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TORONTO, Feb. 19, 2019  – Avante Corp Inc. (TSX.V: XX) (OTC: ALXXF) (“Avante” or the “Company”) is pleased to announce its results for the quarter ended December 31, 2018 (all amounts in Canadian dollars, unless otherwise indicated).

“I am pleased with the results for the quarter as we have continued to execute on our strategy of building a platform critical to supporting a business with significantly greater scale which we intend to realize through M&A in the near term,” said Craig Campbell, CEO and Director of Avante. “Our core businesses have delivered against our expectations and, prior to investments at the corporate level, generated positive adjusted EBITDA. We continue to execute against our strategic plan of capturing market share through focused organic growth and strategic M&A which has resulted in significant top-line growth.”

“Our core business operations are strong and we remain focused on optimizing operations which has led to margin improvement in a number of key categories,” added Craig Campbell. “Consistent with our long-term vision, we have made significant investments in building operational infrastructure that is capable of supporting acquisitions of varying sizes in the near term. This quarter, not only did we execute against our strategic priorities by driving and realizing organic growth, but we also saw the completion of our recent acquisitions contribute meaningfully to revenue and adjusted EBITDA within the core businesses. Integration of acquisitions has been a priority for Avante and we are pleased with our recent progress in fully amalgamating Avante Security Inc (“ASI”), Watermark, and Architronics that will not only lead to operational efficiencies but will also provide for a better overall customer experience. In a short period of time, we have grown the business from generating roughly $2 million of annual adjusted EBITDA to a run-rate of more than $4 million prior to the investments that we have made in the business which are critical to support our near-term acquisition strategy.”

“Importantly, our acquisition pipeline is extremely robust as we are emerging as the acquirer of choice within the security industry,” said Craig Campbell. “We continue to nurture and build-out our pipeline and we see numerous opportunities to meaningfully grow our revenue and adjusted EBITDA profile without the need to significantly invest further in our corporate infrastructure. We remain focused on identifying and completing highly accretive acquisitions that can benefit from revenue synergies within Avante and deliver against our goal of generating meaningful growth in consolidated adjusted EBITDA.”

Q3 2019 Highlights

  • Generated revenues of $8,846,014 for the quarter period ended December 31, 2018 which represented 47.0% YoY (2.4% organic, 44.6% acquisitive) and 51.1% QoQ (12.5% organic, 38.5% acquisitive) growth highlighting Avante’s ability to execute against its organic and acquisitive growth strategy. As a percentage of revenue, Avante’s divisions were as follows: Protective Services Division 36.7%, Electronic Security Division 33.7%, Monitoring & Managed Services Division 10.2%, Security Devices & Hardware 19.4%.
  • Generated gross profit of $3,014,657 for the quarter representing 40.7% YoY and 73.1% QoQ growth.
  • Recurring revenue and non-recurring revenue grew 18.0% and 57.7% respectively YoY.
  • Operating expenses (excluding depreciation, amortization of intangibles and share based payments) increased $1.9M YoY due to significant investment in infrastructure to support future growth initiatives, as well as added overhead as a result of newly acquired companies. Acquisitions accounted for 30.8% of the increase in operating expenses YoY, one time/ non-recurring/ acquisition costs 7.4%, and the remainder was related to investments and operational expenses increase. A detailed breakdown of the operational expenses increases is available in the Management Discussion and Analysis
  • Generated adjusted EBITDA before corporate costs of $1.27M which included only one month of our Intelligarde acquisition
  • Generated adjusted EBITDA of $(354,964) which reflects investments necessary for Avante to scale and achieve its long-term vision.
  • Strong balance sheet; cash on hand $3.0M and shareholders’ equity $18.7M.
  • On October 23, 2018, the Company subscribed to a private placement of 1,180,000 Purchased Subscription Receipts at the price of $0.85 per Purchased Subscription Receipt, with 3|Sixty Secure Corp. (“3 Sixty”) for $1,003,000.
  • On November 30, 2018, Avante acquired Intelligarde for consideration of $4,801,370 payable in cash of which $712,500 was held back against representations and warranties to be paid at the first anniversary.
  • In Q3 FY19, the operations of ASI, Watermark, and Architronics were fully amalgamated.


