Genesis Worldwide Inc. Announces Third Quarter 2011 Financial Results

MISSISSAUGA, ON, Nov. 29, 2011 /CNW/ - Genesis Worldwide Inc. ("Genesis" or the "Company"), (NEX: GWI.H), a leading provider of green and sustainable structural building products and technology in the light steel structural products industry, today announces its unaudited financial results for the third quarter and nine months ended September 30, 2011.  All dollar amounts are in Canadian dollars unless otherwise stated.

Financial Highlights

  • Revenue for the third quarter ended September 30, 2011 and 2010 was $nil.  Revenue for the nine months ended September 30, 2011 was $nil, compared to $174,069 for the same period in 2010. The decrease was primarily due to the Company's focus on completing the restructuring, divestiture and cost containment plan implemented during fiscal 2010.

  • Operating expenses for the third quarter ended September 30, 2011 increased to $422,646, compared to $239,248 for the same quarter in 2010.  The increase in operating expenses was due to an increase in general and administrative expenses as a result of increased personnel expenses, public company expenses and accrued expenses, and an increase in occupancy expenses related to a rent provision posted during the second quarter of fiscal 2011 associated with a sub-lease agreement. Operating expenses for the nine months ended September 30, 2011 decreased to $1,381,619, compared to $2,005,328 for the same period in 2010. The decrease was due to the cost saving initiatives, restructuring and the divesture of the Company's structural products division.

  • Net loss from continuing operations for the third quarter ended September 30, 2011 was $277,801, or ($0.00) per common share, compared to a net loss from continuing operations of $520,191, or ($0.01) per common share for the same quarter in 2010.  Net loss from continuing operations for the nine months ended September 30, 2011 was $1,624,189, or ($0.02) per common share, compared to a net loss from continuing operations of $2,165,379, or ($0.04) per common share for the same period in 2010.

Business Update

As previously announced on July 29, 2011, the Company is developing a new version of its FrameBuilder design software and a cloud based version of QuoteBuilder and GNET (the Company's technical library).  The Company will proceed to rollout the standalone version of FrameBuilder in the fourth quarter of 2011 and a beta version of a cloud based version of QuoteBuilder by the second quarter of fiscal 2012.

In addition, the Company also announced on July 29, 2011 that it had hired a software developer during the first quarter of fiscal 2011 to aid in its development of the first five dimensional ("5D") building information modeling system ("BIM").  This new technology will combine new software with the Company's existing software platform and provide the user with a more complete model of their project which includes the dimensions of length, width, height, time and cost. The new software product is scheduled for beta testing in the second quarter of fiscal 2012.

"With our new software initiatives, our signing of a $2.8 million equipment contract with our Vietnam licensee, and the signing of agreements with two separate sales agents for the sale of license, services and equipment agreements to provide the Genesis Solution to private business development companies in Brazil, Libya and the United States, we are on track to building the Company towards profitability", stated Richard Pope, Chairman and Chief Executive Officer of the Company.

Further information regarding the Company, and its business and operations, may be obtained from the Company's continuous disclosure documents filed from time-to-time with the Canadian securities regulatory authorities. These continuous disclosure documents are available through the Company's web site at www.genesisworldwide.com, or through the SEDAR web site maintained by the Canadian securities regulatory authorities, which can be accessed at www.sedar.com.

About Genesis Worldwide Inc.

Genesis is a provider of green light steel building technology and solutions targeted at the global commercial, residential and institutional building sectors. Genesis delivers customized turnkey structural solutions, and provides software packages, industrial equipment, training programs, professional services and support ("Genesis Solution") to its customers and partners globally.  Headquartered in the Greater Toronto Area in Ontario, Canada, Genesis has established a network of partners with engineering, manufacturing and distribution operations in Canada, the United States, the Middle East, Eastern Europe, Russia and South East Asia.  For additional information about the Company, visit www.genesisworldwide.com.

Caution Regarding Forward-Looking Information

Certain statements in this press release which are not historical facts constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws ("forward-looking statements") and are made pursuant to the "safe harbour" provisions of such laws. Statements related to the Company's projected revenues, earnings, growth rates, performance, business prospects and opportunities are forward-looking statements, as are any statements relating to future events, conditions or circumstances. The use of terms such as "may", "will", "should", "plan", "believes", "predict", "potential", "anticipate", "expect", "project", "target", "estimate", "continue", and similar terms are intended to assist in identification of these forward-looking statements.  These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects, and opportunities.  These assumptions, although considered reasonable by the Company at the time of preparation, may prove to be incorrect.

Readers are cautioned not to place undue reliance upon such forward-looking statements.  Such forward-looking statements are not promises or guarantees of future performance and involve both known and unknown risks and uncertainties that may cause the actual results, performance or achievements of the Company to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements.

