PEER 1 Hosting Reports Fiscal 2010 Third Quarter Results
VANCOUVER, May 13 /CNW/ - PEER 1 Network Enterprises, Inc. (TSX:PIX), operating as PEER 1 Hosting, a leading provider of online IT infrastructure, today announced the results for the three and nine months ended March 31, 2010. All amounts are stated in US dollars.
Selected Financial Highlights Comparing the Third Quarters Ended March 31, 2010 and 2009
- Revenue increased 11% to $25.1 million from $22.6 million;
- Gross profit increased 10% to $10.2 million from $9.2 million;
- Operating income decreased 17% to $2.2 million from $2.6 million;
- Normalized EBITDA was flat at $6.4 million; and
- Net income decreased to $0.5 million from $1.41 million.
Selected Recent Operational Highlights
- Launched US$40 million flagship data centre in Toronto Ontario. This
data centre is more than 40,000 square feet and equipped to offer all
three hosting solutions - colocation, dedicated hosting and managed
hosting - under one roof. The building is separated into four sections
called Performance Optimized Data Centre (POD) - with each POD having
the capacity of approximately 270 cabinets, equivalent to
approximately 7,500 servers. The first POD was built with an estimated
capital cost of US$10 million and includes 7,500 square feet of data
centre space and 8,000 square feet of office space, and inventory,
network and storage areas to support the data centre;
- Acquired Atlanta-based VIA Net.Works USA, Inc., a provider of
primarily dedicated and managed hosting solutions built around the
Microsoft platform for small and medium sized businesses;
- Settled via confidential mediation an action that had been pursued in
the Supreme Court of British Columbia by WindyPoint Capital Inc., and
others for compensation alleged to be due and owing to WindyPoint in
connection with financial advisory and investment banking services
that it provided to the Company in 2005. In the third quarter the
Company took a one time charge of $440,000 in relation to the
settlement;
- Announced Intention to commence a Normal Course Issuer Bid;
- Entered into a referral partnership with Magento, Inc., the leading
open source eCommerce platform provider, to enable merchants using
Magento's feature-rich eCommerce platform to deploy sites via PEER 1
Hosting to optimize their web presence and performance; and
- Launched PEER 1 Hosting Channel Partner Portal to help simplify
existing partnering program to better serve and support partners.
"During the quarter we launched our flagship Toronto data centre, which has since welcomed its first managed hosting and colocation customers," said Fabio Banducci, President and CEO of PEER 1 Hosting. "Interest in our new state-of-the-art data centre among small and medium size businesses continues to build and we have also attracted the interest from larger enterprise customers. In the third quarter, we also acquired VIA Net.Works USA, Inc. allowing us to leverage some technical and service synergies and further grow our U.S. customer base."
Review of the Three and Nine Months Ended March 31, 2010
Revenue increased to $25.07 million for the three months ended March 31, 2010 from $22.65 million for the three months ended March 31, 2009 and $72.34 million for the nine months ended March 31, 2010 from $69.79 million for the nine months ended March 31, 2009. The increase in revenue for the three and nine month periods is primarily attributable to organic growth, the effect of the increase in value of the Canadian dollar against the US dollar, and $0.09 million from the VIA acquisition. When adjusted for the exchange rates in effect during the period, revenue for the three months ended March 31, 2010 was $24.27 million. Taking into account the effect of the differing exchange rates between the Canadian and US dollars for the comparative period, revenue increased by 7.15% for the three months ended March 31, 2010. When adjusted for the exchange rates in effect during the period, revenue for the nine months ended March 31, 2010 was $71.16 million. Taking into account the effect of the differing exchange rates between the Canadian and US dollars for the comparative period, revenue increased by 1.96% for the nine months ended March 31, 2010.
Colocation revenue increased to $3.41 million and $10.07 million for the three and nine months ended March 31, 2010, respectively, compared with $2.90 million and $9.00 million for the same periods in the prior fiscal year. The increases in colocation revenue are attributable to organic growth as well as the increase in the value of the Canadian dollar against the US dollar. PEER 1 Hosting's efforts to secure additional data centre space are ongoing. The effect on revenue from the increase in value of the Canadian dollar against the US dollar was $0.38 million and $0.54 million for the three and nine months ended March 31, 2010 respectively.
