IDC reports third quarter 2009 results

CALGARY, Nov. 12 /CNW/ - Imaging Dynamics Company Ltd. (IDC or the Company) (TSX: IDL) a global supplier in the growing digital radiography (DR) equipment market, today reported financial results for the three and nine months ended September 30, 2009.

    
    Third Quarter 2009 Highlights

    -  Reduced receivables by $3.4 million compared to December 31, 2008 on
       the collection of approximately $10.8 million during the nine months
       ended September 30, 2009; Days Sales Outstanding (DSO) for the quarter
       reduced to 122 days from 301 days for the same quarter last year;

    -  Reduced inventory by $1.3 million compared to December 31, 2008;

    -  Reduced payables and accruals by $1.8 million compared to December 31
       2008;

    -  Cash and cash equivalents decreased by $0.6 million to $0.5 million at
       September 30, 2009 from $1.1 million at December 31, 2008;

    -  Sales and marketing, general and administrative, production and
       manufacturing and research and development expenses were reduced by
       44.4 percent to $1.5 million from $2.7 million during the quarter
       compared to the same quarter last year and were reduced by 48.6
       percent to $5.2 million from $10.1 million on a year to date basis
       compared to the same period last year;

    -  Reduced total expenses by 38.6 percent to $1.9 million from $3.1
       million during the quarter compared to the same quarter last year and
       reduced by 44.8 percent to $6.7 million from $12.2 million on a year
       to date basis compared to the same period last year;

    -  Purchase orders received during the third quarter and opening backlog
       totaled $3.2 million ($1.7 million shipped and recognized, $1.5
       million booked to closing backlog);

    -  Gross revenues were lower by 16.6 percent compared to the same quarter
       last year and lower by 40.1 percent on a year to date basis; which was
       largely due to the decline in revenues in United States ("US") as a
       result of the slowing economic conditions; and

    -  Gross margins were 20.5 percent for the quarter compared to 20.2
       percent for the same quarter last year and 26.9 percent compared to
       27.5 percent on a year to date basis; which were also impacted due to
       lower margin sales during the period, the global pricing pressures on
       digital radiography products and the continued utilization of
       inventory that was purchased during previous quarters.
    

Net loss was for the third quarter of 2009 was $1,542,205 or $0.02 of basic and diluted loss per share compared to a net loss of $2,672,105 or $0.03 of basic and diluted loss per share for the same quarter last year. Year-to-date net loss was $4,481,648 or $0.05 of basic and diluted loss per share compared to a net loss of $8,380,804 or $0.12 basic and diluted loss per share for the same period last year

Commenting on the third quarter 2009 results, Tom Boon, IDC's President and CEO said, "While our results this quarter are not in line with expectation, like most companies in the diagnostic imaging industry we are challenged to sustain the quality and momentum of top line performance in the current market. Throughout 2009 we have continued to improve and expand our global distribution channels which will yield better results. On a quarter-over-quarter and year-over-year basis, the company continues to make solid improvements to our balance sheet, expense reduction and careful management of our working capital."

Boon continued, "Overall, the IDC brand is strong and there continues to be a high level of interest in and quote activity for IDC's digital radiography technology. There is modest growth in our sales funnel and considerable tender opportunities in the emerging markets that we fully expect will favour IDC's technology. These are challenging times and we remain optimistic that IDC will benefit as our value proposition, channel initiatives, and marketing programs give us a solid foundation for revenue growth in this uncertain and unpredictable market."

A conference call to review the results will take place on Friday, November 13, 2009 at 8.00 a.m. EDT (6.00 a.m. MDT). To participate in the call please dial 416-646-3095 or 877-974-0451 approximately 5 minutes prior to the conference call.

