Extract from MD&AQUOTE
As has now been the case for the third consecutive year, revenue during the third quarter has declined
when compared to the second quarter. This trend can be considered a seasonal issue primarily associated
with AVI applications as the Company receives fewer orders during the summer months. This trend has
resulted in the third quarter being the slowest quarter for revenue generation annually over the past three
years.
In addition, revenue for the quarter has been impacted by foreign exchange volatility. The average US
dollar to Canadian dollar foreign exchange rate decreased 2.5% during the third quarter alone. As an
example, at the beginning of the third quarter, every US$1 in revenue converted to a year-to-date average
of CDN$1.1357 and by the end of the third quarter, every US$1 in revenue converted to a year-to-date
average of CDN$1.1071.
UNQUOTE