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Noveko International Inc. Announces Results for the First Quarter Ended
September 30, 2009
Significant 98% Increase in Revenues
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EKO / TSX
</pre>
<p/>
<p><location>MONTREAL</location>, <chron>Nov. 13</chron> /CNW Telbec/ - Noveko International Inc. ("the Company") today announces its results for the first quarter ended <chron>September 30, 2009</chron>.</p>
<p>"We almost doubled our revenues in the first quarter and significantly reduced our loss from the same period of last year, which proves we are really starting to reap the benefits of our accelerated growth. We were pleased to achieve considerable progress in the commercialization of our antimicrobial products with new distribution agreements with BLD Distribution, L.L.C. and SappTech Sdn Bhd and a substantial increase in orders for our masks and hand sanitizers. We are confident we can keep up this momentum, especially since the refocusing of our mask marketing strategy in <location>North America</location> will give us access to a wider, fast-growing market. In addition, we recently concluded a financing agreement of more than <money>$15 million</money> that reflects the market confidence in our business model. We are actively pursuing our efforts to achieve other major advances in sales and profitability in upcoming quarters," indicated André Leroux, Chairman of the Board and Chief Executive Officer of the Company.</p>
<p/>
<p>First Quarter Financial Highlights</p>
<p/>
<pre>
- Consolidated revenues up by 98% to $4.5 million
- Stock-based compensation charge down by $1.8 million
- Loss before amortization, financial expenses, income taxes and
discontinued operations down by $2.8 million - Positive EBITDA for the
masks and medical equipment segments
- Loss from continuing operations down by $2.5 million
Three-Month Periods Ended September 30, 2009 and 2008
(in thousands of $, except per-share amounts) (unaudited)
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2009(1) 2008
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Revenues from continuing operations 4,496 2,272
Gross margin 2,203 1,196
Loss before amortization, financial expenses,
income taxes and discontinued operations(2) (2,956) (5,804)
Loss from continuing operations (3,811) (6,280)
Loss from discontinued operations(3) (328) (259)
Net loss(4) (4,139) (6,539)
Loss per Class A share (basic and diluted)
Continuing operations $(0.06) $(0.10)
Discontinued operations(3) $(0.00) $(0.00)
Net loss(4) $(0.06) $(0.10)
Weighted average number of
outstanding Class A shares,
basic and diluted (in thousands) 67,277 65,542
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(1) The consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiaries as at September 30, 2009.
(2) Including stock-based compensation charge of $1,251,305 and
$3,056,823 for the respective periods of 2009 and 2008, which has no
impact on the cash balance.
(3) BLI's results.
(4) Including BLI's results.
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Balance Sheet Data September 30, June 30,
2009 2009
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Total assets 48,703 50,897
Shareholders' equity 36,298 38,487
Total interest-bearing debt(1) 3,087 4,163
Cash, cash equivalents, short-term
investments and deposit in trust 2,215 4,711
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(1) Including long-term debt and its current portion, bank loans, and
short and long-term convertible debentures; excluding BLI.
