Belzberg Reports Second Quarter 2008 Financial Results



    TORONTO, Aug. 7 /CNW/ - Belzberg Technologies Inc. (TSX -BLZ), a provider
of technology-based equity and options trading services, announced today that
in the second quarter ended June 30, 2008, the net loss was $0.4 million as
compared to earnings of $1.7 million same quarter last year.
    Total revenues for the second quarter decreased 19% to $9.0 million
versus $11.1 million in the same year-ago period. Diluted loss per share for
the second quarter was ($0.03) per share as compared to earnings of $0.11 per
share in the same year-ago period.

    
    -------------------------------------------------------------------------
    Financial Highlights
    (in millions of dollars,       Three months ended       Six months ended
     except per share data)             June 30,                June 30,
    (unaudited)                     2008        2007        2008        2007
    -------------------------------------------------------------------------
    Revenue                    $     9.0   $    11.1   $    18.6   $    22.0
    Net earnings (loss)        $    (0.4)  $     1.7   $     0.7   $     3.4
    Diluted earnings (loss)
     per share                 $   (0.03)  $    0.11   $    0.05   $    0.22
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    The Company's financial position at June 30, 2008 included cash and cash
equivalents of $22.6 million and working capital of $28.9 million.
    "Results in the second quarter were impacted by higher costs that have
been incurred in anticipation of the company initiating its clearing
business," said Sid Belzberg, CEO of Belzberg. "It is currently expected that
we will have all the necessary approvals in place to commence clearing
operations in the near future. We have also made good progress in building a
pipeline of new clearing and execution customers."

    Revenue

    Total revenue from option contracts traded both electronically and
non-electronically was $3.7 million in the second quarter of 2008 compared to
$4.8 million in the same year-ago quarter. Options revenue in the second
quarter decreased by approximately $0.3 million from a strengthening Canadian
dollar.
    Average total daily volume of electronic equity and index options
contracts traded both electronically and non-electronically on the floor of
the CBOE and on other exchanges were 266,000 contracts per day in the second
quarter of 2008 compared to 287,000 contracts per day in the same year-ago
quarter.
    Total revenue from U.S. equity order flow was $2.6 million in the second
quarter of 2008 compared to $3.5 million in the same year-ago quarter. A
strengthening Canadian dollar impacted U.S. equity revenue by approximately
$0.2 million.

    About Belzberg Technologies

    Belzberg Technologies Inc. is a provider of technology-based brokerage
services, trading equities and options through Electronic Brokerage Systems,
Belzberg Technologies' wholly owned agency-only broker-dealer. Electronic
Brokerage Systems is a member of most North American stock exchanges, options
exchanges and clearing organizations, including the NYSE, NASDAQ, CBOE, NSCC
and OCC. Using Belzberg's suite of integrated trading tools and network
connectivity, Belzberg's customers have direct access to all North American
equities and options markets. The firm's client-base includes over 200 leading
U.S and international brokerage houses and financial institutions. Belzberg
Technologies is listed on the Toronto Stock Exchange (Ticker-BLZ) - additional
information is available at www.belzberg.com.

    Forward looking statement disclaimer

    Except for historical information contained herein, the matters discussed
in this press release are based on forward-looking statements that involve
risk and uncertainty. A variety of important factors could cause results to
differ materially from such statements, including but not limited to economic,
competitive, governmental and technological factors affecting the company's
operation, markets, products, prices and other factors.

