TORONTO, Oct. 30, 2014 /CNW/ - NexJ Systems Inc. (TSX: NXJ), a provider of cloud-based software, delivering enterprise solutions for the financial services, insurance, and healthcare industries, today announced financial results for its third quarter ended September 30, 2014.
Financial Highlights for Q3 2014
- Third quarter revenue was $5.2 million, a difference of 21% Y/Y
- Adjusted EBITDA (as defined below) was a loss of $3.2 million or $0.16 per share (basic and diluted) for the quarter ended September 30, 2014 as compared to an adjusted EBITDA loss of $3.9 million or $0.19 per share (basic and diluted) for the comparative period in 2013
- Net loss was $3.4 million or $0.17 per share (basic and diluted) for the quarter ended September 30, 2014, as compared to a net loss of $3.8 million or $0.19 per share (basic and diluted) for the comparative period in 2013
Financial Highlights Year-to-Date 2014
- Nine month revenue was $19.5 million, a difference of 2% Y/Y
- Adjusted EBITDA (as defined below) was a loss of $7.4 million or $0.36 per share (basic and diluted) for the nine months ended September 30, 2014 as compared to an adjusted EBITDA loss of $14.6 million or $0.72 per share (basic and diluted) for the comparative period in 2013
- Net loss was $7.8 million or $0.38 per share (basic and diluted) for the nine months ended September 30, 2014, as compared to a net loss of $15.7 million or $0.77 per share (basic and diluted) for the comparative period in 2013
"We are very pleased with new bookings. Our first corporate banking contract in Asia-Pacific opens new markets for us," said William M. Tatham, Chief Executive Officer of NexJ. "We also believe our new contract in healthcare signifies the start of the commercialization phase for NexJ Health."
Conference Call Information
NexJ will be hosting an earnings report conference call today at 5:00 p.m. ET. The call can be accessed via webcast or by phone by dialing 647-427-7450 (Toronto local or international) or 1-888-231-8191 (North America Toll Free). Investors should dial in approximately 10 minutes before the teleconference is scheduled to begin.
A replay of the call will be available beginning today at 8:00 p.m. ET through 11:59 p.m. on November 6, 2014 and can be accessed by dialing 416-849-0833 (Toronto local) or toll free at 1-855-859-2056 and using password 22642438.
Non-IFRS Measures
This news release includes certain measures that have not been prepared in accordance with International Financial Reporting Standards ("IFRS") such as Adjusted EBITDA and Adjusted EBITDA margin which are used to evaluate the Company's operating performance as a complement to results provided in accordance with IFRS. The Company believes that Adjusted EBITDA and Adjusted EBITDA margin are useful supplemental information as it provides an indication of the results generated by the Company's main business activities prior to taking into consideration how those activities are financed and taxed and also prior to taking into consideration asset depreciation and the other items listed below.
The term "Adjusted EBITDA" refers to net income/loss before adjusting for share-based payment expense, depreciation and amortization, lease-exit charges, net, earn-out expense (recovery), foreign exchange gain/loss, finance income, finance costs and income taxes. "Adjusted EBITDA margin" refers to the percentage that Adjusted EBITDA for any period represents as a portion of total revenue for that period.
The term Adjusted EBITDA and Adjusted EBITDA margin are not measures recognized by IFRS and do not have standardized meanings prescribed by IFRS. Therefore, Adjusted EBITDA and Adjusted EBITDA margin may not be comparable to similar measures presented by other issuers. Investors are cautioned that Adjusted EBITDA and Adjusted EBITDA margin should not be construed as an alternative to net income (loss) as determined in accordance with IFRS.
The following table reconciles Adjusted EBITDA to net income (loss):
| Three months ended September 30, |
Nine months ended September 30, |
|||
| 2014 |
2013 |
2014 |
2013 |
|
| (in thousands of dollars, except percentages) |
(in thousands of dollars, except percentages) |
|||
| Total revenue |
$5,215 |
$6,623 |
$19,495 |
19,935 |
| Net loss |
(3,377) |
(3,779) |
(7,789) |
(15,668) |
| Add back: |
||||
| Share-based payment expense |
80 |
137 |
254 |
582 |
| Depreciation and amortization |
510 |
470 |
1,357 |
1,366 |
| Lease-exit charges, net |
— |
— |
(625) |
— |
| Earn-out expense (recovery) |
— |
(745) |
— |
(310) |
| Foreign exchange loss (gain) |
(398) |
80 |
(455) |
(246) |
| Finance income |
(53) |
(90) |
(204) |
(336) |
| Finance Cost |
50 |
— |
89 |
— |
| Adjusted EBITDA |
(3,188) |
(3,927) |
(7,373) |
(14,612) |
| Adjusted EBITDA margin |
(61%) |
(59%) |
(38%) |
(73%) |
About NexJ Systems Inc..
