Port Coquitlam, British Columbia (FSCwire) - VendTek Systems Inc. (VSI - TSX Venture) (the "Company"), a developer and licensor of software for the global prepaid telecom and financial services markets, today reported its financial results for its first quarter of fiscal 2015 ended July 31, 2015 (“Q3 2015”).
Selected Financial Information
- Revenue for the quarter ended July 31, 2015 increased $86,269 to $391,039, or 28.3% from $304,770 in the prior fiscal quarter of Q3 2014;
- Operating expenses were $813,787 compared to $1,015,982 in the prior fiscal quarter.
- Adjusted EBITDA[1] loss was $399,935 for Q3 2015 compared to a loss of $675,114 for the prior year;
- Net loss from continuing operations was $544,712 compared to $762,821 in the prior fiscal quarter;
- Cash used in operations was $375,286 for Q3 2015, compared to $611,249 cash used in operations in the prior fiscal year;
- Cash and cash equivalents was $134,089 at July 31, 2015 compared to $291,366 at October 31, 2014.
“Since earlier this year, our Company has refocused its business to solely operate as a software provider, having eFresh™ as its core product. While this decision was inevitable due to the company’s inability to raise sufficient funds in order to support the growth its distribution network, it was also supported by our strong belief that our eFresh™ technology can, with the adequate sales team and structure, generate significant value to our shareholders” says Felipe Ayres, VendTek’s Chief Executive Officer.
These consolidated financial statements have been prepared on the going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. For the quarter ended July 31, 2015 the Company has incurred a net loss from continuing operations of $544,712 and negative cash flows of $375,286 from operating activities. The Company also has a working capital deficiency of $3,264,121 and a shareholders’ deficiency of $4,024,393 as at July 31, 2015.
[1] Management defines Adjusted EBITDA as net income adjusted for financing, taxes, depreciation, amortization expenses, impairment of non-financial assets, foreign exchange differences and stock based compensation expense. Please see the Management Discussion and Analysis for more details.
These conditions raise significant doubt about the ability of the Company to continue as a going concern without additional financing or renegotiate the terms of existing financing. In addition to the funds raised subsequent to quarter end, Management is pursuing several sources of additional financing (both debt and equity) and is of the opinion that sufficient working capital will be obtained from: external financing, renegotiation of existing financing; and improved operations to meet the Company’s liabilities and commitments as they become due, although there is significant risk that this may not happen on a timely basis or on terms acceptable to the Company.
These consolidated financial statements do not give effect to any adjustments which would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the accompanying consolidated financial statements.
Subsequent to quarter end, on September 2, 2015, the Company closed its previously announced non-brokered private placement of $1,000,000 in secured convertible debentures.
The debentures bear interest at a rate of 12% per annum and mature on September 2, 2018. These debentures are convertible into common shares of the Company any time until maturity at a price of $0.10 per common share on conversion. The net proceeds from the Offering will be used for general corporate purposes, including working capital.
The Private Placement may be considered a related party transaction pursuant to applicable securities laws due to the fact that certain insiders of the Company will be participating in the Offering.
VendTek’s MD&A and complete financial statements and notes are available at www.sedar.com and the Company’s website www.vendteksystems.com.
For more information or to receive the complete statements please contact Samantha White at 604-805-4653 or 1-800-806-4958 or investment@vendteksystems.com.
VendTek Systems Inc.
Unaudited Condensed Consolidated Statement of Financial Position
(All amounts expressed in Canadian dollars)
|
|
|
|
|
|
|
|
|
July 31,
|
|
October 31,
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$ 134,089
|
|
$ 291,366
|
|
Accounts receivable
|
|
195,744
|
|
101,776
|
|
Prepaid expenses and deposits
|
|
84,622
|
|
81,943
|
|
|
|
414,455
|
|
475,085
|
|
Non-current assets:
|
|
|
|
|
|
Property, plant and equipment, net
|
|
83,131
|
|
87,053
|
|
Intangible assets
|
|
48,119
|
|
60,198
|
|
|
|
|
|
|
|
|
|
$ 545,705
|
|
$ 622,336
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Deficiency
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
$ 2,152,142
|
|
$ 1,997,969
|
|
Current portion finance lease obligations
|
|
25,975
|
|
25,051
|
|
Current portion of convertible debentures
|
|
735,757
|
|
860,000
|
|
Short term loans
|
|
764,702
|
|
597,206
|
|
|
|
3,678,576
|
|
3,480,226
|
|
Non-current liabilities:
|
|
|
|
|
|
Long term portion of capital lease
obligations
|
|
14,107
|
|
34,314
|
|
Long term portion of convertible
debentures
|
|
877,415
|
|
635,754
|
|
|
|
|
|
|
|
Shareholders’ deficiency:
|
|
|
|
|
|
Share capital
|
|
13,001,656
|
|
12,188,130
|
|
Contributed surplus
|
|
4,281,720
|
|
4,090,033
|
|
Deficit
|
|
(21,350,078)
|
|
(19,847,980)
|
|
Accumulated other comprehensive income
|
|
42,309
|
|
41,859
|
|
|
|
(4,024,393)
|
|
(3,527,958)
|
|
|
|
|
|
|
|
|
|
$ 545,705
|
|
$ 622,336
|
October 31, 2012 and 2011
Approved on behalf of the Board:
VendTek Systems Inc.