Bandwidth revenues increased to $2.29 million and $6.41 million for the three and nine months ended March 31, 2010, respectively, compared with $1.91 million and $6.33 million for the same periods in the prior fiscal year. The increase in revenue for the three months ended March 31, 2010 is primarily attributable to the increased value of the Canadian dollar against the US dollar and increased overage charges, partly offset by pricing pressures in the market. The increase in revenue for the nine months ended March 31, 2010 is primarily attributable to the increased value of the Canadian dollar against the US dollar, partly offset by pricing pressures as well as reduced overage charges as customers experienced lower bandwidth requirements during the nine months period. The effect on revenue from the increase in value of the Canadian dollar against the US dollar was $0.29 million and $0.44 million for the three and nine months ended March 31, 2010 respectively.
Hosting Services revenues increased to $17.92 million and $51.72 million for the three and nine months ended March 31, 2010 from $16.70 million and $51.01 million for the three and nine months ended March 31, 2009. The increase for the three and nine months ended March 31, 2010 is attributable to organic growth and additional revenue from the VIA acquisition. Hosting Services revenues have not been materially impacted by foreign exchange effects as virtually all Hosting Services sales are currently denominated in US dollars.
PEER 1 Hosting's Canadian operations accounted for $5.17 million of revenue for the three months ended March 31, 2010 compared with $4.06 million of revenues for the three months ended March 31, 2009. The Company's Canadian operations accounted for $14.86 million of revenues for the nine months ended March 31, 2010 compared with $13.22 million of revenues for the nine months ended March 31, 2009. This change is primarily related to favorable foreign exchange effects of $0.80 million and $1.17 million, respectively, for the three and nine months ended March 31, 2010, and organic growth. The foreign exchange effects in revenue largely provide a natural hedge which offset exchange effects on expenses incurred in Canadian operations.
Cost of sales increased by $1.45 million to $14.85 million for the three months ended March 31, 2010 from $13.40 million for the three months ended March 31, 2009. During the three and nine months ended March 31, 2010, the Company incurred costs of $0.49 million and $1.17 million respectively related to its UK expansion which are included in cost of sales. Cost of sales as a percentage of revenue was 59.25% for the three months ended March 31, 2010 and 59.18% for the three months ended March 31, 2009. Cost of sales increased to $42.67 million for the nine months ended March 31, 2010 from $39.31 million for the nine months ended March 31, 2009. Cost of sales as a percentage of revenue increased to 58.99% for the nine months ended March 31, 2010 from 56.32% for the nine months ended March 31, 2009.
The increase in cost of sales for the three months ended March 31, 2010 compared to the same period in the prior year is primarily due to increased staff costs of $0.22 million, increased depreciation costs of $0.47 million, increased power costs of $0.17 million, increased repairs & maintenance costs of $0.24 million, increased software license cost of $0.3 million, increased Service Level Agreement ("SLA") costs of $0.10 million and increased rent costs of $0.27 million associated with data centre expansion in the UK and Toronto, offset in part by decreased costs of $0.31 million for bandwidth.
The increase in cost of sales for the nine months ended March 31, 2010 compared to the same period in the prior year is primarily due to increased staff costs of $0.61 million, increased depreciation costs of $1.15 million, increased software license costs of $0.44 million, increased power costs of $0.39 million, increased repairs and maintenance costs of $0.48 million, increased SLA costs of $0.25 million and increased rent costs of $1.13 million associated with data centre expansion in the UK, Toronto and Herndon Virginia, offset in part by decreased costs of $1.14 million for bandwidth.
Total operating expenses increased $1.41 million to $8.05 million for the three months ended March 31, 2010 from $6.64 million for the three months ended March 31, 2009. During the three months ended March 31, 2010, the Company incurred cost of $0.41 million related to its UK expansion which are included in operating expenses. Operating expenses as a percentage of revenue increased to 32.10% for the three months ended March 31, 2010 from 29.30% for the three months ended March 31, 2009. The increase in operating expenses for the three months ended March 31, 2010 is largely attributable to $0.81 million higher staff and training cost, increased travel expenses of $0.06 million, increased advertising expenses of $0.24 million, increased commission expenses of $0.40 million attributable to new sales, increased stock based compensation of $0.19 million, $0.03 million higher bank and credit card expenses, $0.01 higher insurance expense offset in part by $0.20 million lower amortization, $0.02 million in decreased bad debt expense, $0.07 million lower legal and other professional service expenses and $0.09 lower bonus expense.
