COM DEV Announces Second Quarter Fiscal 2009 Results



    Company reports record revenue; increases revenue guidance for the year

    CAMBRIDGE, ON, June 11 /CNW/ - COM DEV International Ltd. (TSX:CDV) today
announced its second quarter financial results for the three-month period
ended April 30, 2009. All amounts are stated in Canadian dollars unless
otherwise noted.

    
    Second Quarter Highlights

    -   Revenue was $64.1 million, an increase of 18% over the $54.2 million
        recorded in the second quarter of 2008.

    -   Gross margin was 28%, compared to 24% in Q2 2008.

    -   Net income was $4.9 million, or $0.07 per share, compared to
        $2.0 million or $0.03 per share for the prior year period.

    -   New orders won in the second quarter totaled $50 million, compared to
        $42 million a year earlier and $88 million in the first quarter of
        fiscal 2009.

    -   Backlog at April 30, 2009 was $173 million, compared to $189 million
        three months earlier.

    -   The Company completed an equity financing which raised gross proceeds
        of $23 million, primarily to fund the commercialization of its AIS
        technology.

    -   Subsequent to the end of the quarter, the Company entered into an
        agreement to purchase a building in Cambridge, Ontario with 30,000
        square feet of office and lab space. The building will be occupied by
        COM DEV's Mission Development Group and newly formed subsidiary
        exactEarth(TM) Ltd.
    

    "We generated record revenue in the second quarter and grew our margins
and our bottom line, even as we continued to invest in the growth of the
Company," said John Keating, CEO of COM DEV. "The space sector remains healthy
in the face of broader economic challenges. With a solid backlog and bright
prospects for continuing strength in our new order activity, we are
sufficiently confident to raise our revenue guidance to growth of at least 15%
in fiscal 2009."

    Financial Review

    COM DEV's fiscal 2009 second quarter revenues of $64.1 million
represented an increase of $9.9 million or 18% over the second quarter of
2008. The revenue split between the three market segments was 58% commercial,
26% civil and 16% military, compared to a 61/27/12 split in the second quarter
of 2008. On a year-to-date basis, revenues of $120.6 million are 22% higher
than revenues in the first six months of fiscal 2008. Management now
anticipates full year revenue growth of at least 15%, compared to earlier
guidance of growth of at least 10%.
    COM DEV received new orders totaling $50 million during the quarter, of
which 64% were commercial, and the remainder were civil. In Q2 2008 the
Company booked $42 million of new orders, with a commercial/civil/military
split of 64/34/2.
    Order backlog at quarter-end was $173 million, compared to a record
backlog of $189 million three months earlier, and $120 million one year ago.
Backlog was split between the Company's commercial, civil and military sectors
at a ratio of 45%, 40% and 15% respectively, compared to 44%, 35% and 21% at
the end of Q1 2009.
    Gross margin was $17.8 million in Q2 2009, representing 28% of revenues,
compared to $12.8 million or 24% of revenues in Q2 2008. Improved margins
reflect the positive impacts of a stronger U.S. dollar, and higher volumes of
work flowing through the organization during the period.
    Net research and development expense was $4.5 million in the quarter,
compared to $3.0 million in the second quarter of 2008. The increase was due
to a combination of lower outside funding than the prior year, and spending on
a development project which the Company believes holds potential for future
work in both Europe and North America. Gross R&D spending in the quarter was
$5.5 million, compared to $4.6 million in Q2 2008. Outside funding was $1.0
million in the current quarter, compared to $1.7 million a year earlier.
    Selling, general and administrative expenses were $8.1 million in the
second quarter, compared to $8.5 million in Q2 2008, while as a percentage of
total revenue, SG&A was 13%, down from 16% a year earlier. Reduced costs
associated with the work of the Special Committee were partly offset by
increased costs related to bidding activities, business development, and
corporate development.
    Net income for the quarter was $4.9 million, up from $2.0 million in Q2
2008, while earnings per share were $0.07, compared to $0.03 a year earlier.
    COM DEV ended the quarter with $31.9 million of cash and equivalents,
compared to $9.2 million at January 31, 2009. Operating activities generated
$7.2 million of cash in Q2 2009, while financing activities generated $19.6
million, primarily due to the issuance of 7,797,000 new common shares. At
April 30, 2009, the Company had outstanding debt of $25.5 million including
the current portion, and its $27 million line of credit facility was not drawn
upon.
    COM DEV's basic share count averaged 73,790,688 (fully diluted:
74,009,630) in the second quarter, and stood at 76,100,289 on April 30, 2009.

