D-BOX Releases First Quarter Results for 2008



    LONGUEUIL, QC, Aug. 22 /CNW/ - D-BOX Technologies Inc. (TSX-V: DBO.A)
("D-BOX" or "the Company") a leading provider of motion technology for
immersive home entertainment, today announced that it released its first
quarter results, ending June 30, 2007.

    
    Highlights of the first quarter of 2008

    -  Completion of a public offering totaling $11.5 million, of which
       $10 million was raised during the quarter;

    -  Installation of D-BOX technology at the Hollywood studios of EFILM,
       one of the world's most advanced digital projection laboratories;

    -  Signature of an agreement to collaborate with a major international
       manufacturer on the design of a mass-market video game motion chair;

    -  Association with Virtue Arts and VirtuePlay, for the integration of
       the D-BOX motion technology to a new video game;

    -  Signature of a co-marketing agreement with Digiscreen, a Canadian
       designer and distributor of digital technology for movie theatres.
    

    During the first quarter of 2008, D-BOX's revenues were $802,538 compared
to $1,111,461 for the same period the preceding year. Operating expenses were
$1,277,299 compared to $866,061 for the same quarter of the previous year. Net
loss for the quarter was $997,850 ($0.015 per share) compared to $319,526
($0.05 per share) for the first quarter of fiscal 2007. The decrease in
revenue is attributed to a lower level of deliveries to an important client of
the arcade market, to impacts related to changes made to the sales process and
to unfavorable variations in the exchange rate. The higher operating expenses
are mainly attributed to increased costs related to the hiring of new
resources during the course of the previous year.
    "During the first quarter of 2008 we continued to implement our
development strategy, going forward with several marketing initiatives and
putting considerable effort into developing our distribution network, which
currently stands at more than 200 points of sale," said Claude Mc Master,
President and CEO of D-BOX Technologies. "We have also invested considerable
time, effort and money into developing new partnerships to promote the
adoption of our technology as the entertainment industry standard. During the
next quarters, we will actively work at expanding our line of products and
making them more accessible to the mass market. The collaboration agreement we
recently signed with a major international manufacturer is an important step
in this direction," Mr. Mc Master added. "Following our most recent public
offering, our financial position is solid and this will allow us to accelerate
our growth efforts."

    About D-BOX

    D-BOX Technologies designs and manufactures high-technology motion
systems destined mainly for the entertainment industry. Its unique, patented
technology uses motion codes specifically programmed for each film, TV program
or video game, resulting in motion that is perfectly synchronized with
on-screen action. By forming strong industry alliances, D-BOX's award-winning
motion technology is creating a global standard in the entertainment world.
For more information, please visit www.d-box.com.
    D-BOX(R) is a registered trademark and Motion Code is a trademark of
D-Box Technologies Inc. Other names are for informational purposes only and
may be trademarks of their respective owners.

    Forward-Looking Statements

    Certain statements included herein, including those that express
management's expectations or estimates of our future performance, constitute
"forward-looking statements" within the meaning of applicable securities laws.
Forward-looking statements are necessarily based upon a number of estimates
and assumptions that, while considered reasonable by management at this time,
are inherently subject to significant business, economic and competitive
uncertainties and contingencies. We caution that such forward-looking
statements involve known and unknown risks, uncertainties and other risks that
may cause our actual financial results, performance, or achievements to be
materially different from our estimated future results, performance or
achievements expressed or implied by those forward-looking statements.
Numerous factors could cause actual results to differ materially from those in
the forward-looking statements, including without limitation, our ability to
achieve increased market acceptance for our product offerings and penetrate
new markets; the existence of undetected errors or similar problems in our
products; our ability to manage our growth; our ability to compete
successfully; potential liabilities; maintaining our intellectual property
rights and litigation involving intellectual property rights; our dependence
on the expertise of our key personnel; and our access to sufficient capital to
fund our future requirements. This list is not exhaustive of the factors that
may affect any of our forward-looking statements. Investors are cautioned not
to put undue reliance on forward-looking statements. All subsequent written
and oral forward-looking statements attributable to D-BOX or persons acting on
our behalf are expressly qualified in their entirety by this notice. We
disclaim any intent or obligation to update publicly these forward-looking
statements, whether as a result of new information, future events or
otherwise. Risks and uncertainties about our business are more fully discussed
in our Annual Report.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.


    
    D-BOX TECHNOLOGIES INC.