Quarter endedQuarter endedNine-month period endedNine-month period ended
Dec 31, 2018Dec 31, 2017Dec 31, 2018Dec 31, 2017
Total revenues8,846,0146,016,90220,276,94916,964,193
Revenues – Recurring Monitoring and Response[1]1,907,2461,615,9225,435,2274,802,501
Revenues – Other Security Services6,938,7684,400,98014,841,72212,161,692
Total gross profit3,014,6572,142,8786,618,0006,043,524
Adjusted EBITDA[2](354,964)672,287125,4191,888,318
Net income before tax(1,022,967)(80,693(1,468,691)767,379
Net income for the year(1,026,876)(84,693)(1,582,177)605,380
Basic and diluted income per share(0.056)(0.008)
Diluted Income per Share(0.056)(0.008)


1 Revenues – Recurring Monitoring and Response includes Alarm Response and Monitoring services
2 Adjusted EBITDA – Net income before taxes + Depreciation + Amortization of intangibles + Share Based Payments + Acquisition and integration costs + Expensing of CWL fair value adjustment per IFRS (-) Non-controlling interest’s share

Avante generated revenues of $8,846,014 for the three-month period ended December 31, 2018 which represents a 47.0% growth (2.4% organic, 44.6% acquisitive) over $6,016,902 of revenues registered for the three-month period ended December 31, 2017. Of the $2,829,112 increase in revenue, $2,685,440 or 94.9% was attributable to acquisitions, and the remaining $143,672 or 5.1% was attributable to organic growth year over year. Gross profit for the three-month period ended December 31, 2018 expanded 40.7% to $3,014,657 as compared to $2,142,878 for the period ended December, 2017 (34.7% acquisitive, 6.0% organic). This illustrates how Avante has been able to execute against its strategy of growing organically and through acquisition with the opportunity to capture further upside as Avante continues to unlock cross-selling opportunities and streamline the core business operations of acquired companies.

It is Management’s belief that a quarter over quarter comparison is a more accurate reflection of the underlying performance of the business since the Company has changed significantly in the last fiscal year. In comparing Q3 FY19 to Q2 FY19 revenue increased 51.1% (38.5% acquisitive, 12.5% organic) and gross profit increased 73.1% (28.7% acquisitive, 44.4% organic). This indicates that the Company’s efforts to improve gross margins has resulted in significant organic growth in the quarter.


Q2 2019 Q3 2019Growth ($)Growth (%)
Revenue$5,855,951 $8,846,014$2,990,063 51.1%
Acquisitive$429,274 $2,685,440 $2,256,16638.5%
Organic$5,426,677 $6,160,574$733,897 12.5%
Gross Profit$1,741,420 $3,014,657 $1,273,237 73.1%
Acquisitive$242,927 $743,234 $500,307 28.7%
Organic$1,498,493 $2,271,423 $772,93044.4%

Of the $2,990,063 increase in revenue (51.1% QoQ growth), $2,256,166 or 75.5% was attributable to acquisitions, and the remaining $733,897 or 24.5% was attributable to organic growth quarter over quarter.

Recurring revenues grew 18.0% YoY as ASI registered a 10.1% YoY growth in alarm response packages sold. Monitoring revenues also grew by 18.0% YoY buoyed by a 21.5% increase in the number of Intelligent Perimeter Protection packages sold, as well as growth in the number of residential monitoring accounts.  Recurring Monthly Revenue (“RMR”), increased to $635,749 in Q3 FY19 from $538,641 in Q3 FY18, Other non-recurring security services (including secure transport, international security travel advisory, consulting, and asset protection) increased to $6,938,768, representing 57.7% YoY growth. This growth was attributable to performance of our existing operating subsidiaries and the inclusion of Veridin, Watermark, Intelligarde.

Gross margin amounted to 34.1% as compared to 35.6% for the same period last year. Compared to Q2 FY19, gross margin increased 440 BPS. The decrease in gross margins YoY is attributable to the increase instituted wage rates in the province of Ontario for patrol and transport operatives along with upgrades to the mobile fleet and the addition of operatives in the Oakville area.

Adjusted EBITDA for the three-month period amounted to $(354,964) as compared to $672,287 for the three-month period ended December 31, 2017. This was largely due to an increase in Salaries and related costs of $949,306 (29.1% due to acquisitions), owing to investments to support future growth including the strengthening of Avante’s executive bench through strategic hires.

Net of investments at the corporate level, the business generated $1.27M of adjusted EBITDA for the three-month period ending December 31, 2018 highlighting core business operations are strong and profitable with the opportunity to capture further upside through unlocking cross-selling opportunities, as well as streamlining the core business operations of acquired companies. M&A is a significant pillar of Avante’s growth strategy and management views its investment in shared services and corporate infrastructure as critical to support the significant acquisition pipeline it has identified. Following the successful integration of recent acquisitions and investments made in corporate infrastructure, management believes it is well positioned to execute and integrate larger acquisitions to accelerate growth of Avante in the near term. As management has indicated in the past, corporate costs are expected to decrease as a percentage of total revenue as the company grows revenue and adjusted EBITDA through disciplined, accretive acquisitions.

Net loss amounted to $(1,026,876) for the quarter period end as compared to a loss of $(84,693) in the same period last year.

