EXFO Reports Fourth-Quarter and Year-End Results for Fiscal 2009
- Annual sales decrease 5.9% in the current economic environment
- Record cash flows from operations attain US$22.6 million
- Gross margin improves for a seventh consecutive year to reach 61.3%
- Cash position of US$69.7 million and no debt
</pre>
<p/>
<p><location>QUEBEC</location> CITY, <chron>Oct. 13</chron> /CNW Telbec/ - EXFO Electro-Optical Engineering Inc. (NASDAQ: EXFO, TSX: EXF) reported today fourth-quarter and year-end financial results for the fiscal year ended <chron>August 31, 2009</chron>.</p>
<p>Annual sales decreased 5.9% to US$172.9 million in fiscal 2009 from US$183.8 million in 2008. In the fourth quarter of 2009, sales reached US$36.5 million compared to US$43.6 million in the previous quarter and US$50.9 million in the fourth quarter of 2008. Overall for fiscal 2009, net bookings decreased 2.2% to US$180.5 million from US$184.6 million in 2008 for an annual book-to-bill ratio of 1.04. In the fourth quarter of 2009, net bookings totaled US$40.7 million for a book-to-bill ratio of 1.11 compared to US$40.2 million in the third quarter of 2009 and US$45.7 million in the fourth quarter of 2008.</p>
<p>Gross margin improved for a seventh consecutive year to reach 61.3% of sales in fiscal 2009. In the fourth quarter of 2009, gross margin amounted to 60.0% compared to 62.3% in the previous quarter and 59.9% in the fourth quarter of 2008.</p>
<p>In fiscal 2009, GAAP net loss totaled US$16.6 million, or US$0.27 per share, including US$21.7 million for impairment of goodwill, US$5.1 million in amortization of intangible assets, US$1.4 million in stock-based compensation costs and US$1.2 million in restructuring charges. These items were partially offset by US$1.9 million for the recognition of previously unrecognized R&D tax credits and US$0.9 million for the net recovery of income taxes. These items resulted in a net income tax recovery of US$2.6 million.</p>
<p>In fiscal 2008, GAAP net earnings reached US$18.4 million, or US$0.27 per diluted share, including US$6.5 million for the net recovery of income taxes and an extraordinary gain of US$3.0 million related to the negative goodwill on the acquisition of Navtel Communications. These items were partially offset by US$3.9 million in amortization of intangible assets and US$1.3 million in stock-based compensation costs. These items resulted in a net income tax recovery of US$0.9 million.</p>
<p>In the fourth quarter of 2009, GAAP net loss amounted to US$1.2 million, or US$0.02 per share, including US$1.2 million in restructuring charges, US$1.1 million in amortization of intangible assets, and US$0.4 million in stock-based compensation costs. These items were offset by US$1.9 million for the recognition of previously unrecognized R&D tax credits and US$0.9 million for the net recovery of income taxes. These items resulted in a net income tax expense of US$0.1 million.</p>
<p>In the third quarter of fiscal 2009, GAAP net loss totaled US$23.3 million, or US$0.39 per share. EXFO recorded a non-cash charge of US$21.7 million for impairment of goodwill and a foreign exchange loss of US$4.7 million in the third quarter of 2009. GAAP net loss in the third quarter of 2009 also included US$1.4 million in amortization of intangible assets and US$0.4 million in stock-based compensation costs. These items resulted in a net income tax recovery of US$2.3 million.</p>
<p>In the fourth quarter of 2008, GAAP net earnings amounted to US$3.3 million, or US$0.05 per diluted share, including US$1.4 million in amortization of intangible assets and US$0.4 million in stock-based compensation costs. These items resulted in a net income tax recovery of US$0.2 million.</p>
