Three months ended June 30: ------------------------------------------------------------------------- Description 2009 2008 Increase/decrease ------------------------------------------------------------------------- Revenue $2.27 million $3.18 million -28.6% ------------------------------------------------------------------------- Gross Income $1.30 million $1.93 million -32% ------------------------------------------------------------------------- EBITDA $(146,689) $(52,254) -280% ------------------------------------------------------------------------- Net Earnings, continuing operations $(1,706,036) $163,438 - ------------------------------------------------------------------------- Comprehensive Income (Loss) $(1,706,036) $85,771 - ------------------------------------------------------------------------- EPS, continuing operations(1) $(0.006) $0.006 - ------------------------------------------------------------------------- EPS(1) $(0.006) $0.003 - ------------------------------------------------------------------------- Year ended June 30: ------------------------------------------------------------------------- Description 2009 2008 Increase/decrease ------------------------------------------------------------------------- Revenue $10.11 million $12.69 million -20% ------------------------------------------------------------------------- Gross Income $6.77 million $8.80 million -23% ------------------------------------------------------------------------- EBITDA $(236,032) $774,057 -130% ------------------------------------------------------------------------- Net Earnings, continuing operations $(2,481,455) $413,703 - ------------------------------------------------------------------------- Comprehensive Income (Loss) $(2,481,455) $118,736 - ------------------------------------------------------------------------- EPS, continuing operations(1) $(0.086) $0.014 - ------------------------------------------------------------------------- EPS(1) $(0.086) $0.004 - ------------------------------------------------------------------------- (1) Earnings Per Share (basic and diluted) Following are the highlights of the 2009 fiscal year: - Revenues from continuing operations for the year ended June 30, 2009 declined $2,583,286 from 2008 results. The U.S. operation continued to feel the full effect of the recession as revenue for the year ended June 30, 2009 declined 24.6% from $2,698,193 in fiscal 2008 to $2,033,676. The Canadian operation also saw a $1,918,769 or 19.2% decline in revenue for the fiscal year ended June 30, 2009 versus 2008. The decrease in revenue is primarily due to the recessionary environment resulting in reduced marketing budgets and fewer new business opportunities. - At year-end, we recorded a goodwill impairment charge of $1,460,403 in light of the significant down turn in the economy and the ensuing effect on our business. This was in addition to an impairment charge of $370,733 in relation to the U.S. operation that was recorded in the second quarter of fiscal year 2009, resulting in a comprehensive loss of $2,481,455 for the year. These goodwill write-downs are a one-time non-cash charge. - The percentage of gross income from the Company's top ten clients in the fiscal year 2009 amounted to 68% versus 69% in 2008. Two of these clients represented greater than 10% of consolidated gross income in both fiscal years. As per our stated goals, the company continues to focus on larger accounts and providing comprehensive integrated and interactive marketing services - The Company's net cash position as at June 30, 2009 amounted to $929,935 compared to $998,425 as at June 30, 2008. As of the date of this MD&A, the Company's net cash position is $465,463. We believe, with the adjustments to date and further reorganization plans, that we will be able to navigate the economic uncertainties that we all currently face. We also believe, at this current time, we have sufficient working capital and cash to manage operations through fiscal 2010. - As a result of the economic slow down, we continue to adjust our cost structure to better position ourselves for future success in an uncertain environment. Salary and wages decreased by $829,928 or 13.1% from $6,292,170 in fiscal 2008 to $5,470,242 in fiscal 2009. General and Administration costs were also reduced by 13.3% from 1,589,570 in fiscal 2008 to $1,378,531 in fiscal 2009. Ongoing adjustments will be made to bring cost into appropriate alignment with revenues. - We continue to make strategic investments in current clients and marketing and business development activities to ensure that when the market moves to recovery, we are in a position to activate marketing programs and remain top of mind as thought and creative leaders with desired clients.
About Rare Method Interactive Corp.
Rare Method (TSX-V: RAM) is a leading integrated agency that leverages technology to make marketing more effective and accountable. Rare Method offers a full range of marketing services including marketing strategies, creative, technology development, media planning & management, campaign analytics, reporting & optimization. Rare Method has 47 employees in
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For further information: Rare Method Investor & Media inquiries: Mr. Tom Short, President, Rare Method, (403) 543-4500 or [email protected]
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