Total operating expenses increased $2.09 million to $22.76 million for the nine months ended March 31, 2010 from $20.67 million for the nine months ended March 31, 2009. During the nine months ended March 31, 2010, the Company incurred cost of $1.58 million related to its UK expansion which are included in operating expenses. Operating expenses as a percentage of revenue increased to 31.47% for the nine months ended March 31, 2010 from 29.62% for the nine months ended March 31, 2009. The increase in operating expenses for the nine months ended March 31, 2010 is largely attributable to $2.14 million higher staff and training cost, increased commission expenses of $0.80 million attributable to new sales, increased travel expenses of $0.15 million, increased insurance expenses of $0.04 million and $0.01 million higher advertising expenses offset in part by $0.27 million lower amortization, $0.21 million in decreased bad debt expense, lower stock based compensation of $0.14 million, $0.50 million lower legal and other professional service expenses. The decrease in bad debt expense for both the three and nine month periods reflect a lower estimated expense for doubtful accounts that is based on management's review of specific customer payment history, the age of the accounts receivable and collection trends.
Normalized EBITDA, which excludes the one time charge associated with settlement of a legal claim, was $6.4 million for the three month periods ended March 31, 2010 and March 31, 2009.
Net income for the three months ended March 31, 2010 decreased to $0.50 million, compared with $1.4 million for the corresponding period in 2009. Earnings per share for the three months ended March 31, 2010 was $0.00, compared with $0.01 for corresponding period in 2009.
As at March 31, 2010, PEER 1 Hosting had cash and cash equivalents of $3.7 million, compared with $15.7 million at June 30, 2009.
The Company had a working capital deficit of $7.06 million at March 31, 2010 compared to working capital of $4.77 million as at June 30, 2009. The decrease in working capital is primarily due to investments in property and equipment one time costs relating to the WindyPoint legal settlement of $440,000, and the acquisition of VIA for net cash of $534,000. The Company anticipates current liquidity and cash generated from operations to be sufficient to fund operations for the foreseeable future. Subsequent to the Quarter ended March 31, 2010, the Company was advanced US$3 million under the US$25 million loan Facility A held with National Bank of Canada. This brings the total borrowing under facility A to US$5 million, leaving US$20 million available under this loan facility. The total US$5 million borrowed under this facility carries a combined interest rate of 3.11% determined as the rate of US three month Libor plus the applicable margin.
PEER 1 Hosting had 121,294,620 common shares outstanding as at March 31, 2010.
EBITDA Reconciliation
EBITDA Reconciliation
(unaudited - prepared by management)
(in $ thousands) Three Months Ended
--------------------------
31-Mar-10 31-Mar-09
Net Profit 459 1,414
Income tax expense 775 842
Interest expense 338 405
Amortization - licences, fixed assets and
deferred network costs 3,642 3,373
Stock based compensation 620 434
Loss (gain) on disposal of assets (29) -
Amortization of deferred gain (20) (20)
Loss on Derivative 111 -
Foreign exchange loss (gain) 75 (48)
-------------------------------------------------------------------------
EBITDA 5,971 6,400
Settlement of legal claim 440 -
Normalized EBITDA 6,411 6,400
Conference Call
PEER 1 Hosting will hold a conference call today, Thursday, May 13, 2010 at 5:30 p.m. Eastern Standard Time (EST), to discuss the results of the third quarter of fiscal 2010. The Company's full Financial Statements and Management's Discussion and Analysis are available on its website at http://www.peer1.com/investors.
To access the conference call by telephone, dial (647) 427-7450 or 1-888-231-8191. Please connect approximately 15 minutes prior to the beginning of the call. The conference call will be archived for replay until Thursday, May 20, 2010, at midnight. To access the archived conference call, dial (416) 849-0833 or 1-800-642-1687 and enter the reservation number: 72472460 followed by the number sign.
A live audio webcast of the conference call will be available at:
http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=3061300
Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast. The webcast will be archived at the above website for 90 days.
Non-GAAP Measures
PEER 1 Hosting reports EBITDA because it is a key measure used by management to evaluate the Company's performance. PEER 1 Hosting believes that EBITDA is useful supplemental information, as it provides an indication of the results generated by PEER 1 Hosting's main business activities prior to taking into consideration how those activities are financed and expensed. EBITDA is not a recognized measure under Canadian GAAP, and accordingly investors are cautioned that EBITDA should not be construed as an alternative to net earnings or loss determined in accordance with Canadian GAAP as an indicator of financial performance of PEER 1 Hosting, or as a measure of the company's liquidity and cash flows. PEER 1 Hosting's method of calculating EBITDA may differ from other issuers and, accordingly, EBITDA may not be comparable to similar measures presented by other issuers. The schedule above sets out PEER 1 Hosting's EBITDA calculations.
