Urbanimmersive Technologies reports its financial results for the second quarter of 2012-2013

TSX VENTURE EXCHANGE SYMBOL - UI

Highlights (as at May 28, 2013)

  • Promising initial adoption of AVU3D® technology in the real estate market;
  • Signature of AVU3D® technology agreements with Sutton Quebec and RE/MAX Promotional Funds Inc.;
  • Signature of an AVU3D® technology agreement with Astral TV Plus;
  • Signature of an AVU3D® technology agreement with Services Immobiliers Terramont, specialized in commercial brokerage;
  • Signature of an AVU3D® technology agreement with Plogg Solutions Inc., owner of AppartMap.com, a real estate leasing website;
  • Signature of an AVU3D® technology license with CREO, specialized in serious gaming;
  • Significant increase of AVU3D® immersive visits positioning into Google™ search engine and  of world-wide and national internet ranking of www.avu3d.com site;
  • Launch of the portal www.avu3d.com in its beta version;
  • Launch of the mobile version of AVU3D® for Android mobile platforms.

MONTREAL, May 30, 2013 /CNW Telbec/ - Urbanimmersive Technologies Inc. ("Urbanimmersive Technologies") (TSXV: UI), today presented its unaudited consolidated financial results, including those of Urbanimmersive Inc. ("Urbanimmersive" and, collectively with Urbanimmersive Technologies, the "Corporation"), its wholly owned subsidiary, for the second quarter ended March 31, 2013. As anticipated by the Company during the previous quarter, revenue decreased significantly in the second quarter of 2013 compared to revenues for the second quarter of 2012 due to the decision by the company to refocus its development strategy on the real estate market by allocating its direct sales and marketing resources as well as its research and development team on this market. Indeed, the revenue for the three months period ended March 31, 2013 totalled $178,759 compared to total revenues of $306,622 for the same period of 2012. This bold strategy has enabled the Company to make significant progress into the real estate market and build a solid foundation with key players in this global industry.

"We are very pleased to observe signs that the company's strategic plan provides the desired effects" said Ghislain Lemire, president and CEO of Urbanimmersive Technologies. "The decision to reduce the sales and production efforts of rendered 3D imaging products to focus the company's efforts on AVU3DMD products in the real estate brokerage market is bearing fruit. In fact, considerable progress has been made in the AVU3DMD commercialization plan with the signing of important agreements with leading real estate agencies. Strong demand for AVU3DMD products from the agents demonstrates that the adoption of AVU3DMD process is definitely underway. "In the upcoming quarters, the company intends to support this adoption rate with an innovative business model focussing on the needs and realities of real estate agents. Furthermore, additional products and features will soon be integrated to immersive real estate visits, potentially providing additional monetization sources for the Company. "

"The strong initial adoption rate of AVU3D® immersive technology observed during the second quarter of 2013, together with recent business alliances and negotiations with other real estate agencies and the maturity gained on its AVU3D® technology enabled Urbanimmersive's Management to be very optimistic about the next real estate high season beginning at the end of September. Our organizational structure and our systems have been strongly tested in recent months due to the record number of orders received and our teams rose brilliantly to the challenge. "

Qualifying Transaction

As communicated previously, on October 4, 2012, Urbanimmersive Technologies announced the closing of the acquisition (the "Acquisition") of all of the securities of Urbanimmersive and of a concurrent private placement for aggregate proceeds of $2,500,000 (the "Offering"). The Acquisition constituted the Qualifying Transaction of Urbanimmersive Technologies pursuant to Policy 2.4 of the TSX Venture Exchange Inc. (the "Exchange"). As part of the Qualifying Transaction, Urbanimmersive Technologies acquired all of the shares and debentures of Urbanimmersive in exchange for the issuance of an aggregate of 8,311,441 common shares of Urbanimmersive Technologies (the "Common Shares") at a deemed price of $0.75 per Common Share for a total consideration of $6,233,580.

On October 12, 2012, the Corporation announced that the Exchange had accepted for filing its Qualifying Transaction and had issued its final exchange bulletin. As a result, trading in the Common Shares of Urbanimmersive Technologies resumed at the opening of the markets on Monday, October 15, 2012. In addition, the name of the Corporation was changed from UI Capital Inc. to Urbanimmersive Technologies Inc.

Operating Results

The net loss for the second quarter ended March 31, 2013 was $531,682 or ($0.04) per share, compared to a net loss of $204,766 or ($0.05) per share for the same period ended March 31, 2012. The net loss for the six month period ended March 31, 2013 was $2,035,884 or ($0.15) per share compared to $469,521 or ($0.11) per share for the same period of 2012.

