Homeserve Reports Third Quarter Results

TORONTO, Dec. 18 /CNW/ - Homeserve Technologies Inc. today reported net loss of $1.2 million or $0.32 per common share, after preferred share dividends on revenues of $1.2 million for the third quarter ended November 30, 2009, compared to net loss of $1.3 million or $0.33 per common share, after preferred share dividends on revenues of $1.6 million for the same period of the prior fiscal year. The $0.1 million quarter-over-quarter decrease in net loss was primarily attributed to reduced investment income of $0.1 million resulting from the sale of our investment portfolio in the second quarter of Fiscal 2010 and reduced amortization of $0.2 million as a result of an impairment charge taken in the fourth quarter of Fiscal 2009 for software relating to the Aeromove(R) and Move Services Affinity Program ("MSAP") operations.

    
    -------------------------------------------------------------------------
                                                   Three            Nine
                                                Months Ended    Months Ended
                                                November 30,     November 30,
    ($ thousands, except per share amounts)     2009    2008    2009    2008
    -------------------------------------------------------------------------

    Revenue                                    1,217   1,577   9,457  10,158
    Cost of sales                                120      72     399     278
    -------------------------------------------------------------------------
    Gross margin                               1,097   1,505   9,058   9,880
    Operating costs - selling, general and
     administrative                            1,032   1,450   3,139   4,184
    Operating costs - amortization             1,270   1,543   3,814   4,650
    -------------------------------------------------------------------------
    Net income (loss) from operations         (1,205) (1,488)  2,105   1,046
    Gain on sale of short-term investment          -     144     142     367
    Investment income                              -       -     839       -
    -------------------------------------------------------------------------
    Net income (loss) for the period          (1,205) (1,344)  3,086   1,413
    Preferred share dividends                   (984)   (981) (2,973) (2,965)
    -------------------------------------------------------------------------
    Basic and diluted earnings (loss) to
     common shareholders                      (2,189) (2,325)    113  (1,552)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Basic and diluted earnings (loss)
     per common share                         $(0.32) $(0.33)  $0.02  $(0.22)



    Calculation of Earnings per share

    A summary of the components of the Company's diluted earnings per share
    is as follows:
    -------------------------------------------------------------------------
                                                    Three           Nine
                                                Months Ended    Months Ended
    ($ thousands, except number of shares        November 30,    November 30,
     and per share amounts)                     2009    2008    2009    2008
    -------------------------------------------------------------------------

    Net income (loss)                         (1,205) (1,344)  3,086   1,413
    Preferred share dividends                   (984)   (981) (2,973) (2,965)
    -------------------------------------------------------------------------
    Net income (loss) available to common
     shareholders                             (2,189) (2,325)    113  (1,552)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average outstanding common
     shares                                    6,944   6,944   6,944   6,944
    -------------------------------------------------------------------------
    Common shares and common share
     equivalents                               6,944   6,944   6,944   6,944
    -------------------------------------------------------------------------
    Basic and diluted income (loss) per
     common share                             $(0.32) $(0.33)  $0.02  $(0.22)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

Outlook

The award of the Government of Canada Contract ("GOC Contract") for the combined Canadian Forces, Government of Canada Department and Agencies and the Royal Canadian Mounted Police to a subsidiary of BRPS for a five year term with two one-year renewal options, which commenced on December 1, 2009, secures significant relocation volumes from which the Company earns licensing fees. Management anticipates the fees earned from the GOC Contract will provide sustainable cash flows for the Company for the immediately foreseeable future which is expected to mitigate the decline in corporate relocation volumes attributed to the slowdown in the worldwide economy and the continued investment in our Aeromove(R) initiatives.

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.

Additional Information

Detailed financial information and Management's Discussion and Analysis of Results and Financial Condition as at and for the quarter ended November 30, 2009 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 the Company's audited financial statements for the year ended February 28, 2009, which are and is also available on SEDAR's website at www.sedar.com.

%SEDAR: 00004370E

SOURCE HOMESERVE TECHNOLOGIES INC.

For further information: For further information: Jenn Pearce, Homeserve Technologies Inc., (416) 510-5321 or JPearce@homeserve.ca

Organization Profile

HOMESERVE TECHNOLOGIES INC.

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