Xplore Reports Q3'08 Results



    TSX-XPL

    AUSTIN, TX, Feb. 13 /CNW/ - Xplore Technologies Corp. (TSX: XPL)
("Xplore" or the "Company"), a leading rugged mobile computer provider,
reported today results of operations for its third quarter ended December 31,
2007.

    Financial Results of Operations
    -------------------------------
    Revenue for the three months ended December 31, 2007 and 2006 was
approximately $5,394,000 and $8,114,000, respectively, and for the nine months
ended December 31, 2007 and 2006 was approximately $18,303,000 and
$25,953,000, respectively. Revenue for the three months ended December 31,
2007 decreased from the prior period by 34% principally due to a 22% decline
in unit sales and for the nine months ended December 31, 2007 by 29% resulting
from a 29% decline in unit sales. The impact of the declines in unit sales
were partially offset by 9% and 7% improvement in average selling price for
the three and nine months ended December 31, 2007, respectively. The Company
is developing numerous new products, including a rugged notebook PC, as well
as the next generation of its iX104 Tablet PC. Management believes these
products will be available in 2008 and should enable the Company, through
their introduction, to resume the growth of its revenues.
    Gross profit for the three months ended December 31, 2007 and 2006 was
approximately $1,622,000 and $2,243,000, respectively, and gross profit as a
percent of revenue for those periods was 30.1% and 27.6%, respectively. Gross
profit for the nine months ended December 31, 2007 and 2006 was approximately
$5,550,000 and $7,165,000, respectively, and gross profit as a percent of
revenue for those periods was 30.3% and 27.6%, respectively. The improvement
in gross profit as a percentage of revenue for the three and nine months ended
December 31, 2007 as compared to the prior corresponding period was
attributable to cost reduction initiatives principally related to component
pricing and freight.
    Operating expenses for the three months ended December 31, 2007 and 2006
were approximately $3,927,000 and $3,749,000, respectively, and for the nine
months ended December 31, 2007 and 2006 were approximately $10,632,000 and
$9,855,000, respectively. The increase was principally due to the
non-recurring costs associated with our corporate migration to the United
States of $345,000 and an increase in development costs of $386,000 related to
the development of our future products, including a rugged notebook. In
addition, the Company had non-cash charges related to employee stock
compensation of $729,000 and a $264,000 non-cash charge relating to the value
assigned to warrants issued for financial advisory services. These increases
were offset by the reduction of variable costs directly related to the decline
in revenue that included commission expenses and marketing co-op allowances.
    The Company's net loss was approximately $2,287,000 ($0.03 per share) and
$1,525,000 ($0.03 per share) for the three months ended December 31, 2007 and
2006, respectively, and approximately $5,145,000 ($0.07 per share) and
$4,920,000 ($0.08 per share) for the nine months ended December 31, 2007 and
2006, respectively.

    Restatement of Second Quarter 2008 Financial Statements
    -------------------------------------------------------
    The Company also announced today that it has restated its unaudited
consolidated financial statements for the three and six months ended
September 30, 2007 to reflect an adjustment to its accounting for the
beneficial conversion feature of the Series C Convertible Preferred Stock and
warrants issued in connection with its September 2007 private placement.
    Subsequent to their issuance, the Company determined that there was a
mathematical error made in the calculation of the deemed dividends related to
the beneficial conversion feature of its Series C Convertible Preferred Stock
with respect to its unaudited consolidated financial statements for the three
and six months ended September 30, 2007, which resulted in a $1,179,000
understatement of such amount for those periods. The correction of this error
changes the net loss attributable to common shareholders for the three months
ended September 30, 2007 from $3,226,000, as previously reported, to
$4,405,000, as restated, and from $4,647,000, as previously reported, to
$5,826,000, as restated, for the six months ended September 30, 2007. The
correction of this error changes the loss per share attributable to common
shareholders for the three months ended September 30, 2007 from $0.05, as
previously reported, to $0.07, as restated, and from $0.07, as previously
reported, to $0.09, as restated, for the six months ended September 30, 2007.
    The correction of this error is non-cash in nature and will not impact
the Company's cash flow from operations or financial condition for the
affected period.
    The financial data is presented in accordance with U.S. GAAP. The prior
year financial statements attached to this press release have been restated as
discussed in our Form 10-K filed on June 27, 2007.