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Analysis of Operating Results
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</pre>
<p/>
<p>As indicated in the Annual Management's Report for the fiscal year ended <chron>June 30, 2009</chron>, we now report segmented information based on the following business segments: medical equipment, sanitizers, antimicrobial surgical masks and respirators, filtration products and other activities consisting primarily of the activities of the parent company, Noveko International Inc. ("Noveko International"), and Noveko Trading 2008 LLC ("Noveko Trading"), as well as the marketing management services offered by Magnum Pharmaceutics Inc. ("Magnum") to external clients.</p>
<p>Furthermore, as Bolduc Leroux Inc.'s ("BLI") activities no longer fit with our growth strategy, we are actively continuing our efforts to divest this subsidiary. Accordingly, BLI's results of operations and assets and liabilities have been withdrawn from continuing operations to be treated as discontinued operations in the Company's financial statements.</p>
<p/>
<p>Consolidated and Segmented Revenues from Continuing Operations</p>
<p/>
<pre>
(in dollars)
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Three Months Ended September 30, 2009 2008
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Medical equipment 2,295,945 1,548,396
Sanitizers 792,758 66,738
Masks 794,277 10,900
Filtration 505,329 373,016
Other 107,837 272,999
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Total 4,496,146 2,272,049
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Consolidated revenues for the first quarter ended September 30, 2009 grew
by $2.2 million or 97.9% to $4.5 million. This growth came primarily from:
- the medical equipment segment, whose revenues increased by
$0.7 million, reflecting the contribution of SARL Noveko Algérie
("Noveko Algérie") - acquired in July 2008 - and the increase in its
sales, and of S.A.S. E.C.M. ("ECM"), which started to benefit from the
launch of its new Imagyne(TM) for use in human medicine and the gradual
recovery in the bovine and swine markets; and
- the sanitizers and masks segments, which posted revenue increases of
$0.7 million and $0.8 million respectively, driven by the sharp rise in
demand in the context of the A (H1N1) influenza pandemic threat.
</pre>
<p/>
<p>The operating profit margin was 49.0% for the quarter ended <chron>September 30, 2009</chron>, compared with 52.6% for the quarter ended <chron>September 30, 2008</chron>. This decline is due primarily to the different product mix resulting from the acquisitions closed during the previous year and downward adjustments in the prices of filtration products for livestock farms and medical equipment for use in veterinary medicine.</p>
<p>Selling and administrative expenses increased by approximately <money>$0.2 million to $3.8 million</money>. This slight rise stemmed primarily from the costs related to product marketing and selling initiatives in the various business segments.</p>
<p>Stock-based compensation charge, which has no impact on the Company's cash balance, decreased by <money>$1.8 million</money> from the first quarter of the previous year to <money>$1.3 million</money>. Primarily as part of the acquisitions closed at the beginning of the previous year, the Company had granted stock options to employees and consultants entitling them to purchase a total of 2,950,000 Class A shares at a weighted average exercise price of <money>$2.76</money> per share with a vesting period extending over 12 to 30 months. The change in stock-based compensation charge between the first quarter ended <chron>September 30, 2009</chron> and the first quarter ended <chron>September 30, 2008</chron> thus stems from the fact that stock-based compensation is recorded gradually.</p>
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Earnings (Loss) Before Amortization, Financial Expenses, Income Taxes and
Discontinued Operations
(in dollars)
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Quarters Ended September 30, 2009 2008
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Medical equipment 117,486 (394,556)
Sanitizers (257,676) (524,400)
Face masks 39,414 (835,028)
Filtration (600,354) (335,645)
Other (2,255,117) (3,714,517)
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Total (2,956,247) (5,804,146)
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Considering the aforementioned factors, the loss before amortization,
financial expenses, income taxes and discontinued operations amounted to
approximately $3.0 million, down by $2.8 million from the first quarter ended
September 30, 2008. The following business segments contributed to this
significant improvement:
- the medical equipment segment posted earnings before amortization,
financial expenses and income taxes (EBITDA) of $0.1 million, compared
with a loss of $0.4 million for the corresponding quarter of the
previous year. This variation reflects Noveko Algérie's contribution
and improvement in profitability, as well as that of ECM;
- the sanitizers segment lowered its loss by approximately $0.3 million
thanks to a strong increase in the AZURO(TM) products sales volume and
an almost nil stock-based compensation charge for the quarter;
- the masks segment recorded EBITDA of $39,414, up from a loss of
$0.8 million for the corresponding quarter of the previous year, thanks
to a significant increase in sales and operating profit margin and a
decrease in stock-based compensation charge;
- conversely, the filtration products segment increased its loss by
approximately $0.3 million due notably to the higher administrative
expenses and stock-based compensation charge of Noveko Taiwan, which
was only in its start-up phase during the first quarter of the previous
year;
- as for the other activities, they lowered their loss by $1.5 million,
due primarily to the decrease in Noveko International's stock-based
compensation charge.
