IDC REPORTS THIRD QUARTER 2010 RESULTS

CALGARY, Nov. 10 /CNW/ - Imaging Dynamics Company Ltd. ("IDC" or the "Company") (TSX: IDL) a global leader in the digital radiography (DR) equipment market, today reported financial results for the third quarter September 30, 2010.

Third Quarter 2010 Highlights

• Closed on the rights offering during the quarter and raised gross proceeds of $1.5 million and net of share issue costs of $1.3 million;
• Reduced receivables by $0.8 million compared to December 31, 2009 on the collection of approximately $4.0 million during the nine months ended September 30, 2010; Days Sales Outstanding (DSO) for the quarter reduced to 67 days from 122 days for the same quarter last year;
• Reduced inventory by $1.2 million compared to December 31, 2009;
• Payables and accruals decreased by $0.3 million compared to December 31 2009;
• Sales and marketing, general and administrative, production and manufacturing and research and development expenses were reduced by 18.2 percent to $1.2 million from $1.5 million during the quarter compared to the same quarter last year and were reduced by 21.9 percent to $4.0 million from $5.2 million on a year to date basis compared to the same period last year;
• Reduced total expenses by 27.1 percent to $1.4 million from $1.9 million during the quarter compared to the same quarter last year and reduced by 30.4 percent to $4.7 million from $6.7 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 $1.9 million ($1.0 million shipped and recognized in third quarter, $0.9 million booked to closing backlog);
• Gross revenues were lower by 45.3 percent compared to the same quarter last year and lower by 58.7 percent on a year to date basis; which was largely due to the decline in revenues from Asia Pacific, and EMEA & SA where the orders have been pushed into upcoming quarters of 2010 and slower purchasing decisions in other regions; and
• Gross margins were 30.4 percent for the quarter compared to 20.5 percent for the same quarter last year and 32.6 percent compared to 26.9 percent on a year to date basis.

Net loss for the third quarter of 2010 was $1,096,880 or $0.01 of basic and diluted loss per share compared to a net loss of $1,425,850 or $0.02 of basic and diluted loss per share for the same quarter last year.  Year-to-date net loss was $3,545,120 or $0.04 of basic and diluted loss per share compared to a net loss of $4,481,648 or $0.05 basic and diluted loss per share for the same period last year.

Commenting on third quarter 2010 results, M. Thomas Boon, IDC President and Chief Executive Officer stated, "Our third quarter financial results were impacted by supply chain constraints which delayed fulfillment of existing orders for detector shipments to the Asia Pacific region; as well as digital radiography system shipments to the United States and the Latin America region.  The outlook for each of these regions for the remainder of 2010 and into 2011 is favorable for IDC's digital imaging technology.  Initial orders for the China Foundation for Poverty Alleviation agreement announced in June will be pushed into late 2010 or early 2011 as resources for this project are being devoted to recovery and rebuilding from recent earthquakes in the Yushu/ZhouQu region of Northwestern China. "

Boon continues, "The proceeds from the shareholder rights offering that closed in September has improved the Company's current cash position.  Ongoing reductions in receivables, payables, inventory and total expenses is clear evidence that each individual in the Company is cognizant of their role in sustaining the business and positioning the Company for the expected recovery of the global digital radiography market segment.  Near term the Company continues to focus on revenue growth the will occur primarily in the emerging markets where our brand and channels are strong.  In addition, the Company is expanding the product portfolio to include DR flat panel technology in selected geographic markets which is expected to add to revenue growth in the near term.  We are optimistic about the potential for considerable improvement in the Company's financial performance by early 2011."

A conference call to review the results will take place on Friday November 12, 2010 at 10:00 a.m. EST (8:00 a.m. MST).  To participate in the call please dial 647-427-7450 or 888-231-8191 approximately five minutes prior to the conference call.

Imaging Dynamics Company Ltd.
Consolidated Balance Sheets
As at			September 30		December 31
			2010		2009
Assets			(Unaudited)		(Audited)
Current Assets
	Cash and cash equivalents	$	948,816	$	310,957
	Receivables		412,932		1,187,101
	Inventory		3,606,294		4,830,116
	Prepaids and deposits		238,486		447,704
			5,206,528		6,775,878
Property, plant and equipment			427,185		524,154
Intangible assets			428,912		511,603
		$	6,062,625	$	7,811,635
Liabilities and Shareholders' Equity
Current Liabilities
	Loan	$	1,000,000	$	500,000
	Payables and accruals		3,212,631		3,516,738
	Customer deposits		584,664		438,876
	Warranty liability		1,408,582		1,457,661
			6,205,877		5,913,275
Shareholders' Equity
	Share capital		71,527,873		70,246,559
	Contributed surplus		6,009,961		5,930,955
	Warrants		4,381,787		4,238,599
	Deficit		(82,062,873)		(78,517,753)
			(143,252)		1,898,360
		$	6,062,625	$	7,811,635

