Posera-HDX Announces Record Financial Results for Fiscal 2013

TORONTO, March 27, 2014 /CNW/ - Posera-HDX Ltd. (TSX: HDX) (the "Company") announced today its financial results for the three-months and year ending December 31st, 2013.  HDX is listed on the TSX under the symbol "HDX".

Paul Howell, Chief Executive Officer, reports:

Posera-HDX Ltd. achieved record levels of revenue and EBITDA for the 2013 fiscal year and also for the three-months ending December 31st, 2013.  On December 9th, 2013 the Company completed the acquisition of Zomaron Inc. ("Zomaron"). The acquisition of Zomaron, a rapidly growing company with a successful and accomplished management team and over 140 sales agents, will be instrumental in the Company's growth strategy and lays the groundwork for significant sales growth in 2014 and beyond. The Company achieved record revenue and EBITDA prior to the acquisition, when excluding revenues and EBITDA derived from the acquisition of Zomaron.

The Company's total revenue was $19,511,412 for the year-ended December 31, 2013, an increase of $3,065,306 (18.6%) from $16,446,106 for the year-ended December 31, 2012. EBITDA profit of $943,596, for the year-ended December 31, 2013 an increase of $2,065,961 from a loss of ($1,122,365) for the year-ended December 31, 2012.

The Company achieved revenue of $5,940,741 for the three-months ended December 31, 2013; an increase of $1,403,213 (30.9%) from $4,537,528 for the three-months ended December 31, 2012 and up $769,186 (14.9%) from $5,171,555 for the three-months ended September 30, 2013. EBITDA profit for the three-months ended December 31, 2013, was $854,771, an increase of $1,288,869 from a loss of ($434,098) for the three-months ended December 31, 2012, and an increase of $297,916 from an EBITDA profit of $556,855 for the three-months ended September 30, 2013.

In the twenty-two days subsequent to the date of acquisition of Zomaron during the remainder of fiscal 2013, Zomaron's merchant base processed credit and debit transactions totalling $41,816,054. The Company recorded $150,526 of payment processing revenue, which resulted from $710,068 of gross payment processing fees for the remaining twenty-two days of December 31, 2013.  For the year-ended December 31, 2013 Zomaron had 2,209 active merchants which compares to 1,299 active merchants as at December 31, 2012, which was prior to the date of acquisition of Zomaron by Posera-HDX Ltd.

There are over 20,000 merchants world-wide that operate Posera-HDX's software solutions. The Company anticipates that integration work between Posera-HDX's software solutions and Zomaron's payment solutions will be completed in 2014. Complimentary marketing and sales operations of intercompany products commenced during December of 2013 with a numerous clients contracting the Company to provide solutions from both divisions.

The Company continues to pursue acquisitions within the point of sale and payments industries although none are specifically named at this time.

Year-ended December 31, 2013 - Highlights and Summary

  • Revenues and earnings for the combined entity for the year-ended December 31, 2013 includes twenty-two days of operating results for Zomaron Inc. ("Zomaron") whom was acquired on December 9, 2013, whereas revenues and earnings for the year-ended December 31, 2012 does not include a full twelve months of operations for Zomaron;
  • Net income (loss) for the year-ended December 31, 2013 was a loss of ($992,438), a decrease of ($3,800,786) from a loss of ($4,793,224) for the year-ended December 31, 2012;
  • EBITDA profit (loss) for the year-ended December 31, 2013 was $943,596, an increase of ($2,065,961) from a loss of ($1,122,365) for the year-ended December 31, 2012;
  • Normalized EBITDA profit (loss) for the year-ended December 31, 2013 was $818,301, an increase of $1,344,236 from ($525,935) for the year- ended December 31, 2012;
  • Total revenue was $19,511,412 for the year-ended December 31, 2013, up $3,065,306 (18.6%) from $16,446,106 for the year-ended December 31, 2012;
  • Total point of sale revenue was $19,350,796 for the year-ended December 31, 2013, up $2,916,421 (17.7%) from $16,434,375 for the year-ended December 31, 2012;
  • Total payment processing revenue was $160,616 for the year-ended December 31, 2013, up $148,885 (1,269.2%) from $11,731 for the year-ended December 31, 2012;
  • Total gross payment processing fees was $722,511 for the year-ended December 31, 2013, up $709,894 (5,626.5%) from $12,617 for the year-ended December 31, 2012;
  • Gross profit was $7,933,552 for the year-ended December 31, 2013, up $1,926,856 (32.1%) from $6,006,696 for the year-ended December 31, 2012;
  • Operating expenses were $8,666,064 for the year-ended December 31, 2013, down $2,341,614 (21.3%) from $11,007,678 for the year-ended December 31, 2012; and
  • Operating expenses net of the impairment of assets were $8,403,789 for the year-ended December 31, 2013, down $184,025 (2.1%) from $8,587,814 for the year-ended December 31, 2012.

