PUR Premier American Uranium Inc

CALGARY, March 16 /CNW/ -- CALGARY, March 16 /CNW/ - Pure Technologies Ltd. ("Pure") (TSXV: PUR) is pleased to announce strong financial results for the year ended December 31, 2010.  Revenue for the year was $48.4 million, a 53% increase over 2009 and EBITDA of $7.1 million increased by 58% over the previous year.  Net income for the year was $5.5 million, an increase of 263% over 2009. Earnings per share of $0.13, on a fully diluted basis, more than tripled compared to 2009. Fourth quarter results were strong with revenue of $16.5 million, versus $12.9 million in the fourth quarter of 2009.  Revenue growth reflects a significant year-over-year increase in worldwide project activity, as well as the inclusion of a full quarter of contribution by the recently acquired Pressure Pipe Inspection Company ("PPIC").  Net income for the quarter was $3.6 million, compared to $2.4 million for the fourth quarter of 2009.  "This has been a tremendous year for Pure as we achieved record financial results and great success in all elements of our business", said Jack Elliott, President.  "With the acquisition of PPIC, we broadened our global reach and added to our technology and services portfolio. The acquisition for the partial year generated revenues of $9.2 million. We also continued to expand our business development activities and obtained several substantial contracts as well as advanced our presence in regions including Australia, Hong Kong, the Philippines, and Mexico." Highlights for the year included: -- The PPIC acquisition, which was a significant milestone for Pure and the international water technology sector. The integration of the business and resources of PPIC is essentially complete with sales, marketing, operations and R&D functions now combined. With this acquisition, we have accelerated our project delivery capability and research & development output and we have been successful in securing new or renewed pipeline monitoring, leak detection and condition assessment contracts from former clients of PPIC. -- The establishment of Pure Technologies China Ltd. ("Pure China"), a joint venture with Balama Prima Engineering Co. Ltd., a privately-held Hong Kong-based company with business interests in the infrastructure sector in China. This joint venture extended our global reach into the Asian market with Pure China representing Pure's interests in China, Hong Kong, Taiwan and Macau. -- The acquisition of Aqua Environmental Pty. Ltd. ("Aqua"), a privately-held company headquartered in Sydney, Australia which provides pipeline leak detection and condition assessment services for Australia and New Zealand. This acquisition allows Pure to build on the established expertise in the region, which holds significant opportunity. Following the acquisition, Aqua signed a substantial three-year contract award with Yarra Valley Water in Melbourne, Australia for leak detection services. -- The significant increase in revenue from leak detection services. The scarcity of water in many locations has driven the need to ensure water loss in transmission distribution networks is minimized. As a result, the demand for leak detection services including Pure's Sahara® and Smartball® patented technologies has grown substantially with several contract and renewal awards. -- The completion of a $30,100,000 financing. The offering was fully subscribed and brought new investors from Europe and North America into our shareholder group. Financial Overview Pure generated $16.7 million in revenue growth over 2009, an increase of 53% in total revenue.  Revenue growth has shown dramatic increases since 2005 followed by increased profitability of the Company.  All product groups saw a minimum of 16% growth over 2009, with the majority of the growth (343%) coming from inspection services.  This product group represents the revenue from both the PPIC and Aqua Environmental Pty. Ltd. acquisitions completed in the year.  Gross margin was 64.5% which is slightly lower than 2009 at 65.1%. Expenses as a percentage of revenue increased slightly from 55% to 57%. This small increase is attributable to the amortization related to the intangibles recognized within the purchase price allocation of the acquisitions.  Working capital grew by 56%. Earnings increased from $1.5 million in 2009 to $5.5 million. Overall, the financial results of the Company continue to strengthen, positioning it to capitalize on its new markets and technologies. Geographically, all regions experienced considerable revenue growth.  Mexico has led this growth as a result of the PPIC acquisition combined with the first installation of an AFO system in the country.  The Middle East/Africa region accounted for approximately $4.0 million of the increase while business in the U.S. continues to grow and there has been increased work and interest within Canada.  