TORONTO, May 13 /CNW/ - MedcomSoft Inc. (TSX - MSF) today announced its
financial results for the third quarter ended March 31, 2008.
Summary of Operating Results and Highlights
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Consolidated revenues for the three-month period ending March 31, 2008
decreased by $116,456 or 23% to $386,204 from $502,660 in the same period last
year. On a year to date basis, revenues for the nine months of fiscal 2008
decreased by $136,860 or 12% to $993,606 from $1,130,466 in the comparable
period of fiscal 2007.
Overall operating expenses for the third quarter of fiscal 2008 decreased
by $229,991 or by 12% to $1,641,791 from $1,871,782 in the third quarter of
fiscal 2007. On a year to date basis, total operating expenses for the nine
months of fiscal 2008 increased by $104,644 or 2% to $5,040,023 from
$4,935,379 in the comparable period of fiscal 2007.
The Company incurred a net loss for the third quarter of fiscal 2008 of
$1,250,795 or a loss of $0.02 per common share, compared to a net loss of
$1,351,439 or $0.02 per common share in the third quarter of the prior year.
On a year to date basis, the Company incurred a net loss in fiscal 2008 of
$4,025,519 or a loss of $0.05 per common share, compared to a net loss of
$3,754,206 or $0.06 per common share for the comparative period in fiscal
2007.
During its third fiscal quarter, the Company made changes to the
composition and structure of its board of directors. Effective January 2,
2008, the board accepted the resignations of Peter Langer, Dr. Peter Aldor,
Dr. Ross Black and Dr. Thomas A. Riemenschneider. Replacing the former
directors, Dr. Steven Small, Mr. John Gillberry and Mr. Ray Simonson were
appointed to the board. Dr. Steven Small was appointed Chairman of the board
and Chairman of the Special Executive Committee, comprised of Dr. Small and
Mr. Gillberry, and supported by former healthcare investment banker Mr. Robert
Wilson, a Senior Research Director of the Florida Institute for Human and
Machine Cognition (FIHMC) on a consultative basis to conduct an independent
strategic review of the Company - including, among other things, its
go-to-market strategies, strategic alliances, capitalization and human
resource requirements.
The Company closed private placement equity financings during the third
quarter consisting of the issue of a total of 14,988,000 common shares and
2,222,400 compensation warrants raising gross proceeds of $1,840,000.
Business Highlights
During the period, the Company entered into new sales contracts valued at
more than $850 thousand over the next 20 months with two practice management
groups based in the USA and Puerto Rico.
The Company accepted the KLAS Enterprises' 2007 Year-End Best in KLAS
Award in the Ambulatory (1-5 Physicians) category at the HIMSS 2008 Conference
in February. Additionally, MedcomSoft Record user, Alicia V. Valdez, M.D.,
received the prestigious Davies Ambulatory Care Award of Excellence for her
use of Record in her Valdez Family Clinic.
Subsequent to the quarter end, the Company entered into a Non-binding
Letter of Agreement and Strategic Alliance with eQuality Healthcare
Information for Physicians, LLC, (eQHIP), a wholly owned subsidiary of the
Hawaii Independent Physician's Association, Hawaii's largest and only
statewide Independent Physician Association ("IPA") with more than 750
physicians, for the purpose of deploying MedcomSoft Record throughout the
State of Hawaii. Under the agreement, eQHIP will provide the implementation,
training and support services to its members and MedcomSoft has agreed to
supply eQHIP with up to 250 MedcomSoft Record licenses over a period of
18 months.-------------------------------------------------------------------------
Three months ended Nine months ended
March 31, March 31,
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Operating Results 2008 2007 2008 2007
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Revenue $ 386,204 $ 502,660 $ 993,606 $ 1,130,466
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Departmental
Operating Expenses:
Sales and
marketing 303,657 562,513 1,088,441 1,426,756
Services 293,245 384,985 994,954 956,064
Research and
development 311,262 314,829 980,469 753,853
General and
administrative 528,391 410,445 1,379,443 1,265,926
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Total departmental
operating expenses 1,436,555 1,672,772 4,443,307 4,402,599
Licenses and other
product costs 35,769 26,330 97,770 74,664
Amortization 17,163 14,552 51,635 41,694
Stock compensation 150,585 156,736 441,927 411,163
Interest expense 1,719 1,392 5,384 5,259
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Total operating
expenses 1,641,791 1,871,782 5,040,023 4,935,379
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Loss from
operations (1,255,587) (1,369,122) (4,046,417) (3,804,913)
Interest Income 4,792 17,683 20,898 50,707
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Net loss for
the period $(1,250,795) $(1,351,439) $(4,025,519) $(3,754,206)
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Average number of
shares outstanding 79,755,991 68,202,479 73,397,897 64,137,847
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Net earnings
(loss) per share:
- non-diluted basis (0.02) (0.02) (0.05) (0.06)
- diluted basis (0.02) (0.02) (0.05) (0.06)
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March 31, June 30,
Financial Position (as at) 2008 2007
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Cash 1,153,015 1,874,460
Other current assets 464,922 380,977
Capital assets and long term assets 294,472 323,670
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Total assets 1,912,409 2,579,107
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Current liabilities 1,360,324 1,309,732
Long term capital lease obligations 34,109 49,992
Shareholders' equity 517,976 1,219,383
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Total liabilities and shareholders' equity 1,912,409 2,579,107
-------------------------------------------------------------------------The Company had cash of $1,153,015 as at March 31, 2008 compared to
$1,874,460 at June 30, 2007 for a net outflow of cash of $721,445 for the nine
month period in fiscal 2008.