Amortization expenses increased by $0.2 million to $0.6 million. This rise
is primarily attributable to intangible assets, notably patents in the
filtration products segment and the purchase of software for the Company's new
ERP management system.
Net Loss from Continuing Operations
(in dollars)
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Quarters Ended September 30, 2009 2008
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Medical equipment (68,493) (372,271)
Sanitizers (282,947) (544,426)
Face masks (8,936) (849,474)
Filtration (736,196) (450,677)
Other (2,714,317) (4,063,659)
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Total (3,810,889) (6,280,507)
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</pre>
<p/>
<p>Considering the aforementioned factors, the Company substantially reduced its net loss from continuing operations, which decreased to <money>$3.8 million</money> for the quarter ended <chron>September 30, 2009</chron>, down by <money>$2.5 million</money> from the first quarter of the previous year.</p>
<p>A <money>$0.3 million</money> loss from discontinued operations (BLI) was recorded in first-quarter results; consequently, the net loss amounted to <money>$4.1 million</money> for the first quarter, compared with <money>$6.5 million</money> for the corresponding quarter of the previous year.</p>
<p>Considering a net change in unrealized losses on translation of the financial statements of self-sustaining foreign operations of <money>$0.3 million</money> for the first quarter, compared with an unrealized loss of <money>$0.4 million</money> for the corresponding quarter of the previous year, a net loss of <money>$4.4 million</money> represented comprehensive loss for the quarter ended <chron>September 30, 2009</chron>, compared with a net loss of <money>$7.0 million</money> for the corresponding quarter of the previous year.</p>
<p>The loss from continuing operations and the net loss amounted to <money>$0.06</money> per Class A share (basic and diluted) on a weighted average of 67,276,665 outstanding shares, compared with a loss per share of <money>$0.10</money> on a weighted average of 65,542,241 shares for the first quarter of the previous year. The increased weighted average number of outstanding shares is due to the issuance of Class A shares subsequent to the exercise of stock options and to the conversion right of convertible debentures.</p>
<p/>
<pre>
Principal Quarterly Financial Information (Unaudited)
(in thousands of $, except per-share amounts)
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First Second Third Fourth
Quarter Quarter Quarter Quarter
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Fiscal 2010
Revenues 4,496
Loss from continuing operations (3,811)
Comprehensive loss (4,417)
Loss per Class A share from
continuing operations (basic and
diluted) (0.06)
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Fiscal 2009
Revenues 2,272 3,908 2,609 3,373
Loss from continuing operations (6,281) (6,740) (5,577) (10,262)
Comprehensive loss (6,699) (5,305) (6,931) (9,411)
Loss per Class A share from
continuing operations (basic and
diluted) (0.10) (0.10) (0.08) (0.15)
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Fiscal 2008
Revenues 1,295 2,182 1,621 2,331
Loss from continuing operations (2,127) (1,701) (3,418) (6,825)
Comprehensive loss (2,230) (1,534) (2,573) (6,928)
Loss per Class A share from
continuing operations (basic and
diluted) (0.04) (0.04) (0.06) (0.12)
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Quarter Highlights and Subsequent Events
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</pre>
<p/>
<p>Distribution Agreement with BLD Distribution, L.L.C. - for the sale and promotion of the hand sanitizers within the <location>United States</location> to the foodservices and educational segments, industrial sectors such as janitorial, warehousing and farming, and government and pharmaceutical entities. BLD committed to purchase hand sanitizers from Noveko Inc. ("Noveko") for an amount of at least US$3 million within the first year.</p>
<p>Licence and Supply Agreement with Microban Internatinal Ltd. - global leader in built-in antimicrobial product protection, offering durable antimicrobial solutions for consumer, industrial and healthcare products around the world, granted us the right to sell our line of AZURO(TM) hand sanitizers under the Microban(R) brand name. This global agreement also granted us the right to use the Microban(R) brand as the lead/host brand or ingredient brand, and the right and licence to use the Microban(R) antimicrobial technology and proprietary antimicrobial additives in the manufacture of Noveko(TM) surgical masks and respirators through <chron>December 31, 2012</chron>.</p>
