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DIRTT releases Q1 2020 financial results

CALGARY, Alberta, May 06, 2020 (GLOBE NEWSWIRE) -- DIRTT Environmental Solutions Ltd. (“DIRTT,” the “Company,” “we” or “us”) (TSX: DRT, NASDAQ: DRTT), an interior construction company that uses technology for client-driven design and manufacturing, today announced its financial results for the three months ended March 31, 2020. All financial information in this news release is presented in U.S. dollars, unless otherwise stated.

First Quarter 2020

  • Revenue of $41.0 million

  • Gross profit margin of 27.6%

  • Adjusted Gross Profit Margin1 of 38.0%

  • Net loss of $5.3 million or $(0.06)/share

  • Net loss margin of (13.0)%

  • Adjusted EBITDA1 of $(5.5) million

  • Adjusted EBITDA Margin1 of (13.4)%

  • $43.5 million cash balance

Notes: (1) See “Non-GAAP Financial Measures”. We have revised our calculations of Adjusted Gross Profit Margin and Adjusted EBITDA for the periods presented.

Management Commentary

“Revenues for the first quarter of $41.0 million were generally in line with our expectations, despite the onset of the COVID-19 pandemic in March,” stated Kevin O’Meara, chief executive officer.

“As the threat of COVID-19 emerged, we took decisive measures to keep our employees safe, maximize liquidity and prudently manage our expenses. First, we implemented work-from-home policies for our non-factory workforce and instituted strict access restrictions and social-distancing measures within our factories, all consistent with protocols required and recommended by health authorities. We also eliminated or deferred uncommitted non-critical spending; supplemented our existing cash on hand via entering into new capital lease facilities; and reached an agreement in principal, subject to completion of final documentation, to allow additional covenant flexibility in our revolving credit facility, which remains currently undrawn. To further mitigate costs and right size our capacity, we reduced production staffing in January and April and as a result, our plant headcount is now 25% lower than at year end.

 “While the duration and ultimate impacts of this pandemic cannot yet be determined, we believe DIRTT’s innovation, manufacturing excellence, and nimble commercial execution all remain key advantages in commercial construction.  We are taking a targeted approach to executing our strategic plan while conserving financial liquidity, which we believe will allow us to emerge as an even stronger leader in the prefabricated construction market as the pandemic abates. Since January, that approach has included hiring another regional sales director, upgrading our sales management, enhancing our sales and marketing tools and adding two new distribution partners in April.

“While we have slowed down hiring within our commercial organization, we are moving forward with filling key positions to round out our capabilities. We will also move forward with the sales and marketing tools that we believe will enhance our sales performance for a nominal cost. We expect that commissioning activities for our new South Carolina plant will begin in the second half of 2020, with commercial operations expected to commence in the first half of 2021. With the establishment of our capital lease facility, we believe the incremental commissioning cash cost of approximately $4.0 million, of which approximately $2.0 million will be financed, is a prudent investment that will eliminate single-plant risk and will, we believe, create significant cost savings through material and labor efficiencies as well as logistics improvements.”

Mr. O’Meara concluded, “While it is impossible to predict COVID-19’s near- and long-term impact on how organizations use their space and thus commercial construction activity levels, we believe the current crisis may present new opportunities, such as increased investment in healthcare infrastructure and the need for flexibility as people begin to re-occupy their existing work spaces. Nevertheless, we remain prepared to take further actions as necessary if economic or industry conditions deteriorate. Whatever the ultimate timing and pace of economic recovery, our goal is to have a strong financial position and the organizational capabilities to enable us to target the market segments where we can be most effective and grow our market share.”


DIRTT is a global leader in industrialized construction. Its system of physical products and digital tools empowers organizations, together with construction and design leaders, to build high-performing, adaptable, interior environments. Operating in the commercial, healthcare, education, and public sector markets, DIRTT’s system provides total design freedom, and greater certainty in cost, schedule, and outcomes. Headquartered in the US and Canada, DIRTT trades on Nasdaq under the symbol “DRTT” and on the Toronto Stock Exchange under the symbol “DRT”.

For further information please contact:

  • Kim MacEachern

    Investor Relations, DIRTT

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