MetroBridge Networks Announces Second Quarter 2007 Results



    VANCOUVER, Aug. 28 /CNW/ - MetroBridge Networks International Inc.
(TSX-V: MEB), a premier high-speed wireless broadband provider for business
with operations in Canada and the United States, today announced results for
MetroBridge Networks Corporation for the second quarter ended June 30, 2007.

    
    Highlights:

    -   Revenue up 97% year-over-year to $926,938 for the second quarter -
        annualized revenue of $3.9 million at quarter-end
    -   ARPU(*) up 7% to $350 from the first quarter
    -   Sales of Value-added Services up 175% from the first quarter, now
        represent 6% of revenue
    -   Customer Locations reached 885 in the quarter, up 137% year-over-year
    -   Churn(*) at 0.89% for the quarter
    -   Closed $9 million public offering on the TSX Venture Exchange on
        July 26th, 2007

    (*) See Non-GAAP Measures
    

    "MetroBridge's second quarter results show the strong organic growth
resulting from our focus on increasing ARPU through larger, higher-bandwidth
contracts, and the rapid development of our portfolio of value-added products
and service," said Dave King, President and Chief Executive Officer. "During
the quarter we continued to invest in the required infrastructure to grow in
our existing markets and a successful public offering has set the stage for
executing our systematic acquisition strategy."

    Second Quarter Financial Results:

    Total revenue for the second quarter ended June 30, 2007 was $926,938
compared with $471,528 for the second quarter ended June 30, 2006. The
increase in revenue was driven by increased ARPU and net customer additions of
512. Value-added services revenue, a new revenue stream for the company within
the last year, grew to $175% and now represents 6% of revenue.
    Gross margin increased to 63% for the second quarter of 2007 compared
with 59% for the second quarter of 2006. The increase in gross margin is due
to the increased efficiencies that we have experienced in bandwidth usage and
other fixed costs as we have grown our network and customer base.
    Sales, general and administrative (SG&A) expenses increased by 3% to
$825,578 from the first quarter, and 31% compared with $645,846 for the second
quarter of 2006. The increase was primarily due to expenses associated with
the growth of our sales force, administrative personnel and infrastructure as
we prepared the company for continuing expansion.
    EBITDA increased by 18% to $(328,139) for the second quarter of 2007
compared with $(399,978) for the second quarter of 2006. The increase in
EBITDA was driven largely by the rising contribution from Vancouver
operations.
    MetroBridge reported a net loss of $621,903 or $0.02 per share for the
second quarter of 2007, compared to a net loss of $479,802 or $0.03 per share
for the second quarter of 2006.
    During the quarter MetroBridge raised $1.7 million through a convertible
debenture financing. Additionally, on July 26, 2007 MetroBridge completed its
previously announced amalgamation with Huntingdon Capital, and raised
$9 million through a concurrent public offering.

    Outlook

    "MetroBridge's business model is underpinned by the annuity-like nature
of its recurring revenue base, the continuing growth in businesses' need for
bandwidth, and the capital cost advantages of wireless broadband solutions,"
said Dave King, President and Chief Executive Officer. "Through the balance of
2007 and beyond, we plan to continue to execute on our strategy of North
American acquisitions combined with aggressive organic growth. To drive
organic growth, we intend to grow our suite of value-added products and
services, with the aim of increasing ARPU and ensuring customer retention.
Additionally, we intend to continue to pursue larger enterprise-level
contracts and grow our direct sales force."

    Conference Call

    President and Chief Executive Officer Dave King and Chief Financial
Officer Christopher Morris will hold a conference call at 1:30 pm Pacific Time
on Tuesday, August 28, 2007, to discuss financial results and performance.
Interested parties may access the call dialing (800) 732-9307 or (416)
644-3420 (for international callers).
    A telephonic replay of the conference call may be accessed until
September 13, 2007, by dialing (877) 289-8525 or (416) 640-1917 (for
international callers) using pass code 21243621 followed by the number sign.

    (*) Non-GAAP Measures

    ARPU is the average revenue per user per month, calculated by dividing
the average number of customers by the total average revenue (excluding
interest) for the period.
    Churn represents the monthly recurring revenue lost during the period
attributable to customers who had been with the company for greater than
90 days, as a percentage of total revenue (excluding interest) for the period.

    Forward Looking Statements

    This press release contains certain forward-looking statements that
reflect the current views and/or expectations of MetroBridge Networks
International Inc. with respect to performance, business and future events.
Such statements are subject to a number of risks, uncertainties and
assumptions. Actual results and events may vary significantly from those
disclosed herein. Investors are cautioned not to rely on these forward-looking
statements. MetroBridge Networks International Inc. does not undertake to
update these forward-looking statements.

