DIRTT Environmental Solutions Ltd. (TSX: DRT, NASDAQ: DRTT), an
interior construction company that uses technology for
client-driven design and manufacturing, is holding its Analyst Day
today in New York City, where management will announce its
strategic plan and financial targets for the end of 2023.
Kevin O’Meara, DIRTT’s chief executive officer, commented: “Our
plan and financial targets reflect our belief in the strength of
DIRTT’s value proposition and the size of our growth opportunity
within the interior construction market. Combined with the benefits
of the organizational transformation we are implementing, our
profitable business model is designed to drive significant value in
the coming years.”
Highlights of the strategic plan include:
- Enhancing the areas of software and product innovation, both of
which underpin DIRTT’s core customer value proposition;
- Operational improvements, including the implementation of a
formalized lean manufacturing approach within our factories to
further our metrics-driven continuous improvement culture, optimize
our cost structure and ensure the highest standard of quality for
our clients;
- Establishing a robust commercial function that integrates
marketing and sales to enable stronger sales execution.
Specifically, the commercial strategy centers on the following
themes:
- People, roles and organizational structure;
- Strategic marketing, including lead generation and tracked
conversion rates;
- Sales excellence, including customer segmentation and sales
execution; and
- A redefined and strengthened distribution partner
experience.
DIRTT’s strategic plan targets revenue levels between $450
million and $550 million at Adjusted EBITDA Margins between 18% and
22% by the end of 2023.
A live webcast of Analyst Day, which begins at 9:00 a.m. EST on
Tuesday, Nov. 12, 2019, will be accessible from DIRTT’s website at
www.dirtt.com/investors. Following the conclusion of Analyst Day, a
replay of the presentation will be available on dirtt.com.
Special Note Regarding Forward-Looking
Statements
Certain statements contained in this news release are
“forward-looking information” and “forward-looking statements”
(collectively, “Forward-Looking Information”) as defined under
applicable provisions of the United States Private Securities
Litigation Reform Act of 1995, and Section 21E of the
Exchange Act and within the meaning of applicable
Canadian securities laws. All statements, other than statements of
historical fact included in this news release, regarding our
strategy, future operations, financial position, estimated revenues
and losses, projected costs, prospects, plans and objectives of
management is Forward-Looking Information. When used in this news
release, the words “anticipate,” “believe,” “expect,” “estimate,”
“intend,” “plan,” “project,” “outlook,” “may,” “will,” “should,”
“would,” “could,” “can,” the negatives thereof, variations thereon
and other similar expressions are intended to identify
Forward-Looking Information, although not all Forward-Looking
Information contains such identifying words. In particular,
this news release contains Forward-Looking Information with respect
to, among other things, the Company’s business plans and
objectives; growth strategy and opportunities; revenue and Adjusted
EBITDA targets; the implementation of the Company’s strategic plan
and its expected benefits; and market opportunities.
Forward-Looking Information is based on certain estimates, beliefs,
expectations and assumptions made in light of management’s
experience and perception of historical trends, current conditions
and expected future developments, as well as other factors that may
be appropriate.
Information in this news release regarding the Company’s
estimated revenue and Adjusted EBITDA targets may constitute
Forward-Looking Information, as described above, and may also
constitute financial outlook information within the meaning of
applicable Canadian securities laws. The Company believes the
expectations reflected in such Forward-Looking Information and
financial outlook information are reasonable, but no
assurance can be given that these expectations will prove to be
correct and such Forward-Looking Information and financial outlook
information should not be unduly relied upon.
Forward-Looking Information necessarily involves unknown risks
and uncertainties, which could cause actual results or outcomes to
differ materially from those expressed or implied in such
statements. Due to the risks, uncertainties and assumptions
inherent in Forward-Looking Information, you should not place undue
reliance on Forward-Looking Information. Factors that could have a
material adverse effect on our business, financial condition,
results of operations and growth prospects can be found in the
section titled “Risk Factors” in our Registration Statement on Form
10, filed with the United States Securities and Exchange Commission
(“SEC”) on September 20, 2019, and our Form 10-Q filed with the SEC
on November 7, 2019. These risks are not exhaustive. Because
of these risks and other uncertainties, our actual results,
performance or achievement, or industry results, may be materially
different from the anticipated or estimated results discussed in
the Forward-Looking Information in this news release. New risk
factors emerge from time to time, and it is not possible for our
management to predict all risk factors nor can we assess the
effects of all factors on our business or the extent to which any
factor, or combination of factors, may cause actual results to
differ materially from those contained in, or implied by, any
Forward-Looking Information. Our past results of operations are not
necessarily indicative of our future results. You should not rely
on any Forward-Looking Information, which represents our beliefs,
assumptions and estimates only as of the dates on which it was
made, as predictions of future events. We undertake no obligation
to update this Forward-Looking Information, even though
circumstances may change in the future, except as required under
applicable securities laws. We qualify all of our Forward-Looking
Information by these cautionary statements.