<p>Air Transat Chooses Noveko(TM) Antimicrobial Technology - first order from Air Transat obtained in <chron>September 2009</chron> for some 500,000 Noveko(TM) antimicrobial masks and respirators as well as for AZURO(TM) hand sanitizers. Additional orders are expected within the near term. The antimicrobial products purchased by Air Transat are intended to protect the airline's passengers, flight personnel and ground crew. Furthermore, discussions are still under way with Air Transat and the French company Aerosys Technologies to obtain the required certifications in order to equip Air Transat's aircraft fleet with filters incorporating Noveko's antimicrobial filtration technology.</p>
<p>Distribution Agreement with SappTech - agreement with an initial term of three years, covering the distribution of our antimicrobial masks and respirators and hand sanitizers in <location>Malaysia</location>, <location>Singapore</location>, <location>Indonesia</location>, <location>Thailand</location>, and in the State of <location>Brunei Darussalam</location>. This agreement also covers Epurair's air purifiers. SappTech has undertaken to purchase a minimum of 100 million masks over the term of the agreement for an estimated value of approximately <money>$25 million</money>.</p>
<p>Agreement with McKesson Logistics Solutions - agreement with McKesson Logistics Solutions ("MSL"), Canada's leading third-party logistics provider for the healthcare industry, pursuant to which MSL provides us with order-to-cash logistics management services, including order fulfillment, storage, inventory and transportation management, for the distribution of our Noveko(TM) surgical masks and respirators and hand sanitizers.</p>
<p>Closing of a Private Placement for Total Gross Proceeds of <money>$15.7 Million</money> - On <chron>October 8, 2009</chron>, we announced the closing of an initial amount of <money>$11.7 million</money> units in connection with a best efforts private placement (the "Offering). On <chron>October 27, 2009</chron>, we closed this Offering when the Agents exercised in whole the option granted to them pursuant to the agency agreement, generating additional gross proceeds of <money>$4 million</money>, for total gross proceeds of <money>$15.7 million</money> under the Offering. Each unit was offered at <money>$2.20</money> and consisted of one (1) Class A Share of the Company (one "Class A Share") and one-half of one Class A share purchase warrant (each whole Class A Share Purchase Warrant, a "Warrant"). Each Warrant entitles its holder to purchase a Class A Share, at a price of <money>$3.00</money> per share for a period of 36 months ending on <chron>October 8, 2012</chron>, subject to an exercise period acceleration clause. Accordingly, we issued a total of 7,156,000 Class A Shares under the Offering and 3,578,000 Class A Shares may be issued upon due exercise of the Warrants.</p>
<p>Increased Demand and Production for our Masks and Respirators - On <chron>September 24, 2009</chron>, we announced that the value of our firm orders for our masks, for the period beginning <chron>July 1st, 2009</chron>, totalled <money>$12 million</money>, representing a quantity of approximately 50 million masks, reflecting a sharp increase in the demand. Since then, Malaysian-based SappTech has undertaken to purchase a minimum of 100 million masks, for an estimated value of approximately <money>$25 million</money> over a three-year period. In addition to these orders, negotiations are still under way with various potential distributors and clients with respect to several other orders.</p>
<p>We are still discussing with various suppliers to increase the assembly pace of the materials used in the manufacture of our masks and remain on the lookout for opportunities to expand our production more efficiently. We expect to reach a monthly production rate of about 9 million face masks in the current quarter and to continue gradually increasing it throughout the fiscal year.</p>
<p>Increased Demand and Production for our Sanitizers - The current context of a pandemic had led to a sharp increase in the demand for sanitizers. To that effect, we announced, on <chron>September 24, 2009</chron>, that the value of our firm orders for our hand sanitizers, for the period beginning <chron>July 1st, 2009</chron>, currently totalled <money>$6 million</money>.</p>
<p>Refocusing our strategy for the marketing of our masks and respirators in <location>North America</location> - On <chron>November 6, 2009</chron>, we announced that we are refocusing our strategy for the marketing of our Noveko(TM) masks and respirators in <location>North America</location>. In this regard, the initial 510(k) submission for the Noveko(TM) 3xEZ antibacterial surgical mask to the US Food and Drug Administration ("the FDA") ("the initial FDA submission") has been withdrawn. The prevailing A (H1N1) influenza virus pandemic context and the time and cost imperatives associated with the initial FDA submission process - which took longer and proved more complex than initially expected, moreover being limited to the Noveko(TM) 3xEZ surgical mask which had only an antibacterial claim - led us to refocus our strategy to prioritize the accelerated marketing of our Noveko(TM) masks and respirators in the <location>United States</location>, outside healthcare institutions, as well as in <location>North America</location>, globally.</p>
