News Release Details

Quarterhill Announces Third Quarter 2018 Financial Results

11/08/2018

OTTAWA, Nov. 8, 2018 /PRNewswire/ - Quarterhill Inc. ("Quarterhill" or the "Company") (TSX: QTRH) (NASDAQ: QTRH), announces its financial results for the three- and nine-month periods ended September 30, 2018. All financial information in this press release is reported in U.S. dollars, unless otherwise indicated.

Third Quarter 2018 Highlights

  • Revenue of $19.6 million
  • Recurring revenues of $6.3 million, representing 32% of total revenue
  • Adjusted EBITDA* of ($2.5) million
  • Net loss of ($9.3) million, or ($0.08) per common share
  • Cash and equivalents were $62.4 million at September 30, 2018
  • IRD and VIZIYA's combined revenue and Adjusted EBITDA were up 14% and 125%, respectively year over year
  • WiLAN won a $145.1 million jury award in its patent suit against Apple Inc.
  • IRD announced a five-year $8.1 million contract with the State of Hawaii

"Highlights in Q3 were led by continued strong performance at IRD and WiLAN's significant trial victory versus Apple," said Doug Parker, President & CEO of Quarterhill. "For the second quarter in a row, IRD generated good revenue and adjusted EBITDA performance and they also signed a key contract with the State of Hawaii for more than $8 million over five years. Year-to-date, IRD has contributed $32.5 million of profitable revenue to Quarterhill and with a building pipeline of business and new products in the market, we believe their outlook remains promising."

"With WiLAN, we signed several new licenses in Q3, but the big news in the quarter was the August 1st jury verdict, which awarded us $145.1 million in our patent trial versus Apple. We are obviously very pleased with the jury's decision and believe that it reflects well on our team, our portfolio and our process, and enhances our already strong reputation in the industry. On the M&A front, building our pipeline remains a top priority and we continue to see real progress in this area, which includes a series of advanced negotiations that are currently underway." 

Approval of Eligible Dividend
The Board of Directors has declared an eligible quarterly dividend of CDN $0.0125 per common share payable on January 9, 2019, to shareholders of record on December 14, 2018.

Business Strategy and Segments
Our acquisition strategy focuses primarily on financial metrics while remaining cognizant of broader technology and market trends as we build a portfolio of businesses that are characterized as having recurring revenue, free cash flow and profitable growth potential. Driven by the execution of a proven and disciplined acquisition strategy, we seek to enable shareholders to benefit from consolidation and convergence trends in today's technology industry. As of September 30, 2018, the Company had investments in three segments: Technology (WiLAN); Mobility (IRD); and Factory (VIZIYA).

Q3 and year-to-date 2018 Consolidated Financial Review
Quarterhill's consolidated financial results for the three- and nine-month periods ended September 30, 2018 include a full contribution from Wi‑LAN Inc. ("WiLAN"), International Road Dynamics Inc. ("IRD") and VIZIYA Corp. ("VIZIYA"). The 2017 comparative period information for the nine-month period ended September 30, 2017, includes a full contribution from WiLAN along with IRD's results from operations for the period from June 1 to September 30, 2017 and VIZIYA's results from operations for the period from May 4 to September 30, 2017.

Consolidated revenues for the three months ended September 30, 2018 ("Q3 2018") were $19.6 million, compared to $85.9 million in Q3 2017. Consolidated revenues for the nine months ended September 30, 2018 ("year-to-date") were $52.0 million, compared to $112.1 million in the same period last year. Revenue in the comparable periods of 2017 included strong performance from WiLAN, which generated revenue of $72.6 million in Q3 2017 compared to $4.4 million in Q3 2018. Combined, IRD and VIZIYA grew revenue organically year-over-year by 14% and accounted for 77% of consolidated revenues in Q3 2018.

Gross margin for Q3 2018 was $5.1 million, or 26%, compared to $67.5 million, or 79%, in Q3 2017. Gross margin for the nine months ended September 30, 2018 was $9.3 million, or 18%, compared to $76.7 million, or 68%, in the same period last year. Gross margin comparisons reflect the variability in the WiLAN business noted above. Gross margin and gross margin percentage increased for both IRD and VIZIYA in Q3 2018 compared to Q3 2017. On a sequential basis, consolidated gross margin increased to 26.2% from 18.9% last quarter.

