In-Touch Survey Systems Ltd. announces Q2 2013 financial results
OTTAWA, Aug. 29, 2013 /CNW/ - In-Touch Survey Systems Ltd. ("In-Touch") (TSXV: INX) today announced its operating and financial results for the quarter ended June 30, 2013.
Revenue for the second quarter was $2,815,598, which was 5% lower than revenue of $2,947,069 in the same quarter in 2012. The Company previously announced that it had lost several major customers in 2012 that would negatively impact revenues in 2013. The Company is pleased to report that the Company has successfully replaced and exceeded the customers lost in 2012 and that Q3 2013 revenues are expected to exceed Q3 2012 revenues.
Net loss before taxes for the second quarter was $139,964 compared to net income of $351,933 reported in the same quarter in 2012. Product Development and Marketing spending was the main contributor to the loss but was an important strategic investment decision for revenue and product line growth in 2013 and 2014. G&A expenses were also higher with additional expenses related to the acquisition. While the management team is not happy with the net loss in Q2 the Company is pleased to report that it expects to return to profitability in Q3 2013.
Gross Margin increased to 53.6% in the second quarter compared to 49.6% for the same quarter in 2012. Company-defined adjusted EBITDA decreased to ($52,000) for the second quarter, compared to an EBITDA of $279,000 for the same quarter in 2012. The improvement in Gross Margin resulted from a concerted effort over the past two years to return our margins to historical levels. Additionally, the Company is currently implementing an expense review program and again is pleased to report that it expects to have significant positive EBITDA in Q3 2013
"Replacing the lost customers and their associated revenue from 2012 and improving the gross margins were two of our successful strategic initiatives. Currently, the Company's sales forecast puts 2013 revenues slightly ahead of 2012 revenues, which would be a major achievement for the Company. The Company continues to invest heavily in new product development and marketing and we have a cost optimization plan being implemented in Q3 and Q4," said Michael Gaffney, Chief Executive Officer.
"The acquisition of GCS Field Research ("FR") on April 1, 2013 opened
important new compliance markets for the Company. We expect the
compliance market to expand with increasing government regulation in
food, education, pharmaceutical and financial services. We were very
pleased with the smooth acquisition and integration of FR into
In-Touch.," said Gaffney.
|Consolidated Statements of Operations||Q2 2013||Q2 2012|
|Cost of services||1,305,721||1,485,070|
|Total operating expenses||1,641,953||1,082,570|
|Earnings (loss) from operating activities||(132,076)||379,429|
|Change in fair value of contingent consideration||(5,278)||730|
|Net earnings (loss) before income taxes||$||(139,964)||$||351,933|
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.For further information: