TORONTO, March 31 /CNW/ - Hosted Data Transaction Solutions Inc. ("HDX")
announced today its financial results for the fiscal year and three-month
period ending December 31, 2007. HDX (formerly Dexit Inc.) is listed on the
TSX under the symbol HDX.
Revenue increased to $2,649,265 for the year ended December 31, 2007.
This represents an increase of 162% from revenue of $1,010,287 for the
previous year. HDX expanded its product and service offering in 2007 and
completed the acquisition of the quick service restaurant division of Howell
Data Systems Inc. (QSR) on August 3, 2007. The Company consequently recognized
five months of revenue and earnings from QSR during the period.
Operating expenses for the year ended December 31, 2007 declined to
$2,390,206 from $9,247,666 reported in the previous year. The decrease of
$6,857,460 in operating expenses was due to management's continued focus on
cost cutting measures.
The net loss for the year ended December 31, 2007 was $896,764, or $0.05
per share. This result is $6,971,034 better than the net loss of $7,867,798,
or $0.76 per share for the previous year. The significant turnaround is
attributable primarily to the continued cost rationalization and operational
focus which the Company has imposed over the last year.
As at December 31, 2007, the Company had cash, cash equivalents and short
term investments of $4.48 Million. The number of shares outstanding as at
December 31, 2007 was 26,487,693.
The main highlight of 2007 is that the Company completed the acquisition
of the quick service restaurant division of Howell Data Systems Inc. (QSR) on
August 3, 2007.
QSR is a profitable business that develops, sells, and installs
touch-screen point of sale software, enterprise management software, and the
associated system hardware components. QSR also provides ongoing software and
hardware support to merchants that utilize the company's solutions from coast
to coast. The Company intends to utilize this acquisition to be the platform
upon which it will grow HDX both organically and via additional acquisitions
that are accretive to the Company.
The Company raised $5.43 million by way of a private placement during
2007 to fund the $4 million cash component of the QSR purchase price and
provide additional working capital to the Company.
In conjunction with the completion of the QSR acquisition, the Company
changed its name to Hosted Data Transaction Solutions Inc. and started trading
under a new ticker symbol "HDX".
On October 12, 2007, the Company completed a rights offering raising
gross proceeds of $1.88 million, resulting in the issuance of 2,355,006 Common
Shares and 1,177,499 warrants.
During 2007 the Company deployed the Dexit RFID payment solution
integrated with touch screen point of sale equipment. The system was deployed
in a closed loop, private branded configuration at merchant locations
including high school cafeterias, corporate cafeterias, and quick service
restaurants with drive through.
On November 14, 2007, HDX entered into a letter of intent to acquire
Sabrepoint Inc. ("Sabrepoint"), a point-of-sale technology company, for
$1,250,000 subject to closing adjustments. The transaction closed on
February 19, 2008 and the purchase price was satisfied by the payment of
$850,000 in cash and by the issuance of 400,000 HDX common shares. The final
purchase price is subject to post closing adjustments if applicable by HDX,
customary closing conditions, receipt of all necessary regulatory approvals
and the negotiation and execution of a definitive purchase and sale agreement.
On November 20, 2007, HDX entered into a letter of intent to acquire
Biz-Pro Ltd. (Biz-Pro), a point-of-sale technology company, for $3,000,000
subject to closing adjustments. The transaction closed on January 16, 2008 and
the purchase price was satisfied by the payment of $2,000,000 in cash and by
the issuance of 1,000,000 HDX common shares. The final purchase price is
subject to post closing adjustments if applicable by HDX, customary closing
conditions, receipt of all necessary regulatory approvals and the negotiation
and execution of a definitive purchase and sale agreement.
The historical pro-forma consolidated HDX, Sabrepoint, and Biz-Pro
revenue is approximately $10 million per annum. Sabrepoint and Biz-Pro have
historically generated positive net income and positive cash flow from
operations. HDX intends to achieve economies of scale from the amalgamation of
Additional information on HDX's 2007 financial results will be available
in the financial reports filed by the Company with Sedar at www.sedar.com and
posted to the Investor Relations section of the Company's website at
About the Company
Hosted Data Transaction Solutions Inc. is in the business of managing
merchant transactions with consumers and facilitating payment. HDX develops
and deploys touch screen POS system software and associated enterprise
management tools and has developed and deployed numerous POS applications. HDX
also provides system hardware integration services, merchant staff training,
system installation services, and post sale software and hardware support
HDX leading edge technology also includes customer self serve kiosks and
"line buster" mobile point of sale terminals. These products have been
designed to dramatically enhance customer throughput and drastically reduce
customer queues. These technologies are especially effective in high foot
traffic environments that have limited cash register counter space, limited
retail square footage, and the absence of a drive through.
HDX pioneered an "instead of cash"(R) electronic based payment
facilitation service. The Dexit(R) Service can be private branded for a
specific merchant and enables customers to pay for items quickly and
conveniently with the tap of a RFID (radio frequency identification) tag
linked to a pre-paid account. This Dexit(R) Service payment solution is
especially well suited for corporate and institutional cafeteria environments
where hundreds of customers purchase and pay for meals in compressed periods
throughout the business day.
This discussion includes certain forward-looking statements that are
based upon current expectations, which involve risks and uncertainties
associated with our business and the environment in which the business
operates. Any statements contained herein that are not statements of
historical facts may be deemed to be forward-looking, including those
identified by the expressions "anticipate", "believe", "plan", "estimate",
"expect", "intend", and similar expressions to the extent they relate to the
Company or its management. The forward-looking statements are not historical
facts, but reflect Dexit's current expectations regarding future results or
events. These forward-looking statements are subject to a number of risks and
uncertainties that could cause actual results or events to differ materially
from current expectations, including the matters discussed under "Risks and
Uncertainties" in the Annual Information Form filed on April 2, 2007 with the
regulatory authorities. Dexit assumes no obligation to update the
forward-looking statements, or to update the reasons why actual results could
differ from those reflected in the forward-looking statements.
(R) Registered trade-mark of Dexit Inc.
For further information:
For further information: Paul Howell, President/CEO, Hosted Data
Transaction Solutions Inc. (HDX), (416) 703-6462, extension 263