Operating expenses include selling, general and administrative costs, research and development costs, depreciation and amortization of intangible assets. Operating expenses for Q3 2018 were $16.8 million, compared to $31.3 million in Q3 2017. Operating expenses for the nine months ended September 30, 2018 were $46.6 million, compared to $51.5 million in the same period last year. Operating expenses in Q3 2018 included a one-time $2.3 million restructuring charge at IRD related to streamlining their operations, which, going forward, will save IRD approximately $2.2 million annually in expenses.

Adjusted EBITDA for Q3 2018 was ($2.5) million compared to $60.6 million in Q3 2017. Adjusted EBITDA for the nine months ended September 30, 2018 was ($13.8) million compared to $63.1 million in the same period last year. The variance in adjusted EBITDA for the Q3 2018 and year-to-date periods reflects the variability in the WiLAN business noted above. Adjusted EBITDA for both IRD and VIZIYA more than doubled in Q3 2018 from Q3 2017.

Net loss for Q3 2018 was ($9.3) million, or ($0.08) per basic and diluted Common Share, compared to net earnings of $26.2 million, or $0.22 per basic and diluted Common Share, in Q3 2017. Net loss for the nine months ended September 30, 2018 was ($29.2) million, or ($0.25) per basic and diluted Common Share, compared to net earnings of $22.6 million, or $0.19 per basic and diluted Common Share, in the same period last year. For the Q3 2018 and year-to-date periods, net loss increased due primarily to lower revenue from WiLAN and the restructuring charge at IRD, offset in part by improved overall operational performance at IRD and VIZIYA.

Cash consumed in operations for Q3 2018 was $9.0 million, compared to $9.3 million of cash generated from operations in Q3 2017. Cash used in operations for the nine months ended September 30, 2018 was $18.0 million, compared to $20.8 million of cash generated from operations in the same period last year. For the Q3 2018 and year-to-date periods, the difference in cash from operations compared to the same periods last year is primarily due to lower revenue in the WiLAN business, offset in part by higher revenue and adjusted EBITDA in the IRD and VIZIYA businesses.

Cash and cash equivalents and short-term investments amounted to $62.4 million at September 30, 2018, compared to $86.6 million at December 31, 2017.

The table below highlights financial performance for the Company's Technology, Mobility and Factory segments. For detailed results and discussion related to these segments, please refer to the Management's Discussion and Analysis document, which will be filed on SEDAR and at www.quarterhill.com in the investor section.


For the three months ended September 30, 2018


Technology

Mobility

Factory

Corporate

Total

Revenues

$

4,445

$

12,439

$

2,695

$

-

$

19,579

Cost of revenues (excluding depreciation and amortization)


5,877


8,208


355


-


14,440



(1,432)


4,231


2,340


-


5,139

Selling, general and administrative expenses


761


2,211


1,828


2,071


6,871

Research and development expenses


-


534


368


-


902

Depreciation of property, plant and equipment


62


275


32


3


372

Amortization of intangibles


4,581


960


757


-


6,298

Special charges


-


2,320


-


-


2,320

Results from operations


(6,836)


(2,069)


(645)


(2,074)


(11,624)

Finance income


(3)


(2)


-


(135)


(140)

Finance expense


-


72


4


2


78

Foreign exchange loss (gain)


(223)


108


32


174


91

Other income


-


(247)


-


-


(247)

Loss before taxes


(6,610)


(2,000)


(681)


(2,115)


(11,406)

Current income tax expense (recovery)


912


(41)


(116)


-


755

Deferred income tax recovery


(2,103)


(504)


(264)


(9)


(2,880)

Income tax recovery


(1,191)


(545)


(380)


(9)


(2,125)

Net loss

$

(5,419)

$

(1,455)

$

(301)

$

(2,106)

$

(9,281)












Adjusted EBITDA


(2,178)


1,442


158


(1,934)


(2,512)












Other reconciling items:











Effect of deleted deferred revenue


-


8


-


-


8

Stock-based compensation


15


(52)


14


137


114












 


