RE: Just looked at the June 25...
Tri-Vision loses $4.19-million in fiscal 2007
2007-06-25 08:38 ET - News Release
Mr. Najmul Siddiqui reports
TRI-VISION REVENUES ROSE 143% IN FOURTH QUARTER AND 41% FOR THE YEAR; V-CHIP LICENSING RATE CONTINUED WITH 6 LICENSES ANNOUNCED DURING THE QUARTER, INCLUDING 4 FOR THE U.S. MARKET - TRI-VISION COMPLETED A $4 MILLION BOUGHT DEAL EQUITY FINANCING - TRI-VISION NEGOTIATED A MERGER WITH WI-LAN INC., AN INTELLECTUAL PROPERTY LICENSING COMPANY WHICH SUBJECT TO SHAREHOLDER APPROVAL
Tri-Vision International Ltd. has released its financial results for fourth quarter and year ended March 31, 2007.
Najmul Siddiqui, Tri-Vision's chief executive officer, stated: "Our fourth quarter expanded on gains made in the third quarter and showed marked upward movement. Results from continuing operations are very encouraging as we maintained gross profit margin above 40 per cent for two consecutive quarters."
Revenue for the fourth quarter rose 143 per cent to $3.4-million, compared with $1.4-million in the prior year, and the net loss was five cents per share compared with four cents per share a year earlier, as a result of increased revenues for both V-chip licensing and Think Broadband (TBB) product sales offset by the previously disclosed $2.5-million legal fee accrual in fiscal the fourth quarter of 2007 that was required to be made in accordance with the terms of one of the company's licence agreements. For the year ended March 31, 2007, total revenue was $9.6-million, compared with $6.8-million in the prior year, an increase of 41 per cent.
Tri-Vision Electronics Inc. saw royalty revenues increase to $1.3-million in the fourth quarter from $1.0-million in the third quarter of fiscal 2007 and nil from the prior year. TBB's revenues improved to $2.1-million in the fourth quarter, up by $700,000 over the previous year, fuelled by increases in cable equipment sales.
Fourth quarter gross profit grew to $1.4-million compared with a loss in the previous year. This represents a gross profit margin of 42 per cent compared with 41 per cent in the third quarter of fiscal 2007 and negative 10 per cent in the comparable quarter last year. Gross profit for the fiscal year ended March 31, 2007, was up at $3.3-million, representing a gross profit margin of 34 per cent as compared with $1.9-million, or gross profit margin of 28 per cent for the previous fiscal year.
Selling, general and administrative expenses were $1.5-million (excluding a legal expense accrual of $2.5-million related to a certain licence agreement) in the fourth quarter compared with $1.4-million in the year prior. Research and development expenses were lower quarter over quarter at $200,000 compared with $700,000 excluding a $1.1-million investment tax credit. For the fiscal year ended March 31, 2007, selling, general and administrative expenses were $4.2-million (excluding a legal expense accrual of $2.5-million related to a certain licence agreement) compared with $3.5-million for fiscal 2006. Research and development expenses were down at $700,000 for the year compared with $1.2-million (excluding a $1.1-million investment tax credit) in the previous year. Throughout fiscal 2007, expanding sales activities resulted in increased travel and legal expenses beyond the levels incurred in fiscal 2006 as Tri-Vision's sales force and licensing team continued pursuing new contracts around the world. The fourth quarter saw six new V-chip licences announced for the Canadian and/or the United States market. Subsequent to the year-end, six additional licences have been added to bring the total to 95 licensees, 49 for the Canadian patent and 46 for the United States patent. Tri-Vision continues to pursue licensing deals with all remaining major manufacturers that each hold significant market share which, when finalized, would add substantially to Tri-Vision's United States market position. It is important to note that regardless of when such licensing contracts are signed, Tri-Vision will be entitled to collect royalties on sales that date back to the FCC mandated deadlines.
