IDC reports second quarter 2008 results



    CALGARY, July 31 /CNW/ - Imaging Dynamics Company Ltd. (IDC or the
Company) (TSX: IDL) a global supplier in the digital radiography (DR)
equipment market, today reported financial results for the second quarter
ending June 30, 2008. For the second quarter of 2008, IDC reported a loss of
$0.05 per share on revenues of $5,327,965 as compared to a loss of $0.04 per
share on revenues of $9,274,939 for the same quarter last year.

    
    Second Quarter Highlights

      -  Raised $9.4 million though a prospectus/private placement offering;

      -  Purchase Orders received during the quarter and opening backlog
         totaled $7.3 million ($5.3 shipped and recognized, $2.0 booked to
         closing backlog);

      -  Cash and cash equivalents net of short-term borrowing increased by
         $1.8 million compared to December 31, 2007 and by $1.2 million
         compared to March 31, 2008;

      -  Reduced receivables by $4.2 million compared to December 31, 2007 on
         the collection of $14.9 million during the six months and by
         $2.1 million compared to March 31, 2008 on the collection of
         $6.4 million during the quarter;

      -  Reduced inventory by $3.3 million compared to December 31, 2007 and
         by $1.4 million compared to March 31, 2008;

      -  Reduced payables and accruals by $9.1 million compared to
         December 31, 2007 and by $7.2 million compared to March 31, 2008;

      -  Reduced expenses by 30% compared to the same quarter last year and
         by 23% on a year to date basis compared to the same period last
         year;

      -  Gross revenues were lower by 43% compared to the same quarter last
         year and by 31% on a year to date basis compared to the same period
         last year; which was largely due to the decline in revenues in
         United States ("US") and Latin America;

      -  Gross margins were 24% for the quarter and on a year to date basis
         were 29% which were also impacted due to lower margin sales during
         the quarter, foreign exchange impact on gross revenues, the
         continued utilization of inventory that was purchased during
         previous quarters when the US- Canadian dollar exchange rate was
         much higher and inventory adjustments during the quarter to ensure
         proper valuation.
    

    Commenting on the second quarter 2008 results, Tom Boon, IDC's President
& CEO said, "While I am pleased with IDC's ability to raise money and in the
overall improvement in our balance sheet, we must offset the softness on the
U.S. market with growth opportunities in the international and emerging
markets where the IDC brand is strong and our value proposition gives IDC a
competitive advantage. I remain confident that the opportunities we see in the
second half of 2008 will position IDC for profitable growth and industry
leadership with our patented and award winning CCD based DR technology."

    A conference call to review the results will take place on Friday,
August 1, 2008 at 8:00 a.m. EDT (6:00 a.m. MDT). To participate in the call,
please dial 416.644.3419 or 800.731.5319 approximately 5 minutes prior to the
conference call.


    
    Imaging Dynamics Company Ltd.
    Consolidated Balance Sheets

    As at                                              June 30   December 31
                                                          2008          2007
    -------------------------------------------------------------------------

    Assets                                          (Unaudited)     (Audited)
    Current Assets
      Cash and cash equivalents                   $  2,535,926  $  1,460,554
      Receivables                                    8,013,893    12,219,209
      Inventory                                     10,879,761    14,142,710
      Prepaids and deposits                            747,659     1,100,558
                                                  ------------- -------------

                                                    22,177,239    28,923,031
    Property, plant and equipment                    1,777,950     1,880,932
    Intangible assets                                  232,667       244,912
                                                  ------------- -------------

                                                  $ 24,187,856  $ 31,048,875
                                                  ------------- -------------
                                                  ------------- -------------
    Liabilities and Shareholders' Equity
    Current Liabilities
      Short-term borrowing                        $    498,975  $  1,260,244
      Payables and accruals                          5,350,683    14,421,090
      Customer deposits                                333,466       345,140
      Loan payable                                           -        45,013
      Warranty liability                               956,483     1,098,287
                                                  ------------- -------------

                                                     7,139,607    17,169,774
                                                  ------------- -------------

    Shareholders' Equity
      Share capital                                 70,246,559    65,983,374
      Contributed surplus                            5,305,295     4,743,668
      Warrants                                       4,053,035             -
      Deficit                                      (62,556,640)  (56,847,941)
                                                  ------------- -------------

                                                    17,048,249    13,879,101
                                                  ------------- -------------

                                                  $ 24,187,856  $ 31,048,875
                                                  ------------- -------------
                                                  ------------- -------------

    -------------------------------------------------------------------------
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    Imaging Dynamics Company Ltd.
    Consolidated Statements of Operations, Comprehensive Loss and Deficit
    (Unaudited)
    -------------------------------------------------------------------------
                              Three Months Ended            Six Months Ended
                      --------------------------- ---------------------------
                           June 30       June 30       June 30       June 30
                              2008          2007          2008          2007
                      ------------- ------------- ------------- -------------
    Revenues, net     $  5,327,965  $  9,274,939  $ 11,716,760  $ 17,059,069

    Cost of goods sold   4,071,449     5,430,197     8,342,237    10,059,784
                      ------------- ------------- ------------- -------------