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
			2010		2009		2010		2009
Revenues, net		$	952,169	$	1,742,299	$	3,421,683	$	8,275,591
Cost of goods sold			663,185		1,384,960		2,305,291		6,052,877
Gross profit			288,984		357,339		1,116,392		2,222,714
Expenses
	Sales and marketing		362,167		517,527		1,135,829		1,678,656
	General and administrative		536,942		579,710		1,773,249		2,068,160
	Production and manufacturing		160,169		238,825		531,360		689,037
	Research and development		178,379		176,621		604,566		743,357
	Foreign exchange (gain) loss		(99,526)		74,940		(59,292)		279,880
	Warranty		19,700		71,200		78,200		348,400
	Stock-based compensation		22,778		25,337		79,006		430,799
	Bad debts		119,373		136,358		119,373		136,358
	Amortization		56,039		79,819		179,659		254,953
	Interest		29,918		121		98,430		1,847
	Financing costs		-		-		143,188		102,285
			1,385,939		1,900,458		4,683,568		6,733,732
Loss before interest and other income			(1,096,955)		(1,543,119)		(3,567,176)		(4,511,018)
Interest and other income			75		914		22,056		29,370
Net loss, being comprehensive loss		$	(1,096,880)	$	(1,542,205)	$	(3,545,120)	$	(4,481,648)
Net loss per share
	Basic and diluted	$	(0.01)	$	(0.02)	$	(0.04)	$	(0.05)
Deficit, beginning of period		$	(80,965,993)	$	(75,486,694)	$	(78,517,753)	$	(72,547,251)
Net loss, being comprehensive loss			(1,096,880)		(1,542,205)		(3,545,120)		(4,481,648)
Deficit, end of period		$	(82,062,873)	$	(77,028,899)	$	(82,062,873)	$	(77,028,899)

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
					2010		2009		2010		2009
Cash flows used in operating activities
	Net loss			$	(1,096,880)	$	(1,542,205)	$	(3,545,120)	$	(4,481,648)
		Items not affecting cash
			Financing costs		-		-		143,188		58,311
			Amortization		56,039		79,819		179,659		254,953
			Stock-based compensation		22,778		25,337		79,006		430,799
			Warranty		(668)		34,823		(49,079)		251,204
					(1,018,731)		(1,402,226)		(3,192,346)		(3,486,381)
Change in non-cash working capital					659,894		1,644,660		2,048,891		2,879,679
					(358,837)		242,434		(1,143,455)		(606,702)
Cash flows from (used in) financing activities
	Loan				-		-		500,000		-
	Note payable				(200,000)		-		-		-
	Proceeds from share issuances, net				1,281,314		-		1,281,314		-
					1,081,314		-		1,781,314		-
Net change in cash and cash equivalents					722,477		242,434		637,859		(606,702)
Cash and cash equivalents
	Beginning of period				226,339		255,132		310,957		1,104,268
	End of period			$	948,816		497,566		948,816		497,566

About Imaging Dynamics Company (IDC):

IDC is a medical devices technology company and innovative force in the high growth field of digital radiography (DR) technology. IDC's product line of CCD-based X-Series direct capture technology replaces conventional film-based diagnostic imaging and provides a cost-effective solution for producing high quality diagnostic images, enhancing patient care and improving workflow.

Each IDC DR solution provides high resolution radiographic images in the digital format required for today's (PACS) Picture Archiving & Communication Systems and the growing requirements for the electronic health record, all without the use of film, environmentally unfriendly chemicals, cassettes or expensive imaging plates. 

Throughout its history, IDC has been recognized by multiple industry organizations and research analysts such as: Frost & Sullivan, Deloitte Technology and PROFIT; for its dedication to continued innovation, global growth and customer focused value proposition.

IDC is based in Calgary, Alberta, Canada. 

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.

For further information:

Contacts:

Mr. M. Thomas Boon
President & Chief Executive Officer
1.403.251.9939
[email protected]

Mr. Swapan Kakumanu
Executive Vice President & Chief Financial Officer
1.403.251.9939
[email protected]