About PEER 1 Hosting
PEER 1 Hosting believes in the limitless opportunity of the Internet, and the business growth potential it provides for its more than 10,000 customers. As a global online IT hosting provider, PEER 1 Hosting offers a reliable high performance Internet network supporting scalable managed hosting, dedicated hosting through the ServerBeach brand, and colocation solutions. Backed by its 100 percent uptime guarantee and 24x7x365 FirstCall Support(TM), PEER 1 Hosting ensures customers' online presence is always fast, always available. Since 1999, PEER 1 Hosting has grown to include 17 state-of-the-art data centres and points-of-presence throughout North America and Europe. The company's headquarters are in Vancouver, Canada, with European operations headquartered in Southampton, UK. PEER 1 Hosting shares are traded on the TSX under the symbol PIX. For more information visit: www.peer1.com or www.peer1hosting.co.uk.
Forward Looking Statements
Statements in this release relating to matters that are not historical fact are forward-looking statements based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. Factors that could cause or contribute to such differences include, but are not limited to, general economic conditions, changes in technology, reliance on third party manufacturing, managing rapid growth, global sales risks, limited intellectual property protection and other risks and uncertainties described in PEER 1 Hosting's public filings with securities regulatory authorities.
PEER 1 NETWORK ENTERPRISES, INC.
Consolidated Balance Sheet
March 31, 2010
(in thousands of United States dollars)
March 31, June 30,
2010 2009
-------------------------------------------------------------------------
Assets
Current:
Cash and cash equivalents $ 3,696 $ 15,744
Accounts receivable 3,872 3,449
Future income tax asset 98 237
Prepaid expenses 1,848 1,130
-------------------------------------------------------------------------
9,514 20,560
Other assets 2,918 2,692
Future income tax asset 2,002 1,042
Property and equipment 50,332 36,856
Equipment under capital lease 1,062 1,013
Goodwill (Note 3) 2,394 1,715
Intangible assets 3,307 2,552
-------------------------------------------------------------------------
$ 71,529 $ 66,430
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Liabilities
Current:
Accounts payable and accrued liabilities $ 9,781 $ 7,936
Deferred revenue 2,968 2,886
Current portion of deferred gain 79 79
Current portion of deferred lease inducements 126 138
Current portion of derivative liabilities 152 89
Current portion of notes payable 3,000 2,250
Current portion of obligations under capital
lease 393 211
Income taxes payable 78 2,200
-------------------------------------------------------------------------
16,577 15,789
Deferred gain 433 493
Deferred lease inducements 566 664
Derivative liabilities 190 179
Notes payable 12,096 12,303
Obligation under capital lease 334 363
-------------------------------------------------------------------------
30,196 29,791
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Shareholders' equity 41,333 36,639
-------------------------------------------------------------------------
$ 71,529 $ 66,430
-------------------------------------------------------------------------
-------------------------------------------------------------------------
PEER 1 NETWORK ENTERPRISES, INC.
