Redishred Capital Corp. Announces the Acquisition of Select Shred in Florida
Redishred Capital Corp.
3 min read
MISSISSAUGA, ON / ACCESSWIRE / June 3, 2024 / Redishred Capital Corp ("Redishred" or the "Company") (TSXV:KUT) announces the completion of the acquisition of SelectShred, Inc. ("Select Shred") effective May 31, 2024.Select Shred offers on-site paper and hard drive shredding, product destruction, and paper recycling services. Select Shred earned approximately $0.3 million USD in revenue in 2023.
The Company also wants to highlight the pro forma EBITDA margin (See "Cautionary Note Regarding Non-IFRS measures") of Select Shred which is estimated to be in the range of 35% to 40% and views this acquisition as accretive to the Company's cash flows and earnings per share.
The asset acquisition includes on-site paper and hard drive shredding trucks, containers, client relationships, and other assets used in the shredding and paper recycling business.
Kasia Pawluk, Redishred's Senior Vice President of Acquisitions, noted, "The acquisition of Select Shred allows us to further grow and densify our footprint in the Fort Lauderdale, West Palm Beach and Port St. Lucie areas, and achieve routing and other synergies with the significant overlap of Select Shred's routes with our existing Fort Lauderdale location. We want to thank Richard & Gloria Kinkead for the business they have built and their long-standing care for their customers. We look forward to continuing this service and care for customers and we wish them well in their future endeavors."
The purchase price for this acquisition, including earnouts, is estimated to be between $0.4 million and $0.5 million USD, depending on the achievement of certain financial results. The acquisition was financed by utilizing the Company's senior credit facility.
About Redishred
Redishred Capital Corp. ("Redishred") is the owner of the PROSHRED?, PROSCAN and secure e-Cycle brands, trademarks and intellectual property in the United States. Redishred digitizes, secures, shreds and recycles confidential documents and proprietary materials for thousands of customers in the United States in all industry sectors. Redishred is a pioneer in the mobile document destruction and recycling industry and has the ISO 9001:2015 certification. It is Redishred's vision to be the ‘system of choice' in providing digital retention, secure shredding and recycling services on a global basis. Redishred grants PROSHRED` and PROSCAN franchise businesses in the United States and by way of a license arrangement in the Middle East. Redishred also operates seventeen corporate businesses directly. The Company's plan is to grow its business by way of acquisition and operation of information security businesses that generate stable and recurring cash flow through a scheduled client base, continuous paper recycling and concurrent unscheduled shredding service.
FOR FURTHER INFORMATION PLEASE CONTACT:
Redishred Capital Corp. (TSX.V- KUT) Jeffrey Hasham, MBA, CA, CPA Chief Executive Officer [email protected] Phone: (416) 849-3469Fax: (905) 812-9448
Note: The TSX Venture Exchange has neither approved nor disapproved of the information contained herein.
This news release contains forward looking statements that reflect the current expectations of management of Redishred and Redishred's future results, performance, achievements, prospects and opportunities. Wherever possible, words such as "may", "will", "estimate", "believe", "expect", "intend" and similar expressions have been used to identify these forward looking statements. These statements reflect current beliefs and are based on information currently available to management of Redishred. Forward looking statements necessarily involve known and unknown risks and uncertainties. A number of factors, including those discussed in the 2023 Management Discussion and Analysis under "Risk Factors", could cause actual results, performance, achievements, prospects or opportunities to differ materially from the results discussed or implied in the forward looking statements.
These factors should be considered carefully and a reader should not place undue reliance on the forward looking statements. There can be no assurance that the expectations of management of Redishred will prove to be correct.
In particular, certain statements in this document discuss Redishred's anticipated outlook of future events. These statements include, but are not limited to:
An increase to Redishred's cash flow and earnings per share, which may be impacted by the level of costs, industry growth levels, the demand for recycled paper products, changes in local and federal regulations, and the economic situation in the United States;
The realization of synergies, which may be impacted by the successful integration of operations, procedures, and personnel, and the demand for services; and
Pro-forma EBITDA margins, which may be impacted by industry growth levels, the demand for services, changes in local and federal regulations, the economic situation in the United States, and the realization of synergies, which may be impacted by the successful integration of operations, procedures, the economic situation in the United States and personnel.
Readers are cautioned that such forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from these statements. Redishred can give no assurance that actual results will be consistent with these forward-looking statements.
This press release makes reference to certain Non-IFRS measures that do not have a standardized meaning under IFRS and therefore may not be comparable to similarly titled measures presented by other publicly traded companies. The Company includes these measures as a means of measuring financial performance. More specifically, the Company makes reference to the following Non-IFRS measures:
EBITDA is defined as earnings before interest, taxes, depreciation and amortization.
EBITDA margin is defined as the percentage of revenue that has turned into EBITDA.
Pro forma EBITDA is defined as EBITDA, for the referenced company, for the twelve months ended with respect to the fiscal period being referenced, adjusted for the anticipated cost savings and other synergies that the Company anticipates as a result of the acquisition of the referenced company, as if the Company had acquired the referenced company at the beginning of the fiscal period.
Pro forma EBITDA margin is defined as the percentage of revenue that has turned into Pro forma EBITDA.
