Look Communications Reports Second Quarter 2009 Results



    
    Look Comments on Industry Canada Consultation on Transition to Broadband
    Radio Service (BRS) in the Band 2500-2690 MHz
    

    TORONTO and MONTREAL, April 29 /CNW/ - Look Communications Inc. ("Look"
or the "Corporation") (TSX Venture: LOK and LOK.A) today reported its
financial and operating results for the second quarter of fiscal 2009, ended
February 28, 2009.

    
    Highlights for the second quarter ended February 28, 2009 included the
    following:

    -   Service and sales revenue from continuing operations for the quarter
        ended February 28, 2009 was $3.3 million compared to $4.4 million for
        the quarter ended February 29, 2008;

    -   Operating expenses increased approximately $0.4 million or 9.5% to
        $4.8 million for the quarter ended February 28, 2009 (quarter ended
        February 29, 2008 - $4.4 million);

    -   EBITDA (earnings from continuing operations before interest expenses,
        income taxes, depreciation and amortization, and gain (loss) on
        disposition of property and equipment) for the quarter ended
        February 28, 2009 was negative $2.4 million compared to negative
        $1.1 million for the quarter ended February 29, 2008;

    -   The loss and comprehensive loss from continuing operations for the
        quarters ended February 28, 2009 and February 29, 2008 was
        $3.4 million or $0.03 per share and $2.5 million or $0.02 per share
        respectively;

    -   Unrestricted cash and cash equivalents increased by $0.5 million or
        15.5% during the six months ended February 28, 2009 from $3.6 million
        at August 31, 2008 to $4.1 million at February 28, 2009;

    -   During the six months ended February 28, 2009 and February 29, 2008,
        the Corporation recorded income and comprehensive income from the
        discontinued operation of the web hosting and domain name business of
        $4.5 million, or $0.03 per share, and $1.1 million, or a nominal
        amount per share, respectively; and

    -   Industry Canada released the long-anticipated Notice No. DGRB-005-09
        - Consultation on Transition to Broadband Radio Service (BRS) in the
        Band 2500-2690 MHz (see detail below).
    

    Subsequent to the second quarter ended February 28, 2009, and during the
Corporation's Plan of Arrangement approved by the Ontario Superior Court of
Justice on January 21, 2009, on March 6, 2009, Industry Canada (the
"Department") released the long-anticipated Notice No. DGRB-005-09 -
Consultation on Transition to Broadband Radio Service (BRS) in the Band
2500-2690 MHz (the "Spectrum Consultation"). The Spectrum Consultation is
seeking, amongst other things, consultation on the criteria to be used in the
issuance of BRS licences to operators of qualified Multipoint Communication
System (MCS) licences and Multipoint Distribution Service (MDS)
authorizations. The Spectrum Consultation also introduced the Stakeholder
Proposal Development (SPD) process which involves the facilitation of
discussions with MCS and MDS incumbents with the goal of developing proposals
to align the spectrum that would be retained by incumbents following the
transition to BRS with a new internationally compatible band plan applicable
to BRS.
    In the Spectrum Consultation, the Department has stated the following:

    
    "At the World Radiocommunication Conference in 2000 (WRC-2000), the band
    2500 to 2690 MHz was identified for IMT-2000 radio services (also known
    as third generation mobile or 3G services). The identification of this
    band by the (International Telecommunication Union) (the "ITU") has
    created significant interest, as it is the only band identified by the
    ITU for next generation mobile services on a global basis. High-capacity
    mobile services may be offered in this band because of good radio
    propagation characteristics, the prospect of relatively low-cost
    equipment and the large spectrum blocks that can accommodate the latest
    broadband technologies. These factors make this spectrum unique and
    valuable."

    In addition, the Department is seeking comments on, amongst other things:

    1.  Whether the Department adopt a firm transition date of March 31, 2011
        to BRS rather than renew MCS and MDS licences;
    2.  The options that should be applied to the Manitoba school boards and
        the commercial MCS licensee;
    3.  Which component(s) (i.e. CRTC Decision, Industry Canada broadcasting
        certificate, and CRTC licence) should be required for licensed MDS in
        order to qualify for conversion to BRS in a given area;
    4.  Whether CRTC licence-exempt systems that serve small, rural, and
        remote communities having small populations should be treated
        differently from the CRTC-licensed systems;
    5.  Whether Tier 3 or Tier 4 licence areas are the most appropriate for
        the conversion of site-specific MCS licences to BRS spectrum
        licences, where applicable, and for the conversion of MDS
        authorizations, including Industry Canada spectrum licences issued in
        the 2596-2690 MHz band; and
    6.  Licence conditions proposed for voluntarily converted BRS licences.