For the three months ended September 30, 2017


Technology

Mobility

Factory

Corporate

Total

Revenues

$

72,592

$

11,555

$

1,750

$

-

$

85,897

Cost of revenues (excluding depreciation and amortization)


9,882


8,048


495


-


18,425



62,710


3,507


1,255


-


67,472

Selling, general and administrative expenses


1,310


2,530


905


1,756


6,501

Research and development expenses


-


853


639


-


1,492

Depreciation of property, plant and equipment


82


445


28


1


556

Amortization of intangibles


5,473


1,072


791


-


7,336

Loss on disposal of intangibles


15,190


-


-


-


15,190

Special charges


-


-


-


218


218

Results from operations


40,655


(1,393)


(1,108)


(1,975)


36,179

Finance income


(76)


(1)


-


(16)


(93)

Finance expense


926


43


3


(2)


970

Foreign exchange loss (gain)


(131)


409


2


(41)


239

Other income


-


(231)


-


-


(231)

Income (loss) before taxes


39,936


(1,613)


(1,113)


(1,916)


35,294

Current income tax expense (recovery)


5,082


232


(5)


-


5,309

Deferred income tax expense (recovery)


(5,369)


(858)


(291)


10,292


3,774

Income tax expense (recovery)


(287)


(626)


(296)


10,292


9,083

Net earnings (loss)

$

40,223

$

(987)

$

(817)

$

(12,208)

$

26,211












Adjusted EBITDA


61,400


707


3


(1,550)


60,560












Other reconciling items:











Effect of deleted deferred revenue


-


82


292


-


374

Increased costs from inventory step-up


-


444


-


-


444

Stock-based compensation


-


67


-


206


273

Effect of deleted prepaid expense


-


(10)


-


-


(10)

 


For the nine months ended September 30, 2018


Technology

Mobility

Factory

Corporate

Total

Revenues

$

10,188

$

32,510

$

9,287

$

-

$

51,985

Cost of revenues (excluding depreciation and amortization)


19,797


21,789


1,127


-


42,713



(9,609)


10,721


8,160


-


9,272

Selling, general and administrative expenses


1,999


7,497


5,130


6,334


20,960

Research and development expenses


-


1,593


1,101


-


2,694

Depreciation of property, plant and equipment


209


849


91


6


1,155

Amortization of intangibles


14,297


2,923


2,271


-


19,491

Special charges


-


2,320


-


-


2,320

Results from operations


(26,114)


(4,461)


(433)


(6,340)


(37,348)

Finance income


(3)


(9)


-


(510)


(522)

Finance expense


1


144


10


2


157

Foreign exchange loss (gain)


334


(164)


51


(295)


(74)

Other income


-


(884)


(269)


-


(1,153)

Loss before taxes


(26,446)


(3,548)


(225)


(5,537)


(35,756)

Current income tax expense (recovery)


1,137


158


(645)


1


651

Deferred income tax expense (recovery)


(6,928)


(1,138)


(749)


1,599


(7,216)

Income tax expense (recovery)


(5,791)


(980)


(1,394)


1,600


(6,565)

Net earnings (loss)

$

(20,655)

$

(2,568)

$

1,169

$

(7,137)

$

(29,191)












Adjusted EBITDA


(11,582)


1,891


2,101


(6,210)


(13,800)












Other reconciling items:











Effect of deleted deferred revenue


-


166


148


-


314

Stock-based compensation


26


94


24


124


268

 


For the nine months ended September 30, 2017


Technology

Mobility

Factory

Corporate

Total

Revenues

$

92,218

$

16,203

$

3,665

$

-

$

112,086

Cost of revenues (excluding depreciation and amortization)


23,644


10,800


896


-


35,340



68,574


5,403


2,769


-


76,746

Selling, general and administrative expenses


5,484


3,502


1,781


2,350


13,117

Research and development expenses


-


1,161


999


-


2,160

Depreciation of property, plant and equipment


261


493


62


1


817

Amortization of intangibles


16,097


1,308


1,262


-


18,667

Loss on disposal of intangibles


15,190


-


-


-


15,190

Special charges


-


-


-


1,512


1,512

Results from operations


31,542


(1,061)


(1,335)


(3,863)


