BURNABY, BC – Despite a 94% uptick in sales, Glentel posted a $12.3 million net loss for its third quarter after recording a one-time intangible asset and goodwill impairment in its Retail Australia Division.
Consolidated adjusted net income for the third quarter ended September 30, 2013 was $7.5 million, down from $8.9 million in the third quarter of 2012. EBITDA decreased 14% to $12.7 million from $14.7 year-over-year, and EBIT was down 48% to $6.3 million compared to $12.1 million last year.
Sales for the quarter were $338.6 million, well up from $174.8 million in 2012. Sales in this period also include sales from Wireless Zone and AMT/Allphones, both of which were acquired in the fourth quarter of 2012.
Glentel’s Diamond Wireless sales in the U.S. increased to $81.5 million in the third quarter, compared to $59.9 million last year. Retail sales for its Wireless Zone stores were at $115.3 million.
Internationally, Glentel recorded a $23.1 million ($17.6 million, net of tax) impairment charge on its investment in AMT as a result of the Optus and Virgin Mobile Australia brands exiting the Allphones retail channel in Australia. The loss of these airtime residuals has resulted in AMT assessing its cost structure and viability of certain Allphones locations in particular geographies that are only supported by the Optus and Virgin Mobile Australia networks. In 2013, AMT closed a total of 57 Allphones locations in Australia.
"Initiatives have been implemented to reposition Allphones' carrier brand offerings in Australia with a continued strategic focus on the Allphones licensed store rollout in the Philippines”, said president and CEO Tom Skidmore, in the company’s release. “As the global supply of popular smartphones continues to increase to match consumer demand in the 4th quarter and throughout 2014, this should strengthen our well-positioned wireless retail distribution channels in the countries that we serve."
Skidmore added that in Canada, the company continued its Target Mobile in-store rollout with 82 stores open as of quarter end, and a total of 124 stores slated to open by year end. At September 30, 2013, the Retail Canada Division operated a total of 426 retail stores in major shopping malls and high-pedestrian-traffic locations, Mac Station stores, Target retail stores, and Costco Warehouses in Canada, compared to 326 stores in 2012.
