Decision Dynamics Announces Q3 2009 Results

Reported revenue exceeds 2008 results

CALGARY, Nov. 24 /CNW/ - Decision Dynamics Technology Ltd. (the "Company") (Decision Dynamics; TSX-V: DDY), a leading provider of project cost control and productivity management software for the energy industry, today reported revenue of $0.5M and $2.7M for the quarter and nine months ending September 30, 2009 respectively. The financial highlights presented below are for the Oncore(TM) continuing operation only, pursuant to the disposition of the Wellcore product line during Q3 2008.

Third quarter and year-to-date 2009 revenues increased 5% and 64%, respectively, over the same periods in 2008, due to the signing of a number of new customer license contracts. A new contract signed in Q3 will provide the Company with approximately $326K in revenue over the contract term of twenty four months. Of the $326K in revenue, $41K has been recognized in the current quarter, with the remaining $285K to be recognized over the remaining contract term. Q3 and year-to-date 2009 expenses, including cost of sales, were 10% and 17% higher than in 2008. This increase for both periods reflects the higher costs related to the Company's strategic objectives - recruitment of experienced and talented personnel for the sales, marketing and development teams and initiatives to build the customer opportunity pipeline. Total expenses for 2009 also include costs associated with the relocation of the customer data centre facility completed in Q2 2009, and restructuring expenses.

    
    Financial Highlights
                                         Three Months        Nine Months
                                            Ending              Ending
    $'000 except per share
     amounts                          Sept. 30, Sept. 30, Sept. 30, Sept. 30,
                                          2009      2008      2009      2008

    Operating Results
    Revenue                                478       455     2,731     1,663
    Cost of sales                          225       308       898       844
    Gross profit(4)                        253       147     1,833       819
    Gross margin(4)                        53%       32%       67%       49%

    Operating, Amortization and
     other expenses                        875     1,456     3,022     3,140
    EBITDA(2)                             (583)     (610)   (1,021)   (1,488)
    Loss before discontinued
     operations                           (622)   (1,309)   (1,189)   (2,321)
    Net income (loss)                     (622)    2,700    (1,189)     (914)
    Loss per share, before
     discontinued operations             (0.01)    (0.02)    (0.02)    (0.04)
    Income (loss) per share, after
     discontinued operations             (0.01)     0.04     (0.02)     0.02
    Income from discontinued
     operations (including gain on
     disposal of $3.6M)                      -     4,009         -     3,235


    Financial Position                                    Sept. 30,  Dec. 31,
                                                              2009      2008
    Cash                                                     2,385     3,815
    Working capital(4)                                       2,772     4,064
    Total assets                                             4,124     5,391


    Notes
    -----
    (1)  "Gross profit" is defined as revenue less cost of sales and "gross
         margin" is gross profit divided by revenue expressed as a
         percentage.
    (2)  "EBITDA" is defined as net income (loss) before interest, income
         taxes, depreciation and amortization.
    (3)  "Working capital" is defined as current asset less current
         liabilities.
    (4)  Gross profit, gross margin, EBITDA and working capital do not have a
         standardized meaning under GAAP and may not be comparable to the
         same terms as used by other entities in the industry; however, the
         Company believes they are an important measure of performance and
         indicator of success for software businesses and are relevant to
         readers within the investment community.
    

Q3 2009 saw the Company continue to see progress from the strategic investments made in the sales and development groups. Following the successful close of two significant customer contracts in Q2 2009, the Company signed a new customer license contract early in Q3 2009. Although recognized Q3 2009 license revenue decreased 5% from 2008, services revenue increased 30% for the same period. License revenues in Q3 2009 include the new customer license that will be recognized as recurring revenue. Services revenue for Q3 2009 included new license implementation revenue as well as a recurring customer support contract. Year-to-date license revenue for 2009 significantly increased over 2008, reflecting the close of two significant contracts in Q2 2009, as well as the new customer license closed in Q3 2009. Services revenue for the nine months ended September 30, 2009, was down 27% from the same period in 2008. Services revenue in 2008 included professional services generated from late 2007 license sales. In 2009, the Company has increased its license revenues primarily though increased product adoption within the Company's existing customer base. As the product is well deployed within these customers, the Company does not expect an increase in services revenue on projects directly attributable to these sales i.e. implementations. However, the Company believes the expansion of Oncore(TM) licensing within these customers will continue to provide future license and services revenue opportunities.

