Toronto-based Avante Logixx Inc. has acquired all the outstanding shares of Watermark Security. The transaction closed August 7, 2018.
Watermark provides alarm monitoring and cottage check services to clients in Muskoka, Ont., and the surrounding areas. The family-owned security systems integrator operates out of Port Carling, Ont. in the Muskoka Lakes Region.
In conjunction with the acquisition, Watermark’s president, Doug Clendenan, will remain with Avante as he transitions to the role of manager, Muskoka region. Clendenan will oversee the region as Avante executes on its strategic growth plan.
Avante also recently announced its results for the fourth quarter and the full year ended March 31, 2018.
In FY 2018, the company reports it generated revenues of $23,336,570, which represented 11.7 per cent year over year growth. Recurring revenue grew by 9.4 per cent and non-recurring revenue grew by 12.4 per cent.
The company attributes the growth in recurring revenues to an increase in the number of customers who signed up for Avante’s alarm response and video monitoring services. The increase in non-recurring revenue is largely due to the inclusion of home and commercial automation revenues from Architronics Ltd.
Additionally, the company reports that revenues from high-end residential security installations/services grew by over 20 per cent, while locksmithing services and sale of fine hardware grew by about 12 per cent.
The gross margin for FY 2018 was 35.5 per cent compared to 32.7 per cent for FY 2017.
In a conference call to discuss the results, Avante Logixx CEO Craig Campbell said, “We have made significant strides in reorganizing the company and I believe that we are well-positioned to grow and become a leading provider of technology-enabled security services here in Ontario, as well as across Canada.”
Campbell added that the company is exploring opportunities to expand its footprint to new geographies, and has “commenced an initiative to explore the opportunity to expand into the western suburbs of the GTA and mainly the southeast Oakville area.”
Moving forward, the company will “focus on the three strategic initiatives: organic growth, integration of our prior acquisition, and accretive acquisitions that make sense for our business.”
With regards to its acquisition strategy, Campbell said the company is “not restricting ourselves as we assess acquisitions to put into our deal pipeline.”
“However, the short-term, immediate focus is deals that are complementary to our existing infrastructure here in Toronto,” he elaborated. “So we are looking at some tuck-in opportunities that leverage our core customer, and then we’re also looking at an acquisition to give us the opportunity to have a platform in another adjacent market where we can benefit from our core business and infrastructure.”
In the next 12 months, the company expects to see the most growth in Ontario, Campbell added.
“Longer term as we get our feet under ourselves and are executing well, we will look at opportunities regardless of geography where we can efficiently deploy and manage the capital,” he concluded.