Revenues in Europe have increased mainly due to SmartBall license agreements that have been signed or renewed.  To date, we have issued nine licenses for either water or oil pipelines. Marketing and promotion expenses increased by 44% in 2010, consistent with 2009 as a percentage of revenue.  Acquisitions and the formation of the joint venture in Hong Kong attributed to 43% of this increase.  Also, additional resources were employed in North America to focus on the wastewater and power generation markets and coverage of South America expanded, resulting in favorable contracts that will be executed in 2011. Marketing efforts of the acquisitions have been fully integrated into the Company's strategies and expanding business in all geographical locations will be a focus in 2011. Engineering and operations expenses increased 72% in 2010.  As a percentage of revenue, these expenses have grown from 12% to 13.5%. The 2010 acquisitions accounted for 40% of the increase while staffing levels added the remaining amount. As a result of the acquisitions, additional staff training was undertaken during the latter part of 2010; this will continue into 2011 to ensure that the operations staff is sufficiently trained in the Company's technologies to adequately execute the revenue growth. General and administration expenses increased 42% over 2009.   Of the increase, 54% is attributable to acquisitions and the formation of the Hong Kong joint venture.  The remaining 46% of the increase is due to the growth of company in terms of required office space, staff, and third party fees.  As a percentage of revenue, general and administration has remained consistent at 20% for 2010 and 2009.  Significant reductions in G&A have been made in relation to the PPIC acquisition.  These savings will be realized in 2011 and 2012. Research and development expenditures increased by 36% for the year; 11% of the increase was due to the acquisition of PPIC.  The remaining increase is due to projects underway that did not meet our capitalization policy. In 2010, $553,565 in costs were capitalized in PPIC for the development of PipeDiver™.  In 2009, no development costs were capitalized.  Research grants, in the amount of $80,304 were offset against development costs.  Comparatively, in 2009, $93,458 of research grants were offset against development costs.  Integration of staff from PPIC's research and development function occurred during the latter part of 2010.  Depreciation and amortization increased 130% from 2009. The expense increased between 2008 and 2009 by 25%.  Over the last two years, this expense increase has been attributable in part to the amortization related to intangibles acquired in the acquisitions. For 2010, the amortization related to the acquisition intangibles was $1,438,944. The second factor is the actual depreciation on assets acquired during 2010 with the purchase of PPIC and Aqua Environmental which accounts for $379,944 of the increase.     Pure's working capital at December 31, 2010 was $47.1 million, a 56% increase over 2009.  Of the amount, $14.2 million is in cash and cash equivalents.  The value of outstanding accounts receivable from Libya currently stands at $24 million.  Management expects that these receivables will be collected and is in regular contact with senior management of the Great Man-Made River Authority (GMRA).  The Company is closely monitoring developments and updates will be provided to shareholders as the situation evolves. 2011 Outlook Looking ahead to 2011, the Company's first quarter results will be adversely affected by the recent events in Libya.  Under our current contract with GMRA, we had anticipated shipping equipment worth approximately $10.7 million in March 2011.  This shipment will now be delayed. Furthermore, we had anticipated that revenues of approximately $2 million related to the provision of technical support for pipeline monitoring and $5 million related to Price Brothers UK activities would occur in 2011.  Our backlog of over $44 million plus $5 million in recurring revenue currently includes $12.7 million of this amount; however all work in Libya will be delayed until conditions are deemed appropriate for the Company to resume activities.  Although these events will likely affect our business in the short term, we have pursued a business strategy over the last two years to diversify our revenues and to make us less dependent on any one customer.  We expect this trend to continue in 2011. Our business in the Americas has been growing at a rate of approximately 100% per year over the past two years and we expect that this growth rate will be maintained in 2011.  Our overseas business has begun to generate meaningful revenues that we expect will contribute to overall growth in the future as agencies are increasingly faced with the challenge of addressing deteriorating infrastructure and shrinking capital budgets.  