<p>"EXFO made significant progress navigating through the severe global economic recession in fiscal 2009 and I believe we continued to gain market share from a reduced telecom test and service assurance pie," said Germain Lamonde, EXFO's Chairman, President and CEO. "I'm particularly pleased with our Protocol business which grew 63.1% on full-year revenue contributions from the Brix and Navtel acquisitions and on our focus on IP convergence - both in fixed and mobile communication networks - to account for more than one-third of Telecom revenues. We also continued building for the future in key telecom growth sectors with 26 new product introductions, including several game-changing solutions."</p>
<p>"It was more challenging on the EBITDA side, given lower sales volume caused by the recession, but actions were taken to align our operating expenses to market conditions through a US$6 million annualized cost-reduction plan in the fourth quarter," <person>Mr. Lamonde</person> added. "I'm pleased we still raised our gross margin for a seventh consecutive year to reach 61.3%, generated record cash flows from operations of US$22.6 million, and maintained a healthy balance sheet. Now that the worst of the economic recession seems to be behind us, I'm excited about EXFO's strong strategic position to take advantage of key market opportunities and return to our profitable growth path, as reflected in our new corporate performance metrics for the next three years."</p>
<p/>
<pre>
Selected Financial Information
(In thousands of US dollars)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Segmented Q4 2009 Q3 2009 Q4 2008 FY 2009 FY 2008
results: ----------- ----------- ----------- ----------- ------------
(unaudited) (unaudited) (unaudited) (unaudited)
Sales:
Telecom
Division $ 31,509 $ 39,047 $ 45,338 $ 153,082 $ 160,981
Life
Sciences
& Indus-
trial
Division 4,998 4,589 5,605 19,796 22,809
----------- ----------- ----------- ----------- ------------
Total $ 36,507 $ 43,636 $ 50,943 $ 172,878 $ 183,790
----------- ----------- ----------- ----------- ------------
----------- ----------- ----------- ----------- ------------
Earnings
(loss) from
operations:
Telecom
Division $ (3,238) $ (21,990) $ 2,867 $ (21,954) $ 9,524
Life
Sciences
& Indus-
trial
Division 2,020 438 721 3,876 2,459
----------- ----------- ----------- ----------- ------------
Total $ (1,218) $ (21,552) $ 3,588 $ (18,078) $ 11,983
----------- ----------- ----------- ----------- ------------
----------- ----------- ----------- ----------- ------------
Other
selected
information:
GAAP net
earnings
(loss) $ (1,181) $ (23,346) $ 3,314 $ (16,585) $ 18,424
Recognition
of pre-
viously
unrecognized
R&D tax
credits $ (1,902) $ - $ - $ (1,902) $ -
Amortiza-
tion of
intangible
assets $ 1,147 $ 1,355 $ 1,402 $ 5,067 $ 3,871
Restruc-
turing
charges $ 1,171 $ - $ - $ 1,171 $ -
Impairment
of
goodwill $ - $ 21,713 $ - $ 21,713 $ -
Stock-
based
compensa-
tion costs $ 379 $ 383 $ 368 $ 1,409 $ 1,272
Net
recovery
of income
tax $ (943) $ - $ - $ (943) $ (6,515)
Extraor-
dinary
gain
(negative
goodwill) $ - $ - $ - $ - $ (3,036)
Net income
tax effect
of the
above
items $ 93 $ (2,273) $ (225) $ (2,613) $ (915)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
</pre>
<p/>
<p>Operating Expenses</p>
<p/>
<p>Selling and administrative expenses amounted to US$63.8 million, or 36.9% of sales, in fiscal 2009 compared to US$61.2 million, or 33.3% of sales, in 2008. In the fourth quarter of 2009, selling and administrative expenses totaled US$14.2 million, or 38.9% of sales, compared to US$16.7 million, or 38.3% of sales, in the third quarter of 2009 and US$17.0 million, or 33.4% of sales, in the fourth quarter of 2008.</p>
<p>Gross research and development (R&D) expenses reached US$35.8 million, or 20.7% of sales, in fiscal 2009 compared to US$32.5 million, or 17.7% of sales, in 2008. In the fourth quarter of 2009, gross R&D expenses attained US$9.0 million, or 24.7% of sales, compared to US$9.3 million, or 21.4% of sales, in the previous quarter and US$8.6 million, or 16.8% of sales, in the fourth quarter of 2008.</p>