25,283

Finance income


(467)


(1)


-


(77)


(545)

Finance expense


926


54


6


(2)


984

Foreign exchange loss (gain)


(516)


695


43


(694)


(472)

Other income


-


(300)


-


-


(300)

Income (loss) before taxes


31,599


(1,509)


(1,384)


(3,090)


25,616

Current income tax expense


6,516


333


34


-


6,883

Deferred income tax expense (recovery)


(7,869)


(920)


(485)


5,416


(3,858)

Income tax expense (recovery)


(1,353)


(587)


(451)


5,416


3,025

Net earnings (loss)

$

32,952

$

(922)

$

(933)

$

(8,506)

$

22,591












Adjusted EBITDA


63,147


1,517


523


(2,054)


63,133












Other reconciling items:











Effect of deleted deferred revenue


-


107


534


-


641

Increased costs from inventory step-up


-


581


-


-


581

Stock-based compensation


57


99


-


296


452

Effect of deleted prepaid expense


-


(10)


-


-


(10)

 

Conference Call and Webcast
Quarterhill will host a conference call to discuss its financial results today at 10:00 AM Eastern Time.

Webcast Information  The live audio webcast will be available at: https://event.on24.com/wcc/r/1858362/6CC5061D06CF512665FE4AF163E1FFBB

Dial-in Information 

  • To access the call from Canada and U.S., dial 1.888.231.8191 (Toll Free)
  • To access the call from other locations, dial 1.647.427.7450 (International)

Replay Information
Webcast replay will be available for 90 days at: https://event.on24.com/wcc/r/1858362/6CC5061D06CF512665FE4AF163E1FFBB 

Telephone replay will be available from 1:00 PM ET on November 8, 2018 until 11:59 PM ET on November 15, 2018 at: 1.855.859.2056 (Toll Free) or 1.416.849.0833 (International). The telephone replay requires the passcode 9560049.

Non-GAAP Disclosure*

Quarterhill follows U.S. GAAP in preparing its interim and annual financial statements. We use the term "Adjusted EBITDA" to mean net earnings (loss) from continuing operations before: (i) income taxes; (ii) finance expense or income; (iii) amortization and impairment of intangibles; (iv) special charges and other one-time items; (v) depreciation of property, plant and equipment; (vi) effects of deleted deferred revenue; (vii) the effects of fair value step up in inventory acquired; (viii) stock based compensation; (ix) foreign exchange (gain) loss; and * equity in earnings and dividends from joint ventures. Adjusted EBITDA is used by Quarterhill management to assess our normalized cash generated on a consolidated basis and in our operating segments. Adjusted EBITDA is also a performance measure that may be used by investors to analyze the cash generated by Quarterhill and our operating segments. ADJUSTED EBITDA IS NOT A MEASURE OF FINANCIAL PERFORMANCE UNDER U.S. GAAP. IT DOES NOT HAVE ANY STANDARDIZED MEANING PRESCRIBED BY U.S. GAAP AND IS THEREFORE UNLIKELY TO BE COMPARABLE TO SIMILARLY TITLED MEASURES USED BY OTHER COMPANIES. ADJUSTED EBITDA SHOULD NOT BE INTERPRETED AS AN ALTERNATIVE TO NET EARNINGS AND CASH FLOWS FROM OPERATIONS AS DETERMINED IN ACCORDANCE WITH U.S. GAAP OR AS A MEASURE OF LIQUIDITY.

About Quarterhill
Quarterhill is focused on the disciplined acquisition, management and growth of companies in dedicated technology areas including, vertical market software and solutions, intelligent industrial systems, and innovation and licensing. Quarterhill's emphasis is on seeking out acquisition opportunities at reasonable valuations that provide a foundation for recurring revenues, predictable cash flows and margins, profitable growth, intimate customer relationships and dedicated management teams.  Quarterhill is listed on the TSX and NASDAQ under the symbol QTRH. For more information: www.quarterhill.com.