We continue to look for opportunities to grow our business organically and through strategic acquisitions.  The Company will also file its Annual Information Form and Annual Report on SEDAR. 2010 Financial Highlights (Unaudited) Consolidated Three months ended Twelve months ended Statement of Operations Dec. 31, 2010 Dec. 31, 2009 Dec. 31, 2010 Dec. 31, 2009 Equipment 5,035,000 9,461,000 21,942,000 18,740,000 sales Inspection 8,065,000 838,000 14,655,000 3,310,000 services Consulting 2,012,000 1,635,000 6,860,000 5,892,000 services Monitoring 1,409,000 932,000 4,895,000 3,731,000 and technical support Total Revenue 16,521,000 12,866,000 48,352,000 31,673,000 Cost of sales 4,999,000 5,096,000 17,180,000 11,041,000 Marketing 1,830,000 1,005,000 5,871,000 4,071,000 Engineering 2,246,000 1,058,000 6,532,000 3,809,000 and operations General and 3,707,000 2,169,000 9,597,000 6,751,000 administration Research and 247,000 465,000 2,033,000 1,498,000 development Depreciation 1,549,000 428,000 3,291,000 1,434,000 and amortization Foreign (472,000) (251,000) (400,000) exchange loss (1,549,000) Interest 32,000 7,000 108,000 income 85,000 Net income 1,503,000 2,401,000 3,554,000 1,605,000 (loss) before income taxes Income taxes (2,062,000) 37,000 (1,908,000) 100,000 Net income 3,565,000 2,364,000 5,462,000 1,505,000 (loss) Net income (loss) per share -- basic $0.09 $0.07 $0.13 $0.05 -- diluted $0.09 $0.07 $0.13 $0.04 Weighted average number of shares outstanding -- basic 44,545,529 33,477,914 41,020,760 33,261,069 -- diluted 45,505,852 34,237,141 41,948,040 33,935,273 Consolidated Balance Dec. 31, 2010 Dec. 31, 2009 Sheet (Unaudited) Assets Current assets: Cash and cash 14,173,000 15,565,000 equivalents Accounts receivable 41,394,000 17,297,000 Inventory 4,313,000 1,475,000 Prepaid expenses 1,203,000 819,000 Net investment in 36,000 75,000 lease 61,119,000 35,231,000 Property and equipment 5,813,000 2,859,000 Goodwill 24,533,000 1,988,000 Intangible assets 11,466,000 1,977,000 Future tax asset 1,251,000 - Net investment in 38,000 lease - 104,182,000 42,093,000 Liabilities and Shareholders' Equity Current liabilities: Accounts payable and 6,180,000 4,812,000 accrued liabilities Acquisition holdback 4,250,000 - payable Deferred revenue 3,546,000 125,000 13,976,000 4,937,000 Future income taxes 239,000 - Shareholders' equity: Share capital 91,360,000 45,576,000 Contributed surplus 2,496,000 1,591,000 Share Purchase 993,000 - Warrants Accumulated other (46,000) (191,000) comprehensive loss Deficit (4,597,000) (10,059,000) 90,206,000 36,916,000 104,182,000 42,093,000 About Pure Technologies Ltd. Pure Technologies Ltd. is an international asset management technology and services company which has developed patented technologies for inspection, monitoring and management of critical infrastructure around the world.  Pure's business model incorporates four distinct but complementary business streams: -- Sales of proprietary monitoring technologies for pipelines, bridges and structures (SoundPrint®, SoundPrint® AFO); -- Recurring revenue from data analysis and site maintenance for these technologies, and from technology licensing; -- Premium technical services including inspection, leak detection and condition assessment (P-Wave®, SmartBall®, Sahara®, PipeDiver™, PureRobotics™); -- Specialized engineering services in areas related to asset management, primarily in the area of pipeline condition assessment for water and wastewater infrastructure (Openaka Corp., Price Brothers UK Ltd, and Jason Consultants). Forward-Looking Statements This release contains forward-looking statements.  Forward-looking statements, without limitation, may contain the words "believes", "expects", "anticipates", "estimates", "intends", "plans", or similar expressions.  Forward-looking statements are not guarantees of future performance.  They involve risks, uncertainties and assumptions and the Company's actual results could differ materially from those anticipated.  Forward-looking statements are based on the opinions and estimates of Management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements.  In the context of any forward-looking information please refer to risk factors detailed in, as well as other information contained in, the Company's filings with Securities Regulators (www.sedar.com). ® Registered Trademarks, property of Pure Technologies Ltd. "The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release" To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/March2011/16/c3600.html pTo find out more about Pure Technologies Ltd. (TSX-V: PUR), visit our website at a href="http://www.puretechltd.com"www.puretechltd.com/a.  Or contact James E. Paulson, Chairman or Karen Keebler, Chief Financial Officer at (403) 266-6794 or e-mail to a href="mailto:info@puretechnologiesltd.com"info@puretechnologiesltd.com/a./p

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