United Protection Security Group Inc. - Q2 RESULTS

EDMONTON, Aug. 31 /CNW/ -- EDMONTON, Aug. 31 /CNW/ - S.Jorstad, Chairman and Chief Executive Officer of United Protection Security Group Inc. (UPSG or the Company), (TSX-V:UZZ) announces that the Company has released its interim financial and operating results for the second quarter ended June 30, 2010.
S.Jorstad stated, "As we expected, we continue to regain profitability during Q2 following the unusual weakness of the 2009 results. Revitalizing the British Columbia business unit is our most important priority and we made solid progress executing a business improvement plan that includes improving pricing, capturing significant cost improvements and developing a marketing strategy to increase market share. Meanwhile, we are reaping the rewards from having a diversified customer portfolio as our electronic security division in Q2 delivered the same profit level as Q1-2010. Results this year are from organic growth only as no revenue stream have been realized from the acquisition of NoGo NoTow franchising relationship as it is still in the pilot project marketing phase. Several key relationships have been established and I expect promising results in the future from this acquisition."
S.Jorstad further stated, "Negotiations that occurred in Q2 resulted in the news release of July 12, 2010 with respect to the $5,000,000 equity line facility arranged through Dutchess Capital Management. As announced, this facility will give the Company access to capital for strategic expansion initiatives as well as expansion of existing business segments. Management believes that this is a significant event towards the overall objective of strengthening the Company's long term financial position and aggressive growth strategies."
F.Ramsoondar, Chief Financial Officer reports on Q2- 2010 Financial Summary:
Revenue for the quarter amounted to $8,537,267, compared to $7,099,273 for the same quarter last year, an increase of $1,437,994 or 20.26%. Revenue for the six month period ended June 30, 2010 amounted to $17,350,443 compared to $14,860,396 for the same period last year, an increase of $2,490,047 or 16.76%.
Gross profit for the quarter amounted to $1,945,960 (22.79% of revenue), compared with $1,201,732 (16.93% of revenue) for the same period last year, an increase of $744,228. Gross profit for the six month period ended June 30, 2010 amounted to $4,006,853 compared to $2,887,175 for the same period last year, an increase of $1,119,678 or 38.78%.
Operating expenses totalled $1,715,709 for the period, compared with $1,613,889 for the same period last year, an increase of $101,820 or 6.31%. Operating expenses for the six month period ended June 30, 2010 amounted to $3,450,565 compared with $3,531,667 for the same period last year, a decrease of $81,102 or 2.35%.
EBIITDAS totalled $400,591 (4.69% of revenue) for the period, compared to negative EBIITDAS of $(246,358) for the same period last year, an increase of $646,949. EBIITDAS for the six month period ended June 30, 2010 amounted to $888,618 compared to $67,468 for the same period last year, an increase of $821,150 or 1,217.10%.
Net income for the period totalled $198,251, ($0.003 basic and diluted earnings per share); compared with net loss of $(376,980) ($(0.006) basic and diluted loss per share) for the same period last year, an increase of $575,231. Net income for the six month period ended June 30, 2010 totalled $524,288 ($0.01 basic and diluted earnings per share) compared to net loss of $(650,612) ($(0.01) basic and diluted loss per share) for the same period last year, an increase of $1,174,900.

Reconciliation of EBIITDA and EBIITDAS to Historical Results (CGAAP)


    
    Statement of          Three          Three            Six            Six
    income               months         months         months         months
                          ended          ended          ended          ended
                  June 30, 2010  June 30, 2009  June 30, 2010  June 30, 2009

    Net income (loss)
     for the period   $ 198,251      $(376,980)     $ 524,288      $(650,612)
    Add:
    Income taxes         32,000        (35,177)        32,000          6,120
    Interest             44,744         84,209         77,326        164,602
    Amortization and
     impairment         124,216         81,590        251,825        547,358
                      -------------------------------------------------------
    EBIITDA             399,211       (246,358)       885,439         67,468
                      -------------------------------------------------------
    Add:
    Stock-based
     compensation         1,380              -          3,179              -
                      -------------------------------------------------------
    EBIITDAS          $ 400,591      $(246,358)     $ 888,618       $ 67,468
                      -------------------------------------------------------
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In addition to using financial measures prescribed by CGAAP, certain non-CGAAP measures are also used by the Company. These non-GAAP measures are EBIITDA and EBIITDAS. References in this press release to EBIITDA are to net income before interest, impairment, taxes, depreciation and amortization. References in this press release to EBIITDAS are to net income before interest, impairment, taxes, depreciation, amortization and stock-based compensation.


    
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To find out more about United Protection Security Group Inc. (TSX-V: UZZ), visit our website at www.unitedprotection.com. To join the 'request for information', go to the web page www.unitedprotection.com and click the tab 'request information' and follow the prompts. You may also email Investor Relations at: [e-mail].
Statements in this press release other than purely historical information, including statements relating to the Company's future plans and objectives or expected results, are forward-looking statements. Forward-looking statements are based on numerous assumptions and are subject to all of the risks and uncertainties inherent in the Company's business, including risks related to business development and retention, and risks related to the current economic and credit conditions. As a result, actual results may vary materially from those described in the forward-looking statements.
The TSX Venture Exchange has neither approved nor disapproved the information contained herein.

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For additional investor and media relations inquiries contact: Fredy Ramsoondar, CFO, Executive Vice President, and Director, Email: [e-mail], Tel: [phone]

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