Advantex Announces Fiscal 2009 Third Quarter Results

    ADX: TSX

    TORONTO, May 15 /CNW/ - Advantex Marketing International Inc. (TSX:ADX),
a leading specialist in loyalty marketing programs and merchant funding, today
announced its results for the Fiscal 2009 third quarter ended March 31, 2009.
All references to quarters or years are for the fiscal periods and all
currency amounts are in Canadian dollars unless otherwise noted.
    "The Company's third quarter results were impacted by soft consumer spend
in a weak economy, and seasonality during our historically weak third quarter
that is reflective of decline in consumer spend, following the holiday period,
in the CIBC Advantex programs, and Online business," said Kelly E. Ambrose,
President and Chief Executive Officer.
    "The business model is sound, and the Company continues to experience
strong demand for its Advance Purchase Marketing (APM) product offering. The
Company is committed to achieving a profit before non cash items for Fiscal,
2009. In order to do so in difficult economic times, the Company is working on
two fronts: increasing the number of establishments participating in its
programs to offset the decline in the consumer spend, and cutting costs, "Mr.
Ambrose said.
    A detailed look at the results for the three and nine months ended March
31, 2009 is set out:

    Results of Operations

    (in millions of dollars)                     Q3      Q3      YTD     YTD
                                                 --      --      ---     ---
                                               Fiscal  Fiscal  Fiscal  Fiscal
                                               ------  ------  ------  ------
                                                2009    2008    2009    2008
                                                ----    ----    ----    ----
                                                 (*)     (*)     (*)     (*)
                                                 ---     ---     ---     ---

      CIBC Advantex programs
        Advance Purchase Marketing Model       $ 1.2   $ 1.2   $ 4.5   $ 3.5
        Marketing Only Model                     0.9     0.7     2.6     2.4
        Online Shopping Malls                    0.5     0.6     2.0     2.6
                                                -----   -----   -----   -----

      Total revenue                              2.6     2.5     9.1     8.6
    Direct Expenses                             (1.0)   (0.7)   (3.1)   (3.3)
                                                -----   -----   -----   -----
                                                -----   -----   -----   -----
    Gross Profit                                 1.6     1.8     5.9     5.3
    Selling, general and administrative expenses 1.8     1.7     5.1     5.2
                                                -----   -----   -----   -----
    Contribution from operations                (0.2)    0.1     0.8     0.1

    Stock based compensation                     0.0     0.0    (0.1)    0.0
                                                -----   -----   -----   -----
    Profit/(Loss) before amortization and
     Interest                                   (0.2)    0.1     0.8     0.1
    Amortization, accretion charge on
     debentures and amortization of deferred
     financing charges                          (0.3)   (0.2)   (0.7)   (0.5)
    Stated interest on convertible debenture/
     non-convertible debenture/loan payable     (0.3)   (0.3)   (0.8)   (0.6)
                                                -----   -----   -----   -----
    Net (loss) for the period                 $ (0.8) $ (0.4) $ (0.7) $ (1.1)
                                                -----   -----   -----   -----
                                                -----   -----   -----   -----

    (*) The presentation above is not set out in accordance with Canadian
        generally accepted accounting principles (GAAP), but has been
        included to provide additional analysis for the reader. Some numbers
        in the above presentation above may not add due to rounding.

    Third quarter results reflect:

    1.  A substantially weakened economy. The decline in consumer spend at
        establishments participating in our programs has ranged between 11 %
        - 25 % in the October 2008 to March 2009 period compared with
        corresponding period in the previous year

    2.  Costs were high given the new market realities. Although well
        intentioned as we geared up for expansion, we could not support the
        cost structure going forward, and to address this the Company
        implemented both a salary reduction, and a headcount reduction
        program in mid March / early April, 2009

    Additional details on the Company's Q3 performance and its financial
position at March 31, 2009 are available in the unaudited consolidated
financial statements, and management's discussion and analysis for the three
and nine months ended March 31, 2009.

    About Advantex Marketing International Inc.

    Advantex is a specialist in the marketing services industry, managing
white-labeled rewards accelerator programs for major affinity groups through
which their members earn bonus frequent flyer miles and/or other rewards on
purchases at participating merchants. Under the umbrella of each program,
Advantex provides merchants with marketing, customer incentives, and secured
future sales through its Advance Purchase Marketing model. Advantex partners
include more than 700 restaurants, online retailers, golf courses, small inns
and resorts, and major organizations, including CIBC, United Airlines, Alaska
Airlines, and Lufthansa Airlines. Advantex is traded on the Toronto Stock
Exchange under the symbol "ADX". For additional information on Advantex,
please visit

    Forward-Looking Information

    This Press Release contains certain "forward-looking information". All
information, other than information comprised of historical fact, addresses
activities, events or developments that the Company believes, expects or
anticipates will or may occur in the future. Such forward looking information
includes, without limitation, information regarding the Company's belief that
Transaction Credits are likely indicators of future revenue; the Company's
expectation that its cost saving measures, implemented mid March, 2009 / early
April, 2009, will be realized during the remainder of Fiscal 2009 and beyond ;
management's expectations with respect to reaching an agreement with CIBC /
potential partners to expand its Advance Purchase Marketing (APM) program into
retail fashion establishments in remainder of Fiscal 2009 and beyond, and its
ability to continue to access financing under its existing line of credit
facility with respect to expanding the APM program in both the current
categories (dining, golf, small inns and spa) allowed under the current CIBC
agreement, and in the retail fashion category ; the Company's anticipated
increase in the number of Merchant Partners with which it will do business;
the Company's anticipated revenues from the 'Infinite Hotel' program, the
anticipated strong demand for the APM program offered by the Company; the
Company's continued investment in information technology systems required to
keep pace with partner and marketplace standards; the number of retailers the
Company expects to target for its programs, including the regional markets in
which the Company intends to focus on; the impact on the Company's revenues
that increased merchant participation would have; the Company's expectation
that increase in merchants participating in its programs will offset impact
from decline in consumer spend on the Company's revenues; the Company's
expectation that it will be able to work out a payment plan with the CRA such
that it will not diminish its ability to maintain and or increase its
Transaction Credits; the Company's intentions with respect to retaining future
earnings in the foreseeable future; and other information regarding financial
and business prospects and financial outlook is forward-looking information.
Forward-looking information reflects the current expectations or beliefs of
the Company based on information currently available to the Company.
Forward-looking information is subject to a number of risks, uncertainties and
assumptions that may cause the actual results of the Company to differ
materially from those discussed in the forward-looking information, and even
if such actual results are realized or substantially realized, there can be no
assurance that they will have the expected consequences to, or effects on the
Company. Factors that could cause actual results or events to differ
materially from current expectations include, among other things, changes in
general economic and market conditions, changes to regulations affecting the
Company's activities, uncertainties relating to the availability and costs of
financing needed in the future, delays in finalizing the retail contract,
continuation of listing on the TSX, and other factors, including without
limitation, those listed under "Risks and Uncertainties" and "Economic
Dependence" in the Company's interim and year end filings. All forward-looking
information speaks only as of the date on which it is made and, except as may
be required by applicable securities laws, the Company disclaims any intent or
obligation to update any forward-looking information, whether as a result of
new information, future events or results or otherwise. Although the Company
believes that the assumptions inherent in the forward-looking information are
reasonable, forward-looking information is not a guarantee of future
performance and accordingly undue reliance should not be put on such
information due to the inherent uncertainty therein.

    %SEDAR: 00004122E

For further information:

For further information: Mukesh Sabharwal, Vice-President and Chief
Financial Officer, Tel: (905) 470-9558 ext. 249, E-mail:

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