Year-to-date revenues of $2.7M have surpassed the Company's 2008 results of $2.2M. New customer license revenues are unpredictable, as they are impacted by factors beyond our control, such as the timing of customer decisions and contract execution. While the Company continues to see a growth in opportunities in its customer pipeline and progress made in shortening sales cycles, it expects that many of these new license opportunities materialize in 2010.

Q3 and year-to-date 2009 total expenses increased 10% and 17% over the same periods in 2008. This increase reflects the Company's strategic objectives to invest in first-class sales, marketing and development teams. Investments in these areas have resulted in better customer lead identification, faster conversion from lead to opportunity, and a stronger product offering, which the Company believes will result in a higher revenue stream. In addition, expenses for the year-to-date 2009 included a larger commission expense related to the license sales, expenses incurred to relocate the Company data centre facility to Calgary from Edmonton, and third party technical consulting expenses incurred in the delivery of license and services customer project.

"Decision Dynamics is pleased with the fact that we have exceeded our entire 2008's revenues as of Q3 2009," says Decision Dynamics CEO, Justin Zinke.

About Decision Dynamics Technology Ltd.

Decision Dynamics Technology Ltd. is a leading provider of project cost control and productivity management software for the energy industry, including major electrical power companies.

Its product, Oncore(TM), is a project cost management solution that provides high volume, real-time capture of field labor, equipment, and material cost information, contract validation and approvals for operations management and capital projects. Oncore(TM) unifies the project data, information, and knowledge needed for complete project visibility thereby enabling better faster project management decisions. Decision Dynamics is a Microsoft Gold Certified Partner. The Company's head office is located in Calgary, Alberta, Canada. It operates a wholly-owned foreign subsidiary in the United States.

    
    Neither the TSX Venture Exchange nor its Regulation Services Provider (as
    that term is defined in the policies of the TSX Venture Exchange) accepts
    responsibility for the adequacy or accuracy of this release.
    

In this news release Decision Dynamics makes forward-looking statements or provides forward looking information (collectively "forward-looking statements"). These statements relate to future events or Decision Dynamics' future performance. The use of any of the words "anticipates", "could", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking statements and are based on Decision Dynamics' current belief or assumptions as to the outcome and timing of such future events. By their nature, these forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and the risk that such forward-looking statements will not be achieved. Some of the material assumptions that Management has made are:

    
    -   the condition of the financial markets will remain at current levels
    -   our customers will continue to look for, and make investments in
        project cost control software
    -   the customer opportunities in our sales pipeline will result in
        closed contracts
    -   we will be able to attract, motivate and retain talented employees at
        a sufficient level to achieve our strategic plans

    Readers of this analysis are cautioned not to place undue reliance on
these forward-looking statements as a number of important factors could cause
actual results to differ materially from the plans, objectives and intentions
expressed in such forward-looking statements. Some of the key factors we have
considered are:

    -   impact of the current financial markets condition
    -   impact of market demand for Oncore(TM) on revenue growth
    -   reliance on key clients
    -   degree of competition in target markets
    -   our ability to control expenses
    -   technological changes to Oncore(TM)
    -   length of sales cycle required to close customer opportunities
    -   our ability to execute our strategic plans
    -   our ability to recruit and retain high caliber employees
    

The Operating Risks section of the Company's interim and annual Management Discussion and Analysis is filed with applicable securities regulatory authorities and accessible through the SEDAR website www.sedar.com. The Company cautions that the foregoing list of factors is not exhaustive and that, when relying on forward-looking statements to make decisions, investors and others should carefully consider the foregoing factors as well as other uncertainties and events. The Company disclaims any intention or obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.

SOURCE DECISION DYNAMICS TECHNOLOGY LTD.

For further information: For further information: Justin Zinke, Chief Executive Officer, Decision Dynamics Technology Ltd., (403) 451-0731; Kim Tremblay, Chief Financial Officer, Decision Dynamics Technology Ltd., (403) 451-0726

Organization Profile

DECISION DYNAMICS TECHNOLOGY LTD.

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