    Conference Call

    A conference call will be held Thursday, June 11, 2009 at 5:30 pm EDT to
discuss this announcement. To access the live webcast, please visit the
Company's website at www.comdevintl.com or www.newswire.ca for directions.
Participants will require Windows Media Player(TM) to listen to the webcast.

    About COM DEV

    COM DEV International Ltd. (www.comdevintl.com) is a leading global
designer and manufacturer of space hardware subsystems. With facilities in
Canada, the United Kingdom and the United States, COM DEV manufactures
advanced products and subsystems that are sold to major satellite prime
contractors for use in communications, space science, remote sensing and
military satellites.

    This news release contains statements that, to the extent they are not
recitations of historical fact, may constitute "forward-looking statements"
within the meaning of applicable Canadian securities laws. Forward-looking
statements may include financial and other projections, as well as statements
regarding COM DEV's future plans, objectives or economic performance, or the
assumptions underlying any of the foregoing. COM DEV uses words such as "may",
"would", "could", "will", "likely", "expect", "anticipate", "believe",
"intend", "plan", "forecast", "project", "estimate" and similar expressions to
identify forward-looking statements. Any such forward-looking statements are
based on assumptions and analyses made by COM DEV in light of its experience
and its perception of historical trends, current conditions and expected
future developments, as well as other factors COM DEV believes are appropriate
under the relevant circumstances. However, whether actual results and
developments will conform to COM DEV's expectations and predictions is subject
to any number of risks, assumptions and uncertainties. Many factors could
cause COM DEV's actual results, historical financial statements, or future
events to differ materially from those expressed or implied by the
forward-looking statements contained in this news release. These factors
include, without limitation: the determinations made by the special committee
of COM DEV's board of directors which is charged with reviewing COM DEV's
historical stock option granting practices; the determinations made by outside
advisors, auditors and others with respect to this ongoing review;
unanticipated developments and delays encountered during this ongoing review;
developments relating to COM DEV's communication with the Ontario Securities
Commission during this ongoing review; additional corrections that may be
required based on factual findings and analysis obtained during this ongoing
review; legal and accounting developments regarding stock option grants and
interpretations of such guidance; fluctuations in currency exchange rates;
delays in the purchasing decisions of COM DEV's customers; the competition COM
DEV faces in its industry and/or marketplace; and the possibility of
technical, logistical or planning issues in connection with the deployment of
COM DEV's products or services.

    
    The triangular logo and the word COM DEV are each registered trademarks
    and the property of COM DEV Ltd. All rights reserved.


                         COM DEV International Ltd.
                    Consolidated Statements of Operations
        (Canadian dollars in thousands, except for per share figures)
                                  Unaudited

    For the three months ended April 30                    2009         2008
    -------------------------------------------------------------------------

      Revenue                                        $   64,104   $   54,165
      Cost of revenue                                    46,338       41,349
                                                    ------------ ------------
      Gross margin                                       17,766       12,816
                                                    ------------ ------------
      Research and development costs                      5,525        4,633
      Research and development recovery                     987        1,673
                                                    ------------ ------------
      Net research and development                        4,538        2,960
      Selling and general expenses                        8,082        8,497
                                                    ------------ ------------
      Operating income                                    5,146        1,359
      Interest income                                      (101)        (168)
      Foreign exchange loss (gain)                          315         (544)
      Other expense                                          99          109
                                                    ------------ ------------
    Income before non-controlling interest                4,833        1,962
       Non-controlling interest                             (20)          (2)
                                                    ------------ ------------
    Net income                                       $    4,853   $    1,964
                                                    ------------ ------------
                                                    ------------ ------------
    Earnings per share
    Basic and diluted earnings per share             $     0.07   $     0.03



                         COM DEV International Ltd.
                    Consolidated Statements of Operations
        (Canadian dollars in thousands, except for per share figures)
                                  Unaudited

    For the six months ended April 30                      2009         2008
    -------------------------------------------------------------------------

      Revenue                                        $  120,615   $   99,045
      Cost of revenue                                    88,171       75,430
                                                    ------------ ------------
      Gross margin                                       32,444       23,615
                                                    ------------ ------------
      Research and development costs                      9,371        7,407
      Research and development recovery                   2,031        2,430
                                                    ------------ ------------
      Net research and development                        7,340        4,977
      Selling and general expenses                       15,475       15,345
                                                    ------------ ------------
      Operating income                                    9,629        3,293
      Interest expense (income)                             322         (231)
      Foreign exchange (gain) loss                          (87)          26
      Other expense                                         207          176
                                                    ------------ ------------
    Income before non-controlling interest                9,187        3,322
      Non-controlling interest                              (20)          13
                                                    ------------ ------------
    Net income                                       $    9,207   $    3,309
                                                    ------------ ------------
                                                    ------------ ------------
    Earnings per share
    Basic and diluted earnings per share             $     0.13   $     0.05