<p>Net R&D expenses totaled US$27.7 million, or 16.0% of sales in fiscal 2009, compared to US$26.9 million, or 14.6% of sales, in 2008. In the fourth quarter of 2009, net R&D expenses amounted to US$5.4 million, or 14.7% of sales, compared to US$7.8 million, or 17.8% of sales, in the third quarter of 2009 and US$7.3 million, or 14.3% of sales, in the fourth quarter of 2008.</p>
<p/>
<p>Fiscal 2009 Business Highlights</p>
<p/>
<p>- Market expansion - EXFO's annual sales decreased 5.9%, or 13.5% on an</p>
<p> organic basis (excluding acquisitions and gains or losses from forward</p>
<p> exchange contracts recorded in sales), largely due to the global</p>
<p> economic recession in 2009. Protocol sales, benefiting from full-year</p>
<p> revenue contributions from the Brix Networks and Navtel Communications</p>
<p> acquisitions, IP convergence and network capacity upgrades on wireline</p>
<p> and wireless networks, increased 63.1% year-over-year. The company's</p>
<p> Optical (-17.5%) and Copper Access (-21.8%) businesses were more</p>
<p> affected by challenging market conditions, since many network operators</p>
<p> deferred capital-intensive deployment decisions. Likewise, the Life</p>
<p> Sciences and Industrial Division (-13.2%) was affected by difficult</p>
<p> market conditions. In terms of geographic diversification, the Americas</p>
<p> accounted for 57.4% of sales in 2009 (vs. 55.8% in 2008), <location>Europe</location>,</p>
<p> <location>Middle East</location> and <location>Africa</location> (EMEA) 26.9% (vs. 28.4% in 2008), and Asia-</p>
<p> Pacific 15.7% (vs. 15.8% in 2008). EXFO's largest customer accounted</p>
<p> for 11.6% of total sales, while the company's top three customers</p>
<p> represented 17.8%.</p>
<p/>
<p>- Profitability -EXFO raised its gross margin for a seventh consecutive</p>
<p> year to reach 61.3%, generated a record of US$22.6 million in cash</p>
<p> flows from operations, and closed fiscal 2009 with a cash position of</p>
<p> US$69.7 million and no debt. EBITDA dropped to US$14.5 million, or 8.4%</p>
<p> of sales, mainly due to the global economic recession. The company</p>
<p> implemented a restructuring plan in the fourth quarter that incurred a</p>
<p> charge of US$1.2 million but will provide US$6 million in annualized</p>
<p> cost savings.</p>
<p/>
<p>- Innovation - EXFO launched 26 new products in fiscal 2009, including</p>
<p> three in the fourth quarter, compared to 27 in 2008. Key product</p>
<p> introductions in 2009 included laboratory and portable test solutions</p>
<p> for characterizing 100 Gbit/s Ethernet and 40/43 Gbit/s SONET/OTN</p>
<p> networks; a distributed PMD analyzer that allows network operators to</p>
<p> cost-effectively upgrade their networks to 40 Gbit/s and 100 Gbit/s;</p>
<p> new software releases for the IMS InterWatch platform and Packet Blazer</p>
<p> product lines that support the migration of voice and video</p>
<p> applications to the IPv6 (Internet Protocol, version 6) addressing</p>
<p> scheme; and the next-generation FTB-500 multi-layer platform for high-</p>
<p> end test applications in the field and central office. Following the</p>
<p> year-end, the company released the industry's first turnkey optical</p>
<p> modulation analyzer for complete characterization of signals up to 100</p>
<p> Gbaud/s. Sales from products on the market two years or less accounted</p>
<p> for 38.4% of total sales in fiscal 2009, including 38.8% in the fourth</p>
<p> quarter, compared to 34.6% in fiscal 2008.</p>
<p/>
<p>Business Outlook</p>
<p/>