    Gross profit         1,256,516     3,844,742     3,374,523     6,999,285
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------
    Expenses
      Sales and
       marketing         1,331,340     1,800,508     2,810,322     3,592,029
      General and
       administrative    1,100,413     1,404,284     2,345,960     2,594,129
      Production and
       manufacturing       456,004       360,113     1,010,878       792,632
      Research and
       development         551,994       563,346     1,185,669     1,139,213
      Foreign exchange
       loss                223,375       933,478        64,793     1,119,563
      Warranty             160,937       307,722       318,844       545,142
      Stock-based
       compensation        184,839       428,102       561,627       819,210
      Bad debts            251,866       226,360       251,866       226,360
      Amortization         180,649       337,088       358,288       682,479
      Interest              77,028       135,670       201,811       245,220
                      ------------- ------------- ------------- -------------
                         4,518,445     6,496,671     9,110,058    11,755,977
                      ------------- ------------- ------------- -------------
    Loss before
     interest and
     other income       (3,261,929)   (2,651,929)   (5,735,535)   (4,756,692)

    Interest and
     other income           11,753        24,567        26,836        52,933
                      ------------- ------------- ------------- -------------
    Net loss, being
     comprehensive
     loss             $ (3,250,176) $ (2,627,362) $ (5,708,699) $ (4,703,759)
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

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

    Net loss per share
      Basic and
       diluted        $      (0.05) $      (0.04) $      (0.09) $      (0.08)
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

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

    Deficit, beginning
     of period        $(59,306,464) $(44,658,966) $(56,847,941) $(42,582,569)

    Net loss, being
     comprehensive
     loss               (3,250,176)   (2,627,362)   (5,708,699)   (4,703,759)
                      ------------- ------------- ------------- -------------
    Deficit, end of
     period           $(62,556,640) $(47,286,328) $(62,556,640) $(47,286,328)
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Imaging Dynamics Company Ltd.
    Consolidated Statement of Cash Flows
    (Unaudited)
    -------------------------------------------------------------------------

    Increase (decrease) in cash and cash equivalents are as follows:

                              Three Months Ended            Six Months Ended
                      --------------------------- ---------------------------
                           June 30       June 30       June 30       June 30
                              2008          2007          2008          2007
                      ------------- ------------- ------------- -------------
    Cash flows from
     operating
     activities
      Net loss        $ (3,250,176) $ (2,627,362) $ (5,708,699) $ (4,703,759)
        Items not
         affecting cash
          Amortization     180,649       337,088       358,288       682,479
          Stock-based
           compensation    184,839       428,102       561,627       819,210
          Warranty        (166,378)      250,636      (141,804)      324,575
                      ------------- ------------- ------------- -------------
                        (3,051,066)   (1,611,536)   (4,930,588)   (2,877,495)

      Change in non-
       cash working
       capital          (3,877,182)    3,540,149    (1,260,917)    1,186,325
                      ------------- ------------- ------------- -------------

                        (6,928,248)    1,928,613    (6,191,505)   (1,691,170)
                      ------------- ------------- ------------- -------------
    Cash flows from
     financing
     activities
      Proceeds from
       share issuances,
       net               8,316,220       361,168     8,316,220       408,568
      Short-term
       borrowing, net     (745,333)   (1,069,481)     (761,269)     (224,836)
      Repayment of
       loans payable       (31,000)      (25,000)      (45,013)      (25,000)
                      ------------- ------------- ------------- -------------

                         7,539,887      (733,313)    7,509,938       158,732
                      ------------- ------------- ------------- -------------
    Cash flows used
     in investing
     activities
      Property, plant
       and equipment
       additions          (142,252)      (87,511)     (243,061)     (264,172)
                      ------------- ------------- ------------- -------------

    Net change in cash
     and cash
     equivalents           469,387     1,107,789     1,075,372    (1,796,610)

    Cash and cash
     equivalents
      Beginning of
       period            2,066,539     2,996,793     1,460,554     5,901,192
                      ------------- ------------- ------------- -------------

    End of period     $  2,535,926  $  4,104,582  $  2,535,926  $  4,104,582
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

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

    About IDC

    IDC (Imaging Dynamics Company) is a medical technology company and
innovative force in the fast-growing field of digital radiography (DR)
technology. IDC's X-Series of direct capture technology replaces conventional
film-based X-rays and provides a cost-effective alternative to cassette based
film or computed radiography (CR) systems.
    Each IDC DR solution provides high resolution radiographic images in the
digital format required for today's electronic medical record networks, all
without the use of film, environmentally harmful chemicals, cassettes or
expensive imaging plates. In addition to its number one ranking for three
consecutive quarters for customer service by MD Buyline, IDC is the recipient
of the 2007 Frost & Sullivan Technology Innovation Award and is among the 2007
Deloitte Technology Fast 500, which ranks the fastest growing technology,
media, telecommunications and life sciences companies in North America.
    IDC is based in Calgary, Alberta, Canada.
    You may also visit the IDC Web site: www.imagingdynamics.com.

    Statements in this release which describe IDC's intentions, expectations
or predictions, or which relate to matters that are not historical facts are
forward-looking statements. These forward-looking statements involve known and
unknown risks and uncertainties which may cause the actual results,
performances or achievements of IDC to be materially different from any future
results, performances or achievements expressed in or implied by such
forward-looking statements. IDC may update or revise any forward-looking
statements, whether as a result of new information, future events or changing
market and business conditions. Known and unknown risks and uncertainties
include: IDC's ability to manufacture its products with a sufficient level of
quality and in volumes which satisfy market demand; the ability of IDC to
establish direct and indirect sales channels; the ability of IDC to establish
industry partnerships; IDC's ability to attract and retain key personnel; the
strength and breadth of IDC's patents; and other factors relating to general
economic conditions, specific industry conditions and IDC's particular
situation.

    %SEDAR: 00007697E




For further information:

For further information: Tom Boon, President and CEO; Swapan Kakamanu,
Chief Financial Officer, 1-866-975-6737, info@imagingdynamics.com,
www.imagingdynamics.com

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Imaging Dynamics Company Ltd.

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