NexJ is a provider of cloud-based software, delivering enterprise solutions for the financial services, insurance and healthcare industries. Our next-generation, people-centered software combines industry-specific functionality with information from multiple applications and data stores to provide comprehensive knowledge of the individual.
Based in Toronto, NexJ has clients throughout North America, Europe and Asia Pacific. For more information about NexJ, visit www.nexj.com, e-mail [email protected], or call 416-222-5611. Join us on LinkedIn, follow us on Twitter, subscribe to our YouTube channel, like us on Facebook or hang out with us on Google+.
NexJ Forward-looking Statement
Certain statements in this press release may contain words considered forward-looking statements or information under applicable securities laws. These statements are based on NexJ's current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which the company operates. These statements are subject to important assumptions, risks and uncertainties that are difficult to predict, and the actual outcome may be materially different. NexJ's assumptions, although considered reasonable by the company at the date of this press release, may prove to be inaccurate and consequently its actual results could differ materially from the expectations set out herein. For additional information with respect to risks and other factors which could occur, see NexJ's securities filings with the OSC and other securities regulators. NexJ securities filings are available on www.sedar.com. Unless otherwise required by applicable securities laws, NexJ disclaims any intention or obligations to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
| NexJ Systems Inc. |
||||
| Condensed Interim Consolidated Statements of Financial Position |
||||
| (Expressed in thousands of Canadian dollars) |
||||
| (Unaudited) |
||||
| September 30, 2014 |
December 31, 2013 |
|||
| Assets |
||||
| $ |
$ |
|||
| Current assets: |
||||
| Cash and cash equivalents |
20,310 |
29,293 |
||
| Accounts receivable |
6,706 |
7,246 |
||
| Prepaid expenses and other assets |
1,578 |
1,727 |
||
| Total current assets |
28,594 |
38,266 |
||
| Non-current assets: |
||||
| Property and equipment |
2,666 |
3,014 |
||
| Intangible assets |
1,916 |
1,643 |
||
| Goodwill |
4,504 |
3,640 |
||
| Other assets |
260 |
260 |
||
| Total non-current assets |
9,346 |
8,557 |
||
| Total assets |
37,940 |
46,823 |
||
| Liabilities and Shareholders' Equity |
||||
| Current liabilities: |
||||
| Accounts payable and accrued liabilities |
4,594 |
4,677 |
||
| Deferred revenue |
4,105 |
5,021 |
||
| Provisions |
119 |
572 |
||
| Contingent consideration |
641 |
- |
||
| Total current liabilities |
9,459 |
10,270 |
||
| Non-current liabilities: |
||||
| Accrued liabilities |
451 |
596 |
||
| Provisions |
264 |
742 |
||
| Deferred revenue |
- |
212 |
||
| Deferred tax liability |
16 |
- |
||
| Total non-current liabilities |
731 |
1,550 |
||
| Total liabilities |
10,190 |
11,820 |
||
| Shareholders' equity: |
||||
| Share capital |
83,300 |
83,018 |
||
| Share purchase loans |
(3,622) |
(3,622) |
||
| Contributed surplus |
5,769 |
5,515 |
||
| Deficit |
(57,697) |
(49,908) |
||
| Total shareholders' equity |
27,750 |
35,003 |
||
| Total liabilities and shareholders' equity |
37,940 |
46,823 |
||
| NexJ Systems Inc. |
||||||
| Condensed Interim Consolidated Statements of Comprehensive Loss |
||||||
| (Expressed in thousands of Canadian dollars, except per share amounts) |
||||||
| (Unaudited) |
||||||
| Three Months ended September, |
Six Months ended September, |
|||||
| 2014 |
2013 |
2014 |
2013 |
|||
| Revenue: |
$ |
$ |
$ |
$ |
||
| License and subscription fees |