The Company’s Balance Sheet is healthy, where total debt to equity was 22.4% as of December 31, 2018. Cash and cash equivalents on hand as of December 31, 2018 was in excess of $3 million which is expected to continue to support organic growth initiatives and strategic acquisition opportunities, as well as undrawn credit facilities of approximately $9 million through the RBC acquisition facility and operating line of credit.


Avante will be hosting a conference call to discuss the aforementioned results on Wednesday, February 20, 2019, at 8:30 AM EST.

Dial in details are as follows: 

Local: (+1) 416-764-8658          Toll Free: (+1) 888-886-7786                        Conference ID:84876525

Playback details below, available until March 13, 2017:

Local: (+1) 416-764-8692          Toll Free: (+1) 877-674-7070                        Playback Pin:532844 #

About Avante Corp

Avante Corp Inc. (XX.V) is a Toronto based provider of technology enabled security solutions. We acquire, manage and build industry leading businesses which provide specialized, mission-critical solutions that address the needs of our customers. Our businesses continuously develop innovative solutions that enable our customers to achieve their objectives. With an experienced team and a proven track record of solid growth, we are taking steps to establish a broad portfolio of security businesses to provide our customers and shareholders with exceptional returns. Please visit our website at and consider joining our investor email list.

Forward Looking Statements

All statements in this press release, other than statements of historical fact, may constitute “forward looking information” with respect to Avante within the meaning of applicable securities laws. Forward-looking information is often, but not always, identified by the use of words such as “seek”, “anticipate”, “plan”, “continue”, “planned”, “expect”, “project”, “predict”, “potential”, “targeting”, “intends”, “believe”, “potential”, and similar expressions, or describes a “goal”, or a variation of such words and phrases or state that certain actions, events or results “may”, “should”, “could”, “would”, “might” or “will” be taken, occur or be achieved. This forward-looking information includes statements with respect to, among other things, the intention to create a platform capable of supporting a business with significantly greater scale, Avante’s strategic plan, Avante’s intentions to engage in mergers and acquisitions in the near term, Avante’s intentions to identify, acquire and integrate suitable targets for mergers and acquisitions, the ability to achieve operational efficiencies and provide a better overall customer experience, Avante’s run- rate, opportunities to grow Avante’s revenue and adjusted EBITDA profile, investments in corporate infrastructure, Avante’s ability to execute and integrate larger acquisitions, and the expected trajectory of corporate costs as a percentage of revenue. Forward-looking information is subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those expressed or implied by the forward looking information, including, without limitation, the ability to identify, acquire and integrate suitable targets for mergers and acquisitions, the ability to control corporate costs, and the list of risk factors identified in Avante’s Management Discussion & Analysis (MD&A), Annual Information Form (AIF) and other continuous disclosure, which list is not exhaustive of the factors that may affect any of Avante’s forward-looking information. In connection with the forward-looking statements contained in this and subsequent press releases, Avante has made certain assumptions about its business and the industry in which it operates and has also assumed that no significant events occur outside of Avante’s normal course of business. Although management believes that the assumptions inherent in the forward-looking statements are reasonable as of the date the statements are made, forward-looking statements are not guarantees of future performance and, accordingly, undue reliance should not be put on such statements due to the inherent uncertainty therein. Avante’s forward-looking information is based on the beliefs, expectations and opinions of management on the date the statements are made, and Avante does not assume any obligation to update forward-looking information, whether as a result of new information, future events or otherwise, other than as required by applicable law. For the reasons set forth above, readers should not place undue reliance on forward-looking information.

Non-IFRS Financial Measures

This presentation contains certain financial measures that are not determined in accordance with IFRS, including Adjusted EBITDA.

  • Adjusted EBITDA is calculated by adding back: Expense fair value adjustment of CWL inventory; Depreciation on property, plant and equipment; Amortization of intangible assets; Share based payments; and Management reorganization & integration costs to Income before income taxes.  Adjusted EBITDA is used by management of Avante to provide a more accurate measure of its operating performance.

These measurements should not be considered an alternative to, or more meaningful than, other measures as determined in accordance with IFRS. These measurements do not have a standardized meaning under IFRS; thus, Avante’s determination of Adjusted EBITDA may not be comparable to that reported by other companies. Reference should be made to Avante’s management’s discussion and analysis and related financial statements for more information relating to the calculation of Adjusted EBITDA.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

[1] Revenues – Recurring Monitoring and Response includes Alarm Response and Monitoring services

[2] Adjusted EBITDA – Net income before taxes + Depreciation + Amortization of intangibles + Share Based Payments + Acquisition and integration costs + Expensing of CWL fair value adjustment per IFRS (-) Non-controlling interest’s share