    About MetroBridge Networks International Inc.

    MetroBridge, a leading international fixed wireless provider, delivers
broadband wireless access using pre-WiMAX and other advanced wireless
technologies. Its highly redundant mission critical network provides
connections up to 2500Mbps in Arizona and British Columbia. MetroBridge's
aggressive growth strategy contemplates acquisitions throughout North America
and additional complementary products and services. The company operates in
all market segments including police and 911 services, the financial industry,
retailers and businesses of all sizes. MetroBridge was the first Canadian
carrier selected to join the WiMAX Forum to assist the industry in
establishing equipment interoperability. Please visit the Company's website at
www.metrobridge.com

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


    
    METROBRIDGE NETWORKS CORPORATION
    Interim Consolidated Balance Sheets
    (Expressed in Canadian dollars)
    (Unaudited)

                                                      June 30    December 31
                                                        2007         2006
                                                    ------------ ------------

    ASSETS
    Current
      Cash                                          $ 1,626,876  $   689,762
      Accounts receivable                               645,288      341,150
      Network inventory                                 384,542      384,729
      Deferred share issue costs                        374,436            -
      Deferred finance costs                            170,448            -
      Prepaid expenses and deposits                     142,005       44,941
    -------------------------------------------------------------------------
                                                      3,343,595    1,460,582
    Capital Assets                                    1,328,912    1,318,872
    Assets under Capital Lease                          733,960      187,326
    Intangible Assets                                   330,637      492,926
    -------------------------------------------------------------------------

                                                    $ 5,737,104  $ 3,459,706
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES
    Current
      Accounts payable and accrued liabilities      $   997,716  $   424,276
      Loans payable                                     250,000      755,250
      Convertible debenture                           1,714,000            -
      Deferred revenue                                   81,828       41,680
      Obligations under capital lease payable
       within the next year                             320,281       64,756
      Current portion of long term debt                  52,339       58,252
    -------------------------------------------------------------------------
                                                      3,416,164    1,344,214
    Obligations under capital lease                     435,730      108,998
    Long term debt                                      522,112       39,578
    -------------------------------------------------------------------------
                                                      4,374,006    1,492,790
    -------------------------------------------------------------------------

    SHAREHOLDERS' EQUITY
      Share capital                                   7,188,424    6,444,062
      Contributed surplus                               334,500      217,219
      Deficit                                        (6,159,826)  (4,694,365)
    -------------------------------------------------------------------------
                                                      1,363,098    1,966,916
    -------------------------------------------------------------------------

                                                    $ 5,737,104  $ 3,459,706
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Approved By The Board

     "Martin Carsky"  Director
    -----------------

     "Rennie Heel"    Director
    -----------------



    METROBRIDGE NETWORKS CORPORATION
    Interim Consolidated Statements of Loss
    (Expressed in Canadian dollars)
    (Unaudited)

                              Three months ended        Six months ended
                                     June 30                 June 30
                          ------------------------- -------------------------
                               2007         2006        2007         2006
                          ------------ ------------ ------------ ------------

    REVENUE
      Network             $   839,869  $   440,087  $ 1,607,263  $   820,386
      Installation             69,139       30,402      121,543       59,697
      Other                    17,930        1,039       40,736        2,751
    -------------------------------------------------------------------------
                              926,938      471,528    1,769,542      882,834
    -------------------------------------------------------------------------

    COST OF SALES
      Network                 320,987      177,992      653,439      313,602
      Installation             21,895       11,916       46,392       19,726
    -------------------------------------------------------------------------
      Cost of sales
       (exclusive of
       amortization of
       network equipment
       of $124,703,
       $32,827, $205,865,
       and $37,816)           342,882      189,908      699,831      333,328

      Amortization of
       network equipment      124,703       32,827      205,865       37,816
    -------------------------------------------------------------------------
                              467,585      222,735      905,696      371,143
    -------------------------------------------------------------------------

    OPERATING EXPENSES
      Corporate office        377,222      325,449      721,244      513,231
      Sales and marketing     265,757      215,191      505,385      355,313
      Salaries and benefits    60,404       20,010      133,660       44,002
      General and
       administrative         145,085       85,156      313,757      145,224
      Share-based
       compensation            56,286       35,792      111,227       71,216
      Amortization             73,791       28,675      140,167       76,408
      Interest                 95,270       18,322      123,126       27,701
      Bad debts                 7,441            -       12,342       (4,922)
    -------------------------------------------------------------------------
                            1,081,256      728,595    2,060,908    1,228,173
    -------------------------------------------------------------------------
    OPERATING LOSS FROM
     CONTINUING OPERATIONS   (621,903)    (479,802)  (1,197,062)    (716,482)