<p>EXFO forecasted sales between US$40 million and US$45 million and a GAAP net loss between US$0.06 and US$0.02 per share for the first quarter of 2010. GAAP net loss includes US$0.02 per share in after-tax amortization of intangible assets and stock-based compensation costs and assumes a pre-tax foreign exchange loss of US$0.03 per share to account for the significant decrease of the US dollar compared to the Canadian dollars since the end of the fourth quarter of fiscal 2009.</p>
<p>This guidance was established by management based on existing backlog as of the date of this press release, seasonality and expected bookings for the remaining of the quarter.</p>
<p/>
<p>Corporate Performance Objectives for Fiscal 2010-2012</p>
<p/>
<p>Given the global economic recession in fiscal 2009, EXFO has adjusted its corporate performance metrics over a new three-year period extending from fiscal 2010 to 2012. The company has maintained its 20% sales CAGR objective, proposed to double EBITDA in dollars, and raised its gross margin target to 64% for the newly defined three-year period.</p>
<p/>
<pre>
------------------------------------------------------
Corporate Performance Objectives for FY 2010-2012
------------------------------------------------------
Increase sales by a CAGR of 20% or more
------------------------------------------------------
Raise gross margin to 64%
------------------------------------------------------
Double EBITDA* in dollars
------------------------------------------------------
* EBITDA is defined as net earnings (loss) before interest, income
taxes, amortization of property, plant and equipment, amortization of
intangible assets, impairment of goodwill and extraordinary gain. See
the following page on EXFO's Website, www.EXFO.com/investors, for a
reconciliation with GAAP net earnings (loss) in previous fiscal
years.
</pre>
<p/>
<p>Conference Call and Webcast</p>
<p/>
<p>EXFO will host a conference call today at <chron>5 p.m. (Eastern time</chron>) to review its fourth-quarter and year-end financial results for fiscal 2009. To listen to the conference call and participate in the question period via telephone, dial 1-416-641-6654. Germain Lamonde, Chairman, President and CEO, and <person>Pierre Plamondon</person>, CA, Vice-President of Finance and Chief Financial Officer, will participate in the call. An audio replay will be available one hour after the end of the conference call until <chron>7 p.m.</chron> on <chron>October 20, 2009</chron>. The replay number is 1-402-977-9141 and the reservation number is 21434695. The live audio Webcast and replay of the conference call will also be available on EXFO's Website at <a href="http://www.EXFO.com/investors">www.EXFO.com/investors</a>.</p>
<p/>
<p>About EXFO</p>
<p/>
<p>EXFO is a leading provider of test and service assurance solutions for network service providers and equipment manufacturers in the global telecommunications industry. The Telecom Division offers a wide range of innovative solutions extending across the full technology lifecycle ? from design to technology deployment and onto service assurance ? and covering all layers on a network infrastructure to enable triple-play services and next-generation, converged IP networking. The Life Sciences and Industrial Division offers solutions in medical device and opto-electronics assembly, fluorescence microscopy and other life science sectors. For more information, visit <a href="http://www.EXFO.com">www.EXFO.com</a>.</p>
<p/>
<p>Forward-Looking Statements</p>
<p/>