Forward-looking Information
This news release contains forward-looking statements and forward-looking information within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and other United States and Canadian securities laws.  Forward-looking statements and forward-looking information are based on estimates and assumptions made by Quarterhill in light of its experience and its perception of historical trends, current conditions, expected future developments and the expected effects of new business strategies, as well as other factors that Quarterhill believes are appropriate in the circumstances. Many factors could cause Quarterhill's actual performance or achievements to differ materially from those expressed or implied by the forward-looking statements or forward-looking information. Such factors include, without limitation, the risks described in Quarterhill's March 1, 2018 annual information form for the year ended December 31, 2017 (the "AIF"). Copies of the AIF may be obtained at www.sedar.com or www.sec.gov. Quarterhill recommends that readers review and consider all of these risk factors and notes that readers should not place undue reliance on any of Quarterhill's forward-looking statements. Quarterhill has no intention, and undertakes no obligation, to update or revise any forward-looking statements or forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

All trademarks and brands mentioned in this release are the property of their respective owners.

Quarterhill Inc.

Condensed Consolidated Interim Statements of Operations

(Unaudited)

(in thousands of United States dollars, except share and per share amounts)




Three months ended September 30,


Nine months ended September 30,


2018


2017


2018


2017

Revenues

$

19,579


$

85,897


$

51,985


$

112,086

Cost of revenues (excluding depreciation and amortization)


14,440



18,425



42,713



35,340



5,139



67,472



9,272



76,746

Operating expenses












Selling, general and administrative expenses


6,871



6,501



20,960



13,117

Research and development expenses


902



1,492



2,694



2,160

Depreciation of property, plant and equipment


372



556



1,155



817

Amortization of intangibles


6,298



7,336



19,491



18,667

Loss on disposal of intangible assets


-



15,190



-



15,190

Special charges


2,320



218



2,320



1,512



16,763



31,293



46,620



51,463

Results from operations


(11,624)



36,179



(37,348)



25,283













Finance income


(140)



(93)



(522)



(545)

Finance expense


78



970



157



984

Foreign exchange loss (gain)


91



239



(74)



(472)

Other income


(247)



(231)



(1,153)



(300)

Income (loss) before taxes


(11,406)



35,294



(35,756)



25,616













Current income tax expense


755



5,309



651



6,883

Deferred income tax expense (recovery)


(2,880)



3,774



(7,216)



(3,858)

Income tax expense (recovery)


(2,125)



9,083



(6,565)



3,025

Net earnings (loss)

$

(9,281)


$

26,211


$

(29,191)


$

22,591













Net earnings (loss) per share












  Basic and fully diluted

$

(0.08)


$

0.22


$

(0.25)


$

0.19













Weighted average number of common shares












  Basic


118,817,466



118,627,249



118,752,303



118,595,713

  Fully diluted


118,817,466



118,627,249



118,752,303



118,595,713

 

Quarterhill Inc.

Supplemental Condensed Consolidated Interim Statements of Operations Information

(Unaudited)

(in thousands of United States dollars)




Three months ended September 30,


Nine months ended September 30,


2018


2017


2018


2017

Revenues












  License

$

4,762


$

72,158


$

12,898


$

91,470

  Systems


7,885



6,759



19,757



9,826

  Services


660



780



2,040



1,494

  Recurring


6,272



6,200



17,290



9,296

Total revenues

$

19,579


$

85,897


$

51,985


$

112,086













Cost of revenues (excluding depreciation and amortization)












  License

$

5,927


$

9,864


$

19,927


$

23,706

  Systems


5,281



4,740



13,392



6,638

  Services


305



500



995



821

  Recurring


2,927



3,321



8,399



4,175

Total cost of revenues

$

14,440


$

18,425


$

42,713


$

35,340

 

Quarterhill Inc.

Condensed Consolidated Interim Statements of Comprehensive Income (Loss)

(Unaudited)

(in thousands of United States dollars)


Three months ended September 30,


Nine months ended September 30,


2018


2017


2018


2017

 Net earnings (loss)

$

(9,281)


$

26,211


$

(29,191)


$

22,591













 Other comprehensive income (loss):












 Foreign currency translation adjustment


424



3,209



(1,847)



3,742

Comprehensive income (loss)

$

(8,857)


$

29,420


$

(31,038)


$

26,333

 

Quarterhill Inc.

Condensed Consolidated Interim Balance Sheets

(Unaudited)

(in thousands of United States dollars)


As at

September 30,
2018


December 31,
2017

Current assets






Cash and cash equivalents

$

57,698


$

81,818

Short-term investments


1,200



1,236

Restricted short-term investments


3,500



3,500

Accounts receivable


16,425



19,298

Other current assets


16



13

Unbilled revenue


6,647



3,045

Income taxes receivable


241



144

Inventories


6,080



5,083

Prepaid expenses and deposits


3,383



4,129



95,190



118,266

Non-current assets






Property, plant and equipment


2,955



3,801

Intangible assets


95,002



114,944

Investment in joint venture


3,980



3,383

Deferred income tax assets


26,913



20,195

Goodwill


42,091



42,587

TOTAL ASSETS

$

266,131


$

303,176







Liabilities






Current liabilities






Bank indebtedness

$

5,674


$

3,568

Accounts payable and accrued liabilities


15,093



20,487

Income taxes payable


29



599

Patent finance obligation


-



4,090

Current portion of deferred revenue


5,752



6,733

Current portion of long-term debt


77



115

Contingent consideration


4,474



4,474



31,099



40,066

Non-current liabilities






Deferred revenue


1,616



884

Long-term debt


347



401

Deferred income tax liabilities


5,315



7,291

TOTAL LIABILITIES


38,377



48,642

Shareholders' equity






Capital stock


419,111



418,873

Additional paid-in capital


22,757



22,489

Accumulated other comprehensive income


18,264



20,111

Deficit


(232,378)



(206,939)



227,754



254,534

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

$

266,131


$

303,176


 

Quarterhill Inc.

 Condensed Consolidated Interim Statements of Cash Flows

(Unaudited)

(in thousands of United States dollars)



Three months ended September 30,


Nine months ended September 30,


2018


2017


2018


2017

Cash generated from (used in):












Operations












Net earnings (loss)

$

(9,281)


$

26,211


$

(29,191)


$

22,591

  Non-cash items












Stock-based compensation


114



273



268



452

Depreciation and amortization


6,671



7,892



20,647



19,484

Foreign exchange loss (gain)


(51)



(20)



111



(166)

Equity in earnings from joint venture


(246)



(231)



(884)



(300)

Loss on disposal of assets


(26)



(5)



(25)



(5)

Loss on disposal of intangible assets


-



15,190



-



15,190

Deferred income tax expense (recovery)


(2,880)



3,774



(7,216)



(3,858)

Accrued investment income


-



922



-



772

Embedded derivatives


(2)



11



(3)



21

  Changes in non-cash working capital balances


(3,273)



(44,740)



(1,650)



(33,422)

Cash generated (used) from operations


(8,974)



9,277



(17,943)



20,759

Financing












Dividends paid


(1,143)



(1,173)



(3,469)



(3,401)

Bank indebtedness


993



401



2,106



1,924

Repayment of long-term debt


(17)



(372)



(92)



(396)

Common shares repurchased under normal course issuer bid


-



-



-



(552)

Common shares issued for cash from Employee Share Purchase Plan


-



-



27



33

Cash used in financing


(167)



(1,144)



(1,428)



(2,392)

Investing












Business acquisitions, net of cash acquired


-



(1,112)



-



(67,415)

Purchase of restricted short-term investments


-



-



-



(3,500)

Proceeds from sale of property, plant and equipment


43



-



54



-

Purchase of property and equipment


(253)



(142)



(419)



(256)

Repayment of patent finance obligations


(1,389)



(15,389)



(4,167)



(18,167)

Purchase of intangibles


(25)



(8)



(114)



(12)

Cash used in investing


(1,624)



(16,651)



(4,646)



(89,350)

Foreign exchange gain (loss) on cash held in foreign currency


48



20



(103)



247

Net decrease in cash and cash equivalents


(10,717)



(8,498)



(24,120)



(70,736)

Cash and cash equivalents, beginning of period


68,415



44,315



81,818



106,553

Cash and cash equivalents, end of period

$

57,698


$

35,817


$

57,698


$

35,817

 

Quarterhill Inc.