Non-GAAP Financial Measures
Our consolidated financial statements are prepared in accordance
with GAAP. Those GAAP financial statements include non-cash charges
and other charges and benefits that we believe are unusual or
infrequent in nature or that we believe may make comparisons to our
prior or future performance difficult.
As a result, we also provide financial information in
this news release that is not prepared in accordance with
GAAP and should not be considered as an alternative to the
information prepared in accordance with GAAP. Management uses these
non-GAAP financial measures in its review and evaluation of the
financial performance of the Company. We believe that these
non-GAAP financial measures also provide additional insight to
investors and securities analysts as supplemental information to
our GAAP results and as a basis to compare our financial
performance from period to period and to compare our financial
performance with that of other companies. We believe that these
non-GAAP financial measures facilitate comparisons of our core
operating results from period to period and to other companies by
removing the effects of our capital structure (net interest income
on cash deposits, interest expense on outstanding debt, or foreign
exchange movements on debt revaluation), asset base (depreciation
and amortization), tax consequences and stock-based compensation.
In addition, management bases certain forward-looking estimates and
budgets on non-GAAP financial measures, primarily Adjusted
EBITDA.
Reorganization expenses, impairment expenses, depreciation and
amortization, and stock-based compensation are excluded from our
non-GAAP financial measures because management considers them to be
outside of the Company’s core operating results, even though some
of those expenses may recur, and because management believes that
each of these items can distort the trends associated with the
Company’s ongoing performance. We believe that excluding these
expenses provides investors and management with greater visibility
to the underlying performance of the business operations, enhances
consistency and comparativeness with results in prior periods that
do not, or future periods that may not, include such items, and
facilitates comparison with the results of other companies in our
industry.
The following non-GAAP financial measures are presented in
this news release, and a description of the calculation
for each measure is included.
Adjusted EBITDA: EBITDA (net income
before interest, taxes, depreciation and
amortization) adjusted for non-cash foreign exchange gains or
losses on debt revaluation; impairment expenses; stock-based
compensation expense; reorganization expenses; and any other
non-core gains or losses
Adjusted EBITDA Margin: Adjusted EBITDA
divided by revenue
You should carefully evaluate these non-GAAP financial measures,
the adjustments included in them, and the reasons we consider them
appropriate for analysis supplemental to our GAAP information. Each
of these non-GAAP financial measures has important limitations as
an analytical tool due to exclusion of some but not all items that
affect the most directly comparable GAAP financial measures. You
should not consider any of these non-GAAP financial measures in
isolation or as substitutes for an analysis of our results as
reported under GAAP. You should also be aware that we may recognize
income or incur expenses in the future that are the same as, or
similar to, some of the adjustments in these non-GAAP financial
measures. Because these non-GAAP financial measures may be defined
differently by other companies in our industry, our definitions of
these non-GAAP financial measures may not be comparable to
similarly titled measures of other companies, thereby diminishing
their utility.
About DIRTT DIRTT is a building process powered
by technology. The Company uses its proprietary ICE® software to
design, manufacture and install fully customized interior
environments. The technology drives DIRTT’s advanced manufacturing
and provides certainty on cost, schedule and the final result.
Complete interior spaces are constructed faster, cleaner and more
sustainably. DIRTT’s manufacturing facilities are located in
Phoenix, Savannah and Calgary and the Company works with nearly 100
sales construction partners globally. DIRTT trades on the Nasdaq
under the symbol “DRTT” and on the Toronto Stock Exchange under the
symbol “DRT.” For more information, visit
www.dirtt.com/investors.
For more information, please contact:
Kim MacEachern
Investor Relations, DIRTT
Kmaceachern@dirtt.com
403.618.4539
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