Three-months ended December 31, 2013 (Unaudited) - Highlights and Summary

  • Revenues and earnings for the combined entity for the three months-ended December 31, 2013 includes twenty-two days of operating results for the acquired entity Zomaron Inc. ("Zomaron") which was acquired on December 9, 2013, whereas revenues and earnings for the three-months ended December 31, 2012 and September 30, 2013 does not include the twenty-two days of operations for Zomaron;
  • Net income (loss) for the three-months ended December 31, 2013 was income of $360,773, an  increase of $3,257,662 from a loss of ($2,896,889), for the three-months ended December 31, 2012, and an increase of $40,725 from a loss of ($401,498) for the three-months ended September 30, 2013;
  • EBITDA profit (loss) for the three-months ended December 31, 2013, was a profit of $854,771, an increase of $1,288,869 from a loss of ($434,098) for the three-months ended December 31, 2012, and an increase of $297,916 from an EBITDA profit of $556,855 for the three-months ended September 30, 2013;
  • Normalized EBITDA profit (loss) for the three-months ended December 31, 2013 was $929,702, an increase of $1,102,075 from ($172,373) for the three-months ended December 31, 2012, and an increase of $647,006 from $282,696 for the three-months ended September 30, 2013
  • Total revenue was $5,940,741 for the three-months ended December 31, 2013, up $1,403,213 (30.9%) from $4,537,528 for the three-months ended December 31, 2012 and up $769,186 (14.9%) from $5,171,555 for the three-months ended September 30, 2013;
  • Gross profit was $2,685,584 for the three-months ended December 31, 2013, up $1,046,885 (63.9%) from $1,638,699 for the three-months ended December 31, 2012, and up $638,560 (31.2%) from $2,047,024 for the three-months ended September 30, 2013;
  • Operating expenses were $2,220,765 for the three-months ended December 31, 2013, down $2,602,006 (54.0%) from $4,822,771 for the three-months ended December 31, 2012, and down $77,563 (3.4%) from $2,298,328 for the three-months ended September 30, 2013;
  • Included in cost of sales and operating expenses for the three-months ended December 31, 2013, December 31, 2012 and September 30, 2013 were certain one-time non-recurring expenditures, non-cash amortization of intangible assets and property plant and equipment, non-cash stock-based compensation expense and non-cash impairment to assets totaling $260,795, $2,896,412 and $513,143 respectively;
  • Posera-HDX's cash and cash equivalents totaled $2,954,115 as at December 31, 2013, an increase of $1,903,674 (181.2%) from $1,050,441 as at December 31, 2012, and an increase of $1,808,525 (157.9%) from $1,145,590 as at September 30, 2013. Bank indebtedness was $207,101 as at December 31, 2013, a decrease of $49,683 (19.3%) compared to $256,784 as at December 31, 2012, and an increase of $147,101 (245.2%) compared to $60,000 as at September 30, 2013.
  • Posera-HDX's working capital totaled $595,493 as at December 31, 2013, an increase of $44,136 (8.0%) from $551,357 as at December 31, 2012, and an increase of $511,337 (607.6%) from $84,156 as at September 30, 2013.

Non-GAAP Reporting Measures: 

Management reports on certain non-GAAP measures to evaluate performance of the Company. EBITDA is a measure commonly reported and widely used by investors as an indicator of a company's operating performance and ability to incur and service debt, and as a valuation metric. While EBITDA has been disclosed herein to permit a more complete comparative analysis of the Company's operating performance and debt servicing ability relative to other companies, investors are cautioned that EBITDA as reported by Posera-HDX may not be comparable in all instances to EBITDA as reported by other companies.  For definitions of Non-GAAP measures, refer to the Company's annual management discussion and analysis for the fourth quarter and fiscal 2013.

Additional information on HDX fourth quarter 2013 financial results will be available in the financial reports filed by the Company with Sedar at www.sedar.com

About the Company

Posera-HDX is in the business of managing merchant transactions with consumers and facilitating payment. The company develops and deploys touch screen POS system software and associated enterprise management tools and has developed and deployed numerous POS applications. Posera-HDX also provides system hardware integration services, merchant staff training, system installation services, and post sale software and hardware support services. 

Posera-HDX leading edge technology also includes prepaid stored value payments solutions, customer self serve kiosks and "line buster" mobile point of sale terminals. These products have been designed to dramatically enhance customer throughput and drastically reduce customer queues. These technologies are especially effective in high foot traffic environments that have limited cash register counter space, limited retail square footage, and the absence of a drive through.

Founded in 2008, Zomaron provides credit and debit card processing solutions to Canadian merchants nationwide. Based in London, Ontario, Zomaron has offices in Edmonton AB, Toronto ON, and Montreal QC. Through its nation-wide network of sales representatives and strategic partnerships, Zomaron has experienced rapid growth, doubling its sales annually. Zomaron's exponential growth led it to be ranked on PROFIT magazine's 13th and 14th annual PROFIT HOT 50 issues in October 2012 and 2013 respectively. Zomaron's solutions and services can also be marketed and deployed in the United States. 

Posera-HDX Ltd. develops, deploys, and supports a restaurant point-of-sale software know as "Maitre'D" which has been deployed in over 20,000 locations worldwide in eight different languages.  The Company sells and services its clients directly, as well as through a network of approximately 96 value added reseller partners in 25 countries with approximately 550 representatives selling, supporting & installing its software. Posera-HDX employs approximately 139 people in offices in Toronto, London, Brantford, Mississauga, Seattle, Montreal, Glasgow (U.K.), Paris (France) and Singapore. 

Forward-Looking Statements 

This discussion includes certain forward-looking statements that are based upon current expectations, which involve risks and uncertainties associated with our business and the environment in which the business operates.  Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions "anticipate", "believe", "plan", "estimate", "expect", "intend", and similar expressions to the extent they relate to the Company or its management.  The forward-looking statements are not historical facts, but reflect HDX's current expectations regarding future results or events.  These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under "Risks and Uncertainties" in the Annual Information Form to be filed on March 27th 2014 with the regulatory authorities.  HDX assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements. 

SOURCE Posera-HDX

For further information: Paul Howell, Chief Executive Officer, Posera-HDX Ltd. (HDX), 350 Bay Street, Suite 700, Toronto, Ontario M5H 2S6, (416) 703-6462 ext. 2263