Condensed Consolidated Interim Statements of Shareholders' Equity

(Unaudited)

(in thousands of United States dollars)



Capital Stock



Additional
Paid-in Capital



Accumulated
Other
Comprehensive

Income



Deficit



Total Equity

Balance - January 1, 2017

$

419,485


$

21,036


$

16,225


$

(212,602)


$

244,144
















Comprehensive income:















Net income


-



-



-



22,591



22,591

Other comprehensive income


-



-



3,742



-



3,742

Shares and options issued:















Stock-based compensation expense


-



452



-



-



452

Shares issued upon acquisition


662



-



-



-



662

Sale of shares under Employee Share
Purchase Plan


33



-



-



-



33

Shares repurchased under normal course
issuer bid


(1,342)



790



-



-



(552)

Dividends declared


-



-



-



(3,401)



(3,401)

Balance - September 30, 2017

$

418,838


$

22,278


$

19,967


$

(193,412)


$

267,671
















Balance - December 31, 2017

$

418,873


$

22,489


$

20,111


$

(206,939)


$

254,534

Implementation of ASU 2014-09


-



-



-



4,272



4,272

Implementation of ASU 2016-16


-



-



-



2,949



2,949

Balance - January 1, 2018, revised


418,873



22,489



20,111



(199,718)



261,755
















Comprehensive loss:















Net loss


-



-



-



(29,191)



(29,191)

Other comprehensive loss


-



-



(1,847)



-



(1,847)

Shares and options issued:















Stock-based compensation expense


-



268



-



-



268

Deferred stock units converted to shares


211



-



-



-



211

Shares issued under Employee Share
Purchase Plan


27



-



-



-



27

Dividends declared


-



-



-



(3,469)



(3,469)

Balance - September 30, 2018

$

419,111


$

22,757


$

18,264


$

(232,378)


$

227,754


 

Quarterhill Inc.

Reconciliations of GAAP Net Loss to Adjusted EBITDA

(Unaudited)

(in thousands of United States dollars, except share and per share amounts)




Three months ended September 30,


Nine months ended September 30,

Adjusted EBITDA

2018


2017


2018


2017

Net earnings (loss)

$

(9,281)


$

26,211


$

(29,191)


$

22,591













Adjusted for:












Income tax expense (recovery)


(2,125)



9,083



(6,565)



3,025

Foreign exchange loss (gain)


91



239



(74)



(472)

Finance expense


78



970



157



984

Finance income


(140)



(93)



(522)



(545)

Special charges


2,320



218



2,320



1,512

Amortization of intangibles


6,298



7,336



19,491



18,667

Loss on disposal of intangible


-



15,190



-



15,190

Depreciation of property, plant and equipment


372



556



1,155



817

Effect of deleted deferred revenue


8



374



314



641

Increased costs from inventory step-up


-



444



-



581

Effect of deleted prepaid expenses


-



(10)



-



(10)

Stock-based compensation


114



273



268



452

Other income


(247)



(231)



(1,153)



(300)

Adjusted EBITDA

$

(2,512)


$

60,560


$

(13,800)


$

63,133













Adjusted EBITDA per share












Net earnings (loss)

$

(0.08)


$

0.22


$

(0.25)


$

0.19













Adjusted for:












Income tax expense (recovery)


(0.02)



0.08



(0.06)



0.03

Foreign exchange loss (gain)


-



-



-



-

Finance expense


-



0.01



-



0.01

Finance income


-



-



-



-

Special charges


0.02



-



0.02



0.01

Amortization of intangibles


0.05



0.06



0.16



0.16

Loss on disposal of intangible


-



0.13



-



0.13

Depreciation of property, plant and equipment


-



-



0.01



0.01

Effect of deleted deferred revenue


-



-



-



0.01

Increased costs from inventory step-up


-



-



-



-

Effect of deleted prepaid expenses


-



-



-



-

Stock-based compensation


-



-



-



-

Other income


-



-



(0.01)



-

Adjusted EBITDA per share

$

(0.03)


$

0.50


$

(0.13)


$

0.55













Weighted average number of Common Shares












  Basic


118,817,466



118,627,249



118,752,303



118,595,713

 

Cision View original content:http://www.prnewswire.com/news-releases/quarterhill-announces-third-quarter-2018-financial-results-300746319.html

SOURCE Quarterhill Inc.

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