Ottawa-based Clearford Water Systems (TSX-V:CLI) more than doubled its losses on a rough foreign exchange rate this past quarter, but the firm’s leadership suggests higher revenues from a recent acquisition are a sign of things to come.
In the first full earnings quarter since Clearford’s $7.8 million purchase of Koester Canada went through, revenue for the three-month period ending Mar. 31 was $1.67 million. That’s roughly double the $836,768 in revenues Clearford recorded a year earlier, prior to the acquisition.
Sales and administration costs were also up, due to expenses related to Clearford’s absorption of Koester.
Clearford, which develops sewage and water treatment systems, saw rising revenues on the delivery of backlogged contracts, with operations in India and equipment sales supplementing the growth.
Those results couldn’t keep Clearford out of the red, as the company posted a net loss of $2.7 million in the quarter, more than double its loss of $1.3 million a year ago. Driving these figures was a $651,072 foreign exchange loss on the firm’s U.S. dollar-denominated debt.
The first quarter’s bottom line didn’t dampen president and CEO Kevin Loiselle’s spirits: he said in a statement that the firm’s plans to bring services in-house and consolidate the North American water management industry were going swimmingly.
“Clearford continues to execute on its new business model transitioning into a full-service utility that will benefit from the full value of our product offerings,” he said, adding that future acquisitions were expected later this year.
Clearford also bolstered its cash-in-hand at the end of the quarter, issuing a $1.65 million convertible debenture on a five-year term.