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 and six months ended June 30, 2020. All financial information in this news release is presented in U.S. dollars, unless otherwise stated.
Second Quarter 2020
Revenue of $42.2 million
Gross profit margin of 33.7%
Adjusted Gross Profit Margin1 of 38.2%
Net income of $0.3 million
Net income margin of 0.7%
Adjusted EBITDA1 of $0.3 million
Adjusted EBITDA Margin1 of 0.6%
$44.6 million cash balance
Note: (1) See “Non-GAAP Financial Measures”. We have revised our calculations of Adjusted Gross Profit Margin and Adjusted EBITDA for the periods presented.
“We continued making steady progress in implementing key elements of our strategic plan despite adjusting our hiring plans in reaction to the COVID-19 pandemic,” stated CEO Kevin O’Meara. “Strengthening our commercial capabilities, we welcomed our director of strategic accounts and enterprise sales, whose industry experience includes 25 years with Herman Miller, most recently as Senior Vice President of Sales and five years as president of Trendway, a manufacturer of office furniture and systems. We hired the last of our four regional sales directors, broadened our partner network with five new partners, and will soon re-open our DIRTT Experience Centers to client tours. We also implemented phase one of our CRM system, which we expect will significantly strengthen our ability to manage lead generation and our end to end sales pipeline.
“Leveraging our many new capabilities, on July 7th we launched Make Space for Possibilities™, DIRTT’s first-ever comprehensive strategic marketing campaign. The campaign integrates our Company’s expanded sales, marketing and product efforts, illustrating our in-depth approach to enhancing sales execution. Make Space for Possibilities™ highlights the ability of DIRTT solutions to meet the needs of individuals, teams and organizations seeking greater adaptability within their workplaces and real estate portfolios as they adjust to the long-term impacts of COVID-19.”
Mr. O’Meara concluded, “Despite dramatic economic shifts due to the pandemic and its impact on the construction industry, our second quarter revenue of $42.2 million slightly exceeded our first quarter revenue and we delivered modestly positive adjusted EBITDA. Given the uncertain macro-environment, we continued to take measures to conserve financial liquidity and maintain our strong balance sheet and ended the quarter with just under $45 million of cash. In the second half of 2020, we will be laser-focused on leveraging opportunities to accelerate the shift from conventional to modular construction and, in the process, positioning DIRTT to achieve sustained, long-term market share growth.”
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”.