    About Xplore Technologies(R)

    Xplore Technologies Corp, founded in 1996, is engaged in the business of
the development, integration and marketing of rugged mobile wireless PC
computing systems. 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 award winning 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,
    iX104C2 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 Balance Sheets
                   (in thousands of United States dollars)
    -------------------------------------------------------------------------

                                                     December 31,  March 31,
                                                          2007        2007
                                                      ----------- -----------
                                   ASSETS             (unaudited)
                                   ------

    CURRENT ASSETS:
      Cash and cash equivalents                        $   2,709   $   1,711
      Accounts receivable                                  4,137       4,408
      Inventory                                            4,888       3,639
      Prepaid expenses and other current assets              654         771
                                                      ----------- -----------
                                                          12,388      10,529
    Fixed assets, net                                        889         585
    Deferred charges                                         475           -
                                                      ----------- -----------
                                                       $  13,752   $  11,114
                                                      ----------- -----------
                                                      ----------- -----------

                     LIABILITIES AND SHAREHOLDERS' EQUITY
                     ------------------------------------

    CURRENT LIABILITIES:
      Accounts payable and accrued liabilities         $   5,292   $   5,319
                                                      ----------- -----------
    Total current liabilities                              5,292       5,319
    Debenture                                                  -         250
                                                      ----------- -----------
                                                           5,292       5,569
                                                      ----------- -----------

    Commitments and contingencies

    SHAREHOLDERS' EQUITY:
      Series A Preferred Stock, par value
       $0.001 per share; authorized 64,000; shares
       issued 63,179                                          63          63
      Series B Preferred Stock, par value
       $0.001 per share; authorized 10,000; shares
       issued 9,589                                           10          10
      Series C Preferred Stock, par value
       $0.001 per share; authorized 20,000; shares
       issued 15,274                                          15           -
      Common Stock, par value $0.001 per share;
       authorized 300,000; shares issued 68,082
       and 64,099, respectively                               68          64
      Additional paid-in capital                         107,551      98,469
      Accumulated other comprehensive loss                (1,128)     (1,104)
      Accumulated deficit                                (98,119)    (91,957)
                                                      ----------- -----------
                                                           8,460       5,545
                                                      ----------- -----------
                                                       $  13,752   $  11,114
                                                      ----------- -----------
                                                      ----------- -----------



                          XPLORE TECHNOLOGIES CORP.
                 Consolidated Statements of Loss - Unaudited
         (in thousands of US dollars, except loss per common share)
    -------------------------------------------------------------------------

                                 Three Months Ended      Nine Months Ended
                              ----------------------- -----------------------
                                December    December    December    December
                                31, 2007    31, 2006    31, 2007    31, 2006
                              ----------- ----------- ----------- -----------
                                           (Restated)              (Restated)

    Revenue                    $   5,394   $   8,114   $  18,303   $  25,953
    Cost of revenue                3,772       5,871      12,753      18,788
                              ----------- ----------- ----------- -----------
    Gross profit                   1,622       2,243       5,550       7,165
                              ----------- ----------- ----------- -----------

    Expenses:
    Sales, marketing and
     support                       1,260       1,411       3,624       4,538
    Product research,
     development and
     engineering                   1,162         861       2,818       2,102
    General administration         1,505       1,477       4,190       3,215
                              ----------- ----------- ----------- -----------
                                   3,927       3,749      10,632       9,855
                              ----------- ----------- ----------- -----------
    Loss from operations          (2,305)     (1,506)     (5,082)     (2,690)
                              ----------- ----------- ----------- -----------

    Other expenses:
    Interest expense                  (6)        (27)        (54)     (1,402)
    Loss on extinguishment
     of debt                           -           -           -        (832)
    Other                             24           8          (9)          4
                              ----------- ----------- ----------- -----------
                                      18         (19)        (63)     (2,230)
                              ----------- ----------- ----------- -----------
    Net loss                      (2,287)     (1,525)     (5,145)     (4,920)

