Calgary, Nov. 8, 2010 — Hemisphere GPS, a designer and manufacturer of advanced GPS products, today reported financial results for the third quarter ended September 30, 2010. All amounts in this news release are expressed in US dollars.
For the third quarter ended September 30, 2010, Hemisphere GPS reported a 46% increase in revenues to $13.2 million compared to $9.1 million in the third quarter of 2009. This is the highest Q3 revenue level ever reported by Hemisphere GPS, driven primarily by sales to the Agriculture segment. Total sales of ground-based agriculture products grew by 54% from the third quarter of 2009 while revenues for air-based agriculture products grew by 16%. Ground agriculture product sales to international distributors, OEMs and systems integrator customers were particularly strong during the quarter as a result of new products and improved market conditions for agriculture in general. Revenues from the Company’s Precision Products segment grew by 39% versus the third quarter of 2009 with strength in sales of GPS receivers, Vector heading sensor products and GPS boards sold to OEM customers.
North American demand showed improvement with revenues up by 17% following a decline of 17% over the first half of 2010. International revenues continued to show strong growth, increasing 84% compared to the third quarter of 2009. Sales to customers in Europe increased by 62% and sales in Australia increased by 194% compared to third quarter of 2009. The introduction of the US Outback Guidance distribution model into the Australian market has contributed to growing Australian sales. Sales to other markets, including South America and Asia, were up by over 95% compared to the third quarter of 2009 continuing the strong growth seen in the second quarter.
"Throughout 2010 we communicated expectations for a stronger than usual closing six months to our year based on new product releases, increased order backlog strength, new strategic customer opportunities, improving monthly performance relative to 2009, continued strength in South America, Australia and Asia and more recently from improved optimism related to commodity prices," said Steven Koles, President and CEO of Hemisphere GPS. The third quarter growth reflects these factors, further supported by strong international demand for our new products. We are encouraged that North American demand has begun to show improvement. North America has recovered at a slower pace than our International markets, however, significant strengthening in grain commodity prices during the quarter may support improved confidence and demand from these customers."
The US agriculture sector has shown recent strength following significant increases in commodity pricing during the third quarter. In August, the US Department of Agriculture increased its projection for net farm income to $77.1 billion, up from its February projection of $63 billion, and up by 24% from 2009. This would make 2010 the fourth highest year ever in the United States.
About Hemisphere GPS
Hemisphere GPS designs and manufactures innovative, cost-effective GPS products for positioning, guidance, and machine control applications in agriculture, marine, construction, and other markets. The Company holds numerous patents and other intellectual property and owns several leading brand names, including Outback Guidance®, a leading brand in precision GPS for agriculture. The Company is headquartered in Calgary, Alberta, with major product development, sales, and marketing facilities in Arizona, Kansas, and Australia. Hemisphere GPS is listed on the Toronto Stock Exchange (TSX) trading under the symbol "HEM" and is one of the TSX Cleantech designated companies. For more information about Hemisphere GPS, please go to www.hemispheregps.com.
The above disclosure contains certain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Hemisphere GPS’ control, including: the impact of general economic conditions, industry conditions, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, stock market volatility and market valuations of companies with respect to the announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities. Hemisphere GPS’ actual results, performance or achievement could differ materially from those expressed in, or implied by these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits, including the amount of proceed, that Hemisphere GPS will derive therefrom.