Homeserve Reports Second Quarter Results



    TORONTO, Oct. 18 /CNW/ - Homeserve Technologies Inc. today reported net
income of $0.032 million ($0.14 loss per common share) on revenues of $2.6
million for the second quarter ended August 31, 2007 compared to net income of
$1.0 million ($0.04 per common share) on revenues of $2.4 million for the same
period of the last fiscal year. The $1.0 million quarter-over-quarter decrease
in net income was primarily attributed to a $0.6 million increase in
amortization of intangible assets resulting from additional consideration
earned under terms of the ICON acquisition and $0.5 million increase in costs
associated with the Aeromove program. Partially offsetting these amounts was a
$0.1 million decrease in costs associated with our HomeLink operations.

    
                                       Three months Ended   Six months Ended
    ($ thousands, except per share           August 31          August 31
     amounts)                              2007     2006      2007      2006
    -------------------------------------------------------------------------

    Revenue                               2,591    2,360     8,239     7,793
    Cost of sales                            61        -        68         -
    -------------------------------------------------------------------------
    Gross profit                          2,530    2,360     8,171     7,793
    Operating costs                       1,343      769     3,195     1,579
    -------------------------------------------------------------------------
    Contribution margin                   1,187    1,591     4,976     6,214
    Investment income                       360      343       736       709
    Gain on sale of investments               -        -         -        23
    Amortization                         (1,515)    (896)   (3,021)   (1,781)
    -------------------------------------------------------------------------
    Net income for the period                32    1,038     2,691     5,165
    -------------------------------------------------------------------------
    Basic earnings/(loss) available
     to common shareholders                (962)     263       703     3,616
    Diluted earnings/(loss) available
     to common shareholders                (962)     263       703     3,616
    Basic and diluted earnings/(loss)
     per common share
      Basic                             $ (0.14)  $ 0.04    $ 0.10    $ 0.52
      Diluted                           $ (0.14)  $ 0.04    $ 0.10    $ 0.52



    Calculation of Earnings per share

                                      Three months Ended    Six months Ended
                                            August 31             August 31
    ($ thousands)                          2007     2006      2007      2006
    -------------------------------------------------------------------------

    Net income                               32    1,038     2,691     5,165
    Dividends paid on preferred shares     (994)    (775)   (1,988)   (1,549)
    -------------------------------------------------------------------------
    Basic earnings/(loss) available
     to common shareholders                (962)     263       703     3,616
    -------------------------------------------------------------------------
    Diluted net income/(loss)
     available to common shareholders      (962)     263       703     3,616
    -------------------------------------------------------------------------
    

    Outlook

    Homeserve is well positioned to be a leading technology and marketing
services company in the home and move sector by leveraging its technology
assets, and relationships with related Brookfield companies in the Centract
Residential Real Estate portfolio and through a strategic focus on marketing
services in relevant sectors. In addition to Aeromove, we will look at
leveraging the move services platform by developing partnerships with other
loyalty programs which seek to reach the Canadian moving population with a
one-stop move services program.
    While markets for software remain uncertain, we are optimistic that the
sustainable stable cash flows from the ICON acquisition combined with
licensing opportunities from the Company's CRM software and move services
program model, will position the Company well for the future growth.
    Homeserve will consider seeking a re-listing of the Company's common
shares when there is a reasonable probability of returning value to common
shareholders after having considered the overall capitalization of the Company
and in particular the servicing of the obligations related to the Company's
preferred shares.

    Additional Information

    Detailed financial information and Management's Discussion and Analysis
of Results and Financial Condition as at and for the quarter ended August 31,
2007 is posted on Homeserve's website (under Investor Relations, Financial
Information) at www.homeserve.ca and should be read in conjunction with this
press release and is also available on SEDAR's website at www.sedar.com.

    About Homeserve

    Homeserve is a Canadian based software development and services company
focused on home-related services for the real estate, relocation and banking
industries. Homeserve provides a one-stop shopping service for home buyers and
sellers, offering real-estate related products and services throughout the
customer's purchasing and selling cycle, coordinated by a proprietary CRM
software system and contact centre.

    Forward - Looking Statements

    This press release contains forward-looking information, including
"forward-looking statements". The words "will", "intends", "expected" and
other expressions which are predictions of or indicate future events and
trends and which do not relate to historical matters identify forward looking
statements. Reliance should not be placed on forward-looking statements
because they involve known and unknown risks, uncertainties and other factors,
which may cause Homeserve's performance to differ materially from the
description of the investment expressed or implied by such forward-looking
statements. Although Homeserve believes that the anticipated future results,
performance or achievements expressed or implied by the forward-looking
statements and information are based upon reasonable assumptions and
expectations, the reader should not place undue reliance on forward-looking
statements and information because they involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to differ materially from
anticipated future results, performance or achievement expressed or implied by
such forward-looking statements and information. Factors that could cause
actual results to differ materially from those contemplated or implied by
forward-looking statements include general economic conditions; interest rate
changes; availability of equity and debt financing; and other risks and
factors described from time to time in the documents filed by the Company with
the securities regulators in Canada including in the Annual Information Form
under the heading "Risk Factors." The Company undertakes no obligation to
publicly update or revise any forward-looking statements or information,
whether as a result of new information, future events or otherwise.

    %SEDAR: 00004370E




For further information:

For further information: Susana Hsu, Mansfield Communications Inc.,
(416) 599-0024 or susana@mcipr.com

Organization Profile

HOMESERVE TECHNOLOGIES INC.

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