Financial Information
8. LIQUIDITY AND CAPITAL RESOURCES
As at October 31, 2007 the Company had cash and cash equivalents of $2,480,014, and unused credit facilities of approximately $4,800,000 available for future operating and capital requirements.
As at October 31, 2007, the Company’s assets totalled $25,251,571 of which the majority represented revenue generating capital assets including tangible and intangible assets. The outstanding debt at October 31, 2007 consisted of a $920,834 fixed rate term loan for purchase of the property acquired in March 2006, and revolving bank loans of $838,534 under credit facilities that are available to be used by the Company to finance the growth in the subscriber base, which in turn will contribute to additional recurring revenues and cash flows. The increase in the revolving bank loans is due to loans acquired in March 2007 to finance the acquisition of franchise rights.
The cash flows from operations and financing activities, and cash flows used in financing and investing activities for the years 2003-2007 are summarized below.
The cash flow used in investing activities shows a significant increase primarily due to the Company acquiring a bank loan to finance the purchase of franchise rights. The Company’s cash flow from operations has decreased as the corresponding marketing expenditures increase.
The Company expects to continue investing significantly in growth of the subscriber base, through marketing programs and in the installation of new security systems in subscriber homes. Security systems are installed under three-year contracts, which are subsequently renewable annually. The Company manufactures the equipment that it installs and the manufacturing process involves purchasing various key components from foreign and domestic manufacturers, and utilizing local subcontractors in certain parts of the manufacturing process. The Company’s manufacturing operations are housed in Toronto where the alarm systems are manufactured. In addition to the standard system, the Company also manufactures AlarmPlus telephone line-cut technology that is available exclusively to subscribers of AlarmForce, which is the only Canadian alarm company that manufactures and installs AlarmPlus.
| 2007 | 2006 | 2005 | 2004 | 2003 | |
| $ | $ | $ | $ | $ | |
| Cash flow from operations Cash flow from (used in) |
2,737,038 | 4,945,233 | 3,518,787 | 4,238,574 | 2,665,485 |
| financing activities | 541,108 | (339,202) | (1,184,520) | 3,802,947 | 296,869 |
| Cash flow used in investing activities |
(4,707,441) | (4,783,796) | (2,616,996) | (7,693,607) | (2,984,470) |
The cash flow used in investing activities shows a significant increase primarily due to the Company acquiring a bank loan to finance the purchase of franchise rights. The Company’s cash flow from operations has decreased as the corresponding marketing expenditures increase.
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Testimonials
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I am contacting you on behalf of my mother. We have been very happy with this service and I would highly recommend it to anyone requiring the peace of mind it provides to seniors such as my mother that want to remain in their home and independent or to the children and caregivers of elderly parents who just want to know that help is always at hand in an emergency. Unfortunately my mother needed to use the help button a little too much and she has realized that she needs more help with daily life and has moved to a retirement community. Many thanks
-Mark, ON -
Every person I have talked to has been very nice and helpful.
-Matthew, OH -
Installation was excellent and very knowledgeable about questions and options.
-William, OH -
"This is the Alarm Force Central Station...Identify Yourself Immediately!" is something I say quite often using a mix of Preston Manning and Jimmy Stewart's voices. The fact that there is a two-way voice system protecting my home was the driving force for my decision to go with Alarm Force. Knowing that an intruder is going to be confronted by a live person, Preston Manning or otherwise, is the only way to feel totally secure and safe with your home alarm system. Given that we have not had a break-in since we installed AlarmForce speaks to how AlarmForce is doing a great job in helping to protect our home. Whenever I’ve had to call Alarm Force, the support staff has been exceptional in providing friendly and knowledgeable support. The only problem we've ever had is "user error" as we forgot what our security question was. I have recommended Alarm Force to all my friends and relatives as I feel that Alarm Force is the best choice overall for a home security system.
-Greg B. - Calgary, AB -
We find the system very user friendly! We really like the simplicity.
-David, AB -
We are in all ways satisfied with the service and deportment of the representatives.
-Gordon, BC -
I am very pleased with the alarm system. Thieves broke in through a smashed in back door. The two way voice must have scared them off because they only took one thing and left a laptop sitting right on a table. Thanks to the system my valuables were saved.
-John, GA -
I am very happy with AlarmForce. It gives me a great sense of security. Thank you very much.
-Shirley S.