The net loss increases of $326,916 for the three months period and $2,035,883 for the six month period are due to important changes further described hereinafter.

During the three-month period ended March 31, 2013 the Corporation's revenues decreased from $306,622 for the same period of 2012, to $178,759 a decrease of $127,863 or 41.7%. During the six-month period ended March 31, 2013, the Corporation's revenues decreased to $515,402 from $570,322 for the same period of 2012, an amount of $54,920 or 9%. These decreases are mainly due to the refocus of the Corporation's sales efforts and the sales deployment on AVU3D® immersive visits in the real estate market with affiliated real estate agencies, following the conclusion of agreements with Sutton and RE/MAX.

Due to lower revenue while maintaining the same level of staffing, gross profit during the first quarter of 2013 was $3,403 or 2% of revenue compared to $108,210 or 35.3%, in the second quarter of 2012, a decrease of $104,807. This also impacted the gross profit for the six-month period ended March 31 2013, which was $158,036 or 30.7% compared to $186,039 or 32.6% for the same period of 2012. The cost of sales includes mainly the salaries of the 3D services production employees, amortization of property and equipment as well as intangible assets related to sales and the pro-rated share of administrative costs.

Operating expenses totalled $528,434 during the second quarter of 2013 compared to $263,673 for the same period of 2012, an increase of $264,669 or 100.3%. In addition, during the six-month period ended March 31, 2013, operating expenses totalled $898,817 compared to $564,366 for the same period of 2012, an increase of $334,451 or 59%. Such increases are mainly due to officers compensation in salaries during the first quarter of 2013 and the six-month period ended March 31, 2013, instead of compensation through share redemptions in lieu of their salaries during the same periods of 2012, as well as share-based payments of $72,542 for the three-month period and a total of $81,109 for the six-month period ended March 31, 2013. As a result, the operating loss was $524,939 during the second quarter of 2013 compared to a loss of $155,463 for the same period of 2012, an increase of $369,476. The operating loss was $740,780 for the six-month period ended March 31, 2013 compared to a loss of $378,327 for the same period of 2012.

For the second quarter of 2013, other expenses totalled $6,742 compared to $49,303 for the same period of 2012, a decrease of $42,561 due to significantly lower financial expenses following the Qualifying Transaction of the Corporation on October 4, 2012, more specifically due to the conversion of convertible debentures into common Shares.

For the six-month period ended March 31, 2013, other expenses were unusually high due to the conclusion of the Qualifying Transaction and the Offering. Despite a reduction of $76,695 in financial expenses, from $91,194 to $14,499 compared to the same period of 2012, primarily due to the conversion of the convertible debentures into common Shares, the non-cash expense related to the Exchange listing of Urbanimmersive totalled $1,181,417. In addition, the Corporation accounted for a $99,187 loss resulting from an amendment to a convertible debenture, as detailed in note 5 of the interim financial statements.

As of March 31, 2013, the Corporation had working capital of $823,160 of which $890,082 was in cash, compared to a working capital deficit of $2,833,753 as of September 30, 2012, an improvement of $3,656,913. This change was primarily due to the conclusion of the Qualifying Transaction leading to gross proceeds of $2,225,000, as well as the conversion of convertible debentures, subscription receipts and the share capital redeemable at the holder's option, and the reduction in trade and other payables and bank loans. The working capital as of March 31, 2013 also included the private placement completed by the Corporation as of November 22, 2012 through the issuance of 200,000 Common Shares at $0.75 per share for aggregate proceeds of $150,000.

As of this present date, the Corporation believes it will not have sufficient liquidity to fund its operations and capital needs for the next 12 months and consequently anticipates that it will be have to raise capital over the next quarters to generate cash in sufficient amounts to meet its business plan objectives.

Selected Financial Information (in thousands of $)

The operating results for each of the last eight quarters are presented in the following table. Management considers that the information for each of these quarters was determined in the same way as for our audited financial statements for the year ended September 30, 2012.  These consolidated interim financial statements are unaudited.

  Consolidated
Results
Urbanimmersive Inc. Results Urbanimmersive Inc.
Results
  FY 2013 FY 2012 FY 2011
  Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3
  $ $ $ $ $ $ $ $
Total revenue 179 337 192 251 307 263 249 245
Gross profit 3 155 33 63 108 78 71 55
Operating loss (532) (1,504) (478) (258) (205) (265) (253) (278)
Basic and diluted net loss per Common Share (0.040) (0.113) (0.098) (0.055) (0.050) (0.057) (0.053) (0.058)

Appointment of a Chief Financial Officer 

The Corporation is pleased to announce that Isabelle Gauthier, CPA, CA, has been appointed Chief Financial Officer. Mrs. Gauthier's nomination is effective since May 1st, 2013.