    
    Notice
    The consolidated financial statements have not been reviewed by an
    external auditor

    BELZBERG TECHNOLOGIES INC.
    Consolidated Balance Sheets
    (in thousands of Canadian dollars)
    -------------------------------------------------------------------------

                                                       June 30,  December 31,
                                                          2008          2007
                                                    (Unaudited)     (Audited)
                                                  ------------- -------------
    ASSETS

    CURRENT
      Cash and cash equivalents                   $     22,627  $     21,081
      Cash and cash equivalents on deposit with
       clearing and depository organizations             1,687         2,971
      Receivable from brokers, dealers and
       clearing organizations                              481         2,521
      Accounts receivable                                4,721         4,601
      Prepaid expenses and other receivables               577           380
      Other assets                                         597           925
      Investment tax credits recoverable                   529           489
      Future income tax assets                           1,808         2,201
    -------------------------------------------------------------------------
                                                        33,027        35,169

    CAPITAL ASSETS                                       3,428         2,955

    INVESTMENT                                              38            38

    INVESTMENT TAX CREDITS RECOVERABLE                   1,049           972

    FUTURE INCOME TAX ASSETS                               458           290

    GOODWILL                                             1,608         1,608

    OTHER INTANGIBLE ASSETS, NET                           208           240
    -------------------------------------------------------------------------
                                                  $     39,816  $     41,272
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES

    CURRENT
      Accounts payable and accrued liabilities    $      3,778  $      4,053
      Payable to brokers, dealers and clearing
       organizations                                         -         1,915
      Income taxes payable                                   7            13
      Future income tax liabilities                        345           439
      Obligations under capital lease                        -            27
    -------------------------------------------------------------------------
                                                         4,130         6,447

    FUTURE INCOME TAX LIABILITIES                          236           233

    -------------------------------------------------------------------------
                                                         4,366         6,680
    -------------------------------------------------------------------------

    SHAREHOLDERS' EQUITY

    CAPITAL STOCK                                       23,945        39,599

    CONTRIBUTED SURPLUS                                  3,499         3,677

    RETAINED EARNINGS (DEFICIT)                          8,006        (8,684)
    -------------------------------------------------------------------------
                                                        35,450        34,592
    -------------------------------------------------------------------------
                                                  $     39,816  $     41,272
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    BELZBERG TECHNOLOGIES INC.
    Consolidated Statements of Operations and Retained Earnings (Deficit)
    (in thousands of Canadian dollars)
    (Unaudited)
    -------------------------------------------------------------------------
                              Three months ended         Six months ended
                                    June 30,                  June 30,
                                 2008         2007         2008         2007
                           -----------  -----------  -----------  -----------
    REVENUE
      Transaction fees:
        Equity order flow  $    3,157   $    4,142   $    6,936   $    8,351
        Options and
         futures contracts      3,672        4,778        7,288        9,227
    -------------------------------------------------------------------------
                                6,829        8,920       14,224       17,578

      Subscription fees         1,787        1,864        3,640        3,749

      Other revenue               358          322          700          677
    -------------------------------------------------------------------------
    TOTAL REVENUE               8,974       11,106       18,564       22,004
    -------------------------------------------------------------------------

    EXPENSES
      Exchange, clearing
       and brokerage fees       3,136        3,504        5,456        6,734
      Compensation and
       related benefits         2,951        2,716        5,731        5,517
      Telecommunication
       and datafeed
       services                 1,662        1,554        3,216        3,079
      Administrative and
       other expenses           1,416        1,107        2,509        2,322
      Strategic process
       expenses                     -           10            -           98
      Amortization of
       capital assets             496          347          981          677
      Amortization of
       intangible assets           16           16           32           32
      Foreign exchange loss        58          343          117          531
    -------------------------------------------------------------------------
                                9,735        9,597       18,042       18,990
    -------------------------------------------------------------------------

    EARNINGS (LOSS) BEFORE
     THE UNDERNOTED              (761)       1,509          522        3,014

      Interest expense              -            2            -            7
      Interest income            (149)        (195)        (336)        (376)
    -------------------------------------------------------------------------
                                 (149)        (193)        (336)        (369)
    -------------------------------------------------------------------------

    EARNINGS (LOSS) BEFORE
     INCOME TAXES                (612)       1,702          858        3,383

    PROVISION FOR (RECOVERY
     OF) INCOME TAXES
      Current                       -            -            7            -
      Future                     (184)           -          161            -
    -------------------------------------------------------------------------
                                 (184)           -          168            -
    -------------------------------------------------------------------------