    Unaudited Consolidated Interim Financial Statements

    First quarter period ended June 30, 2007



    D-BOX Technologies Inc.
    UNAUDITED CONSOLIDATED INTERIM BALANCE SHEETS


    As of                                               June 30,    March 31,
                                                           2007         2007
                                                   --------------------------
                                                              $            $
    ASSETS
    Current assets
    Cash and cash equivalents                        10,987,360      931,163
    Short-term investments                                    -    1,799,873
    Accounts receivable                                 884,619      917,559
    Inventories                                       1,315,276    1,226,925
    Prepaid expenses                                     55,332       34,028
    -------------------------------------------------------------------------
                                                     13,242,587    4,909,548
    -------------------------------------------------------------------------
    Property, plant and equipment                       439,335      429,320
    Intangible assets                                   204,345      190,044
    -------------------------------------------------------------------------
                                                     13,886,267    5,528,912
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current liabilities
    Accounts payable and accrued liabilities          1,271,275    1,168,123
    Current portion of long-term debt                    14,696       15,182
    -------------------------------------------------------------------------
                                                      1,285,971    1,183,305
    Long-term debt                                      744,862      742,317
    -------------------------------------------------------------------------
                                                      2,030,833    1,925,622
    -------------------------------------------------------------------------

    Shareholders' equity
    Share capital                                    21,240,302   12,324,101
    Warrants                                            824,172      517,620
    Contributed surplus                                 318,957      291,716
    Equity component of convertible debentures           89,278       89,278
    Deficit                                         (10,617,275)  (9,619,425)
    -------------------------------------------------------------------------
                                                     11,855,434    3,603,290
    -------------------------------------------------------------------------
                                                     13,886,267    5,528,912
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    D-BOX Technologies Inc.
    UNAUDITED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND DEFICIT


    For the first Quarter ended June 30,                   2007         2006
                                                   --------------------------
                                                              $            $
    Revenues                                            802,538    1,111,461
    Cost of goods sold                                  523,089      564,926
    -------------------------------------------------------------------------
    Gross profit                                        279,449      546,535
    -------------------------------------------------------------------------

    Expenses
    Selling and marketing                               543,883      328,792
    Administrative                                      462,214      309,311
    Research and development                            200,394      135,953
    Financial                                            70,808       92,005
    -------------------------------------------------------------------------
                                                      1,277,299      866,061
    -------------------------------------------------------------------------
    Net loss                                           (997,850)    (319,526)

    Deficit, beginning of period                     (9,619,425)  (7,500,890)
    -------------------------------------------------------------------------
    Deficit, end of period                          (10,617,275)  (7,820,416)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic and diluted loss per share                    (0.0153)     (0.0059)
    -------------------------------------------------------------------------

    Weighted average number of shares outstanding    65,181,882   54,045,641
    -------------------------------------------------------------------------



    D-BOX Technologies Inc.
    UNAUDITED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS


    For the first Quarter ended June 30,                   2007         2006
                                                   --------------------------
                                                              $            $
    OPERATING ACTIVITIES
    Net loss                                           (997,850)    (319,526)
    Items not affecting cash:
      Amortization of property, plant and equipment      32,320       14,712
      Amortization of intangible assets                   7,712        5,584
    Stock-based compensation                             27,241       25,179
      Accrued interest and other non-cash interest
       expense on convertible debentures                  8,060       30,328
    -------------------------------------------------------------------------
                                                       (922,517)    (243,723)
    Net change in non-cash working capital items
      Accounts receivable                                32,940       33,136
      Inventories                                       (88,351)      49,683
      Prepaid expenses                                  (21,304)     (22,647)
      Accounts payable and accrued liabilities          103,152      (19,761)
    -------------------------------------------------------------------------
    Cash flows relating to operating activities        (896,080)    (203,312)
    -------------------------------------------------------------------------

    INVESTING ACTIVITIES
    Additions to property, plant and equipment          (42,335)      (5,008)
    Additions to intangible assets                      (22,013)     (25,820)
    Decrease (increase) in short-term investments     1,799,873      (20,319)
    -------------------------------------------------------------------------
    Cash flows relating to investing activities       1,735,525      (51,147)
    -------------------------------------------------------------------------

    FINANCING ACTIVITIES
    Repayment of long-term debt                          (6,001)     (40,603)
    Shares issued                                    10,000,301            -
    Shares issued costs                                (777,548)           -
    -------------------------------------------------------------------------
    Cash flows relating to financing activities       9,216,752      (40,603)
    -------------------------------------------------------------------------

    Net change in cash and cash equivalents          10,056,197     (295,062)
    Cash and cash equivalents, beginning of period      931,163      699,191
    -------------------------------------------------------------------------
    Cash and cash equivalents, end of period         10,987,360      404,129
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Supplementary information
    Interest paid                                         1,286       13,622
    -------------------------------------------------------------------------
    

    %SEDAR: 00012304EF




For further information:

For further information: Normand Chartrand, Chief Financial Officer,
D-BOX Technologies Inc., (450) 442-3003, ext. 258, nchartrand@d-box.com; Eric
Bouchard, The Equicom Group Inc., (514) 844-7997, ebouchard@equicomgroup.com

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