Chairman and CEO Doug Emsley.
Key Highlights for Q1 2025:
Improved Margins- Gross profit for the quarter ended December 31, 2024 was $5.0 million (17.1%) up from $4.9 million (15.7% of revenue) during the same quarter last year.
34th Consecutive Quarterly Dividend- During the quarter we paid $0.03 per share in dividends to shareholders.
Share Buy-backs- During the quarter we bought back 161,400 shares of the Company at an average of $2.61 per share (cancelled 157,400 shares with 4,000 shares held in Treasury to be cancelled early January 2025).
Consistent Revenues- During the first quarter ended December 31, 2024, revenue was $29.2 million, consistent with revenues last quarter (fourth quarter of fiscal year 2024: $29.6 million). Revenues for the quarter ended December 31, 2023 were $30.9 million.
We finished the quarter ended December 31 with:Cash and cash equivalents of $11.4 million equal to $0.62 per share;Working capital of $26.3 million;Total shareholders’ equity of $63.4 million; andNo long-term debt.
Key Performance Indicators for the comparable periods are summarized below:
Key Performance Indicators
Quarter ended
Dec 31
2024
2023
Revenue
29,195
30,882
Cost of Sales
24,198
26,029
Gross Margin
4,997
4,853
Gross Margin (%)
17.1 %
15.7 %
Comprehensive net (loss) income
(125)
66
Comprehensive net (loss) income per share (basic)
$(0.01)
$0.00
Adjusted EBITDA
1,171
1,377
Adjusted EBITDA per share (basic)
$0.06
$0.07
REVENUE, GROSS PROFIT & NET INCOME
Revenues for the quarter ended December 31, 2024 were $29.2 million compared with $30.9 million during the quarter ended December 31, 2023, a decrease of $1.7 million (revenue decrease of 5.5%). The decrease in revenues was primarily due to higher temporary contracts in the prior year. These temporary short-term contracts can fluctuate from one period to another, but the Company’s long-term recurring monthly revenues remain strong.
Gross profit for the quarter ended December 31, 2024 increased to $5.0 million (17.1% of revenue) from $4.9 million (15.7% of revenue) during the same quarter last year. The year-over-year increase in gross margin is a result of our continued focus on higher operational efficiencies and cost savings initiatives.
Comprehensive net loss for the quarter ended December 31, 2024 was $0.1 million (loss of $0.01 per share), compared to comprehensive net income in the same quarter last year of $0.1 million (income of $0.00 per share).
ADJUSTED EBITDA
Adjusted EBITDA is the primary KPI used by the Company to measure the financial performance of the Company. Adjusted EBITDA for the quarter ended December 31, 2024, was $1.2 million ($0.06 per share), consistent with the average adjusted EBITDA per quarter over the past twelve months.
A reconciliation of earnings to EBITDA and Adjusted EBITDA is provided in the Non-IFRS section of the MD&A published concurrently with this press release.*
BALANCE SHEET
Key balance sheet items are summarized below:
Statements of Financial Position
As at
As at
31-Dec-24
31-Dec-23
Cash
11,422
9,779
Accounts receivable
22,578
25,298
Legacy business assets
6,203
7,707
Working capital
26,255
27,808
Long-term debt
0
0
Total assets
80,800
82,755
Total liabilities
17,367
15,872
Total shareholders’ equity
63,433
66,882
Common shares outstanding
18,546
19,193
UPDATE ON NORMAL COURSE ISSUER BID
During the quarter ended December 31, 2024, we bought back 161,400 shares at an average price of $2.61 per share (Same quarter last year: 128,100 shares at an average price of $2.59 per share). We cancelled 157,400 shares with 4,000 shares held in Treasury to be cancelled early January 2025.
We continue to believe that our shares have been trading in a price range which does not adequately reflect their value and that the purchase of shares under the NCIB will enhance shareholder value in general. Over the past eight fiscal years, the Company has bought back and cancelled roughly 47% of the outstanding shares.
OUTLOOK
We are seeing continued growth in demand for the kind of innovative and cost-effective security services and solutions that we offer at SSC. Our ability to combine physical and electronic security services in a fully integrated way is the future of our industry. Additional growth may also come via acquisition, as we look to acquire other profitable companies in the Canadian security industry. Acquisitions may help us reach our growth targets more quickly, but we will not rush to complete new deals, and we will maintain our financial conservatism throughout.
Most of our remaining legacy assets are expected to convert to cash over the next year. Our objective is to make these resources available for the expansion of our security business.
We also plan to continue to distribute capital to shareholders via our dividend, operate with minimal to no debt while maintaining solid liquidity, focusing on maintaining strong margins, and maximizing our Adjusted EBITDA per share.
ABOUT SSC
SSC Security Services Corp. is a national provider of cyber, physical and electronic security services to corporate and public sector clients across Canada. For more information, please visit www.securityservicescorp.ca
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Forward Looking Statements
This release includes forward-looking statements regarding SSC and its business. Such statements are based on the current expectations and views of future events of SSC’s management. In some cases the forward-looking statements can be identified by words or phrases such as “may”, “will”, “expect”, “plan”, “anticipate”, “intend”, “potential”, “estimate”, “believe” or the negative of these terms, or other similar expressions intended to identify forward-looking statements. The forward-looking events and circumstances discussed in this release may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting SSC, including risks regarding the security industry, the agricultural industry, economic factors and the equity markets generally and many other factors beyond the control of SSC. No forward-looking statement can be guaranteed. Forward-looking statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statement or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and SSC undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
*Non-IFRS Measures
SSC measures key performance metrics established by management as being key indicators of the Company’s strength, using certain non-IFRS performance measures, including:
EBITDA, EBITDA per share, Adjusted EBITDA, and Adjusted EBITDA per share.
The Company uses these non-IFRS measures for its own internal purposes. These non-IFRS measures do not have any standardized meaning prescribed by IFRS, and these measures may be calculated differently by other companies. The presentation of these non-IFRS measures is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The Company provides these non-IFRS measures to enable investors and analysts to understand the underlying operating and financial performance of the Company in the same way as it is frequently evaluated by Management. Management will periodically assess these non-IFRS measures and the components thereof to ensure their continued use is beneficial to the evaluation of the underlying operating and financial performance of the Company. For more detailed information, please refer to the Company’s Management Discussion and Analysis dated February 11, 2025 available on the Company’s website at www.securityservicescorp.ca and on SEDAR+ at www.sedarplus.ca.
SOURCE SSC Security Services Corp.
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