Nstein Technologies announces record results for fourth quarter and fiscal 2007



    
    Highlights:

    - First profitable quarter, with an EBITDA of $0.5 million
      representing 9% of the fourth quarter's revenues
    - Sales up 61% over Q4 2006 and 70% over fiscal 2006
    - 27 new projects and clients signed in 2007
    - Total $12.9 million in financing obtained in 2007
    - $15.8 million in working capital as at December 31, 2007
    

    MONTREAL, March 18 /CNW Telbec/ - Nstein Technologies Inc. www.nstein.com
(TSX-V: EIN) today announced its financial results for the fourth quarter and
fiscal 2007.
    Nstein's revenues in the fourth quarter of 2007 reached $6.3 million, an
increase of 61% over the $3.9 million recorded a year earlier. Nstein posted
earnings before financial expenses, income taxes on earnings, depreciation,
amortization, exchange loss and restructuring fees (EBITDA) of $555,970,
compared to a negative EBITDA of $302,804 the year before. Net earnings
amounted to $109,713 or $0.003 per share, as opposed to net losses of $683,330
or ($0.02) per share for the fourth quarter of 2006.
    "These results for the fourth quarter of 2007 are particularly remarkable
and are attributable not only to the fact that Q4 is traditionally our
strongest quarter, but also to the growing demand for Nstein solutions. It is
more and more apparent that our products are becoming widely adopted by the
e-publishing community. This has enabled us to virtually double our sales in
2007 and has had a positive impact on our profitability," said Luc
Filiatreault, President and Chief Executive Officer of Nstein Technologies.
    Nstein's revenues for the year amounted to $18.2 million, an increase of
70% over the $10.7 million recorded in 2006. Nstein posted earnings before
financial expenses, income taxes on earnings, depreciation, amortization,
exchange loss and restructuring fees (EBITDA) of $133,105, compared to a
negative EBITDA of $2,785,873 last year. Net losses totalled $1,830,081 or
$0.049 per share in 2007, as opposed to $4,834,372 or $0.186 per share for
2006.
    "The positive results in the fourth quarter and fiscal 2007 confirm the
market's interest in Nstein's solutions and speak to the high value press and
media organizations place on our products," added Mr. Filiatreault. "Some
27 new projects and clients in the e-publishing sector were added to our
increasingly prestigious portfolio during the year. In the fourth quarter, we
signed agreements with a number of internationally renowned corporations,
including Readers' Digest, Libération and Groupe Express-Roularta."
    During the fourth quarter, Nstein finalized a private financing deal for
$8 million. This in addition to two other private placements concluded earlier
the year brought the Company's total financing to $12.9 million and
considerably increased its working capital, which stood at $15.8 million at
year-end. Nstein hired additional resources for its professional services team
in the fourth quarter in order to ensure optimal service for its growing
client base. The Company also expanded its sales team to step up its market
development efforts in North America, the United Kingdom and France.

    Recent developments

    "Nstein recently acquired Picdar, a leading provider of picture and
digital asset management solutions in the United Kingdom. The arrival of
Picdar within the Nstein group gives us access to an unbeatable portfolio of
prominent media clients in the U.K. and increases our market share in Europe.
The Picdar team will contribute to our firm's success both in Europe and
around the world." said Mr. Filiatreault.
    "We made significant strides forward in 2007 and successfully
consolidated a number of elements essential to our prosperity, namely an
ever-expanding client roster, technology solutions that cater to the core
needs of the e-publishing industry and financial stability. Our foundations
are stronger than ever and we will continue to build on them to make Nstein
the global leader in online publishing solutions," concluded Mr. Filiatreault.

    About Nstein Technologies Inc.

