Nstein reports record sales for fourth quarter and fiscal 2006



    Fourth quarter 2006 sales of $3.9M, a 162% increase compared to
    fourth quarter 2005

    MONTREAL, March 15 /CNW Telbec/ -

    Highlights:
    -----------

    - Record sales for fourth quarter and fiscal 2006
    - Acquisition of Eurocortex, a European leader in content management
    - Important decrease of the EBITDA loss for fourth quarter 2006

    Nstein Technologies Inc., "Nstein" (TSX-V: EIN), today announced its
results for the fourth quarter and fiscal year ended December 31, 2006.
    Nstein's revenues in the fourth quarter of 2006 reached $3.9M compared to
$1.5M, an increase of 162% over the revenues in the fourth quarter of last
year and 38% over those of the third quarter of 2006. For the fourth quarter
of 2006, Nstein posted a loss before financial expenses, exchange gain, income
taxes on earnings, depreciation and amortization (EBITDA) of $0.3M, compared
to $1.8M the year before. The loss amounted to $0.6M or $0.020 per share in
the fourth quarter of 2006, as opposed to $3.9M or $0.209 for the same period
last year.
    Revenues for the year 2006 amounted to $10.7M compared to $9.1M in 2005,
an increase of 18%. Loss before financial expenses, income tax, depreciation,
amortization and impairment of intangible assets (EBITDA) stood at $2.8M
compared to $3.1M for the previous year. Net losses totalled $4.8M or $0.186
per share in 2006, against $6.8M or $0.363 in 2005.
    "These record sales for 2006, and more specifically the two last
quarters, are the direct result of the great receptiveness of the e-publishing
market towards Nstein's solutions and especially its new Ntelligent Content
Management (NCM) Suite, a powerful combination of Nstein's text mining
technology and Eurocortex's content management platform for the press and
media industry," said Mario Girard, Chairman and Chief Executive Officer of
Nstein Technologies. "Never before have press and media organizations seen
such a shift of their advertising revenues from print to digital media. By
enabling cross media publishing and multichannel delivery (from any sources to
various output formats such as RSS feeds, podcasts, etc.), Nstein's
next-generation content management platform helps these organizations bridge
the gap. The NCM Web 2.0-ready platform allows them to generate additional
online revenues, accelerate their time-to-market and reduce their operational
costs."
    Further commenting Nstein's acquisition of Eurocortex, Mr. Girard added:
"Along with their extensive knowledge of the industry, Eurocortex's team
brings a portfolio (30+ clients) of Europe's largest press and media
organizations that consolidates Nstein's niche and will increase its market
share within the e-publishing industry, especially in France and the UK. Also,
the signing of contracts in 2006 with industry leaders such as
Transcontinental Media and Corbis confirms Nstein's ability to provide
world-class solutions to global e-publishing organizations."
    "Among the strategic initiatives pursued by Nstein in 2006 is the launch
of a lab that encompasses the company's work for delivering its technology
through a SAAS offer (Software as a Service)-as previously announced in
2006-and a new collaborative research agreement with the National Research
Council Canada (NRCC). The addition of Nstein's text mining to the NRCC's
search technology sets the ground for a next-generation search environment
much more efficient and relevant than any current technology. Moreover, this
environment is designed to be fully optimized for the online participatory
communication tools brought by the new Web 2.0 reality," added Mr. Girard.

    2007 Strategy

    "While continuing to refine its cutting-edge text mining technology,
Nstein will pursue intensive development and marketing of its NCM Suite for
digital asset management and web content management. The company has never
been so well positionned to gain significant market share in an e-publishing
industry obviously in need of solutions that will help reshape its content
management strategies. With software solutions more complete and unique than
ever, with a much stronger presence in Europe and with the finest industry
specialists as its team, Nstein's future stands on solid ground," concluded
Mr. Girard.

    About Nstein Technologies Inc.

    Nstein Technologies (TSX-V: EIN) develops and markets leading-edge
content management software for the media, publishing and entertainment
industries. Its Ntelligent Content Management Suite enables the
centralization, enrichment and publication of textual and rich media assets
using advanced text mining. Nstein helps publishers significantly increase
their content monetization and reduce their operational costs through cross
media publishing and multichannel delivery. The Company is headquartered in
Montreal, Canada, with offices in the USA and Europe. More information is
available at www.nstein.com.

    
    - The TSX Venture Exchange does not accept responsibility for the
      adequacy or accuracy of this release.

    - Any statement that appears prospective shall not be interpreted as
      such.


    NSTEIN TECHNOLOGIES INC.
    Consolidated Balance Sheets
    As at December 31, 2006 and 2005
    -------------------------------------------------------------------------
                                                          2006          2005
                                                             $             $
    -------------------------------------------------------------------------
    Assets

    Current assets
    Cash and cash equivalents                        2,367,125     1,928,718
    Short-term restricted cash                       1,859,799             -
    Term deposits                                      191,121       164,600
    Accounts receivable                              4,189,878     1,612,137
    Refundable tax credits                             780,267       827,849
    Work in progress                                   578,105       451,639
    Prepaid expenses                                   185,535       125,237
    Current portion of balance receivable on the
     sale of software licenses                         176,598       178,327
    -------------------------------------------------------------------------
                                                    10,328,428     5,288,507

    Balance receivable on the sale of software
     licenses                                                -       165,996
    Property, plant and equipment                      455,902       370,447
    Intangible assets                                1,554,998       748,043
    Deferred financing expenses                         67,074       343,500
    Goodwill                                         5,641,574     5,166,876
    -------------------------------------------------------------------------
                                                    18,047,976    12,083,369
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities

    Current liabilities
    Bank loans                                               -       248,952
    Accounts payable and accrued liabilities         3,726,835     2,369,679
    Deferred revenues                                  655,896       327,151
    Current portion of long-term debt                2,121,927     2,064,542
    -------------------------------------------------------------------------
                                                     6,504,658     5,010,324

    Long-term debt                                   1,074,847     2,988,619
    -------------------------------------------------------------------------
                                                     7,579,505     7,998,943
    -------------------------------------------------------------------------

    Shareholders' Equity

    Share capital                                   40,178,085    29,534,130
    Other equity components                          2,269,836     2,160,640
    Contributed surplus                                532,143        66,877
    Deficit                                        (32,511,593)  (27,677,221)
    -------------------------------------------------------------------------
                                                    10,468,471     4,084,426
    -------------------------------------------------------------------------
                                                    18,047,976    12,083,369
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    NSTEIN TECHNOLOGIES INC.
    Consolidated Statements of Earnings and Deficit
    For the years ending December 31, 2006 and 2005
    -------------------------------------------------------------------------
                                                          2006          2005
                                                             $             $
    -------------------------------------------------------------------------
    Revenues                                        10,717,311     9,103,887
    Cost of sales                                    5,568,827     4,818,093
    -------------------------------------------------------------------------
                                                     5,148,484     4,285,794
    -------------------------------------------------------------------------

    Expenses
    Selling and administrative                       6,291,781     6,004,261
    Research and development                         2,157,593     2,235,809
    Research and development tax credits and other
     credits                                          (515,017)     (818,972)
    Depreciation of property, plant and equipment      148,580       137,533
    Amortization of intangible assets                  286,906     1,152,049
    Gain on disposal of property, plant and
     equipment and intangible assets                         -        (3,284)
    Impairment of intangible assets                          -     1,306,444
    Exchange loss (gain)                              (122,482)      110,969
    Financial expenses                               1,735,495       930,110
    -------------------------------------------------------------------------
                                                     9,982,856    11,054,919
    -------------------------------------------------------------------------

    Net loss for the year                            4,834,372     6,769,125
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Deficit - Beginning of year                     27,677,221    20,908,096

    Deficit - End of year                           32,511,593    27,677,221
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic and diluted net loss per share                 0.186         0.363

    Basic and diluted weighted average number of
     shares outstanding                             25,949,784    18,641,856
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    NSTEIN TECHNOLOGIES INC.
    Consolidated Statements of Cash Flows
    For the years ending December 31, 2006 and 2005
    -------------------------------------------------------------------------
                                                          2006          2005
                                                             $             $
    -------------------------------------------------------------------------
    Cash flows from operating activities
    Loss for the year                               (4,834,372)   (6,769,125)
    Items not affecting cash and cash equivalents
      Interest capitalized on long-term debt           116,042       435,920
      Unrealized exchange gain                         (50,273)            -
      Depreciation of property, plant and equipment    148,580       137,533
      Amortization of intangible assets                286,906     1,152,049
      Amortization of deferred financing expenses      276,426       283,197
      Stock-based compensation costs                   416,300       250,853
      Costs related to the employee stock purchase
       plan                                             14,656             -
      Gain on disposal of property, plant and
       equipment                                             -        (3,284)
      Impairment of intangible assets                        -     1,306,444
    -------------------------------------------------------------------------
                                                    (3,625,735)   (3,206,413)
    -------------------------------------------------------------------------

    Change in non-cash operating working capital
     items
      Accounts receivable                           (2,091,810)      911,746
      Refundable tax credits                           194,230       318,136
      Work in progress                                (109,891)     (399,532)
      Prepaid expenses                                 (57,539)       64,104
      Balance receivable on the sale of software
       licenses                                          1,729      (178,327)
      Accounts payable and accrued liabilities         590,365      (322,173)
      Deferred revenues                                326,459       (23,443)
    -------------------------------------------------------------------------
                                                    (1,146,457)      370,511
    -------------------------------------------------------------------------
                                                    (4,772,192)   (2,835,902)
    -------------------------------------------------------------------------

    Cash flows from financing activities
    Variation in bank loans                           (248,952)      248,952
    Long-term debt                                   1,300,000     3,657,301
    Payments on long-term debt                      (2,635,837)   (1,964,059)
    Deferred financing expenses                        (92,213)     (314,774)
    Issuance of common shares, net of issue
     expenses                                        9,292,517         2,000
    Other equity components, net of issue expenses           -       874,191
    -------------------------------------------------------------------------
                                                     7,615,515     2,503,611
    -------------------------------------------------------------------------

    Cash flows from investing activities
    Variation in term deposits                            (337)            -
    Variation in short-term restricted cash         (1,859,799)            -
    Variation in balance receivable on the sale of
     software licenses                                 165,996      (165,996)
    Business acquisitions, net of cash and cash
     equivalents acquired                             (534,230)     (222,130)
    Additions to property, plant and equipment        (156,228)      (97,749)
    Additions to intangible assets                     (20,318)      (12,319)
    Proceeds from the sale of property, plant and
     equipment                                               -         7,629
    -------------------------------------------------------------------------
                                                    (2,404,916)     (490,565)
    -------------------------------------------------------------------------

    Net change in cash and cash equivalents            438,407      (822,856)

    Cash and cash equivalents - Beginning of year    1,928,718     2,751,574
    -------------------------------------------------------------------------

    Cash and cash equivalents - End of year          2,367,125     1,928,718
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
    %SEDAR: 00014563EF




For further information:

For further information: Investor Relations: Bruno Martel, Chief
Financial Officer, Nstein Technologies Inc., (514) 908-5406,
bruno.martel@nstein.com; Media: Rina Marchand, Marketing Manager, Nstein
Technologies Inc., (514) 908-5406, rina.marchand@nstein.com

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NSTEIN TECHNOLOGIES INC.

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