<p>We will submit to the National Institute for Occupational Safety and Health ("NIOSH") an application for the certifications (N95, N99) still generally used in the North American market, for our Noveko(TM) masks and respirators, which we could not do while the initial FDA submission was underway. Even though Noveko(TM) masks integrate antimicrobial ingredients, some markets still seek NIOSH recognition when making their purchasing decisions, although NIOSH standards are only particle filtration standards.</p>
<p>We believe that the North American population would benefit from having faster access, as is the case in many other markets worldwide, to our antimicrobial masks and respirators, which have been tested and proven effective not only in filtering out, but also in neutralizing a broad spectrum of viruses and bacteria. We also plan to submit the mask product labelling to the US Environmental Protection Agency ("EPA") for certification for industrial use, as the antimicrobial chemical additive incorporated into Noveko(TM) masks and respirators is already EPA registered under the US Federal Insecticide, Fungicide and Rodenticide Program.</p>
<p>Refocusing our strategy will also allow us to concentrate on developing the test protocols and obtaining the required performance data to support a new application to market our Noveko(TM) masks and respirators with an antiviral claim for healthcare institutions in the <location>United States</location>. As previously announced on <chron>September 11, 2009</chron>, at a formal pre-IDE (investigational device exemption) meeting with the FDA, we held discussions with respect to an additional claim that would allow Noveko(TM) masks and respirators to be marketed as a medical device reducing the exposure to airborne influenza particles. The FDA has indicated that it would treat any file supporting such an antiviral claim in priority. Furthermore, a new submission to the FDA by Noveko would allow the Company to include all the improvements currently developed in the design and antimicrobial properties of the Noveko(TM) masks and respirators since the filing of the initial FDA submission.</p>
<p/>
<pre>
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Profile
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</pre>
<p/>
<p>Noveko International Inc. offers innovative solutions in the environmental and medical fields worldwide. Through its subsidiaries, the Company specializes primarily in the following business segments: the development, manufacturing and marketing of derivative products from its patented antimicrobial filtration technology, including air filters, surgical masks and respirators, along with other products with antimicrobial properties such as AZURO(TM) hand sanitizers - and the development, manufacturing and marketing of medical equipment, primarily portable real-time ultrasound scanners for use in human and veterinary medicine.</p>
<p/>
<p>Certain statements set forth in this press release constitute forward-looking statements. In some cases, these statements are identified by the use of terms such as "may", "could", "might", "intend", "should", "expect", "project", "plan", "believe", "estimate" or other comparable variants. These statements are based on the information available at the time they are written, on assumptions made by management and on the expectations of management, acting in good faith, regarding future events, including those relating to economic conditions, fluctuations in exchange rates and operating expenses, and the absence of unusual events entailing supplementary expenditures. Although management considers these assumptions and expectations reasonable based on the information available at the time they are written, they could prove inaccurate. Forward-looking statements are also subject, by their very nature, to known and unknown risks and uncertainties such as those related to the industry, acquisitions, labor relations, credit, key officers, supply and product liability. The actual results of Noveko International Inc. could differ materially from those indicated or underlying these forward-looking statements. The reader is therefore recommended not to unduly rely on these forward-looking statements. Forward-looking statements do not reflect the potential impact of special items, any business combination or any other transaction that may be announced or occur subsequent to the date hereof. Unless otherwise required under securities laws, the Company does not intend and undertakes no obligation to update or revise the forward-looking statements to account for new information, new events or new circumstances.</p>
<p/>
<pre>
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The Management's Report, consolidated financial statements and
accompanying notes for the quarter ended September 30, 2009 will be filed
on SEDAR (www.sedar.com) and available on the Company's website
(www.noveko.com).