Consolidated Statements of Shareholders' Equity
For the Three and Nine Months Ended March 31, 2010
(in thousands of United States dollars except number of shares)
Three months ended
March 31, 2010 March 31, 2009
Number Amount Number Amount
--------------------------------------------------------------------------
SHARE CAPITAL
Common shares
Balance at
beginning of
period 121,260,741 $ 27,942 119,294,323 $ 26,940
Stock options
exercised 33,879 14 - -
Warrants
exercised - - - -
-------------------------------------------------------------------------
Balance at end
of period 121,294,620 27,956 119,294,323 26,940
-------------------------------------------------------------------------
Warrants
Balance at
beginning of
period 833,333 86 2,461,619 493
Warrants
exercised - - - -
-------------------------------------------------------------------------
Balance at end
of period 833,333 86 2,461,619 493
-------------------------------------------------------------------------
Total - share
capital 28,042 27,433
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CONTRIBUTED SURPLUS
Balance at
beginning of
period 5,709 3,879
Stock-based
compensation 619 434
Stock options
exercised (5) -
-------------------------------------------------------------------------
Balance at end of
period 6,323 4,313
-------------------------------------------------------------------------
-------------------------------------------------------------------------
RETAINED EARNINGS
Balance at
beginning of
period 6,862 2,718
Net income 459 1,414
-------------------------------------------------------------------------
Balance at end of
period 7,321 4,132
-------------------------------------------------------------------------
-------------------------------------------------------------------------
ACCUMULATED OTHER
COMPREHENSIVE
INCOME
Balance at
beginning of
period (315) (11)
Other comprehensive
income (loss) (38) -
-------------------------------------------------------------------------
Balance at end of
period (353) (11)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total -
shareholders'
equity $ 41,333 $ 35,867
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Nine months ended
March 31, 2010 March 31, 2009
Number Amount Number Amount
-------------------------------------------------------------------------
SHARE CAPITAL
Common shares
Balance at
beginning of
period 119,314,323 $ 26,950 118,504,368 $ 26,539
Stock options
exercised 352,011 225 111,670 60
Warrants
exercised 1,628,286 781 678,285 341
-------------------------------------------------------------------------
Balance at end
of period 121,294,620 27,956 119,294,323 26,940
-------------------------------------------------------------------------
Warrants
Balance at
beginning of
period 2,461,619 493 3,139,904 678
Warrants
exercised (1,628,286) (407) (678,285) (185)
-------------------------------------------------------------------------
Balance at end
of period 833,333 86 2,461,619 493
-------------------------------------------------------------------------
Total - share
capital 28,042 27,433
-------------------------------------------------------------------------
-------------------------------------------------------------------------
CONTRIBUTED SURPLUS
Balance at
beginning of
period 4,766 2,509
Stock-based
compensation 1,684 1,826
Stock options
exercised (127) (22)
-------------------------------------------------------------------------
Balance at end of
period 6,323 4,313
-------------------------------------------------------------------------
-------------------------------------------------------------------------
RETAINED EARNINGS
Balance at
beginning of
period 4,709 (1,013)
Net income 2,612 5,145
-------------------------------------------------------------------------
Balance at end of
period 7,321 4,132
-------------------------------------------------------------------------
-------------------------------------------------------------------------
ACCUMULATED OTHER
COMPREHENSIVE
INCOME
Balance at
beginning of
period (279) (11)
Other comprehensive
income (loss) (74) -
-------------------------------------------------------------------------
Balance at end of
period (353) (11)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total -
shareholders'
equity $ 41,333 $ 35,867
-------------------------------------------------------------------------
-------------------------------------------------------------------------
PEER 1 NETWORK ENTERPRISES, INC.
Consolidated Statement of Operations
For the Three and Nine Months Ended March 31, 2010
(in thousands of United States dollars, except per share amounts)
Three months ended Nine months ended
-------------------------- --------------------------
March 31, March 31, March 31, March 31,
2010 2009 2010 2009
-------------------------------------------------------------------------
Revenue
Colocation
Services $ 7,143 $ 5,944 $ 20,616 $ 18,783
Hosting Services 17,923 16,705 51,721 51,009
-------------------------- --------------------------
25,066 22,649 72,337 69,792
Cost of revenue 14,852 13,404 42,670 39,306
--------------------------------------------- --------------------------
Gross profit 10,214 9,245 29,667 30,486
Operating expenses 8,047 6,636 22,761 20,671
--------------------------------------------- --------------------------
Operating income
before other items 2,167 2,609 6,906 9,815
--------------------------------------------- --------------------------
Other items:
Interest income (2) (4) (8) (59)
Settlement of
legal claim 440 440 -
Gain on insurance
recovery - - (93) -
Gain on disposal of
property and
equipment (29) - (71) (20)
Loss on derivative 111 - 111 -
Foreign exchange
(gain) / loss 75 (48) 264 (132)
Interest expense
- long term 338 405 987 1,266
--------------------------------------------- --------------------------
933 353 1,630 1,055
--------------------------------------------- --------------------------
Income before
income taxes 1,234 2,256 5,276 8,760
--------------------------------------------- --------------------------
Future income tax
expense (recovery) (212) 144 (712) 381
Current income tax
expense 987 698 3,376 3,234
--------------------------------------------- --------------------------
Income tax expense 775 842 2,664 3,615
--------------------------------------------- --------------------------
Net income $ 459 $ 1,414 $ 2,612 $ 5,145
Other comprehensive
income:
Change in
unrealized fair
value of
derivatives
designated as
cash flow hedges (38) - (74) -
--------------------------------------------- --------------------------
Comprehensive
income $ 421 $ 1,414 $ 2,538 $ 5,145
--------------------------------------------- --------------------------
--------------------------------------------- --------------------------
Net income
attributable to:
Common shares $ 459 $ 1,414 $ 2,612 $ 5,145
Comprehensive
income
attributable to:
Common shares $ 421 1,414 $ 2,538 $ 5,145
--------------------------------------------- --------------------------
--------------------------------------------- --------------------------
Basic and diluted
earnings per
share $ 0.00 $ 0.01 $ 0.02 $ 0.04
--------------------------------------------- --------------------------
--------------------------------------------- --------------------------
Weighted average
number of shares
outstanding:
Basic 121,274,770 119,294,323 120,653,339 119,085,836
Diluted 124,338,272 123,755,886 124,316,811 124,073,826
PEER 1 NETWORK ENTERPRISES, INC.