Many factors could cause the actual results of the Company to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements, including, without limitation, those factors discussed under the heading "Risk Factors" in the Company's most recent Annual Information Form ("AIF"), a copy of which is available on SEDAR at www.sedar.com.  Forward-looking statements are based on management's current plans, estimates, projections, beliefs and opinions, and, except required by law, the Company does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Genesis Worldwide Inc.            
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
          2010  
      September 30, 2011   December 31,  
Assets            
Current assets:            
Cash     $                         4,182   $              7,051  
Accounts receivable, net     358,853   357,732  
Inventory, net     -   556  
Prepaid expenses     5,731   57,794  
      368,766   423,133  
Non-current assets:            
Notes receivable     570,402   1,049,704  
Property, plant and equipment     12,724   15,888  
Deposits     87,733   88,483  
Intangible assets     -   -  
Total assets     $                  1,039,625   $       1,577,208  
             
Liabilities            
Current liabilities:            
Accounts payable and accrued liabilities     $                  2,882,727   $       2,609,470  
Short term loan payable     10,348   154,628  
Deferred revenue     -   349,215  
      2,893,075   3,113,313  
             
Non-current liabilities:            
Long term payables     185,234   144,092  
Provision     1,494,230   1,076,738  
      1,679,464   1,220,830  
Shareholders' equity (deficiency):            
Share capital     62,356,666   61,830,420  
Contributed surplus     2,227,114   1,905,150  
Accumulated deficit     (68,116,694)   (66,492,505)  
Total equity     (3,532,914)   (2,756,935)  
             
Total liabilities and equity     $                  1,039,625   $       1,577,208  

       
Genesis Worldwide Inc.
CONDENSED CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
     
(unaudited)        
                 
    Three Months Ended September 30,   Nine Months Ended September 30,
    2011   2010   2011   2010
                 
Revenue   $                      -   $                      -   $                      -   $                174,069
Cost of revenue   -   11,768   -   40,027
Gross profit   -   (11,768)   -   134,042
                 
Operating expenses:                
Marketing and sales   -   47,712   6,302   395,206
Research and development   -   31,895   75,368   166,831
General and administrative   242,433   136,486   785,318   1,358,579
Occupancy   180,213   23,155   514,631   84,712
Total operating expenses   422,646   239,248   1,381,619   2,005,328
Operating loss before other expenses   (422,646)   (251,016)   (1,381,619)   (1,871,286)
Miscellaneous revenue and expense   -   273,866   -   273,866
                 
Amortization of property, plant and
equipment
  1,055   341   3,164   1,026
Amortization of intangible assets   -   1,364   -   4,090
Bad debt expense   (181,999)   -   154,852   -
Foreign exchange gain   (2,885)   (11,602)   (6,084)   (17,940)
Bank charges, interest expense
and penalty charges
  38,984   5,206   90,638   33,051
Net loss   (277,801)   (520,191)   (1,624,189)   (2,165,379)
Other comprehensive income,
net of tax
  -   -   -   -
Comprehensive loss   (277,801)   (520,191)   (1,624,189)   (2,165,379)
Loss per share                
Basic and diluted   $                 (0.00)   $                 (0.01)   $                 (0.02)   $                 (0.04)
Weighted average number of shares
outstanding
  82,167,550   56,462,351   78,317,694   54,871,796
                 

Genesis Worldwide Inc.                
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
                 
    Three Months
Ended
September 30
  Three Months
Ended
September 30,
  Nine Months
Ended
September 30,
  Nine Months
Ended
September 30,
    2011   2010   2011   2010
                 
OPERATING ACTIVITIES                
Net loss for the period             $ (277,801)   $ (520,191)   $  (1,624,189)   $  (2,165,379)
Adjustments for non-cash items                
Depreciation and amortization of property, plant and            
equipment and intangible assets   1,055   -   3,164   1,705
Bad debt   138,995   -   479,302   -
Provision for liabilities   222,423   -   417,492   -
Stock-based compensation expense   15,562   99,889   81,158   79,036
    100,234   (420,302)   (643,073)   (2,084,638)
Changes in non-cash working capital balances                    
  related to operations                    
Accounts receivable   (5,062)   (266,530)   (1,121)   (177,905)
Unbilled revenue   -   607,466   -   950,929
Inventories and deposits on equipment   -   9,504   556   28,763
Prepaid expenses   13,568   (16,107)   52,813   (37,777)
Accounts payable and accrued liabilities   74,428   196,499   273,257   755,084
Deferred revenue   (331,228)   (2,115)   (349,215)   (82,298)
Cash in trust   -   -   -   100,000
Cash provided by (used by) operating activities   (148,060)   108,415   (666,783)   (547,842)
                     
FINANCING ACTIVITIES                    
Notes receivable   -   -   -   -
Repayment on term loan   10,349   -   (103,138)   -
Common stock issued   -   -   526,246   575,197
Contributed surplus   -   -   240,806   -
Cash provided by financing activities   10,349   -   663,914   575,197
                     
INVESTING ACTIVITIES                    
Additions to property, plant and equipment   -   341   -   (1,638)
Disposals of property, plant and equipment   -   (1,485)   -   -
Minimum royalties paid   -   (99,823)   -   (96,141)
Cash used by investing activities   -   (100,967)   -   (97,779)
                     
Net increase (decrease) in cash                    
  during the year   (137,711)   7,448   (2,869)   (70,424)
Cash, beginning of year   141,893   (5,966)   7,051   71,906
Cash, end of year   4,182   1,482   4,182   1,482

 

SOURCE Genesis Worldwide Inc.

For further information:

Genesis Worldwide Inc.
Richard Pope         
Chief Executive Officer
Tel: (707) 478-6250

Profil de l'entreprise

Genesis Worldwide Inc.

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