NTG Clarity Networks Announces First Quarter 2016 Financial Results

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[{"type":"text","content":"NTG Clarity Networks Announces First Quarter 2016 Financial Results(via Thenewswire.ca)\n \n \nToronto, ON / TheNewswire / May 27, 2016 - NTG Clarity Networks Inc. (TSX.V:NCI), announces its first quarter results for the period ended March 31, 2016 (all figures in Canadian Dollars).\n\n\n \nDuring the first quarter of 2016, NTG Clarity continued the trend of customer and geographical diversification. Along with this trend comes higher cost of sales and selling and G&A expenses as we incurred expenses for our new offices in Oman and Kuwait as well as higher wages and salaries for key personnel which are required for anticipated new revenues to be achieved over the remainder of 2016. \n\n\n \nDuring Q1 2016, NTG Clarity generated revenues of $2,433,333 as compared to $5,002,161 in the same period last year (which was an exceptional, record quarter). Traditionally, Q1 revenue is weaker due to the timing of new budgets and projects. Q1 2016 is in line with first quarters in previous years (Q1 2014: $2,933,749; Q1 3013: $1,486,872). The decrease in revenues was due to:\n\n\n \n-foreign currency exchange including the weakening of the Egyptian pound in relation to the Canadian dollar, and fluctuations in currencies in the period.\n\n\n \n-longer lead time to close new projects as the uncertainty in the Middle East due to lower oil prices has delayed the awarding of new projects. However, with the recent stability in oil prices, we expect the start of new projects in the next quarter. \n\n\n \nThe increase in operating expenses was due to:\n\n\n \n-the costs of our new offices in Egypt, Kuwait and Oman; and\n\n\n \n-the retention of highly skilled employees after the completion of projects, pending the start of new projects. It is important to note that these personnel are the company's main assets.\n\n\n \nRevenue was comprised of 79% professional services, 12% product related sales, 7% for office equipment/services and 2% for field service work. As professional services carry a lower gross margin than product related sales, margins were lower in Q1 compared to the prior year but showed improvement over Q4/15 margins. In Q1 2016, our Gross Margin was 29% compared to 35% in Q1 2015. The higher cost of skilled personnel continues to affect our margins. We are working to balance between growth and expenses to help generate increased ...

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