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Noveko International Inc.
Consolidated balance sheets
As at September 30, 2009 and June 30, 2009
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September 30 June 30
2009 2009
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(unaudited) (audited)
ASSETS
Current assets:
Cash and cash equivalents $ 1,001,501 $ 937,319
Deposit in trust 66,920 70,900
Short-term investments 1,146,600 3,702,958
Accounts receivable 4,983,817 3,845,527
Inventories 8,051,979 7,288,071
Prepaid expenses 468,784 734,777
Current portion of assets held for sale 1,717,686 1,998,371
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17,437,287 18,577,923
Fixed assets 3,919,711 4,124,110
Intangible assets 9,605,528 10,041,542
Other assets 1,206,387 1,198,345
Future income taxes 46,763 82,691
Goodwill 12,772,964 13,035,189
Non-current portion of assets held for
sale 3,714,625 3,836,738
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$ 48,703,265 $ 50,896,538
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Liabilities and shareholders' equity
Current liabilities:
Bank loans 156,860 162,970
Accounts payable and accrued liabilities 3,759,292 2,552,279
Current portion of secured convertible
debentures 488,475 964,710
Current portion of long-term debt 602,539 754,584
Current portion of liabilities held for
sales 2,152,205 2,126,397
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7,159,371 6,560,940
Long-term debt 1,418,790 1,455,182
Secured convertible debentures 419,850 825,117
Future income taxes 1,504,870 1,644,474
Non-current portion of liabilities held
for sales 1,902,746 1,924,217
Shareholders' equity:
Capital stock 81,981,990 80,768,629
Portion of secured convertible
debentures included in equity 186,242 372,473
Contributed surplus 19,918,849 18,718,376
Accumulated other comprehensive loss (444,169) (166,928)
Deficit (65,345,274) (61,205,942)
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36,297,638 38,486,608
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$ 48,703,265 $ 50,896,538
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Noveko International Inc.
Consolidated statements of operations
Three-month periods ended September 30, 2009 and 2008
(unaudited)
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September 30 September 30
2009 2008
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Revenues $ 4,496,146 $ 2,272,049
Cost of sales 2,293,210 1,076,259
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2,202,936 1,195,790
Operating expenses:
Administrative and selling expenses 3,773,385 3,638,400
Stock-based compensation 1,251,305 3,056,823
Research and development 243,070 324,713
Research and development tax credits (108,577) (20,000)
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5,159,183 6,999,936
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Loss before amortization, financial fees,
income taxes and discontinued operations (2,956,247) (5,804,146)
Amortization 562,873 319,669
Financial expenses less investment
revenues 320,783 296,726
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883,656 616,395
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Loss before income taxes (3,839,903) (6,420,541)
Income taxes:
Current (recovered) 52,930 (122,742)
Future (81,944) (17,292)
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(29,014) (140,034)
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Net loss from continuing operations (3,810,889) (6,280,507)
Net loss from discontinued operations (328,443) (258,623)
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Net loss $ (4,139,332) $ (6,539,130)
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Basic and diluted loss per share:
From continuing operations $ (0.06) $ (0.10)
From discontinued operations $ (0.00) $ (0.00)
Net loss $ (0.06) $ (0.10)
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Weighted average number of outstanding
shares, basic and diluted 67,276,665 65,542,241
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Noveko International Inc.