    Further to the above, the Department has confirmed, amongst other things,
the following in the Spectrum Consultation:

    1.  Eligible MCS and MDS incumbents will be issued BRS licences for
        approximately two thirds of their current spectrum holdings;
    2.  The bands 2535-2568 MHz and 2657-2690 MHz, and all other available
        spectrum, would be made available through an auction;
    3.  Effective immediately, the Department has placed a moratorium on new
        applications for broadcasting certificates in the band 2500-2690 MHz;
    4.  The BRS licences issued through a conversion process will expire on
        March 31, 2021; and
    5.  A licensee may apply in writing to transfer its licence in whole or
        in part (divisibility), in both the bandwidth and geographic
        dimensions.
    

    The Department has requested that all parties submit their comments to
the Spectrum Consultation by June 15, 2009, with interested parties then
having until July 17, 2009 to submit a reply to comments posted by other
parties.
    The Department has recognized that in order to give effect to the mobile
allocation and 'flexible-use' licences (mobile, fixed and broadcasting) in
this band, that several additional issues need to be addressed in future
consultations. These consultations will involve three major elements:

    
    1.  The policy framework;
    2.  The licensing framework; and
    3.  The band plan and relevant technical issues.
    

    Look intends to participate fully in each of the SPD process, the current
consultation, and all future consultations.
    The Corporation is very pleased that the Department has outlined a
position with respect to the 2500-2690 MHz band plan. Look's 92 MHz of MDS
spectrum, equivalent to 61 MHz of BRS spectrum, represents BRS coverage of
approximately 1.2 billion MHz/Pops across Ontario and Quebec and is the
largest contiguous block of mobile spectrum owned by any individual operator
in Canada. The identification of this band by the ITU as the only band
designated for next generation mobile services on a global basis reaffirms
Look's belief that its spectrum is a unique and valuable asset.
    The following table reconciles loss and comprehensive loss from
continuing operations to EBITDA:

    
    Three and six months ended February 28, 2009 and February 29, 2008
    (In thousands of dollars)
    -------------------------------------------------------------------------
                             Three months ended         Six months ended
                          February 28  February 29  February 28  February 29
                                 2009         2008         2009         2008
    -------------------------------------------------------------------------
    Loss and comprehensive
     loss for the period
     from continuing
     operations               $(3,440)     $(2,473)     $(6,172)     $(4,855)
    Interest and finance
     charges, net                  24           (4)          48          (30)
    Amortization of
     property and
     equipment and deferred
     charges                      893        1,342        2,049        2,617
    Accretion on liability
     component of
     convertible debentures       107           91          214          183
    Gain on disposition of
     property and equipment         -           (8)          (2)          (8)
    -------------------------------------------------------------------------
    EBITDA                    $(2,416)     $(1,052)     $(3,863)    $ (2,093)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Management views EBITDA as an important measure of operating performance
    of the Corporation; however, since EBITDA does not have any standardized
    meaning prescribed by Canadian GAAP, it may not be considered in
    isolation of GAAP measures such as (1) income (loss) and comprehensive
    income (loss) as an indicator of operating performance or (2) cash flows
    from operating, investing, and financing activities as a measure of
    liquidity. We believe, however, that it is an important measure as it
    allows us to assess our ongoing business without the impact of
    depreciation or amortization expenses as well as non-operating factors.
    It is intended to indicate our ability to incur or service debt and
    invest in property and equipment while allowing us to compare our
    business to our peers and competitors. This measure is not a defined term
    under Canadian GAAP and might not be comparable to similar measures
    presented by other issuers.
    

    About Look Communications Inc.

    Look's mission has been to be an M(3) - Mobile Multi Media -
communications, entertainment and information service provider in Ontario and
Québec. The Corporation currently delivers a full range of communications
services including high-speed and dial-up Internet access, digital television
distribution, and superior customer service to both the business and
residential markets. The Corporation provides its digital television
distribution and wireless Internet services using its approximately 100 MHz of
Multipoint Distribution System spectrum in the 2.5 to 2.7 GHz frequency band
covering approximately 18 million people (1.8 billion MHz/Pops) in the
provinces of Ontario and Québec. Look's shares are listed on the TSX Venture
Exchange under the symbols "LOK" for Multiple Voting Shares and "LOK.A" for
Subordinate Voting Shares. Look's website may be found at www.look.ca.

    The corporate information contained in this release includes
forward-looking statements regarding future events and the future performance
of Look that involve risks and uncertainties that could cause actual results
to differ materially. Assumptions used in the preparation of such information,
although considered reasonable by Look at the time of preparation, may prove
to be incorrect. The actual results achieved may vary from the information
provided herein and the variations may be material. Consequently, there is no
representation by Look that actual results achieved will be the same in whole
or in part as those forecasts.

    
    Neither the TSX Venture Exchange nor its Regulation Services Provider (as
    that term is defined in the policies of the TSX Venture Exchange) accepts
    responsibility for the adequacy or accuracy of this release.


    Look Communications Inc.

