Belzberg Reports Second Quarter 2010 Financial Results

TORONTO, Aug. 10 /CNW/ - Belzberg Technologies Inc. (TSX -BLZ), a provider of technology-based equity and options trading services, announced today its financial results for the three months ended June 30, 2010.

Major elements of the second quarter statements include:

    
    -   Loss of $0.7M ($0.05) per share for the second quarter as compared to
        a loss of $2.5M ($0.17) per share for the first quarter of 2010.

    -   Operating expenses decreased 12% or $0.7M from the previous quarter.

    -   Working capital position of $13.8M at June 30, 2010 as compared to
        $14.1M at March 31, 2010.
    

"We are pleased to see the benefits of our operating changes through these improved financial results in the second quarter," said Judith Robertson, President and CEO. "We are managing our resources carefully through this difficult period and continue to seek scale through partnerships or combinations. At the same time, we continue to invest in our products and services to position the company for future growth."

    
    Financial Highlights                             Three months ended
    (in millions of dollars, except
     per share data)                            June 30, March 31,  June 30,
    (Three month periods unaudited)                2010      2010      2009
    -------------------------------------------------------------------------

    Total revenue                               $    4.7  $    5.1  $   10.8

    Net revenue                                 $    3.8  $    4.1  $    6.0

    Operating expenses                          $    5.4  $    6.1  $    7.5

    Net loss                                    $   (0.7) $   (2.5) $   (1.7)

    Net loss before restructuring and unusual
     non-cash charges                           $   (0.9) $   (2.5) $   (1.7)

    Diluted loss per share                      $  (0.05) $  (0.17) $  (0.09)
    Diluted loss per share before restructuring
     and unusual non-cash charges               $  (0.06) $  (0.17) $  (0.09)
    -------------------------------------------------------------------------
    

About Belzberg Technologies

Belzberg Technologies Inc. is a provider of trading technology and technology-based brokerage services for equities and options. 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.

    

    BELZBERG TECHNOLOGIES INC.
    Consolidated Balance Sheets
    (in thousands of Canadian dollars)
    -------------------------------------------------------------------------
                                                       June 30,  December 31,
                                                          2010          2009
                                                    (Unaudited)     (Audited)
                                                    -----------   -----------

    ASSETS

    CURRENT
      Cash and cash equivalents                     $  10,562     $  15,670
      Cash and cash equivalents segregated under
       regulations and other                            1,953         2,805
      Cash and cash equivalents on deposit with
       clearing and depository organizations            1,303         1,363
      Receivable from brokers, dealers and clearing
       organizations                                    1,247           947
      Accounts receivable                               2,197         2,405
      Prepaid expenses and other receivables              641           468
      Income taxes receivable                              12            12
      Investment tax credits recoverable                   11             -
    -------------------------------------------------------------------------
                                                       17,926        23,670

    CAPITAL ASSETS                                      1,516         2,233

    INVESTMENT                                             30            30

    INVESTMENT TAX CREDITS RECOVERABLE                    149           147

    INTANGIBLE ASSETS, NET                                 67           141
    -------------------------------------------------------------------------
                                                    $  19,688     $  26,221
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES

    CURRENT
      Accounts payable and accrued liabilities      $   2,658     $   5,176
      Payable to customers and correspondents           1,362         1,948
      Payable to brokers, dealers and clearing
       organizations                                      102           345
    -------------------------------------------------------------------------
                                                        4,122         7,469

    FUTURE INCOME TAX LIABILITIES                           -             -
    -------------------------------------------------------------------------
                                                        4,122         7,469
    -------------------------------------------------------------------------

    SHAREHOLDERS' EQUITY

    CAPITAL STOCK                                      23,612        23,754

    CONTRIBUTED SURPLUS                                 4,266         4,044

    DEFICIT                                           (12,312)       (9,046)
    -------------------------------------------------------------------------
                                                       15,566        18,752
    -------------------------------------------------------------------------
                                                    $  19,688     $  26,221
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    BELZBERG TECHNOLOGIES INC.
    Consolidated Statements of Operations and Retained Earnings (Deficit)
    (in thousands of Canadian dollars, except per share amounts)
    (Unaudited)
    -------------------------------------------------------------------------

                                    Three months ended      Six months ended
                                           June 30,              June 30,
                                       2010       2009       2010       2009
                                  ---------- ---------- ---------- ----------

    REVENUE

      Equity order flow and
       clearing                   $   1,663  $   6,242  $   3,817  $  12,532
      Options and futures
       contracts                      1,829      2,997      3,540      6,186
      Subscription fees                 841      1,223      1,776      2,618
      Other revenue                     362        360        675        772
    -------------------------------------------------------------------------
                                      4,695     10,822      9,808     22,108
      Cost of exchange and
       clearance fees                  (872)    (4,809)    (1,884)    (9,368)
    -------------------------------------------------------------------------
    TOTAL NET REVENUE                 3,823      6,013      7,924     12,740
    -------------------------------------------------------------------------

