In-Touch Survey Systems Ltd. announces Q2 2009 financial results



    OTTAWA, Aug. 14 /CNW Telbec/ - In-Touch Survey Systems Ltd. ("In-Touch"
TSX-Venture: INX) is pleased to announce that revenue grew by 8% to $1,414,500
in Q2 2009 compared to $1,313,120 in Q2 2008. Net loss for Q2 2009 was $89,267
similar to a net loss of $86,263 in Q2 2008.
    The strength of the Canadian dollar caused a foreign exchange loss of
$28,500 in Q2 2009 compared to a gain of $1,000 in Q2 2008. FY 2008 Audit
costs were $23,000 higher because of the two acquisitions in 2008. Net income
was negatively affected because of the product mix as noted below. Also,
Market Research revenues were not as high as expected.
    Cash flow from operations (adjusted EBITDA - see details in MD&A) was
$27,000 in Q2 2009 compared to $30,000 in Q2 2008. The Q2 2009 gross margin
was 58% compared to 64% in Q2 2008. Manual Data Collection ('MDC') revenues
grew by 20% which accounted for most of the revenue increase. MDC gross
margins are typically 40% compared to 70% gross margins for Electronic Data
Collection ('EDC'). The sales mix volume, favouring MDC products, was the main
factor in the gross margin decrease.
    "Even though over one million dollars worth of EDC orders for 2009 were
cancelled due to the economic downturn, Electronic Data Collection ('EDC') Q2
2009 revenues were flat compared to Q2 2008. Our acquisition strategy and hard
work by the sales team have largely mitigated the effects of a challenging
economic period and maintained Q2 EDC revenues at last year's levels. We are
closely monitoring Q3 sales as this is when the largest sales order
cancellations occurred last year," said Michael Gaffney, Chief Executive
Officer.

    
    Consolidated Statements of Operations              Q2 2009      Q2 2008
                                                    ------------ ------------

    Revenue                                         $ 1,414,500  $ 1,313,120

    Cost of services and goods sold                     600,409      473,922
                                                    ------------ ------------

    Gross profit                                        814,091      839,198

    Total operating expenses                            831,612      912,914
                                                    ------------ ------------
    Earnings (loss) before undernoted items             (17,521)     (73,716)

    Interest expense                                    (40,098)     (20,332)
    Amortization of financing costs                      (2,670)      (8,123)
    Amortization of discount on promissory note               -      (16,292)
    Amortization of intangible asset                     (2,682)     (12,997)
    Change in fair value of derivative                        -       44,123
    Gain (loss) on foreign exchange                     (28,491)       1,074
    Gain on disposal of property and equipment            2,195            -
                                                    ------------ ------------
    Net loss                                        $   (89,267) $   (86,263)
                                                    ------------ ------------
                                                    ------------ ------------
    

    Certain statements included in this news release contain forward looking
statements, which by their nature are necessarily subject to risks and
uncertainties and other factors that may cause actual results, performance or
achievements of the Company to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. Such statements reflect the Company's current
views with respect to future events, and are based on information currently
available to the Company and on hypotheses which it considers to be
reasonable; however, management warns the reader that hypotheses relative to
future events which are beyond the control of management could prove to be
false, given that they are subject to certain risks and uncertainties.

    
    The TSX Venture Exchange has not reviewed the foregoing and has neither
    approved or disapproved the contents of this press release.
    

    %SEDAR: 00007687E




For further information:

For further information: Karen McNaughton,
kmcnaughton@intouchsurvey.com, Director of Marketing, (613) 270-7913

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In-Touch Survey Systems Ltd.

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