    Impairment of Network
     Equipment and
     Intangible Assets              -            -      268,399            -
    -------------------------------------------------------------------------

    NET LOSS              $  (621,903) $  (479,802) $(1,465,461) $  (716,482)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic Loss per Share
     from Continuing
     Operations           $     (0.02) $     (0.03) $     (0.06) $     (0.04)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic Loss per Share  $     (0.02) $     (0.03) $     (0.06) $     (0.04)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Weighted Average
     Number of Shares
     Outstanding           25,250,625   16,771,768   24,747,510   16,442,410
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    METROBRIDGE NETWORKS CORPORATION
    Interim Consolidated Statements of Deficit
    (Expressed in Canadian dollars)
    (Unaudited)

                              Three months ended        Six months ended
                                     June 30                 June 30
                          ------------------------- -------------------------
                               2007         2006        2007         2006
                          ------------ ------------ ------------ ------------

    OPERATING LOSS FROM
     CONTINUING
     OPERATIONS           $  (621,903) $  (479,802) $(1,465,461) $  (716,482)
    -------------------------------------------------------------------------
    NET LOSS                 (621,903)    (479,802)  (1,465,461)    (716,482)
    DEFICIT, BEGINNING
     OF PERIOD             (5,537,923)  (3,278,783)  (4,694,365)  (3,042,103)
    -------------------------------------------------------------------------

    DEFICIT, END OF
     PERIOD               $(6,159,826) $(3,758,585) $(6,159,826) $(3,758,585)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    METROBRIDGE NETWORKS CORPORATION
    Interim Consolidated Statements of Cash Flows
    (Expressed in Canadian dollars)
    (Unaudited )

                              Three months ended        Six months ended
                                     June 30                 June 30
                          ------------------------- -------------------------
                               2007         2006        2007         2006
                          ------------ ------------ ------------ ------------


    Cash Flows From
     Continuing Operating
     Activities
    Loss from continuing
     operations           $  (621,903) $  (479,802) $(1,465,461) $  (716,482)
    Items not involving
     cash:
      Amortization            198,494       61,501      346,031      114,224
      Share-based
       compensation            62,340       35,792      117,281       71,216
    Changes in non-cash
     operating working
     capital:
      Accounts receivable    (116,863)     (17,900)    (304,137)       9,505
      Network inventory       (10,407)     (71,311)         187     (200,115)
      Prepaid expenses and
       deposits              (447,371)       3,652     (641,948)      (3,172)
      Current obligation
       under capital lease    218,890      (26,366)     255,525       36,285
      Accounts payable and
       accrued liabilities    353,303       (1,548)     573,439     (145,374)
      Deferred revenue         (7,179)      (1,710)      40,147          (10)
    -------------------------------------------------------------------------

                             (370,696)    (497,692)  (1,078,936)    (833,923)
    -------------------------------------------------------------------------

    Cash Flows From
     Financing Activities
    Shares issued for cash    (11,651)     267,225      744,362      621,200
    Loans                   1,696,459      505,250    1,685,371      501,129
    Payments made on
     capital lease           (192,370)        (652)    (236,327)     (63,580)
    -------------------------------------------------------------------------

                            1,492,438      771,823    2,193,406    1,058,749
    -------------------------------------------------------------------------

    Cash Flows From
     Investing Activities
    Cash consideration paid
     for capital assets      (266,952)    (172,394)    (334,460)    (256,724)
    Cash consideration paid
     for intangible assets     18,182         (202)     157,104       (3,006)
    Proceeds from asset sold
     and leased back                -            -            -            -
    -------------------------------------------------------------------------

                             (248,770)    (172,596)    (177,356)    (259,730)
    -------------------------------------------------------------------------

    Increase in Cash from
     Continuing Operations    872,972      101,536      937,114      (34,904)
    -------------------------------------------------------------------------

    Increase in Cash          872,972      101,536      937,114      (34,904)
    Cash, Beginning of
     period                   753,904       44,065      689,762      180,505
    -------------------------------------------------------------------------

    Cash, End of period   $ 1,626,876  $   145,601  $ 1,626,876  $   145,601
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Supplemental Information
     on Non-Cash Transactions
      Acquisition of assets
       under capital lease   (544,878)           -     (658,346)           -
    





For further information:

For further information: Samantha Singh, MetroBridge Investor Relations,
Toll Free: (888) 628-1240, Direct: (604) 628-5627, Fax: (888) 628-2650,
ssingh@metrobridge.com

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METROBRIDGE NETWORKS INTERNATIONAL INC.

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