    Nstein Technologies (TSX-V: EIN) develops and markets multilingual
solutions that power online publishing for the most prestigious newspapers,
magazines and content-driven organizations. Nstein's solutions generate new
revenue opportunities and reduce operational costs by enabling the
centralization, management and automated indexing of digital assets. Nstein
partners with clients to design a complete online strategy for success using
publishing industry best practices for the implementation of its Web Content
Management, Digital Asset Management and Text Mining Engine products.
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           As at
                                                 December 31     December 31
                                                        2007            2006
                                                           $               $
    -------------------------------------------------------------------------
    Assets

    Current assets
    Cash and cash equivalents                     11,730,855       2,367,125
    Short-term restricted cash                             -       1,859,799
    Term deposits                                    185,386         191,121
    Accounts receivable                            7,081,392       4,189,878
    Refundable tax credits                         1,540,023         780,267
    Work in progress                                 875,350         578,105
    Prepaid expenses                                 330,150         185,535
    Current portion of balance receivable on
     the sale of software licenses                         -         176,598
    -------------------------------------------------------------------------
                                                  21,743,156      10,328,428

    Property, plant and equipment                    538,336         455,902
    Intangible assets                              1,171,188       1,554,998
    Deferred financing expenses                            -          67,074
    Goodwill                                       5,641,574       5,641,574
    -------------------------------------------------------------------------
                                                  29,094,254      18,047,976
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities

    Current liabilities
    Bank loans                                       563,280               -
    Accounts payable and accrued liabilities       4,012,304       3,726,835
    Deferred revenues                              1,104,685         655,896
    Current portion of long-term debt                295,997       2,121,927
    -------------------------------------------------------------------------
                                                   5,976,266       6,504,658

    Long-term debt                                   759,832       1,074,847
    -------------------------------------------------------------------------
                                                   6,736,098       7,579,505
    -------------------------------------------------------------------------

    Shareholders' Equity

    Share capital                                 52,652,275      40,178,085
    Other equity components                        2,823,558       2,269,836
    Contributed surplus                            1,223,997         532,143
    Deficit                                      (34,341,674)    (32,511,593)
    -------------------------------------------------------------------------
                                                  22,358,156      10,468,471
    -------------------------------------------------------------------------
                                                  29,094,254      18,047,976
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
    Consolidated Statements of Earnings and Deficit             Three months
                                                                      ending
                                                                 December 31
                                                        2007            2006
                                                           $               $
                                                  (unaudited)     (unaudited)
    -------------------------------------------------------------------------
    Revenues                                       6,268,163       3,888,532
    Cost of sales, net of tax credits              2,214,356       1,699,010
    -------------------------------------------------------------------------
                                                   4,053,807       2,189,522
    -------------------------------------------------------------------------

    Expenses
    Selling and administrative                     2,869,246       2,099,605
    Research and development, net of tax credits     632,984         392,721
    Depreciation of property, plant and equipment     51,890          39,212
    Amortization of intangible assets                111,542          64,282
    Exchange loss                                    117,107           6,277
    Financial expenses                                (7,546)        225,755
    Restructuring fees                               173,264               -
    -------------------------------------------------------------------------
                                                   3,944,094       2,827,852
    -------------------------------------------------------------------------

    Net profit (loss) and comprehensive income
     for the period                                  109,713        (638,330)

    Deficit - Beginning of period                 34,451,387      31,873,263
    -------------------------------------------------------------------------
    Deficit - End of period                       34,341,674      32,511,593
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic and diluted net profit (loss) share          0.003          (0.020)

    Basic and diluted weighted average number
     of shares outstanding                        41,113,271      32,217,118
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
    Consolidated Statements of
    Earnings and Deficit                                       Twelve months
                                                                      ending
                                                                 December 31
                                                        2007            2006
                                                           $               $
    -------------------------------------------------------------------------

    Revenues                                      18,171,858      10,717,311
    Cost of sales, net of tax credits              7,561,455       5,474,801
    -------------------------------------------------------------------------
                                                  10,610,403       5,242,510
    -------------------------------------------------------------------------

    Expenses
    Selling and administrative                     8,233,356       6,291,781
    Research and development, net of tax credits   2,248,335       1,736,602
    Depreciation of property, plant and equipment    191,289         148,580
    Amortization of intangible assets                442,229         286,906
    Exchange loss (gain)                             149,118        (122,482)
    Financial expenses                               519,045       1,735,495
    Restructuring fees                               661,505               -
    -------------------------------------------------------------------------
                                                  12,440,484      10,076,882
    -------------------------------------------------------------------------