Unaudited Consolidated Interim Statements of Operations and Comprehensive Loss
(All amounts expressed in Canadian dollars)
Three and nine months ended July 31, 2015 and 2014
|
|
Restated - (note 7)
|
|
Restated - (note 7)
|
|
|
Three months ended July 31,
|
|
Nine months ended July,31
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
Continuing operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
Products and service revenue
|
$ 391,039
|
|
$ 304,770
|
|
$ 920,775
|
|
$ 1,305,747
|
|
Cost of product and service revenue
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
391,039
|
|
304,770
|
|
920,775
|
|
1,305,747
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
General and administrative
|
638,511
|
|
820,023
|
|
1,710,704
|
|
2,260,989
|
|
Research and development
|
175,276
|
|
195,959
|
|
491,127
|
|
602,277
|
|
Total operating expenses
|
813,787
|
|
1,015,982
|
|
2,201,831
|
|
2,863,266
|
|
|
|
|
|
|
|
|
|
|
Loss before finance cost and
|
|
|
|
|
|
|
|
|
foreign exchange loss (gain)
|
(422,748)
|
|
(711,212)
|
|
(1,281,056)
|
|
(1,557,519)
|
|
|
|
|
|
|
|
|
|
|
Finance cost
|
55,930
|
|
47,522
|
|
165,499
|
|
211,078
|
|
Foreign exchange loss (gain)
|
66,034
|
|
4,087
|
|
55,543
|
|
61,703
|
|
|
|
|
|
|
|
|
|
|
Net loss from continuing operations
|
(544,712)
|
|
(762,821)
|
|
(1,502,098)
|
|
(1,830,300)
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) from discontinued
|
|
|
|
|
|
|
|
|
operations
|
-
|
|
(994,449)
|
|
-
|
|
2,947,262
|
|
Net income (loss)
|
(544,712)
|
|
(1,757,270)
|
|
(1,502,098)
|
|
1,116,962
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
Foreign currency translation difference
|
(1,372)
|
|
6,644
|
|
450
|
|
19,884
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
$ (546,084)
|
|
$ (1,750,626)
|
|
$ (1,501,648)
|
|
$ 1,136,846
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per share
|
$ (0.04)
|
|
$ (0.30)
|
|
$ (0.17)
|
|
$ 0.19
|
|
|
|
|
|
|
|
|
|
|
Earnings per share – continuing operations
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per share
|
$ (0.04)
|
|
$ 0.30
|
|
$ (0.17)
|
|
$ 0.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
Basic and diluted
|
13,034,146
|
|
5,835,765
|
|
8,811,139
|
|
5,835,765
|
VendTek Systems Inc.
Unaudited Condensed Consolidated Statements of Changes in Equity
(All amounts expressed in Canadian dollars)
Nine months ended July 31, 2015 and 2014
|
|
|
|
|
Accumulated other
|
|
Total Shareholders’
|
|
|
Share capital
|
Contributed
|
comprehensive
|
|
equity
|
|
|
Number
|
Value
|
surplus
|
loss
|
Deficit
|
(deficiency)
|
|
|
|
|
|
|
|
|
|
Balance, November 1, 2013
|
58,357,652
|
12,188,130
|
3,916,136
|
(257,601)
|
(20,579,957)
|
(4,733,292)
|
|
|
|
|
|
|
|
|
|
Stock based compensation
|
‑
|
‑
|
33,196
|
‑
|
‑
|
33,196
|
|
|
|
|
|
|
|
|
|
Currency translation adjustment
|
‑
|
‑
|
‑
|
19,884
|
‑
|
19,884
|
|
|
|
|
|
|
|
|
|
Net income (loss) for period
|
‑
|
‑
|
‑
|
‑
|
1,116,962
|
1,116,962
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance July 31, 2014
|
$58,357,652
|
$12,188,130
|
$3,949,332
|
$(237,717)
|
$(19,462,995)
|
$(3,563,250)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, November 1, 2014
|
$58,357,652
|
$12,188,130
|
$4,090,033
|
$41,859
|
$(19,847,980)
|
$(3,527,958)
|
|
|
|
|
|
|
|
|
|
Issue of shares
|
23,766,747
|
813,526
|
‑
|
‑
|
‑
|
813,526
|
|
|
|
|
|
|
|
|
|
Equity component of convertible
|
|
|
|
|
|
|
|
Debentures
|
‑
|
‑
|
144,060
|
‑
|
‑
|
144,060
|
|
|
|
|
|
|
|
|
|
Stock based compensation
|
‑
|
‑
|
47,627