A net loss of $2.8-million was recorded for the fourth quarter (including a $2.5-million legal expense accrual) compared with a net loss of $2.2-million in the same period of the previous fiscal year. For the year ended March 31, 2007, there was a net loss of $4.2-million compared with a net loss of $2.8-million for the previous fiscal year. This represents a loss per share for the fourth quarter and fiscal year ended March 31, 2007, of five cents and seven cents basic and fully diluted, respectively, compared with four cents and five cents, respectively, for the same periods fiscal 2006.
Fourth quarter operational highlights:
March 1, 2007, was FCC's deadline requiring all television receivers in the United States, with or without associated display to include a digital tuner. A digital tuner is required to provide "open" V-Chip capacity that is the basis of Tri-Vision's United States licensing program.
Licensing activities continued resulting in six licences announced during the fourth quarter, and six more announced since March 31, 2007. Eight of those announced were for the more lucrative United States market.
Tri-Vision closed a $4-million bought-deal equity financing with Wellington West Capital Markets.
Late in the fourth quarter Tri-Vision announced the signing of a letter of intent to merge with Wi-LAN Inc., a move which Tri-Vision's board and management believe would strengthen its bargaining position in negotiations with licensees and protect its patents and proprietary technologies.
Subsequent to fiscal year-end:
Continued V-chip licensing with six new licensees for the Canadian and/or United States patents announced, including Nexgen, Falcon, TPV and Microtek for the United States market;
Tri-Vision signed a definitive agreement to merge with Wi-LAN Inc., subject to shareholder approval. Once completed, the merger will create a Canadian pure-play intellectual property giant building upon Wi-LAN's already strong intellectual property portfolio in the wireless and telecom sectors;
Tri-Vision paid approximately $2.5-million for legal expenses relating to a certain license agreement.
Outlook
Looking forward, Mr. Siddiqui stated: "The future for Tri-Vision is up to the shareholders who will vote on the proposed merger with Wi-LAN Inc. on Thursday, June 28. We believe the proposed transaction with Wi-LAN is fair and provides for the strongest platform on which to build for the future of V-chip technology."
CONSOLIDATED STATEMENTS OF LOSS AND DEFICIT
For three months For year
ended March 31, ended March 31,
2007 2006 2007 2006
Revenue 3,391,712 1,390,734 9,551,954 6,791,094
Cost of sales 1,982,176 1,537,190 6,269,527 4,867,001
------------ ------------ ------------ ------------
Gross profit (loss) 1,409,536 (146,456) 3,282,427 1,924,093
------------ ------------ ------------ ------------
Selling, general
and administrative
expenses 1,547,521 1,448,377 4,266,835 3,495,759
Legal expense
accrual 2,457,000 - 2,457,000 -
Research and
development 202,962 656,738 668,774 1,233,439
Investment
tax credit - (1,142,544) - (1,142,544)
------------ ------------ ------------ ------------
4,207,483 962,571 7,392,609 3,586,654
------------ ------------ ------------ ------------
(Loss) before
interest
income (expense),
foreign exchange
and income taxes (2,797,947) (1,109,027) (4,110,182) (1,662,561)
Interest income 75,376 57,965 232,996 188,589
Interest expense (11,563) (15,358) (61,986) (53,444)
Foreign exchange
gain (loss) 4,674 31,319 (28,109) (68,927)
------------ ------------ ------------ ------------
(Loss) before
income taxes (2,729,460) (1,035,101) (3,967,281) (1,596,343)
Provision for
current income
taxes 107,692 1,118,367 231,755 1,253,526
------------ ------------ ------------ ------------
Net (loss) (2,837,152) (2,153,468) (4,199,036) (2,849,869)
============ ============ ============ ============
(Deficit),
beginning
of period (16,990,675) (13,475,323) (15,628,791) (12,778,922)
============ ============ ============ ============
(Deficit),
end of the
period (19,827,827) (15,628,791) (19,827,827) (15,628,791)
============ ============ ============ ============
Net (loss)
per share --
basic and diluted $ (0.05) $ (0.04) $ (0.07) $ (0.05)
============ ============ ============ ============
We seek Safe Harbor.