<p>This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, and we intend that such forward-looking statements be subject to the safe harbors created thereby. Forward-looking statements are statements other than historical information or statements of current condition. Words such as may, will, expect, believe, anticipate, intend, could, estimate, continue, or the negative or comparable terminology are intended to identify forward-looking statements. In addition, any statements that refer to expectations, projections or other characterizations of future events and circumstances are considered forward-looking statements. They are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those in forward-looking statements due to various factors including the effect of the worldwide recession and the timing of the expected recovery on the telecom market for our customers and suppliers; fluctuating exchange rates and our ability to execute in these uncertain conditions; consolidation in the global telecommunications test, measurement and service assurance industry; capital spending levels in the telecommunications, life sciences and high-precision assembly sectors; concentration of sales; the effects of the additional actions we have taken in response to such economic uncertainty (including our ability to quickly adapt cost structures with anticipated levels of business, ability to manage inventory levels with market demand); market acceptance of our new products and other upcoming products; limited visibility with regards to customer orders and the timing of such orders; our ability to successfully integrate our acquired and to-be-acquired businesses; our ability to successfully expand international operations; the retention of key technical and management personnel; and future economic, competitive, financial and market condition .Assumptions relating to the foregoing involve judgments and risks, all of which are difficult or impossible to predict and many of which are beyond our control. Other risk factors that may affect our future performance and operations are detailed in our Annual Report, on Form 20-F, and our other filings with the U.S. Securities and Exchange Commission and the Canadian securities commissions. We believe that the expectations reflected in the forward-looking statements are reasonable based on information currently available to us, but we cannot assure you that the expectations will prove to have been correct. Accordingly, you should not place undue reliance on these forward-looking statements. These statements speak only as of the date of this document. Unless required by law or applicable regulations, we undertake no obligation to revise or update any of them to reflect events or circumstances that occur after the date of this document.</p>
<p/>
<pre>
EXFO Electro-Optical Engineering Inc.
Interim Consolidated Balance Sheet
(in thousands of US dollars)
As at August 31,
------------------------
2009 2008
----------- -----------
Assets (unaudited)
Current assets
Cash $ 10,611 $ 5,914
Short-term investments 59,105 81,626
Accounts receivable
Trade 22,946 31,473
Other 2,752 4,753
Income taxes and tax credits recoverable 2,353 4,836
Inventories 30,863 34,880
Prepaid expenses 2,043 1,774
Future income taxes 5,538 9,140
----------- -----------
136,211 174,396
Tax credits recoverable 26,762 20,657
Forward exchange contracts 428 -
Property, plant and equipment 19,100 19,875
Intangible assets 16,859 19,945
Goodwill 22,478 42,653
Future income taxes 18,533 15,540
----------- -----------
$ 240,371 $ 293,066
----------- -----------
----------- -----------
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 21,650 $ 24,713
Deferred revenue 6,481 5,079
----------- -----------
28,131 29,792
Deferred revenue 4,195 3,759
----------- -----------
32,326 33,551
----------- -----------
Shareholders' equity
Share capital 104,846 142,786
Contributed surplus 17,758 5,226
Retained earnings 43,909 60,494
Accumulated other comprehensive income 41,532 51,009
----------- -----------
208,045 259,515
----------- -----------
$ 240,371 $ 293,066
----------- -----------
----------- -----------
EXFO Electro-Optical Engineering Inc.