Mrs. Gauthier is a chartered accountant, member of the "Ordre des comptables professionnels agréés du Québec" since 1998 and holds a Bachelor of Business Administration. She held the position of Senior Director within the firm Raymond Chabot Grant Thornton for which she worked as an Auditor from 1996 to 2006. This past position allowed Mrs. Gauthier to acquire a solid experience in management and presentation of financial information.

Ms. Gauthier provides financial consulting services to several publicly listed companies, including three mining exploration companies, where she serves as Vice-President of Finance.

With this addition to the executive team, the Corporation will benefit from Mrs. Gauthier's vast experience and knowledge of finance and stock markets. This new appointment will certainly contribute to the Corporation's success.

About Urbanimmersive

Headquartered in Laval, Québec, the Corporation is a leading-edge digital media company that combines its innovative immersive technology with high quality visual content to offer, in the real estate online, offline and mobile advertising markets, digital media visual content immersive solutions. The Corporation also licenses its full suite of software and technology to channel partners in other markets. The Corporation currently has 35 employees.

The Corporation is a one stop shop for visual content digital media in the real estate market.  Its customers consist of residential, commercial and industrial realtors, agents and home builders to whom the Corporation offers an innovative and unique immersive technology which products are utilized for real estate online, offline and mobile advertising, as well as a large range of visual content services. AVU3D®, the Corporation's immersive multimedia technology, produces 3D immersive environments of real and future building assets through which vendors and customers can interact online, either with one another or with objects present in the virtual environment, as if they were fully immersed in it. The Corporation's comprehensive suite of software related to its AVU3D® immersive technology enables its partners and advertisers to add elements such as hot spots containing links, videos, and gaming elements.  It allows for an engaging immersive user experience therefore providing a better multimedia and interactive experience for internet users.

The Corporation's visual content services include the production of 3D drawings, images and 3D animations, interactive color changing application and 3D online immersive environments.

The Corporation has a limited direct sales force however it reaches the real estate market through specialized resellers including architectural photographers, virtual tour providers, web site producers, architects and marketing communication agencies.

The Corporation's immersive technology is also applied to other markets such as, but not limited to, serious games, advergames, security, building and facility management and business advertising.  The Corporation reaches other market segments through channel partners with which it enters into license agreements enabling them to integrate Urbanimmersive's immersive multimedia technology into their business strategy as a value added offer to their customers.

Caution Concerning Forward-Looking Statements

Certain statements made in this press release are forward-looking statements or information. The Corporation is hereby providing cautionary statements identifying important factors that could cause the Corporation's actual results to differ materially from those projected in the forward-looking statements. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases such as "may", "is expected to", "anticipates", "estimates", "intends", "plans", "projection", "could", "vision", "goals", "objective" and "outlook") are not historical facts and may be forward-looking and may involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. In making these forward-looking statements, the Corporation has assumed that the current market will continue and grow and that the risks listed below will not adversely impact the business of the Corporation. By their nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, which contribute to the possibility that the predicted outcomes may not occur or may be delayed. The risks, uncertainties and other factors, many of which are beyond the control of the Corporation that could influence actual results include, but are not limited to: future capital requirements; intellectual property protection and infringement risks; competition; reliance on key management personnel and the other risks factors summarized under the heading "Risks and Uncertainties" in the Corporation management discussion and analysis dated May 28, 2013.

Furthermore, unless otherwise noted, any forward-looking statement speaks only as of the date of this press release, and, except as required by applicable law, the Corporation does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all such factors and to assess in advance the impact of each such factor on the business of the Corporation, or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statement. For additional information with respect to certain of these and other assumptions and risk factors, please refer to the Corporation's management discussion and analysis dated May 28, 2013 and filed with the Canadian securities commissions.

*        *        *

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States or to any U.S. Persons. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended, or the securities laws of any state of the United States of America and may not be offered or sold within the United States of America or its territories or possessions unless pursuant to an exception therefrom.

Neither 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. 

SOURCE: Urbanimmersive Technologies

For further information:

Ghislain Lemire,
President and CEO
514-394-7820 or ghislainlemire@urbanimmersive.com

OR

Nicole Blanchard
Sun International Communications
(450) 973-6600
Nicole.blanchard@isuncomm.com

Profil de l'entreprise

Urbanimmersive Technologies

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