eResearch | On August 31, Mission Ready Solutions Inc. (TSXV: MRS), released its Q2/2020 results. Headquartered in Vancouver, Mission Ready provides comprehensive government contracting solutions and personal protective equipment (“PPE”) to equip military personnel, first-responders, and front-line servers to prevent injuries and improve performance.
Q2/2020 Financial Results
Mission Ready announced revenue of $27.2 million in the Q2/2020 versus $2.3 million in Q2/2019. The 1000% growth in revenue was due to the acquisition and consolidation of Unifire Inc. in the latest results. Mission Ready closed the acquisition of Unifire Inc. in April 2019. Gross profit was $2.1 million compared with $0.5 million in the respective quarter a year ago.
The consolidation event also hit gross margin in the same period as the Cost of Goods Sold went up to $25.2 million from $1.7 million, in the Q2/2020 versus Q2/2019 comparison. Gross margin oscillated to 7.5% compared with 23.8% from the comparable quarter.
CHART 1: Mission Ready Quarterly Revenue and EBITDA
Accounts Receivable Financing Facility
Mission Ready released that its subsidiary, Unifire, Inc., entered into an accounts receivable financing agreement with Crestmark, a division of MetaBank (NASDAQ: CASH).
Using 90% of the face value of the invoices and being secured by the assets of Unifire Inc., Crestmark will advance up to US$8.0 million to Unifire. Fees charged are 1% for the first 30 days and a discount of 0.165% for every five days thereafter.
Latest Announcements
On September 18, Mission Ready announced the Company was awarded 7 government contracts totaling approximately $127.8 million that can reach a ceiling value of $435.7 and is to be fulfilled over a 12-month period.
The Company also released guidance that gross margins should be close to their historical average and all delivery should be completed between September 2020 and September 2021. Contractually, payments to Unifire Inc. are to be received within 30 days of delivery.
On September 24, following the News Release from September 18, Mission Ready announced that the Company already received $37.5 million in new purchase orders across the contracts.
On September 25, Mission Ready announced that approximately $58.5 million in additional purchase orders were received. The total of the purchase orders now, to date, is approximately $96 million.
“We are humbled to receive these significant awards, and honored to contribute meaningfully to the pandemic response, helping to safeguard the lives of our fellow citizens. Additionally, we are thrilled to be exceeding our growth projections and delivering on our commitment to build sustainable value for our shareholders”, says Marcus Treiber, Chief Operating Officer of Mission Ready.
COVID-19
The Company says it is not possible to predict the duration or magnitude of the adverse results of the pandemic and its effects on the Company. However, the Company closely monitors developments of the COVID-19 pandemic.
Mission Ready believes that due to current guidance from the government health authorities, the growing demand for critical life-saving equipment is expected to extend through at least December 2020.
Mission Ready disclosed it has received a total of US$0.48 million under the Paycheck Protection Program of the Coronavirus Aid which helps to cover payroll costs and provides financial relief for Company employees.
Notes: All numbers in USD unless otherwise stated. The author of this report, and employees, consultants, and family of eResearch may own stock positions in companies mentioned in this article.
