OTTAWA, May 29, 2014 /CNW/ - In-Touch Survey Systems Ltd. ("In-Touch")
(TSXV: INX) today announced its operating and financial results for the
quarter ended March 31, 2014.
Revenue for the first quarter was $2,323,307, which was 2% higher than
revenue of $2,282,441 in the same quarter in 2013. Revenues from the
EDC segment increased 9% from $1,988,273 in 2013 to $2,174,762 for the
same quarter in 2014. A decrease in revenue from the IMS division from
$294,168 in Q1 2013 to $148,545 in Q1 2014 was expected due to the loss
of contracts. Q1 benefited from the overlap of the GCS acquisition
which mitigated the account losses from 2013. The full impact of the
account losses is expected to impact year over year revenue comparisons
starting with Q2, 2014. It is anticipated that revenue replacement
will accelerate in Q3 and Q4 with the introduction of new products.
Net income before taxes for the first quarter was $29,172 compared to a
net loss of $145,339 reported in the same quarter in 2013. Gross Margin
increased to 56% in the first quarter compared to 52% for the same
quarter in 2013. The significant improvement in gross margin is
attributed to cost reductions and efficiency initiatives which started
in 2013. There was also some benefit received through product mix
shift.
Company-defined adjusted EBITDA increased to $163,000 for the first
quarter, compared to an EBITDA of ($52,000) for the same quarter in
2013. Because of improved margins EBITDA is expected to remain positive
throughout 2014.
"We are very pleased to see the tangible results of the efforts over the
last few quarters reflected in the Q1 2014 financial statements. We
expect Q2 to be a challenging revenue quarter given the year over year
customer replacement requirement. We are meeting the challenge with a
focus on new sales while maintaining operational efficiencies to ensure
comparable profitability to 2013." said Cameron Watt, President & Chief Executive Officer.
"We remain committed to our investment in product development and
believe that the products we plan to launch in 2014 will be integral to
both the revenue replacement efforts as well as the future growth of
the company.", said Watt.
Consolidated Statements of Operations
|
|
Q1 2014
|
|
Q1 2013
|
Revenue
|
|
$
|
2,323,307
|
|
$
|
2,282,441
|
Cost of services
|
|
|
1,019,929
|
|
|
1,086,823
|
Gross profit
|
|
|
1,303,378
|
|
|
1,195,618
|
Total operating expenses
|
|
|
1,264,135
|
|
|
1,326,070
|
Earnings from operating activities
|
|
|
39,243
|
|
|
(130,452)
|
Finance costs
|
|
|
(10,071)
|
|
|
(16,016)
|
Change in fair value of contingent consideration
|
|
|
-
|
|
|
1,129
|
Net earnings before income taxes
|
|
$
|
29,172
|
|
$
|
(145,339)
|
Certain statements included in this news release contain forward looking
statements, which by their nature are necessarily subject to risks and
uncertainties and other factors that may cause actual results,
performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such statements reflect
the Company's current views with respect to future events, and are
based on information currently available to the Company and on
hypotheses which it considers to be reasonable; however, management
warns the reader that hypotheses relative to future events which are
beyond the control of management could prove to be false, given that
they are subject to certain risks and uncertainties.
The TSX Venture Exchange has not reviewed the foregoing and has neither
approved or disapproved the contents of this press release.
SOURCE In-Touch Survey Systems Ltd.