Consolidated statements of comprehensive loss
Three-month periods ended September 30, 2009 and 2008
(unaudited)
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September 30 September 30
2009 2008
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Net loss $ (4,139,332) $ (6,539,130)
Other comprehensive income, net of income
taxes:
Change in unrealized losses on
translation of financial statements of
self-sustaining foreign operations (277,241) (417,812)
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Comprehensive loss $ (4,416,573) $ (6,956,942)
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Noveko International Inc.
Consolidated statements of deficit and contributed surplus
Three-month periods ended September 30, 2009 and 2008
(unaudited)
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September 30 September 30
2009 2008
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DEFICIT
Deficit, beginning of period $ (61,205,942) $ (29,323,571)
Restatement related to the adoption of
new accounting policies - 49,243
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Restated balance (61,205,942) (29,274,328)
Net loss (4,139,332) (6,539,130)
Share issuance fees - (56,000)
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Deficit, end of period $ (65,345,274) $ (35,869,458)
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CONTRIBUTED SURPLUS
Contributed surplus, beginning of period $ 18,718,376 $ 7,967,778
Fair value of stock options granted 1,251,305 3,070,823
Fair value of stock options exercised (50,832) -
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Contributed surplus, end of period $ 19,918,849 $ 11,038,601
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Noveko International Inc.
Consolidated statements of cash flows
Three-month periods ended September 30, 2009 and 2008
(unaudited)
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September 30 September 30
2009 2008
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Cash flows from operating activities:
Net loss $ (4,139,332) $ (6,539,130)
Adjustments for:
Loss from discontinued operations 328,443 258,623
Future income taxes (81,944) (17,292)
Accreted interest on secured
convertible debentures 55,421 73,589
Stock-based compensation 1,251,305 3,056,823
Gain on disposal of fixed assets 7,283 -
Amortization 562,873 319,669
Loss on fair value of short-term
investments 11,676 75,350
Foreign exchange gain (854) (3,278)
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(2,005,129) (2,775,646)
Net change in non-cash working capital (254,810) (503,301)
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(2,259,939) (3,278,947)
Cash flows from financing activities:
Net changes in bank loan - (87,559)
Increase in long-term debt 30,000 -
Repayment of long-term debt (178,646) (101,071)
Interest paid on secured convertible
debentures (33,123) (46,416)
Proceeds from Class A shares and
warrants issued 72,498 3,591,575
Class A shares issue expenses - (12,800)
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(109,271) 3,343,729
Cash flows from investing activities:
Business acquisitions - (5,797,951)
Acquisition of short-term investments (90,000) (24,716,367)
Proceeds from disposal of short-term
investments 2,634,425 20,228,803
Acquisition of fixed assets (50,241) (274,150)
Proceeds from disposal of fixed assets 12,166 -
Acquisition of intangible assets (37,778) (106,860)
Acquisition of other assets 4,615 -
Deposit in trust 3,980 6,765
Deferred development costs, net of
related research tax credits received (83,866) (84,546)
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2,393,301 (10,744,306)
Cash generated (used) by continuing
operations 24,091 (10,679,524)
Cash generated (used) by discontinued
operations 90,486 (272,494)
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114,577 (10,952,018)
Foreign exchange loss on cash in foreign
currencies (50,395) (25,324)
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Increase (decrease) in cash and cash
equivalents 64,182 (10,977,342)
Cash and cash equivalents, beginning of
period 937,319 11,594,335
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Cash and cash equivalents, end of period $ 1,001,501 $ 616,993
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Cash flows related to continuing operating activities include interest
paid of $72,111 ($60,089 as at September 30, 2008) and income taxes
received for $265,902 ($33,807 as at September 30, 2008).
For further information: For further information: Chantal Vennat, Director, Investor Relations and Corporate Communications, Noveko International Inc., (514) 875-0606; http://www.noveko.com
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