639 |
336 |
2,207 |
961 |
||
| Professional services |
3,405 |
4,757 |
13,118 |
14,514 |
||
| Maintenance and support |
1,171 |
1,530 |
4,170 |
4,460 |
||
| 5,215 |
6,623 |
19,495 |
19,935 |
|||
| Expenses*: |
||||||
| Professional service costs |
2,710 |
3,573 |
9,567 |
11,893 |
||
| Research and development, net |
2,378 |
3,326 |
7,522 |
10,756 |
||
| Sales and marketing |
1,595 |
1,412 |
4,886 |
6,519 |
||
| General and administrative, net |
2,310 |
2,101 |
5,879 |
7,017 |
||
| 8,993 |
10,412 |
27,854 |
36,185 |
|||
| Loss from operations: |
(3,778) |
(3,789) |
(8,359) |
(16,250) |
||
| Foreign exchange gain (loss) |
398 |
(80) |
455 |
246 |
||
| Finance income |
53 |
90 |
204 |
336 |
||
| Finance costs |
50 |
- |
89 |
- |
||
| 401 |
10 |
570 |
582 |
|||
| Loss before income taxes |
(3,377) |
(3,779) |
(7,789) |
(15,668) |
||
| Income taxes |
- |
- |
- |
- |
||
| Net Loss and comprehensive loss |
(3,377) |
(3,779) |
(7,789) |
(15,668) |
||
| Loss per share: |
||||||
| Basic and diluted |
(0.17) |
(0.19) |
(0.38) |
(0.77) |
||
| Weighted average number of common shares |
||||||
| outstanding: |
||||||
| Basic and diluted |
20,458 |
20,378 |
20,385 |
20,372 |
||
| *Share-based payment expense has been |
||||||
| included in expenses as follows: |
||||||
| Professional service costs |
39 |
59 |
120 |
184 |
||
| Research and development, net |
25 |
5 |
42 |
140 |
||
| Sales and marketing |
6 |
34 |
43 |
124 |
||
| General and administrative, net |
10 |
39 |
49 |
134 |
||
| 80 |
137 |
254 |
582 |
|||
| NexJ Systems Inc. |
|||||
| Condensed Interim Consolidated Statements of Cash Flows |
|||||
| (Expressed in thousands of Canadian dollars) |
|||||
| (Unaudited) |
|||||
| Nine Months ended September 30, 2014 and 2013 |
|||||
| 2014 |
2013 |
||||
| Cash flows from (used in) operating activities: |
$ |
$ |
|||
| Loss for the period: |
(7,789) |
(15,668) |
|||
| Adjustments for: |
|||||
| Depreciation and amortization |
1,357 |
1,366 |
|||
| Share-based payment expense |
254 |
582 |
|||
| Finance income |
(204) |
(336) |
|||
| Finance costs |
89 |
- |
|||
| Foreign exchange gain (loss) |
(310) |
(190) |
|||
| Change in non-cash operating working capital: |
|||||
| Accounts receivable |
582 |
675 |
|||
| Prepaid expenses and other assets |
303 |
(874) |
|||
| Income taxes receivable |
- |
146 |
|||
| Accounts payable and accrued liabilities and provisions |
(1,419) |
(2,863) |
|||
| Deferred revenue |
(1,308) |
(1,036) |
|||
| Net cash flows used in operating activities |
(8,445) |
(18,198) |
|||
| Cash flows from (used in) financing activities: |
|||||
| Repurchase of common shares |
(218) |
- |
|||
| Repayment of bank indebtedness |
(66) |
- |
|||
| Repayment of loan |
(496) |
- |
|||
| Exercise of employee stock options |
- |
25 |
|||
| Interest paid |
(3) |
- |
|||
| Net cash flows from (used in) financing activities |
(783) |
25 |
|||
| Cash flows from (used in) investing activities: |
|||||
| Purchase of property and equipment |
(269) |
(332) |
|||
| Interest received |
204 |
336 |
|||
| Net cash flows from (used in) investing activities |
(65) |
4 |
|||
| Effects of exchange rates on cash and cash equivalents |
310 |
190 |
|||
| Decrease in cash and cash equivalents |
(8,983) |
(17,979) |
|||
| Cash and cash equivalents, beginning of period |
29,293 |
46,263 |
|||
| Cash and cash equivalents, end of period |
20,310 |
28,284 |
|||
| Supplemental cash flow information: |
|||||
| Acquisition of property and equipment not yet paid for |
13 |
- |
|||
SOURCE: NexJ Systems Inc.
For further information: Matthew Bogart, Senior Director, Corporate Communications, NexJ Systems Inc., 416-227-3708, [email protected]
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