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VANCOUVER, Jan. 30 /CNW/ - Ignition Point Technologies Corp.
(TSX-VEN:IPN), a Vancouver-based broadband communications company, today
announced financial results for its fourth quarter and fiscal year ended
September 30, 2006.
Total revenue for the fourth quarter ended September 30, 2006 was
$1,307,294 compared to $615,395 in the comparable quarter of fiscal 2005.
Total revenue for the year ended September 30, 2006 was $4,348,031 compared to
$1,628,310 in the prior fiscal year.
The net loss for the fourth quarter ended September 30, 2006 was $554,348
($0.07 per share) compared to $427,251 ($0.06 per share) in the comparable
quarter of fiscal 2005. The net loss for the year ended September 30, 2006 was
$3,048,690 ($0.40 per share) compared to $1,730,066 ($0.24 per share) in the
prior fiscal year.
At September 30, 2006 consolidated cash and cash equivalents totaled
$480,740 which represents a cash value of $0.06 per share. At September 30,
2005 consolidated cash and cash equivalents totaled $2,993,810, representing a
cash value of $0.41 per share. Ignition Point's working capital at
September 30, 2006 was $69,220. Cash resources at Ignition Point Technologies
are currently very limited and net cash contributions from billable sales are
not currently producing adequate cash to cover operating costs. Accordingly,
management has secured new financing, the details of which are presented
Up to $2.5 Million Debt Financing. - The Board of Directors of Ignition
Point Technologies has approved a non-brokered unit financing for up to
$2.5 million, the proceeds of which are to be used for the general corporate
purposes of the Company and its subsidiary TeraSpan Networks Inc. Each unit
will consist of $1,000 principal amount 15% debentures of the Company and
2,500 warrants. Each warrant will entitle the holder to acquire one common
share for a period of two years following completion of this offering at a
price per share equal to $0.20. The Debentures will mature on the second
anniversary of the date of issuance and will be secured by a general security
interest in all of the Company's assets. The offering is subject to receipt of
regulatory approvals. Certain insiders of the Company are participants in this
Restatement of Q2 and Q3 interim statements. - On certain network
construction projects, TeraSpan Networks includes additional fiber optic cable
as part of the build. Teraspan Networks capitalizes the pro-rata portion of
the total costs of the project when it has obtained access and land use rights
negotiated with the applicable jurisdictions allowing the Company to access
the fiber and use of the land in which it is located for the purpose of
connecting additional customers to the network. Access and land use rights
have not been denied to the Company in the past and TeraSpan Networks had
secured municipal access agreements for other fiber installation costs
capitalized in prior years. At the time of the release of the financial
statement for the year ended 2006, projects valued at $607,597 have been
capitalized but access and land use agreements had not been received.
Management believes that access rights for the network builds installed during
the 2006 fiscal year will be subsequently received. As a result, in accordance
with generally accepted accounting principles, costs associated with network
builds where we have not yet obtained access and land use rights are expensed
to cost of sales and services revenue. The adjustments to the current and
previous quarters of fiscal 2006 are as follows: Q4 ($171,466); Q3 ($181,829);
and Q2 ($254,302).
Corporate Event. - The Company has very recently entered into discussions
with major cable and telecom operators to sell certain dark fiber assets owned
by Teraspan Networks. As the discussions are at a very early stage, the
outcome cannot be predicted. If they result in a sale of the size presently
contemplated, the consideration to be received by the Company would be
material, though it would not result in a material change in the Company's
TeraSpan has developed and commercialized an innovative "Vertical Inlaid
Fiber" system for the rapid, non-disruptive, and low-cost deployment of fiber
optic networks. During the quarter TeraSpan achieved a new sales record based
on winning larger network contracts. Management has been making strategic
investments in sales, marketing, network equipment, administration, and
regional office expansion in Winnipeg and Toronto to accommodate anticipated
growth. These investments have had a negative impact on fourth quarter
earnings, but have helped set the stage for the next fiscal year. In the 2006
fiscal year a record $2.86 million fiber network contract was received from
the City of Winnipeg.
FatPort is Canada's largest operator of public Wi-Fi Hotspots. During the
quarter FatPort achieved improved gross margin and record sales despite tight
budget restrictions on spending in all areas, including sales and marketing.
FatPort has made solid progress towards its goal of achieving profitability by
controlling expenses while growing revenue through ongoing marketing
initiatives, customer referrals, and a general increase in wireless adoption
by both business users and consumers.
About Ignition Point
Ignition Point Technologies Corp. (TSX-VEN:IPN) is a Vancouver-based
broadband communications company providing innovative solutions to expand
connectivity to public and private networks. Ignition Point subsidiaries
include TeraSpan Networks Inc. www.teraspan.com and FatPort Corporation
www.fatport.com. For more information, visit www.ignitionpoint.ca.
The Company's financial results are stated in Canadian dollars and are
prepared in accordance with Canadian generally accepted accounting standards.
Complete financials are available at www.sedar.com.
THIS PRESS RELEASE, REQUIRED BY APPLICABLE CANADIAN LAWS, IS NOT FOR
DISTRIBUTION TO U.S. NEWS SERVICES OR FOR DISSEMINATION IN THE UNITED STATES,
AND DOES NOT CONSTITUTE AN OFFER OF THE SECURITIES DESCRIBED HEREIN. THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD
IN THE UNITED STATES OR TO U.S. PERSONS UNLESS REGISTERED OR EXEMPT THEREFROM.
This release may contain certain forward-looking statements reflecting
Ignition Point Technologies' current expectations in the broadband
communications market. Investors are cautioned that all forward-looking
statements involve risks and uncertainties, including, without limitation,
changes in market and competition, technological developments and potential
downturns in economic conditions generally. Additional information on these
and other potential factors that could affect the company's financial results
are detailed in documents filed from time to time with the British Columbia
The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this news release.
For further information:
For further information: Press Contact: Stephen Majlath, CFO, Ignition
Point Technologies Corp., Phone: (604) 633-9090