    
    Imaging Dynamics Company Ltd.
    Consolidated Balance Sheets                 September 30     December 31
    As at                                               2009            2008
    -------------------------------------------------------------------------

    Assets                                          (Unaudited)     (Audited)
    Current Assets
      Cash and cash equivalents                   $    497,566  $  1,104,268
      Receivables                                    1,507,033     4,954,233
      Inventory                                      4,952,011     6,254,484
      Prepaids and deposits                            677,706       450,676
                                                 -------------- -------------

                                                     7,634,316    12,763,661
    Property and equipment                             899,631     1,136,216
    Intangible assets                                  202,053       220,421
                                                 -------------- -------------

                                                  $  8,736,000  $ 14,120,298
                                                 -------------- -------------
                                                 -------------- -------------

    Liabilities and Shareholders' Equity
    Current Liabilities
      Payables and accruals                       $  3,422,272  $  5,248,257
      Customer deposits                                610,101       427,080
      Warranty liability                             1,468,923     1,217,719
                                                 -------------- -------------

                                                     5,501,296     6,893,056
                                                 -------------- -------------
    Shareholders' Equity
      Share capital                                 70,246,559    70,246,559
      Contributed surplus                            5,905,698     5,474,899
      Warrants                                       4,111,346     4,053,035
      Deficit                                      (77,028,899)  (72,547,251)

                                                 -------------- -------------
                                                     3,234,704     7,227,242

                                                 -------------- -------------
                                                  $  8,736,000  $ 14,120,298
                                                 -------------- -------------
                                                 -------------- -------------

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    Imaging Dynamics Company Ltd.
    Consolidated Statements of Operations, Comprehensive Loss and Deficit
    (Unaudited)
    -------------------------------------------------------------------------


                              Three Months Ended           Nine Months Ended
                      --------------------------- ---------------------------
                      September 30  September 30  September 30  September 30
                              2009          2008          2009          2008
                      ------------- ------------- ------------- -------------

    Revenues, net     $  1,742,299  $  2,089,039  $  8,275,591  $ 13,805,799
    Cost of goods
     sold                1,384,960     1,667,423     6,052,877    10,009,660
                      ------------- ------------- ------------- -------------

    Gross profit           357,339       421,616     2,222,714     3,796,139
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

    Expenses
      Sales and
       marketing           517,527     1,107,928     1,678,656     3,918,250
      General and
       administrative      579,710       863,482     2,068,160     3,209,442
      Production and
       manufacturing       238,825       383,257       689,037     1,394,135
      Research and
       development         176,621       364,376       743,357     1,550,045
      Foreign exchange
       (gain) loss          74,940      (309,836)      279,880      (245,043)
      Warranty              71,200       147,460       348,400       466,304
      Stock-based
       compensation         25,337       121,395       430,799       683,022
      Bad debts            136,358       176,182       136,358       428,048
      Amortization          79,819       178,329       254,953       536,617
      Interest                 121        61,355         1,847       263,166
      Financing costs            -             -       102,285             -
                      ------------- ------------- ------------- -------------
                         1,900,458     3,093,928     6,733,732    12,203,986
                      ------------- ------------- ------------- -------------

    Loss before
     interest and
     other income       (1,543,119)   (2,672,312)   (4,511,018)   (8,407,847)
    Interest and
     other income              914           207        29,370        27,043
                      ------------- ------------- ------------- -------------
    Net loss, being
     comprehensive
     loss             $ (1,542,205) $ (2,672,105) $ (4,481,648) $ (8,380,804)
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net loss per
     share
      Basic and
      diluted         $      (0.02) $      (0.03) $      (0.05) $      (0.12)
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Deficit,
     beginning
     of period        $(75,486,694) $(62,556,640) $(72,547,251) $(56,847,941)
    Net loss, being
     comprehensive
     loss               (1,542,205)   (2,672,105)   (4,481,648)   (8,380,804)
                      ------------- ------------- ------------- -------------
    Deficit, end
     of period        $(77,028,899) $(65,228,745) $(77,028,899) $(65,228,745)
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Imaging Dynamics Company Ltd.
    Consolidated Statement of Cash Flows
    (Unaudited)
    -------------------------------------------------------------------------

    Increase (decrease) in cash and cash equivalents are as follows:

