Lyrtech announces 2007 Second Quarter results

    QUEBEC CITY, QC, Aug. 29 /CNW/ - Lyrtech Inc. ("Lyrtech" or the
"Company") (TSX-V: LYT), a worldwide leader in digital signal processing
("DSP") technologies, today announced its financial results for the second
quarter ended June 30, 2007. The Company's financial statements and
Management's Discussion and Analysis are available at and at

    Second Quarter Operating Highlights

      - Revenues totalled $4.6 million a 27% increase compared to Q2 2006.

      - Gross profits amounted to $1.4 million, compared to $1.1 million in
        Q2 2006.

      - Strengthened balance sheet by a debt reduction of $8.6 million since
        the end of the previous fiscal year.

      - Backlog of contracts for work to be delivered before the end of 2007
        totalled $ 4.8 million.

      - 29 % profit margins

    "Our profit margins reflect the fact that we are an original design
manufacturer ("ODM") and not an EMS contract manufacturer ("CM"). This gives
us a broader operating range and these figures demonstrate the scalability of
our DSP technologies. We are acutely aware that the financial results are not
satisfactory; the management team is focused in delivering profitability
before year end" said Miguel Caron, President and CEO of Lyrtech.

    Financial Review

    Revenues for the second quarter ended June 30, 2007 increased by 27% to
$4,654,602 compared to $3,690,218 in the second quarter of 2006.
    Gross profits for the second quarter of 2007 amounted to $1.4 million or
29% of sales, compared to $1.1 million, or 30% of sales in the second quarter
of the previous year.
    Financial expenses totalled $523,639 in the second quarter of 2007,
compared to $161,292 in the second quarter of 2006. The variance in financial
expenses during the quarter is mainly due to a foreign exchange loss of
    Net loss was $1,236,520 or $0.005 per share for the quarter ended
June 30, 2007, compared to a net loss of $795,422 or $0.008 per share for the
same quarter in 2006.
    Revenues for the first six months of 2007 increased by 60% to $9,181,612
compared to $5,752,525 for the first six months of 2006. Gross profits for the
six months ended June 30, 2007 amounted to $3.1 million or 33% of sales,
compared to $1.9 million, or 33% of sales for the first six months of the
previous year.
    Net loss was $1,889,974 or $0.009 per share for the first six months
ended June 30, 2007, compared to a net loss of $1,022,840 or $0.012 per share
for the same period the previous year.
    As at June 30, 2007, cash and cash equivalents were at a negative
$81,744, compared to nil as at December 31, 2006. Working capital was $3.6
million as at June 30 2007, compared to negative $3.2 million as at
December 31, 2006.
    During the quarter, the private placement completed in the first quarter
of 2007 with net proceeds of $8.6 million was used to reimburse $4 million of
bank loans, $3 million of accounts payable and $1.6 million of long term debt,
thus strengthening the Company's balance sheet.
    On June 30, 2007, the basic weighted average number of shares outstanding
totalled 246,737,924, compared to 102,701,999 basic weighted average shares
outstanding for the second quarter of the previous fiscal year.


    We are pleased to announce the appointment of Mr. Jean-Sébastien Bérubé
as Vice President Sales and Marketing. Mr. Bérubé has a MBA from University of
New Hampshire, is a graduate of Université Laval in engineering and holder of
awards from the Natural Sciences and Engineering Research Council of Canada
(NSERC). With more than ten years of operations and business development
experience, Mr. Bérubé has held executive positions at CAE, Teleflex and Roper

    Subsequent Events

    As of July 23, 2007, Lyrtech completed the establishment of a new bank
facility of $5.1 M with National Bank of Canada which include a $2.6 M line of
credit facility guaranteed by accounts receivable and inventories subject to
the maintenance of various financial ratio, and a $1.7 M R&D tax credit
financial line guaranteed up to 80% by Investment Québec.
    As of August 18, 2007, the Company's backlog of contracts for work to be
delivered in 2007 totalled $4.8 million.

    Conference Call Information

    Management of Lyrtech will host a conference call tomorrow, Thursday
August 30, 2007, at 2:00 pm (EDT) to discuss the Company's second quarter
financial results. To access the conference call by telephone, dial
1-866-249-5221. A live audio web cast of the call will be available at The web cast will be archived for 90 days.

    About Lyrtech Inc.

    Lyrtech develops and manufactures advanced digital signal processing
solutions for companies worldwide, a vital technology to network and wireless
communications, audio and video processing, as well as electronic systems in
all fields of technology. Lyrtech offers a full range of DSP-FPGA development
platforms, as well as design, prototyping, and manufacturing of electronic
products through its Innovator division.
    Lyrtech works in partnership with industry leaders such as Texas
Instruments, The MathWorks, and Xilinx. Lyrtech's customers include many
prestigious names of the consumer electronics, telecommunications, aerospace,
and defence fields such as BAE Systems, Defence Research and Development
Canada (DRDC), the European Aerospace Defence and Space Company (EADS),
Fujitsu, Harris, ITT, Motorola, Neural Audio, NTT DoCoMo, and Samsung-Thales.
For more information please visit


    Certain statements made in this press release regarding Lyrtech's future
operations, expected financial position, future revenues, projected costs,
prospects, plans and objectives are forward-looking statements. These
forward-looking statements, by their nature, necessarily involve risks and
uncertainties that could cause actual results to differ materially from those
contemplated by the forward-looking statements. Lyrtech considers the
assumptions on which these forward-looking statements are based to be
reasonable at the time they were prepared, but cautions that these assumptions
regarding future events, many of which are beyond Lyrtech's control, may
ultimately prove to be incorrect. Factors and risks which could cause actual
results to differ materially from current expectations are discussed in
Lyrtech's annual report for the year ended December 31, 2006. Lyrtech
disclaims any intention or obligation to update or revise any forward-looking
statements. For additional information on risks and uncertainties relating to
these forward-looking statements, investors should consult Lyrtech's ongoing
filings, including its most recent annual report, found on SEDAR at

    The TSX Venture Exchange Inc. has not reviewed and does not accept
responsibility for the adequacy and accuracy of this release.

For further information:

For further information: Miguel Caron, President and Chief Executive
Officer, Lyrtech Inc., (418) 877-4644,; Alain Landry,
Chief Financial Officer, Lyrtech Inc., (418) 877-4644,; Eric Bouchard, Investor Relations, The Equicom Group
Inc., (514) 844-7997,

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