Xplore Reports 26% Growth in FY'07 Revenue and Completes Corporate Migration to U.S.



    TSX-XPL

    AUSTIN, TX, June 25 /CNW/ - Xplore Technologies Corp. (TSX: XPL)
("Xplore" or the "Company"), a leading rugged mobile computer provider,
reported today record revenue of $34,534 for the year ended March 31, 2007
which grew approximately 26% over the prior fiscal year. The Company also
announced the completion of its corporate migration to the United States as it
changed its jurisdiction of incorporation from Canada to the State of
Delaware. The domestication was completed following the overwhelming approval
by the Company's shareholders at a special meeting held on June 20, 2007.
    "We are extremely pleased to complete the migration of Xplore from Canada
to the United States" indicated Philip S. Sassower, Chief Executive Officer
and Chairman of the Board of Directors. "We believe this migration made sense
as both our operations and a significant majority of our shareholders are in
the United States. Also, the United States is the largest capital market and
being domiciled here will hopefully give us better access to the United States
capital markets" he added.
    Mark Holleran, President and Chief Operating Officer, stated, "We are
very pleased to announce our fiscal 2007 financial performance which was the
best year in the Company's history. We continued to grow awareness of our
value proposition, as reflected by our revenue growth, and show strength in
foreign markets. We are implementing our plan to become the rugged PC company
with a broader product line of mobile devices."

    Fiscal 2007 Financial Results
    -----------------------------
    Revenue for the years ended March 31, 2007 and 2006 was $34,534 and
$27,480, respectively. Gross profit for fiscal 2007 was $9,811 or
approximately 28% of revenue as compared to $6,809 or approximately 25% of
revenue for fiscal 2006. The fiscal 2007 net loss was $6,615 ($0.11 cents per
share) as compared with $8,986 ($0.16 cents per share) in fiscal 2006.
    The revenue increase was primarily due to unit sales growth attributable
to an increase in the size of our sales force, combined with the momentum from
an increased focus on the Fortune 500 and Global 2000 markets, which provide
for larger unit orders.
    The current year improvement in the gross profit percentage is
attributable to the unit sales growth of the more favorable Centrino-based
product mix as compared to the prior year which includes the discontinued
Renegade product lines that were heavily discounted.
    Total operating expenses in fiscal 2007 were $14,087 as compared to
$11,829 in fiscal 2006. The increase was principally due to the costs
associated with our corporate migration to the United States, engineering
development costs related to future products and an increase in our sales
team.
    The net loss for fiscal 2007 declined from fiscal 2006 primarily due to
the aforementioned year over year increases in revenue by approximately 26%
and gross margin by approximately 44%.

    Fourth Quarter Financial Results for Fiscal 2007
    ------------------------------------------------
    Revenue for the fourth quarter of 2007 was $8,581 and grew approximately
14% when compared to $7,554 in the fourth quarter of 2006. The increase is due
to the unit sales growth and the Centrino-based product mix. In the fourth
quarter of 2006 the discontinued and highly discounted Renegade product line
accounted for approximately 19% of the revenue as compared to less than 1% in
the current year.
    The gross profit percentage for the fourth quarter of 2007 was 30.8% as
compared to 25.4% in the fourth quarter of 2006. The margin improvement was
attributable to the more favorable Centrino-based product mix. Also, the prior
year product mix included sales of the older generation Renegade product lines
that had been discontinued and as such discounted significantly below the
Centrino-based product lines.
    Operating expenses for the fourth quarter of 2007 were $4,232 or
approximately 57% higher than the $2,695 for the fourth quarter of 2006. The
increase was principally due to the costs associated with our corporate
migration to the United States and engineering development costs related to
future products.
    Our net loss for the fourth quarter of 2007 of $1,692 was more than the
fourth quarter of 2006 by $1,401 largely due to the costs related to our
corporate migration.

    Migration to the United States
    ------------------------------
    Xplore's common shares will continue to trade on the Toronto Stock
Exchange under the symbol "XPL" with the same CUSIP Number. Shareholders will
not be required to exchange their existing share certificates, which will
continue to represent the same number of shares of Xplore's capital stock as
immediately prior to the domestication.
    The Company's Registration Statement on Form S-4 describing the
domestication can be obtained free of charge at the Securities and Exchange
Commission's website at www.sec.gov.
    The financial results announced are in thousands of United States
dollars, except for percentage and per share amounts. The financial data is
presented in accordance with U.S. GAAP. The historical financial statements
attached to this press release have been restated.

