Mediagrif Reports Q1 FY2010 Financial Results


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    - Revenues of $11.7 million compared to $12.0 million for the same
      quarter last year.

    - Earnings from operations of $1.9 million compared to $0.5 million for
      the same quarter last year.

    - Loss of $0.2 million or $0.01 per share compared to net earnings of
      $0.3 million or $0.02 per share for the same quarter last year, mainly
      due to foreign exchange loss of $1.6 million on US dollar assets.
    

    LONGUEUIL, QC, Aug. 4 /CNW Telbec/ - Mediagrif Interactive Technologies
Inc. (TSX: MDF), a world-leading operator of e-commerce solutions, today
announced its financial results for the first quarter of fiscal year 2010,
ended June 30, 2009. Unless indicated otherwise, all amounts are in Canadian
dollars.
    Revenues from the first quarter amounted to $11.7 million compared to
$12.0 million for the same quarter last year, an insignificant decrease
considering the unfavorable economic conditions.
    For the quarter ended June 30, 2009, total operating expenses decreased
to $7.2 million compared to $8.6 million for the same quarter last year. This
decrease is mainly due to the general headcount reduction throughout the
Company, to certain office closures in the United States and to a decrease of
the amortization expense due to the impairment done during the last quarter of
the year ended March 31, 2009. Consequently, earnings from operations amounted
to $1.9 million compared to $0.5 million for the same quarter last year.
    Other income (expenses) amounted to ($1.1 million) for the quarter ended
June 30, 2009, compared to $0.2 million for the same quarter last year. This
decrease is mainly due to a foreign exchange loss of $1.0 million on our US
dollar assets compared to a gain of $0.1 million for the same quarter last
year. Furthermore, a foreign exchange loss of $0.6 million on US dollar future
income taxes assets was recorded in the income tax provision.
    Net loss and basic loss per share for the quarter amounted to $0.2
million and to $0.01 as compared to net earnings and basic earnings per share
of $0.3 million or $0.02 for the same quarter last year.

    KEY OPERATING HIGHLIGHTS OF THE FIRST QUARTER OF THE FISCAL YEAR 2010:

    In the third and fourth quarters of fiscal 2009, significant changes were
made to the Company's Board of Directors and senior management team. Following
these changes, the newly appointed team conducted a strategic and operational
review of Mediagrif's business activities in order to reestablish positive
operational margins in all Mediagrif's business networks through headcount
adjustments, office closures and employee relocation.
    These initiatives enabled us to make an operating profit of $1.9 million
for the quarter ended June 30, 2009 compared to $0.5 million for the same
quarter last year.

    KEY FINANCIAL HIGHLIGHTS OF THE FIRST QUARTER OF THE FISCAL YEAR 2010:

    Revenues for the quarter ended June 30, 2009 decreased by $0.3 million
compared to the same quarter last year, from $12.0 million to $11.7 million.
Our business networks BidNet, MERX, Carrus, epipeline, Construction Bidboard
and Global Wine & Spirits operate in markets less affected by the difficult
economic conditions and are showing healthy organic growth. However, our
networks Power Source On-Line, The Broker Forum and Polygon are faced by the
economic slowdown in their respective markets and their revenues are
decreasing. The variation of the Canadian dollar compared to the American
dollar generated a positive impact of $0.4 million. Thus during the quarter,
59% of the revenues were earned in US dollars compared to 64% during the same
quarter last year. Consequently, on a constant currency basis, total revenues
decreased by $0.6 million.
    Gross margin as a percentage of revenue increased to 77.5% during the
quarter ended June 30, 2009, compared to 75.8% for the same quarter last year.
The increase is mainly explained by the lower cost of revenues following the
headcount reduction.
    Total operating expenses decreased to $7.2 million compared to $8.6
million for the same quarter last year. General and administrative expenses
decreased to $2.7 million compared to $3.1 million mainly due to the general
headcount reduction throughout the Company and certain office closures in the
US during the last quarter of the year ended March 31, 2009. Sales and
marketing expenses decreased to $2.3 million compared to $2.6 million mainly
due to the general headcount reduction throughout the Company and lower
representation expenses. Technology expenses decreased to $1.9 million
compared to $2.2 million due to lower salary expenses and a decrease of the
amortization expenses.
    The amortization of acquired intangible assets decreased from $0.5
million for the same quarter last year to $0.2 million this quarter due to the
impairment done during the last quarter of the year ended March 31, 2009.
    Stock-based compensation expense decreased slightly to $67,000 compared
to $142,000 for the same quarter last year, mainly due to a lower number of
outstanding stock options.
    As a result, earnings from operations reached $1.9 million compared to
$0.5 million for the same quarter last year. This increase is mainly due to
lower salary expenses.
    Net loss and diluted loss per share for the quarter amounted to $0.2
million and to $0.01 compared to net earnings and basic earnings per share of
$0.3 million and $0.02 for the same quarter last year.
    As of June 30, 2009, our cash and cash equivalents reached $25.5 million,
an increase from $25.2 million as at June 30, 2008 and a decrease from $27.7
million as at March 31, 2009. This decrease is partially due to severances
that were recorded as expenses during the year ended March 31, 2009. Free cash
flow, defined as cash flows from operating activities less capital
expenditure, was $2.8 million during the quarter, compared to $1.2 million for
the same quarter last year.
    On March 3, 2009, the Company announced the renewal of a normal course
issuer bid whereby it is authorized to purchase for cancellation, for the
twelve-month period starting March 5, 2009, up to 700,865 common shares. As of
June 30, 2009, 24,020 common shares were purchased for cancellation.

    About Mediagrif Interactive Technologies Inc.

    <a href="http://www.mediagrif.com/">Mediagrif Interactive Technologies Inc.</a> (TSX: MDF) is a world-leading
operator of e-commerce solutions. Mediagrif's e-business networks allow buyers
and sellers within specific industries to source, purchase or sell products
and to exchange documents more efficiently using the Internet. Mediagrif
operates 15 networks, including industry leaders <a href="http://www.brokerforum.com/">The Broker Forum</a>, <a href="http://www.powersourceonline.com/">Power
Source On-Line</a>, <a href="http://www.telecomfinders.com/">Telecom Finders</a>, <a href="http://www.globalwinespirits.com/">Global Wine & Spirits</a> and <a href="http://www.polygon.net/">Polygon</a>. Mediagrif
also owns <a href="http://www.merx.com/">MERX</a>, the exclusive provider of e-publishing services to the
Government of Canada, and is a leading provider of <a href="http://www.governmentbids.com/">government bid</a> aggregation
services and e-procurement services in the U.S. Headquartered in Longueuil,
Mediagrif has several offices in North America and Asia. For more information,
please visit us at www.mediagrif.com or call 1 877 677-9088.

    This press release contains certain forward-looking statements with
respect to the Company. These forward-looking statements, by their nature,
necessarily involve risks and uncertainties that could cause actual results to
differ materially from those contemplated by these forward-looking statements.
We consider the assumptions on which these forward-looking statements are
based to be reasonable, but caution the reader that these assumptions
regarding future events, many of which are beyond our control, may ultimately
prove to be incorrect since they are subject to risks and uncertainties that
affect us. We disclaim any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise, except as required by applicable securities legislation.

    Unaudited interim financial statements, accompanying notes and MD&A are
available on www.mediagrif.com and have been filed with SEDAR.




For further information:

For further information: Claude Roy, Chief Executive Officer, Mediagrif
Interactive Technologies Inc., (450) 677-8797 ext. 2004, 1-877-677-9088 ext.
2004, croy@mediagrif.com; Suzanne Mercier, Chief Financial Officer, Mediagrif
Interactive Technologies Inc., (450) 677-8797 ext. 2135, 1-877-677-9088 ext.
2135, smercier@mediagrif.com


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