Interim Unaudited Consolidated Statements of Earnings
(in thousands of US dollars, except share and per share data)
Three Twelve Three Twelve
months months months months
ended ended ended ended
August 31, August 31, August 31, August 31,
2009 2009 2008 2008
----------- ----------- ----------- -----------
Sales $ 36,507 $ 172,878 $ 50,943 $ 183,790
Cost of sales(1),(2) 14,618 66,892 20,416 75,624
----------- ----------- ----------- -----------
Gross margin 21,889 105,986 30,527 108,166
----------- ----------- ----------- -----------
Operating expenses
Selling and
administrative(1) 14,185 63,808 16,993 61,153
Net research and
development(1),(3) 5,371 27,698 7,297 26,867
Amortization of
property, plant
and equipment 1,233 4,607 1,247 4,292
Amortization of
intangible assets 1,147 5,067 1,402 3,871
Restructuring charges 1,171 1,171 - -
Impairment of goodwill - 21,713 - -
----------- ----------- ----------- -----------
Total operating
expenses 23,107 124,064 26,939 96,183
----------- ----------- ----------- -----------
Earnings (loss) from
operations (1,218) (18,078) 3,588 11,983
Interest income
(expense) (86) 597 576 4,639
Foreign exchange gain 186 1,157 1,349 442
----------- ----------- ----------- -----------
Earnings (loss) before
income taxes and
extraordinary gain (1,118) (16,324) 5,513 17,064
Income taxes
Current 413 561 (14) (7,094)
Future 22 72 2,213 14,094
Recognition of previously
unrecognized future
income tax assets (372) (372) - (5,324)
----------- ----------- ----------- -----------
63 261 2,199 1,676
----------- ----------- ----------- -----------
Earnings (loss) before
extraordinary gain (1,181) (16,585) 3,314 15,388
Extraordinary gain - - - 3,036
----------- ----------- ----------- -----------
Net earnings (loss)
for the period $ (1,181) $ (16,585) $ 3,314 $ 18,424
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Basic and diluted
earnings (loss)
before extraordinary
gain per share $ (0.02) $ (0.27) $ 0.05 $ 0.22
Basic and diluted net
earnings (loss) per
share $ (0.02) $ (0.27) $ 0.05 $ 0.27
Basic weighted average
number of shares
outstanding (000's) 59,553 61,845 68,082 68,767
Diluted weighted
average number of
shares outstanding
(000's) 59,553 61,845 68,550 69,318
(1) Stock-based
compensation costs
included in:
Cost of sales $ 40 $ 137 $ 36 $ 148
Selling and
administrative 221 858 232 830
Net research and
development 118 414 100 294
----------- ----------- ----------- -----------
$ 379 $ 1,409 $ 368 $ 1,272
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
(2) The cost of sales is exclusive of amortization, shown separately.
(3) Net research and development expenses for the three and twelve months
ended August 31, 2009 include recognition of previously unrecognized
research and development tax credits of $1,902.
EXFO Electro-Optical Engineering Inc.
Interim Unaudited Consolidated Statements of Comprehensive
Income (Loss)
And Accumulated Other Comprehensive Income
(in thousands of US dollars)
Comprehensive income (loss)
Three Twelve Three Twelve
months months months months
ended ended ended ended
August 31, August 31, August 31, August 31,
2009 2009 2008 2008
----------- ----------- ----------- -----------
Net earnings (loss)
for the period $ (1,181) $ (16,585) $ 3,314 $ 18,424
Foreign currency
translation
adjustment (1,078) (10,671) (18,511) (2,289)
Changes in unrealized
gains (losses) on
short-term
investments - 22 (9) 31
Unrealized gains
(losses) on forward
exchange contracts (229) (1,467) (1,882) 962
Reclassification of
realized gains
(losses) on forward
exchange contracts
in net earnings
(loss) 84 3,167 (770) (3,915)
Future income taxes
effect of the above
items 44 (528) 822 909
----------- ----------- ----------- -----------
Comprehensive
income (loss) $ (2,360) $ (26,062) $ (17,036) $ 14,122
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Accumulated other comprehensive income
Twelve
months ended August 31,
------------------------
2009 2008
----------- -----------
Foreign currency translation adjustment
Cumulative effect of prior periods $ 51,129 $ 53,418
Current period (10,671) (2,289)
----------- -----------
40,458 51,129
----------- -----------
Unrealized gains (losses) on forward exchange
contracts
Cumulative effect of prior periods (96) 1,948
Current period, net of realized gains and
future income taxes 1,172 (2,044)
----------- -----------
1,076 (96)
----------- -----------
Unrealized gains (losses) on short-term
investments
Cumulative effect of prior periods (24) (55)
Current period, net of future income taxes 22 31
----------- -----------
(2) (24)
----------- -----------
Accumulated other comprehensive income $ 41,532 $ 51,009
----------- -----------
----------- -----------
EXFO Electro-Optical Engineering Inc.