    About Xplore Technologies(R)

    Xplore Technologies Corp, founded in 1996, is an innovative leader in the
rugged PC industry. Xplore, whose common shares are listed for trading on the
Toronto Stock Exchange under the symbol TSX: XPL, has offices in Austin Texas
and Helsinki Finland. Its rugged iX104(TM) family of hardware solutions
incorporate leading-edge technology, and are designed based on years of
customer design input. Xplore's diverse customer base comes from the public
safety, retail and wholesale warehousing, utility, military, field service and
transportation industries. Xplore hardware solutions are available from Xplore
or one of its authorized channel partners, for more information, visit
www.xploretech.com.

    The Toronto Stock Exchange has neither approved nor disapproved the
    information contained herein.

    Xplore Technologies is a registered trademark of Xplore Technologies
    Corporation of America. iX104, iX104R, iX104T, Renegade, All Terrain,
    iX104C(2) are trademarks of Xplore Technologies Corporation of America.
    All other tradenames, marked or not, are the sole property of their
    respective owners.

    This news release contains forward-looking statements that involve risks
and uncertainties, which may cause actual results to differ materially from
the statements made. When used in this document, the words "may", "would",
"could", "will", "intend", "plan", "anticipate", "believe", "estimate",
"expect" and similar expressions are intended to identify forward-looking
statements. Such statements reflect Xplore's current views with respect to
future events and are subject to such risks and uncertainties. Many factors
could cause actual results to differ materially from the statements made
including those factors detailed from time to time in filings made by Xplore
with securities regulatory authorities. Should one or more of these risks or
uncertainties materialize, or should assumptions underlying the forward
looking statements prove incorrect, actual results may vary materially from
those described herein as intended, planned, anticipated or expected. Xplore
does not intend and does not assume any obligation to update these
forward-looking statements.

    
    XPLORE TECHNOLOGIES CORP.
    Consolidated Statements of Loss
    (in thousands of United States dollars,
    except share and per share amounts)
    -------------------------------------------------------------------------

                                               Year Ended March 31,
                                   ------------------------------------------
                                         2007          2006          2005
                                   -------------- ------------- -------------
                                                    (Restated)    (Restated)

    REVENUE                         $     34,534  $     27,480  $     17,530
    COST OF REVENUE                       24,723        20,671        13,860
                                   -------------- ------------- -------------
    GROSS PROFIT                           9,811         6,809         3,670
                                   -------------- ------------- -------------

    EXPENSES:
      Sales, marketing and support         6,094         5,284         4,839
      Product research, development
       and engineering                     2,935         2,402         2,327
      General administration               5,058         4,143         4,179
                                   -------------- ------------- -------------
                                          14,087        11,829        11,345
                                   -------------- ------------- -------------
    LOSS FROM OPERATIONS                  (4,276)       (5,020)       (7,675)
                                   -------------- ------------- -------------

    OTHER INCOME (EXPENSE):
      Interest expense                    (1,467)       (4,867)       (2,818)
      Loss on extinguishment of debt        (832)            -             -
      Other income (expense)                 (40)          901            (8)
                                   -------------- ------------- -------------
                                          (2,339)       (3,966)       (2,826)
                                   -------------- ------------- -------------
    NET LOSS                        $     (6,615) $     (8,986) $    (10,501)

    Deemed dividends related to
     beneficial conversion feature
     of convertible Preferred
     Shares                               (3,381)            -             -
    Dividends attributable to
     Preferred Shares                       (885)            -             -
                                   -------------- ------------- -------------
    Loss attributable to common
     shareholders                        (10,881)       (8,986)      (10,501)
                                   -------------- ------------- -------------
                                   -------------- ------------- -------------
    LOSS PER SHARE                         (0.11)        (0.16)        (0.21)
    Deemed dividends related to
     beneficial conversion feature
     of convertible Preferred
     Shares                                (0.06)            -             -
    Dividends attributable to
     Preferred Shares                      (0.01)            -             -
                                   -------------- ------------- -------------
    Loss per share attributable
     to common shareholders         $      (0.18) $      (0.16) $      (0.21)
                                   -------------- ------------- -------------
                                   -------------- ------------- -------------

    Weighted average number of
     common shares outstanding        59,616,950    55,938,753    50,091,486
                                   -------------- ------------- -------------
                                   -------------- ------------- -------------



    XPLORE TECHNOLOGIES CORP.
    Consolidated Balance Sheets
    (in thousands of United States dollars)
    -------------------------------------------------------------------------

                                                            March 31,
                                                  ---------------------------
                                                       2007          2006
                                                  ------------- -------------
                           ASSETS                                 (Restated)
                           ------
    CURRENT ASSETS:
      Cash and cash equivalents                   $      1,711  $         56
      Accounts receivable                                4,408         4,613
      Inventory                                          3,639         3,713
      Prepaid expenses and other
       current assets                                      771           826
                                                  ------------- -------------
                                                        10,529         9,208
    Fixed assets, net                                      585           597
    Deferred charges                                         -         1,419
                                                  ------------- -------------
                                                  $     11,114  $     11,224
                                                  ------------- -------------
                                                  ------------- -------------