Cash used in operating activities comprised the majority of the use of
cash during the third quarter of fiscal 2008, of $966,780, compared with
$1,260,752 in the third quarter of the prior year. There were limited
investing activities in the third quarter of fiscal 2008, which were
consistent with the investing activities of the comparative period in the
prior year. Financing activities were $1,696,259 due mainly to the private
placement equity financings closed in the third quarter of fiscal 2008
compared with financing activities of $4,921 for the third quarter of the
prior year.
As at March 31, 2008, the Company had working capital of $257,613 and a
shareholders' equity of $517,976, which is not sufficient to sustain
operations over the next 12 months. The Company has not been profitable over
the past six years and its ability to continue as a going concern is dependent
upon its ability to generate future profitable operations and to obtain the
necessary financing to meet its obligations and repay its liabilities arising
from normal business operations when they come due.
The Company believes that in order to alleviate liquidity concerns and
achieve sustained profitability it is imperative to develop other strategic
relationships and further strengthen its balance sheet. The Company is
pursuing various alternatives to achieve these objectives.
For further details on these operational and business highlights as well
as the financial results of the Company for third quarter of fiscal 2008,
please see the Company's Interim Management's Discussion and Analysis of
Financial Condition and Results of Operations and the Company's Interim
Unaudited Consolidated Financial Statements for the third quarter of fiscal
2008, which will be filed later today on SEDAR at www.sedar.com.
About MedcomSoft Inc.:
Founded in 1994, MedcomSoft Inc. develops cutting edge software solutions
for the healthcare industry. MedcomSoft has pioneered the use of numerically
codified point-of-care clinical terminologies to create a new generation of
highly interoperable EHRs, which significantly enhance disease surveillance
and accelerate clinical research. MedcomSoft award winning software
applications includes Electronic Health Records, physician order entry systems
with e-prescribing, document management, practice management and clinical data
search, data mining and disease surveillance systems.
MedcomSoft is the recipient of the "Best of KLAS" award in 2007 year-end
report in the Ambulatory EMR 1-5 Physicians category. In addition a MedcomSoft
practice was recently awarded the prestigious 2007 HIMSS Davies Award.
www.medcomsoft.com.
This news release contains forward-looking statements regarding
MedcomSoft's expectations and beliefs with respect to future events and/or
financial performance. These forward-looking statements involve known and
unknown risks, uncertainties and other factors, which may cause the actual
events or results to differ materially from those expressed or implied in such
forward looking statements. Such factors and risks include, but are not
limited to, market conditions, competition including price and product
functionality; economic environment; and the ability to develop and deliver
new products in a timely manner. The reader is referred to the documents that
the Company files from time to time with applicable Canadian securities and
regulatory authorities for a discussion on certain risks and uncertainties
that could cause actual results to differ from those projected, anticipated or
implied. MedcomSoft does not undertake to update forward-looking statements.
%SEDAR: 00010549E
For further information: Steven Small, MedcomSoft Inc., Phone: (877)
673-0101, Fax: (416) 443-9693, www.medcomsoft.com