|
‑
|
‑
|
47,627
|
|
|
|
|
|
|
|
|
|
Currency translation adjustment
|
‑
|
‑
|
‑
|
450
|
‑
|
450
|
|
|
|
|
|
|
|
|
|
Net loss for period
|
‑
|
‑
|
‑
|
‑
|
(1,502,098)
|
(1,502,098)
|
|
|
|
|
|
|
|
|
|
Share consolidation (10:1) April 24, 2015
|
(65,381,248)
|
‑
|
‑
|
‑
|
‑
|
‑
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance July 31, 2015
|
$16,743,151
|
$13,001,656
|
$4,281,720
|
$42,309
|
$(21,350,078)
|
$(4,024,393)
|
VendTek Systems Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
(All amounts expressed in Canadian dollars)
|
|
Three months ended July 31,
|
|
Nine months ended July 31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
Cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations:
|
|
|
|
|
|
|
|
|
Net income(loss) for the period
|
$(544,712)
|
|
$(1,757,270)
|
|
$(1,502,098)
|
|
$1,116,962
|
|
Items not involving cash:
|
|
|
|
|
|
|
|
|
Accretion on convertible
|
|
|
|
|
|
|
|
|
debentures
|
15,909
|
|
18,096
|
|
35,721
|
|
103,396
|
|
Amortization
|
6,892
|
|
208,185
|
|
31,382
|
|
414,751
|
|
Loss (gain) on disposal of assets
|
-
|
|
-
|
|
-
|
|
8,199
|
|
Foreign exchange loss (gain)
|
66,034
|
|
4,087
|
|
55,543
|
|
61,703
|
|
Gain on disposal of
|
|
|
|
|
|
|
|
|
discontinued operations
|
-
|
|
-
|
|
-
|
|
(4,792,384)
|
|
Stock-based compensation
|
|
|
|
|
|
|
|
|
expense
|
15,921
|
|
16,740
|
|
47,627
|
|
33,196
|
|
Changes in non-cash operating
|
|
|
|
|
|
|
|
|
working capital items
|
11,917
|
|
839,413
|
|
2,671
|
|
(653,266)
|
|
Interest expense on long-term debt
|
52,753
|
|
59,500
|
|
129,778
|
|
173,244
|
|
|
(375,286)
|
|
(611,249)
|
|
(1,199,376)
|
|
(3,534,199)
|
|
|
|
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
|
|
|
|
Interest paid on long-term debt
|
(32,389)
|
|
(79,427)
|
|
(74,835)
|
|
(221,034)
|
|
Decrease (increase) in bank indebtedness
|
-
|
|
(151,105)
|
|
-
|
|
36,251
|
|
Issue of convertible debentures
|
-
|
|
-
|
|
350,000
|
|
-
|
|
Issue of shares
|
539,256
|
|
-
|
|
689,282
|
|
-
|
|
Short term loans
|
(58,000)
|
|
-
|
|
109,764
|
|
-
|
|
Repayment of convertible debentures
|
-
|
|
-
|
|
-
|
|
(1,628,000)
|
|
Repayment of capital lease obligations
|
(7,031)
|
|
(200,771)
|
|
(19,283)
|
|
(335,891)
|
|
|
441,836
|
|
(431,303)
|
|
1,054,928
|
|
(2,148,674)
|
|
|
|
|
|
|
|
|
|
|
Investments activities:
|
|
|
|
|
|
|
|
|
Decrease (increase) in restricted cash
|
-
|
|
5,865
|
|
-
|
|
(9,048)
|
|
Purchase of equipment
|
(15,394)
|
|
(117,164)
|
|
(15,394)
|
|
(134,801)
|
|
Net proceeds received from disposition
|
|
|
|
|
|
|
|
|
of discontinued operations
|
-
|
|
(382,307)
|
|
-
|
|
3,602,095
|
|
|
(15,394)
|
|
(493,606)
|
|
(15,394)
|
|
3,458,246
|
|
Effect of foreign exchange on cash
|
|
|
|
|
|
|
|
|
and cash equivalents
|
(34,990)
|
|
51,237
|
|
2,565
|
|
26,014
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in cash
|
|
|
|
|
|
|
|
|
and cash equivalents
|
16,166
|
|
(1,484,921)
|
|
(157,277)
|
|
(2,198,613)
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents,
|
|
|
|
|
|
|
|
|
beginning of period
|
117,923
|
|
1,939,506
|
|
291,366
|
|
2,653,198
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents,
|
|
|
|
|
|
|
|
|
end of period
|
$134,089
|
|
$454,585
|
|
$134,089
|
|
$454,585
|
To view this press release as a PDF file, click onto the following link:
public://news_release_pdf/vendtek09292015.pdfSource: VendTek Systems Inc (TSX Venture:VSI) www.vendteksystems.com
Maximum News Dissemination by FSCwire. http://www.fscwire.com
Copyright © 2015 Filing Services Canada Inc.