      LIABILITIES AND SHAREHOLDERS' DEFICIENCY
      ----------------------------------------

    CURRENT LIABILITIES:
      Accounts payable and accrued
       liabilities                                $      5,319  $      7,042
      Bank indebtedness                                      -         1,672
      Short-term debentures                                  -         5,000
                                                  ------------- -------------
    Total current liabilities                            5,319        13,714
    Debentures                                             250        11,523
                                                  ------------- -------------
                                                         5,569        25,237
                                                  ------------- -------------
    Commitments and contingencies

    SHAREHOLDERS' DEFICIENCY:
      Series A Preferred Shares                         21,128             -
      Series B Preferred Shares                          2,707             -
      Share capital                                     65,812        63,834
      Additional paid-in capital                         8,959         7,714
      Accumulated other comprehensive loss              (1,104)       (1,104)
      Accumulated deficit                              (91,957)      (84,457)
                                                  ------------- -------------
                                                         5,545       (14,013)
                                                  ------------- -------------
                                                   $    11,114  $     11,224
                                                  ------------- -------------
                                                  ------------- -------------



    XPLORE TECHNOLOGIES CORP.
    Consolidated Statements of Cash Flows
    (in thousands of United States dollars)
    -------------------------------------------------------------------------

                                               Year Ended March 31,
                                   ------------------------------------------
                                         2007          2006          2005
                                   -------------- ------------- -------------
                                                    (Restated)    (Restated)
    CASH FLOWS FROM OPERATING
     ACTIVITES:
    Cash used in operations:
      Net loss                      $     (6,615) $     (8,986) $    (10,501)
      Items not affecting cash:
        Depreciation and
         amortization                        579           464           645
        Amortization of deferred
         financing costs                     979         3,048         1,920
        Loss on extinguishment
         of debt                             832             -             -
        Stock-based compensation
         expense                             819           522           305
        Equity instruments issued
         in exchange for services            332           126           101
        Net gain on sales of
         technology                            -          (877)            -
      Changes in operating assets
       and liabilities:
        Accounts receivable                  205        (2,750)        3,452
        Inventory                             74          (759)         (896)
        Prepaid expenses and other
         current assets                       55          (353)          (61)
        Accounts payable and
         accrued liabilities                (599)          897        (1,282)
                                   -------------- ------------- -------------
          Net cash used in
           operating activities           (3,339)       (8,668)       (6,317)
                                   -------------- ------------- -------------
    CASH FLOWS FROM INVESTING
     ACTIVITIES:
      Net proceeds from sales of
       technology                              -           877             -
      Additions to fixed assets             (567)         (589)         (332)
                                   -------------- ------------- -------------
          Net cash provided by
           (used in) investing
           activities                       (567)          288          (332)
                                   -------------- ------------- -------------

    CASH FLOWS FROM FINANCING
     ACTIVITIES:
      Proceeds from bank borrowings       21,325        14,592             -
      Repayment of bank indebtedness     (22,997)      (13,010)            -
      Proceeds from notes payable
       to related party                        -         3,000         2,650
      Repayment of notes payable
       to related party                        -        (3,000)       (2,650)
      Proceeds on issuance of
       debentures                          1,000         5,000         5,000
      Proceeds on issuance of
       common shares                         944           572         2,062
      Proceeds on issuance of
       Series A Preferred Shares           2,251             -             -
      Proceeds on issuance of
       Series B Preferred Shares           2,908             -             -
      Proceeds from exercise
       of warrants                           130             -             -
      Proceeds on exercise of
       options                                 -            40           115
                                   -------------- ------------- -------------
          Net cash provided by
           financing activities            5,561         7,194         7,177
                                   -------------- ------------- -------------
    CHANGE IN CASH AND CASH
     EQUIVALENTS                           1,655        (1,186)          528

    CASH AND CASH EQUIVALENTS,
     BEGINNING OF YEAR                        56         1,242           714
                                   -------------- ------------- -------------
    CASH AND CASH EQUIVALENTS,
     END OF YEAR                    $      1,711  $         56  $      1,242
                                   -------------- ------------- -------------
                                   -------------- ------------- -------------
    SUPPLEMENTAL DISCLOSURE OF
     CASH FLOWS:
      Payments for interest         $        339  $        730  $        823
                                   -------------- ------------- -------------
                                   -------------- ------------- -------------
      Payments for income taxes     $          -  $          -  $          -
                                   -------------- ------------- -------------
                                   -------------- ------------- -------------
    

    %SEDAR: 00004707E




For further information:

For further information: For Media or U.S. Investor Information Contact:
Martin Janis & Company, Inc., Beverly Jedynak, Tel: (312) 943-1100,
Email:b.jedynak-janispr@worldnet.att.net

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XPLORE TECHNOLOGIES CORP.

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