    INTERIM UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS

    As at
    (In thousands of dollars)
    -------------------------------------------------------------------------
                                                    February 28    August 31
                                                           2009         2008
    -------------------------------------------------------------------------
    ASSETS
    Total current assets                             $    7,101   $    6,764
    Restricted cash                                         460          440
    Property and equipment                                5,486        7,503
    Deferred charges                                         45           63
    -------------------------------------------------------------------------
                                                     $   13,092   $   14,770
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY/(DEFICIT)
    Liabilities
    Total current liabilities                        $   16,925   $   17,330
    Liability component of convertible debentures         3,222        3,161
    -------------------------------------------------------------------------
    Total liabilities                                    20,147       20,491
    -------------------------------------------------------------------------

    Shareholders' equity/(deficit)
    Share capital                                        33,417       33,247
    Equity component of convertible debentures            1,480        1,488
    Contributed surplus                                  11,178       11,033
    Deficit                                             (53,130)     (51,489)
    -------------------------------------------------------------------------
    Total shareholders' equity/(deficit)                 (7,005)      (5,721)
    -------------------------------------------------------------------------
                                                     $   13,092   $   14,770
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Look Communications Inc.

    INTERIM UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND
    DEFICIT

    Three and six months ended February 28, 2009 and February 29, 2008
    (In thousands of dollars, except shares and per share amounts)
    -------------------------------------------------------------------------
                             Three months ended         Six months ended
                          February 28  February 29  February 28  February 29
                                 2009         2008         2009         2008
    -------------------------------------------------------------------------
    Service and sales
     revenue                $   3,327    $   4,357    $   6,915    $   8,884
    Carrier charges and
     cost of sales              1,814        2,349        3,754        4,715
    -------------------------------------------------------------------------
    Gross margin from
     continuing operations      1,513        2,008        3,161        4,169
    -------------------------------------------------------------------------
    Operating expenses          4,822        4,402        9,073        8,879
    -------------------------------------------------------------------------
    Loss from continuing
     operations                (3,309)      (2,394)      (5,912)      (4,710)
    Interest and finance
     charges, net                 (24)           4          (48)          30
    Accretion on liability
     component of
     convertible debentures      (107)         (91)        (214)        (183)
    Gain on disposition
     of property and
     equipment                      -            8            2            8
    -------------------------------------------------------------------------
    Loss and comprehensive
     loss for the period
     from continuing
     operations                (3,440)      (2,473)      (6,172)      (4,855)
    Income and
     comprehensive income
     for the period from
     discontinued
     operations                     -          575        4,531        1,142
    -------------------------------------------------------------------------
    Loss and comprehensive
     loss for the period       (3,440)      (1,898)      (1,641)      (3,713)
    Income taxes                    -            -            -            -
    Deficit, beginning of
     period                   (49,690)     (45,645)     (51,489)     (43,830)
    -------------------------------------------------------------------------
    Deficit, end of period  $ (53,130)   $ (47,543)   $ (53,130)   $ (47,543)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Basic and diluted loss
     per share from
     continuing operations  $   (0.03)   $   (0.02)   $   (0.05)   $   (0.03)
    Basic and diluted income
     per share from
     discontinued operations        -            -         0.03            -
    Basic and diluted loss
     per share from
     continuing and
     discontinued operations    (0.03)       (0.02)       (0.02)       (0.03)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average number
     of shares
     outstanding          126,494,274  125,570,287  126,220,301  125,390,947
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Look Communications Inc.

    INTERIM UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

    Three and six months ended February 28, 2009 and February 29, 2008
    (In thousands of dollars)
    -------------------------------------------------------------------------
                             Three months ended         Six months ended
                          February 28  February 29  February 28  February 29
                                 2009         2008         2009         2008
    -------------------------------------------------------------------------
    OPERATING ACTIVITIES
      Loss for the period
       from continuing
       operations           $  (3,440)   $  (2,473)   $  (6,172)   $  (4,855)
      Items not affecting
       cash                     1,087        1,495        2,409        2,897
      Changes in non-cash
       operating working
       capital                    516         (411)         412       (2,672)
    -------------------------------------------------------------------------
    Cash used in continuing
     operations                (1,837)      (1,389)      (3,351)      (4,630)
    Cash provided by/(used
     in) discontinued
     operations                   (12)         588          495        1,136
    -------------------------------------------------------------------------
    Cash used in operating
     activities                (1,849)        (801)      (2,856)      (3,494)
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Cash provided by/(used
     in) financing activities       1           (6)           1          (14)
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Cash provided by/(used
     in) investing activities   1,450          (25)       3,408          (25)
    -------------------------------------------------------------------------

    Increase/(decrease) in
     cash and cash
     equivalents                 (398)        (832)         553       (3,533)
      Cash and cash
       equivalents, beginning
       of period                4,516        5,127        3,565        7,828
    -------------------------------------------------------------------------
    Cash and cash
     equivalents, end of
     period                 $   4,118    $   4,295    $   4,118    $   4,295
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    %SEDAR: 00013414E




For further information:

For further information: Peter Block, Investor and Media Relations,
investorinfo@look.ca, (647) 259-3284

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