                         COM DEV International Ltd.
                         Consolidated Balance Sheets
                       (Canadian dollars in thousands)
                                  Unaudited

                                                        As at       As at
                                                       April 30,  October 31,
                                                         2009        2008
    -------------------------------------------------------------------------

    Assets
      Current
        Cash and cash equivalents                    $   31,896   $   16,102
        Accounts receivable                              38,433       41,085
        Inventory                                        60,891       45,941
        Prepaids and other                                2,962        1,772
        Income taxes recoverable                          3,852        2,819
        Future income tax assets - current                3,957        3,957
                                                    ------------ ------------
                                                        141,991      111,676
      Property, plant and equipment                      71,806       71,960
      Intangible assets                                  12,407       13,413
      Goodwill                                            2,618        2,522
      Future income tax assets - long term                3,958        3,958
                                                    ------------ ------------
      Total assets                                   $  232,780   $  203,529
                                                    ------------ ------------
                                                    ------------ ------------
    Liabilities
      Current
        Accounts payable and accrued liabilities     $   31,630   $   35,467
        Deferred revenue                                 21,271       14,828
        Current portion of loans payable                  7,145        6,203
                                                    ------------ ------------
                                                         60,046       56,498
                                                    ------------ ------------

      Long term
        Loans payable                                    18,318       23,223
        Employee future benefits                          2,121        2,224
                                                    ------------ ------------
                                                         20,439       25,447
                                                    ------------ ------------

      Total liabilities                                  80,485       81,945
                                                    ------------ ------------

    Non-controlling interest                                505          524
                                                    ------------ ------------

    Shareholders' equity
      Share capital                                     346,007      323,975
      Contributed surplus                                 2,203        1,879
      Deficit                                          (194,858)    (204,065)
      Accumulated other comprehensive income             (1,562)        (729)
                                                    ------------ ------------
      Total shareholders' equity                        151,790      121,060
                                                    ------------ ------------

    Total liabilities and shareholders' equity       $  232,780   $  203,529
                                                    ------------ ------------
                                                    ------------ ------------



                         COM DEV International Ltd.
                    Consolidated Statements of Cash Flows
                       (Canadian dollars in thousands)
                                  Unaudited

    For the three months ended April 30                    2009         2008
    -------------------------------------------------------------------------

    Operating activities
      Net income from continuing operations          $    4,853   $    1,964
      Amortization                                        2,842        2,025
      Gain on disposal of assets                            (26)        (211)
      Stock compensation expense                            156          122
      Employee stock option plan awards                      97          111
      Unrealized foreign exchange (gain) loss
       on long term debt                                      -           81
      Non-controlling interest                              (20)          (2)
                                                    ------------ ------------
                                                          7,902        4,090
      Net change in non-cash working capital items         (730)      (5,951)
                                                    ------------ ------------
    Operating activities                                  7,172       (1,861)
                                                    ------------ ------------

    Financing activities
      Shares issued                                      21,615            -
      Repayment of long term debt                        (2,045)        (502)
                                                    ------------ ------------
    Financing activities                                 19,570         (502)
                                                    ------------ ------------

    Investing activities
      Acquisition of capital assets                      (3,897)      (2,745)
      Proceeds on disposal of capital assets                 26          213
      Acquisition of intangible assets                      (86)        (208)
      Business acquisition                                 (140)        (297)
                                                    ------------ ------------
    Investing activities                                 (4,097)      (3,037)
                                                    ------------ ------------
    Effect of exchange rate changes on cash                   8            9
                                                    ------------ ------------

    Net increase (decrease) in cash                      22,653       (5,391)
    Cash and cash equivalents, beginning of period        9,243       14,266
                                                    ------------ ------------
    Cash and cash equivalents, end of period         $   31,896   $    8,875
                                                    ------------ ------------
                                                    ------------ ------------

    Interest paid                                    $      228   $      249
                                                    ------------ ------------
                                                    ------------ ------------



                         COM DEV International Ltd.
                    Consolidated Statements of Cash Flows
                       (Canadian dollars in thousands)
                                  Unaudited

