HAMILTON THORNE ANNOUNCES RECORD REVENUE AND EBITDA FOR THE QUARTER ENDED JUNE 30, 2018

BEVERLY, MA and TORONTO, Ontario – August 22, 2018 – Hamilton Thorne Ltd. (TSX-V:HTL), a leading provider of precision instruments, consumables, software and services to the Assisted Reproductive Technologies (ART) and developmental biology research markets, today reported financial and operational results for the quarter and six-months ended June 30, 2018.

Highlights

Sales increased 30% year over year to a record $7.3 million for the quarter; up 61% to $14.3 million for the six-month period; (constant currency growth of 28% for the quarter; 59% for the six-month period)
Gross profit increased 22% year over year to $4.1 million for the quarter; up 44% to $8.1 million for the six-month period
Net loss of $133 thousand for the quarter due to the change in fair value of debenture (see below); net income increased 74% year over year to $760 thousand for the six-month period
Adjusted EBITDA increased 7% year over year to a record $1.5 million for the quarter; up 39% to $3.1 million for the six-month period
14% organic sales growth for the quarter; 16% for the six-month period

“We had a great start to the year for Hamilton Thorne in Q1 which has continued into the second quarter,” stated David Wolf, President and Chief Executive Officer. “Sales into the human clinical market continued to grow substantially, driven by the contribution from the Gynemed acquisition and strong increases in the sales of our clinical instruments augmented by increases in quality control testing services. Sales into the animal breeding market also grew substantially while sales into research markets were somewhat down. Organic growth was 14% for the quarter and 16% for the six-month period. We were pleased to see margins nudge up to 56.7% from 54.5% in the fourth quarter of 2017, as result of a greater contribution from sales of our own, high-margin products and services.”

Following nineteen quarters of reporting net income, the Company reported a net loss of $133 thousand for the quarter (net income of $760 thousand for the six-month period) largely due to the negative effect of a $615 thousand ($218 thousand for the six months) change in the fair value of a derivative issued in connection with the Gynemed acquisition. Without this non-cash charge, the Company would have reported net income of $482 thousand for the quarter and $978 thousand for the six-month period. Cash flow from operations was $976 thousand for the quarter; $1.7 million for the six-month period.

Mr. Wolf added, “In the second quarter we continued to invest in expanding our sales and marketing footprint, including the expansion of our US and European based sales teams. We also continued to focus our efforts to drive additional cross-selling and marketing synergies across our business lines. Early in the third quarter we completed the acquisition of the ZANDAIR™ air purification products business from Zander Scientific. We see a significant opportunity to grow revenues from the ZANDAIR product line by leveraging our established sales and marketing resources worldwide. With continued EBITDA growth, strong cash flows and having a healthy cash balance of $6.3 million at the end of the quarter, we believe we are well-positioned to continue our acquisition strategy to complement our organic growth.”