Effective immediately, all 40 employees of the division have been transferred to EarthBend in Sioux Falls, S.D., according to the company.
Financial terms were not disclosed.
The news of the sale – part of Mitel’s ongoing strategy to simplify and focus on its core business – came shortly after the company announced it had hit all of its internal forecasted targets in its third quarter, increasing its net income year-over-year and finding a buyer for the business division it was looking to sell.
Mitel’s net income was $5.1 million, up 16 per cent over last year’s $4.4 million, the company announced in its quarterly results published Thursday.
That income came despite a seven per cent dip in revenues year-over-year, from $150.5 million last year to $142 million during the fiscal period ending Jan. 31.
The company’s gross margin – which hit a record peak in its second quarter – was 55.5 per cent, up from 54.4 per cent in last year’s equivalent quarter.
Mitel’s financial results came the day after the company announced it has completed the refinancing of its lien credit facilities with $320 million in new secured credit facilities, allowing the company to reduce its debt.
Proceeds from the credit facilities, along with approximately $35 million in cash, were used to repay the $304 million outstanding under the existing credit facilities, as well as fees and expenses related to the transactions.
“Mitel’s solid operating performance was a key factor in our ability to refinance our credit facilities on favourable terms, providing significant operational flexibility in the years ahead,” stated chief financial officer Steve Spooner in a company release.
“Our forecast reflects our continued focus to execute on our strategy while remaining cautious in a challenging macroeconomic environment.”
The forecast for the company’s fourth fiscal quarter includes revenues in the range of $143 to $148 million, a gross margin between 55 per cent and 56 per cent and operating expenses as a percentage of revenue in the range of 41.5 per cent to 42.5 per cent.
Business highlights for the quarter included more than 30,000 new cloud users, bringing Mitel’s total cloud base to more than 228,000.
Special charges and restructuring costs for the period were $7.3 million, resulting from the company’s decision last August to cut 200 full-time positions worldwide and the closure of “excess facilities.”