    For the six months ended April 30                      2009         2008
    -------------------------------------------------------------------------

    Operating activities
      Net income from continuing operations          $    9,207   $    3,309
      Amortization                                        5,691        3,944
      Gain on disposal of assets                            (26)        (211)
      Stock compensation expense                            386          399
      Employee stock option plan awards                      97           96
      Unrealized foreign exchange (gain) loss
       on long term debt                                      -          643
      Non-controlling interest                              (20)          13
                                                    ------------ ------------
                                                         15,335        8,193
      Net change in non-cash working capital items      (11,915)     (23,230)
                                                    ------------ ------------
    Operating activities                                  3,420      (15,037)
                                                    ------------ ------------

    Financing activities
      Shares issued                                      21,873            2
      Repayment of long term debt                        (3,615)        (902)
                                                    ------------ ------------
    Financing activities                                 18,258         (900)
                                                    ------------ ------------

    Investing activities
      Acquisition of capital assets                      (5,194)      (6,217)
      Proceeds on disposal of capital assets                 26          213
      Acquisition of intangible assets                     (206)        (317)
      Business acquisition                                 (140)        (374)
                                                    ------------ ------------
    Investing activities                                 (5,514)      (6,695)
                                                    ------------ ------------
    Effect of exchange rate changes on cash                (370)          65
                                                    ------------ ------------

    Net increase (decrease) in cash from
     continuing operations                               15,794      (22,567)
    Net cash used in discontinued operations                  -         (271)
                                                    ------------ ------------
    Net increase (decrease) in cash                      15,794      (22,838)
    Cash and cash equivalents, beginning of period       16,102       31,713
                                                    ------------ ------------
    Cash and cash equivalents, end of period         $   31,896   $    8,875
                                                    ------------ ------------
                                                    ------------ ------------

    Interest paid                                    $      677   $      468
                                                    ------------ ------------
                                                    ------------ ------------


                         COM DEV International Ltd.
                 Consolidated Statements of Changes in Equity
                       (Canadian dollars in thousands)
                                  Unaudited


                                             Accumulated
    For the six                                 Other
     months ended                           Comprehensive  Share  Contributed
     April 30, 2009       Total     Deficit     Income    Capital    Surplus
    -------------------------------------------------------------------------

    Balance, October
     31, 2008          $ 121,060  $(204,065) $    (729) $ 323,975  $   1,879

    Comprehensive
     income
      Net Income           9,207      9,207          -          -          -
      Foreign currency
       translation
       adjustments
       (net of taxes
       of $nil)             (833)         -       (833)         -          -
                       ---------- ---------- ---------- ---------- ----------
                           8,374      9,207       (833)         -          -
    Common stock issued   21,873                           22,032       (159)
    Value of ESOP awards      97          -          -          -         97
    Expense recognized
     for stock-based
     compensation            386          -          -          -        386
                       ---------- ---------- ---------- ---------- ----------
    Balance,
     April 30, 2009    $ 151,790  $(194,858) $  (1,562) $ 346,007  $   2,203
                       ---------- ---------- ---------- ---------- ----------
                       ---------- ---------- ---------- ---------- ----------

    -------------------------------------------------------------------------

    For the six
     months ended
     April 30, 2008

    Balance, October
     31, 2007          $ 106,424  $(216,444) $  (1,993) $ 323,862  $     999

    Comprehensive
     income
      Net Income           3,309      3,309          -          -          -
      Foreign currency
       translation
       adjustments
       (net of taxes
       of $nil)              129          -        129          -          -
                       ---------- ---------- ---------- ---------- ----------
                           3,438      3,309        129          -          -
    Common stock issued        2          -          -        113       (111)
    Value of ESOP awards      96          -          -          -         96
    Expense recognized
     for stock-based
     compensation            399          -          -          -        399
                       ---------- ---------- ---------- ---------- ----------
    Balance,
     April 30, 2008    $ 110,360  $(213,135) $  (1,864) $ 323,975  $   1,383
                       ---------- ---------- ---------- ---------- ----------
                       ---------- ---------- ---------- ---------- ----------
    

    %SEDAR: 00003673E




For further information:

For further information: Gary Calhoun, Chief Financial Officer, Tel:
(519) 622-2300 ext. 2826, Fax: (519) 622-2158, gary.calhoun@comdev.ca; Jeff
Codispodi, The Equicom Group, Tel: (416) 815-0700 ext. 261, Fax: (416)
815-0080, jcodispodi@equicomgroup.com

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