Consolidated Statement of Cash Flows
For the Three and Nine Months Ended March 31, 2010
(in thousands of United States dollars)
Three months ended Nine months ended
-------------------------- --------------------------
March 31, March 31, March 31, March 31,
2010 2009 2010 2009
--------------------------------------------- --------------------------
Operating
Activities:
Net income $ 459 $ 1,414 $ 2,612 $ 5,145
Adjustments for
non-cash items:
Amortization of
property and
equipment 3,560 3,050 10,055 8,693
Amortization of
intangible assets 82 323 569 1,051
Increase in
accrued interest - 11 - 66
Bad debt expense 174 198 388 595
Gain on disposal
of property and
equipment (29) - (71) (20)
Gain on insurance - - (93) -
Amortization of
deferred gain (20) (20) (59) (59)
Amortization of
deferred loan
origination fees 74 110 191 350
Future income tax
expense (212) 144 (712) 381
Stock-based
compensation
included in
income for the
period 620 434 1,684 1,825
Decrease in
deferred lease
inducements (37) (36) (110) (35)
Changes in non-cash
working capital:
Decrease (Increase)
accounts receivable 405 816 (458) (466)
Decrease (Increase)
in prepaid expenses (81) 183 (657) (30)
Increase (Decrease)
in accounts payable
and accrued
liabilities 490 (145) 1,147 (1,320)
Increase (Decrease)
in income taxes
payable 54 169 (2,122) 468
Decrease in deferred
revenue (314) (236) (200) (176)
--------------------------------------------- --------------------------
Cash flows from
operating activities 5,225 6,415 12,164 16,468
--------------------------------------------- --------------------------
Investing Activities:
Acquisition of
subsidiary, net
of cash acquired (534) - (534) -
Investment in
other assets (135) 12 (362) 43
Acquisition of
property and
equipment (9,390) (2,788) (22,992) (11,819)
Acquisition of
intangible assets (389) (304) (1,325) (1,200)
Proceeds on
disposition of
equipment 29 - 71 20
--------------------------------------------- --------------------------
Cash flows used in
investing activities (10,419) (3,080) (25,142) (12,956)
--------------------------------------------- --------------------------
Financing Activities:
Proceeds from
line of credit 2,000 - 2,000 -
Repayments of
notes payable (750) (800) (1,500) (2,400)
Payment of capital
lease obligations (66) (47) (178) (148)
Issuance of
capital stock 9 - 471 194
--------------------------------------------- --------------------------
Cash flows from
(used in) financing
activities 1,193 (847) 793 (2,354)
--------------------------------------------- --------------------------
Foreign exchange
gain (loss) on
cash and cash
equivalents 75 (19) 137 (139)
--------------------------------------------- --------------------------
(Decrease) Increase
in cash and cash
equivalents (3,926) 2,469 (12,048) 1,019
Cash and cash
equivalents,
beginning 7,622 9,576 15,744 11,026
--------------------------------------------- --------------------------
Cash and cash
equivalents,
ending $ 3,696 $ 12,045 $ 3,696 $ 12,045
--------------------------------------------- --------------------------
--------------------------------------------- --------------------------
For further information: For investor inquiries please contact: David Feick, The Equicom Group, (403) 218-2839, [email protected]; For media inquiries please contact: Marcela Peake, PEER 1, (604) 909-6428, [email protected]
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