    Deemed dividends related
     to beneficial conversion
     feature of convertible
     Preferred Shares                  -           -      (2,328)     (3,381)
    Dividends attributable to
     Preferred Shares               (410)       (315)     (1,050)       (683)
                              ----------- ----------- ----------- -----------
    Net loss attributable to
     common shareholders       $  (2,697)  $  (1,840)  $  (8,523)  $  (8,984)
                              ----------- ----------- ----------- -----------
                              ----------- ----------- ----------- -----------
    Loss per common share      $   (0.03)  $   (0.03)  $   (0.07)  $   (0.08)
    Deemed dividends related
     to beneficial conversion
     feature of convertible
     Preferred Shares                  -           -       (0.04)      (0.06)
    Dividends attributable to
     Preferred Shares              (0.01)          -       (0.02)      (0.01)
                              ----------- ----------- ----------- -----------
    Loss per share attributable
     to common shareholders    $   (0.04)  $   (0.03)  $   (0.13)  $   (0.15)
                              ----------- ----------- ----------- -----------
                              ----------- ----------- ----------- -----------

    Weighted average number of
     common shares outstanding    66,893      60,897      65,447      58,973
                              ----------- ----------- ----------- -----------
                              ----------- ----------- ----------- -----------



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

                                 Three Months Ended      Nine Months Ended
                                    December 31,            December 31,
                              ----------------------- ----------------------
                                  2007        2006        2007        2006
                              ----------- ----------- ----------- ----------
                                           (Restated)              (Restated)
    CASH FLOWS FROM OPERATING
     ACTIVITES:
    Cash used in operations:
      Net loss                 $  (2,287)  $  (1,525)  $  (5,145)  $  (4,920)
      Items not affecting cash:
        Depreciation and
         amortization                201         173         446         394
        Amortization of
         deferred financing costs      -           -           -         979
        Loss on extinguishment
         of debt                       -           -           -         832
        Stock-based compensation
         expense                     249         259         729         552
        Equity instruments
         issued in exchange
         for services                 98         172         355         212
      Changes in operating
       assets and liabilities:
        Accounts receivable         (740)       (318)        271      (1,169)
        Inventory                   (788)        632      (1,249)     (1,618)
        Prepaid expenses and
         other current assets        217        (229)        117         470
        Accounts payable and
         accrued liabilities       1,095      (2,485)        (96)     (1,170)
                               ----------- ----------- ----------- ----------
          Net cash used in
           operating activities   (1,955)     (3,321)     (4,572)     (5,438)
                               ----------- ----------- ----------- ----------

    CASH FLOWS FROM INVESTING
     ACTIVITIES:
      Additions to fixed assets     (557)        (58)       (750)       (353)
                               ----------- ----------- ----------- ----------
          Net cash used in
           investing activities     (557)        (58)       (750)       (353)
                               ----------- ----------- ----------- ----------

    CASH FLOWS FROM FINANCING
     ACTIVITIES:
      Proceeds from bank
       borrowings                      -       4,000       4,750      17,825
      Repayment of bank
       indebtedness               (1,405)     (3,261)     (4,750)    (18,758)
      Proceeds on issuance
       of debentures                   -           -           -       1,000
      Proceeds on issuance
       of Common Shares                -           -           -         944
      Net proceeds from issuance
       of Series A Preferred Shares    -           -           -       1,451
      Net proceeds from issuance
       of Series B Preferred Shares    -           -           -       2,908
      Net proceeds from issuance
       of Series C Preferred Shares    -           -       6,320           -
      Proceeds on issuance
       of warrants                     -           -           -         800
      Proceeds from exercise
       of warrants                     -           -           -         130
                               ----------- ----------- ----------- ----------
          Net cash provided by
           financing activities   (1,405)        739       6,320       6,300
                               ----------- ----------- ----------- ----------

    CHANGE IN CASH AND CASH
     EQUIVALENTS                  (3,917)     (2,640)        998         509
    CASH AND CASH EQUIVALENTS,
     BEGINNING OF YEAR             6,626       3,205       1,711          56
                               ----------- ----------- ----------- ----------
    CASH AND CASH EQUIVALENTS,
     END OF YEAR               $   2,709   $     565   $   2,709   $     565
                               ----------- ----------- ----------- ----------
                               ----------- ----------- ----------- ----------

    SUPPLEMENTAL DISCLOSURE
     OF CASH FLOWS:
      Payments for interest    $       6   $      21   $      75   $     268
                               ----------- ----------- ----------- ----------
                               ----------- ----------- ----------- ----------
      Payments for income
       taxes                   $       -   $       -   $       -   $       -
                               ----------- ----------- ----------- ----------
                               ----------- ----------- ----------- ----------
    

    %SEDAR: 00004707E




For further information:

For further information: Xplore: 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

Organization Profile

XPLORE TECHNOLOGIES CORP.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890