                              Three Months Ended           Nine Months Ended
                      --------------------------- ---------------------------
                      September 30  September 30  September 30  September 30
                              2009          2008          2009          2008
                      ------------- ------------- ------------- -------------
    Cash flows used in
     operating
     activities
      Net loss        $ (1,542,205) $ (2,672,105) $ (4,481,648) $ (8,380,804)
        Items not
         affecting
         cash
          Financing
           costs                 -             -        58,311             -
          Amortization      79,819       178,329       254,953       536,617
          Stock-based
           compensation     25,337       121,395       430,799       683,022
          Warranty          34,823      (181,722)      251,204      (323,526)
                      ------------- ------------- ------------- -------------

                        (1,402,226)   (2,554,103)   (3,486,381)   (7,484,691)
        Change in
         non-cash
         working
         capital         1,644,660     1,199,315     2,923,653       (61,602)
                      ------------- ------------- ------------- -------------

                           242,434    (1,354,788)     (562,728)   (7,546,293)
                      ------------- ------------- ------------- -------------
    Cash flows from
     (used in)
     financing
     activities
        Proceeds from
         share
         issuances, net          -             -             -     8,316,220
        Short-term
         borrowing, net          -      (498,975)            -    (1,260,244)
        Repayment of
         loans payable           -             -             -       (45,013)
        Financing costs          -             -       (43,974)            -
                      ------------- ------------- ------------- -------------

                                 -      (498,975)      (43,974)    7,010,963
                      ------------- ------------- ------------- -------------
    Cash flows used
     in investing
     activities
        Property and
         equipment
         additions               -        (9,691)            -      (252,752)
                      ------------- ------------- ------------- -------------
    Net change in cash
      and cash
      equivalents          242,434    (1,863,454)     (606,702)     (788,082)
    Cash and cash
     equivalents
        Beginning of
        period             255,132     2,535,926     1,104,268     1,460,554
                      ------------- ------------- ------------- -------------

    End of period          497,566       672,472       497,566       672,472
                      ------------- ------------- ------------- -------------
                      ------------- ------------- ------------- -------------

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

About IDC:

IDC (Imaging Dynamics Company) is a medical technology company and innovative force in the fast-growing field of digital radiography (DR) technology. IDC's X-Series line of direct capture technology replaces conventional film-based image capture and provides a cost-effective alternative to cassette based computed radiography (CR) systems.

Each IDC DR solution provides high resolution radiographic images in the digital format required for today's electronic medical record networks, all without the use of film, environmentally harmful chemicals, cassettes or expensive imaging plates.

IDC received the 2007 Frost & Sullivan Technology Innovation Award and the 2008 PROFIT 100 ranking as one of Canada's fastest-growing companies. IDC was also recognized by the 2008 Deloitte Technology Fast 500, which ranks the fastest growing technology, media, telecommunications and life sciences companies in North America.

IDC is based in Calgary, Alberta, Canada.

You may also visit the IDC Web site: www.imagingdynamics.com.

Statements in this release which describe IDC's intentions, expectations or predictions, or which relate to matters that are not historical facts are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performances or achievements of IDC to be materially different from any future results, performances or achievements expressed in or implied by such forward-looking statements. IDC may update or revise any forward-looking statements, whether as a result of new information, future events or changing market and business conditions. Known and unknown risks and uncertainties include: IDC's ability to manufacture its products with a sufficient level of quality and in volumes which satisfy market demand; the ability of IDC to establish direct and indirect sales channels; the ability of IDC to establish industry partnerships; IDC's ability to attract and retain key personnel; the strength and breadth of IDC's patents; and other factors relating to general economic conditions, specific industry conditions and IDC's particular situation.

SOURCE Imaging Dynamics Company Ltd.

For further information: For further information: Tom Boon, President and Chief Executive Officer; Swapan Kakumanu, Executive Vice President & Chief Financial Officer, 1-866-975-6737, investor@imagingdynamics.com, www.imagingdynamics.com

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