    EXPENSES
      Compensation and related
       benefits                       2,157      3,162      4,709      6,917
      Telecommunication and
       datafeed services              1,560      2,067      3,260      4,117
      Administrative and other
       expenses                         732      1,052      1,497      2,242
      Brokerage fees                    517        669      1,184      1,654
      Amortization of capital assets    410        534        852      1,057
      Amortization of intangible
       assets                            37         55         74        110
    -------------------------------------------------------------------------
                                      5,413      7,539     11,576     16,097
    -------------------------------------------------------------------------

    LOSS BEFORE THE UNDERNOTED       (1,590)    (1,526)    (3,652)    (3,357)

      Restructuring expenses
       (recovery)                      (221)         -       (221)       839
      Government assistance             (11)       (95)       (11)       (95)
      Foreign exchange loss (gain)     (636)       364       (154)       532
      Interest expense                    -         12          3         18
      Interest income                    (1)       (44)        (3)      (131)
    -------------------------------------------------------------------------
                                       (869)       237       (386)     1,163
    -------------------------------------------------------------------------

    LOSS BEFORE INCOME TAXES           (721)    (1,763)    (3,266)    (4,520)

    RECOVERY OF INCOME TAXES
      Current                             -          -
      Future                              -       (358)         -     (1,291)
    -------------------------------------------------------------------------
                                          -       (358)         -     (1,291)
    -------------------------------------------------------------------------

    NET LOSS                           (721)    (1,405)    (3,266)    (3,229)

    RETAINED EARNINGS (DEFICIT),
     BEGINNING OF PERIOD            (11,591)     5,610     (9,046)     7,434

    -------------------------------------------------------------------------
    RETAINED EARNINGS (DEFICIT),
     END OF PERIOD                $ (12,312) $   4,205  $ (12,312)     4,205
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    EARNINGS (LOSS) PER SHARE:
      Basic                       $   (0.05) $   (0.09) $   (0.22) $   (0.22)
      Diluted                     $   (0.05) $   (0.09) $   (0.22) $   (0.22)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    WEIGHTED AVERAGE NUMBER OF
     COMMON AND COMMON EQUIVALENT
     SHARES OUTSTANDING
      (in thousands)
      Basic                          14,638     14,829     14,657     14,832
      Diluted                        14,638     14,829     14,657     14,832
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    BELZBERG TECHNOLOGIES INC.
    Consolidated Statements of Cash Flows
    (in thousands of Canadian dollars)
    (Unaudited)
    -------------------------------------------------------------------------
                                    Three months ended      Six months ended
                                           June 30,              June 30,
                                       2010       2009       2010       2009
                                  ---------- ---------- ---------- ----------

    CASH PROVIDED BY (USED FOR)

    OPERATING ACTIVITIES
      Net loss                     $    (721) $  (1,405) $  (3,266) $ (3,229)
      Items not affecting cash
        Amortization of capital
         assets                          410        534        852     1,057
        Amortization of intangible
         assets                           37         55         74       110
        Unrealized foreign exchange
         loss (gain)                    (457)        68        (92)      382
        Gain on sale of investment         -          -          -        (5)
        Stock-based compensation          68         80        147       143
        Future income taxes                -       (111)         -    (1,125)
      Changes in non-cash working
       capital items                      13      7,159     (2,713)   (2,093)
    -------------------------------------------------------------------------
                                        (650)     6,380     (4,998)   (4,760)
    -------------------------------------------------------------------------

    INVESTING ACTIVITIES
        Purchase of capital assets       (42)      (415)      (135)     (842)
        Purchase of intangibles            -          -          -        (7)
        Purchase of investment             -          -          -        (2)
        Proceeds from sale of
         investment                        -          -          -        15
    -------------------------------------------------------------------------
                                         (42)      (415)      (135)     (836)
    -------------------------------------------------------------------------

    FINANCING ACTIVITIES
        Repurchase of common shares        -          -        (67)      (10)
    -------------------------------------------------------------------------
                                           -          -        (67)      (10)
    -------------------------------------------------------------------------

    Effect of exchange rate changes
     on cash and cash equivalents        457        (68)        92      (382)
    NET DECREASE IN CASH
        AND CASH EQUIVALENTS            (235)     5,897     (5,108)   (5,988)

    CASH AND CASH EQUIVALENTS,
        BEGINNING OF PERIOD           10,797      7,567     15,670    19,452
    -------------------------------------------------------------------------
    CASH AND CASH EQUIVALENTS,
        END OF PERIOD              $  10,562  $  13,464  $  10,562  $ 13,464
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    CASH AND CASH EQUIVALENTS:
        Cash                       $   4,565  $   4,648  $   4,565  $  4,648
        Cash equivalents               5,997      8,816      5,997     8,816
    -------------------------------------------------------------------------
                                   $  10,562  $  13,464  $  10,562  $ 13,464
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    SUPPLEMENTAL CASH FLOW
     INFORMATION
      Interest received            $       1  $      49  $        3 $    139
      Interest paid                        -         12           3       18
      Income taxes paid                    -          -           -       15
    

SOURCE BELZBERG TECHNOLOGIES INC.

For further information: For further information: Judith Robertson, President and Chief Executive Officer, Phone: (416) 360-1812, E-mail: investorinfo@belzberg.com

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BELZBERG TECHNOLOGIES INC.

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