    Net loss and comprehensive income
     for the year                                  1,830,081       4,834,372


    Deficit - Beginning of year                   32,511,593      27,677,221
    -------------------------------------------------------------------------
    Deficit - End of year                         34,341,674      32,511,593
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic and diluted net loss share                   0.049           0.186

    Basic and diluted weighted average number
     of shares outstanding                        37,043,429      25,949,784
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
    Consolidated Statements of Cash Flows                      Twelve months
                                                                      ending
                                                                 December 31
                                                        2007            2006
                                                           $               $
    -------------------------------------------------------------------------

    Cash flows from operating activities
    Loss for the year                             (1,830,081)     (4,834,372)

    Items not affecting cash and cash equivalents
      Interest capitalized on long-term debt          53,865         116,042
      Unrealized exchange gain                       (73,406)        (50,273)
      Depreciation of property, plant and equipment  191,289         148,580
      Amortization of intangible assets              442,229         286,906
      Amortization of deferred financing expenses     67,074         276,426
      Stock-based compensation costs                 348,050         416,300
      Compensation costs related to the deferred
       share unit plan for directors                 261,871         117,338
      Costs related to the employee stock
       purchase plan                                  45,437          14,656
      Gain on disposal of property, plant
       and equipment                                  (4,393)              -
    -------------------------------------------------------------------------
                                                    (498,065)     (3,508,397)
    -------------------------------------------------------------------------

    Change in non-cash operating working
     capital items
      Accounts receivable                         (2,891,514)     (2,091,810)
      Refundable tax credits                        (759,756)        194,230
      Work in progress                              (297,245)       (109,891)
      Prepaid expenses                              (144,615)        (57,539)
      Balance receivable on the sale of
       software licenses                             176,598           1,729
      Accounts payable and accrued liabilities        59,590         499,322
      Deferred revenues                              448,789         326,459
    -------------------------------------------------------------------------
                                                  (3,408,153)     (1,237,500)
    -------------------------------------------------------------------------
                                                  (3,906,218)     (4,745,897)
    -------------------------------------------------------------------------

    Cash flows from financing activities
    Variation in bank loans                          563,280        (248,952)
    Due to directors                                       -         (26,295)
    Long-term debt                                         -       1,300,000
    Payments on long-term debt                    (1,188,991)     (2,635,837)
    Deferred financing expenses                            -         (92,213)
    Issuance of warrants, net of issue expenses      736,577               -
    Issuance of co mmon shares, net of
     issue expenses                               11,671,071       9,292,517
    -------------------------------------------------------------------------
                                                  11,781,937       7,589,220
    -------------------------------------------------------------------------

    Cash flows from investing activities
    Variation in term deposits                         5,735            (337)
    Variation in short-term restricted cash        1,859,799      (1,859,799)
    Variation in balance receivable on the sale
    of software licenses                                   -         165,996
    Business acquisitions, net of cash and
     cash equivalents acquired                       (48,390)       (534,230)
    Additions to property, plant and equipment      (238,936)       (156,228)
    Additions to intangible assets                  (117,459)        (20,318)
    Proceeds from the sale of property,
     plant and equipment                              27,262               -
    -------------------------------------------------------------------------
                                                   1,488,011      (2,404,916)
    -------------------------------------------------------------------------

    Increase in cash and cash equivalents          9,363,730         438,407

    Cash and cash equivalents - Beginning of year  2,367,125       1,928,718
    -------------------------------------------------------------------------
    Cash and cash equivalents - End of year       11,730,855       2,367,125
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    
    %SEDAR: 00014563EF




For further information:

For further information: Nstein Technologies Inc.: 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; Renmark
Financial Communications Inc.: Maurice Dagenais:
mdagenais@renmarkfinancial.com; Josh Rivard: jrivard@renmarkfinancial.com,
(514) 939-3989, Fax: (514) 939-3717; www.renmarkfinancial.com

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NSTEIN TECHNOLOGIES INC.

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