Interim Unaudited Consolidated Statements of Retained Earnings
and Contributed Surplus
(in thousands of US dollars)
Retained earnings
Twelve
months ended August 31,
------------------------
2009 2008
----------- -----------
Balance - Beginning of period $ 60,494 $ 42,330
Add (deduct)
Net earnings (loss) for the period (16,585) 18,424
Premium on redemption of share capital - (260)
----------- -----------
Balance - End of period $ 43,909 $ 60,494
----------- -----------
----------- -----------
Contributed surplus
Twelve
months ended August 31,
------------------------
2009 2008
----------- -----------
Balance - Beginning of period $ 5,226 $ 4,453
Add (deduct)
Stock-based compensation costs 1,407 1,287
Reclassification of stock-based compensation
costs to share capital upon exercise of
stock awards (540) (514)
Discount on redemption of share capital 11,665 -
----------- -----------
Balance - End of period $ 17,758 $ 5,226
----------- -----------
----------- -----------
EXFO Electro-Optical Engineering Inc.
Interim Unaudited Consolidated Statements of Cash Flows
(in thousands of US dollars)
Three Twelve Three Twelve
months months months months
ended ended ended ended
August 31, August 31, August 31, August 31,
2009 2009 2008 2008
----------- ----------- ----------- -----------
Cash flows from
operating activities
Net earnings (loss)
for the period $ (1,181) $ (16,585) $ 3,314 $ 18,424
Add (deduct) items not
affecting cash
Change in discount
on short-term
investments 24 597 (486) 1,035
Stock-based
compensation
costs 379 1,409 368 1,272
Amortization 2,380 9,674 2,649 8,163
Deferred revenue (1,539) 1,706 482 47
Loss on disposal of
capital assets - 237 - -
Impairment of
goodwill - 21,713 - -
Future income taxes (350) (300) 2,213 8,770
Extraordinary gain - - - (3,036)
Change in unrealized
foreign exchange
loss (gain) (414) (1,955) (1,619) (1,093)
----------- ----------- ----------- -----------
(701) 16,496 6,921 33,582
Change in non-cash
operating items
Accounts receivable 9,015 9,654 (4,193) (4,338)
Income taxes and tax
credits (1,202) (3,391) (1,396) (12,833)
Inventories 1,935 2,624 712 (2,166)
Prepaid expenses (12) (350) 379 (127)
Accounts payable and
accrued liabilities (1,870) (2,409) 1,659 (1,416)
----------- ----------- ----------- -----------
7,165 22,624 4,082 12,702
----------- ----------- ----------- -----------
Cash flows from
investing activities
Additions to short-term
investments (88,561) (438,460) (72,800) (717,020)
Proceeds from disposal
and maturity of
short-term investments 82,570 456,612 73,939 760,310
Additions to capital
assets (978) (6,945) (1,452) (6,508)
Business combinations,
net of cash acquired - (2,414) (78) (41,016)
----------- ----------- ----------- -----------
(6,969) 8,793 (391) (4,234)
----------- ----------- ----------- -----------
Cash flows from
financing activities
Change in bank loan - - (1,485) -
Redemption of share
capital (793) (26,871) (4,675) (8,068)
Exercise of stock
options 15 56 - 61
----------- ----------- ----------- -----------
(778) (26,815) (6,160) (8,007)
----------- ----------- ----------- -----------
Effect of foreign
exchange rate changes
on cash 110 95 (199) (88)
Change in cash (472) 4,697 (2,668) 373
Cash - Beginning of
period 11,083 5,914 8,582 5,541
----------- ----------- ----------- -----------
Cash - End of period $ 10,611 $ 10,611 $ 5,914 $ 5,914
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
For further information: Vance Oliver, Manager, Investor Relations, (418) 683-0913, Ext. 3733, [email protected]
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