    NET EARNINGS (LOSS)          (428)       1,702          690        3,383

    DEFICIT, BEGINNING
     OF PERIOD                 (7,659)     (14,266)      (8,684)     (15,947)

    REPURCHASE OF COMMON
     SHARES                        93            -            -            -

    REDUCTION OF STATED
     CAPITAL                   16,000            -       16,000            -

    -------------------------------------------------------------------------
    RETAINED EARNINGS
     (DEFICIT), END OF
     PERIOD                     8,006      (12,564)       8,006      (12,564)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    EARNINGS (LOSS) PER
     SHARE:
      Basic                $    (0.03)  $     0.12   $     0.05   $     0.23
      Diluted              $    (0.03)  $     0.11   $     0.05   $     0.22
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    WEIGHTED AVERAGE
     NUMBER OF COMMON AND
     COMMON EQUIVALENT
     SHARES OUTSTANDING

      Basic                    14,846       14,665       14,819       14,650
      Diluted                  14,938       15,208       14,936       15,245
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    BELZBERG TECHNOLOGIES INC.
    Consolidated Statements of Cash Flows
    (in thousands of Canadian dollars)
    (Unaudited)
    -------------------------------------------------------------------------

                              Three months ended         Six months ended
                                    June 30,                  June 30,
                                 2008         2007         2008         2007
                           -----------  -----------  -----------  -----------
    CASH PROVIDED BY
     (USED FOR)

    OPERATING ACTIVITIES
      Net earnings (loss)  $     (428)  $    1,702   $      690   $    3,383
      Items not affecting
       cash
        Amortization of
         capital assets           496          347          981          677
        Amortization of
         intangible assets         16           16           32           32
        Unrealized foreign
         exchange loss             49          620         (195)         695
        Stock-based
         compensation              39           43           78           86
        Future income taxes      (178)         125          134          140
      Changes in non-cash
       working capital items     (568)      (1,158)       1,021       (1,644)
    -------------------------------------------------------------------------
                                 (574)       1,695        2,741        3,369
    -------------------------------------------------------------------------

    INVESTING ACTIVITIES
      Purchase of capital
       assets                    (389)        (756)      (1,454)      (1,121)
    -------------------------------------------------------------------------
                                 (389)        (756)      (1,454)      (1,121)
    -------------------------------------------------------------------------

    FINANCING ACTIVITIES
      Repayment of
       obligations under
       capital lease                -          (35)         (27)         (65)
      Repurchase of
       common shares              (37)           -         (273)           -
      Proceeds from the
       exercise of stock
       options                     14           40          364          202
    -------------------------------------------------------------------------
                                  (23)           5           64          137
    -------------------------------------------------------------------------

    Effect of exchange
     rate changes on cash
     and cash equivalents         (49)        (620)         195         (695)
    NET INCREASE (DECREASE)
     IN CASH AND CASH
     EQUIVALENTS               (1,035)         324        1,546        1,690

    CASH AND CASH
     EQUIVALENTS, BEGINNING
     OF PERIOD                 23,662       17,802       21,081       16,436
    -------------------------------------------------------------------------
    CASH AND CASH
     EQUIVALENTS, END OF
     PERIOD                $   22,627   $   18,126   $   22,627   $   18,126
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    CASH AND CASH
     EQUIVALENTS:
      Cash                 $    4,983   $    4,824   $    4,983   $    4,824
      Cash equivalents         17,644       13,302       17,644       13,302
    -------------------------------------------------------------------------
                           $   22,627   $   18,126   $   22,627   $   18,126
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    SUPPLEMENTAL CASH
     FLOW INFORMATION
      Interest received    $      164   $      164   $      345   $      346
      Interest paid                 -            2            -            7
      Income taxes paid            77            -          130            -
    





For further information:

For further information: Sid Belzberg, Chief Executive Officer, Phone:
(416) 360-1812, E-mail: investorinfo@belzberg.com

Organization Profile

BELZBERG TECHNOLOGIES INC.

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