Year over Year Revenue Increases 21%
TORONTO, Nov. 22 /CNW/ - ComnetiX(TM) Inc. (TSX:CXI), a leading provider
of biometric identification and authentication solutions, reported results for
its 2006 fiscal year and fourth quarter ended August 31, 2006.
For the fiscal year ended August 31, 2006, revenue was $12.5 million with
a net loss of $4.7 million, or $0.33 per share. This represents a year over
year increase in revenue of 21% compared to revenue of $10.3 million and a net
loss of $2.9 million, or $0.21 loss per share for the fiscal year ended
August 31, 2005.
Revenue for the fourth quarter of fiscal 2006 was approximately
$2.8 million with a net loss of $0.5 million, or $0.04 loss per share. This
represents an increase in revenue of 13% compared to revenue for the fourth
quarter of fiscal 2005 ended August 31, 2005, of $2.5 million with a net loss
of $1.1 million, or $0.08 loss per share.
ComnetiX CEO Bernard Crotty said "I am pleased to report a 21% increase
in year over year revenue and a significant reduction in our quarterly net
loss for the second consecutive quarter as well as a significant reduction
compared to the same quarter in the previous fiscal year. While we are pleased
to see the positive impact of the expense reductions initiated in the second
quarter of fiscal 2006, revenues in the fourth quarter of fiscal 2006 were
adversely impacted by several contract delays including the previously
announced Kern County, CA contract."
Fourth Quarter and Fiscal Year Highlights
The Company continued to increase its presence as a strategic supplier of
law enforcement systems in New York State and Georgia. The Georgia Bureau of
investigation approved several of the Company's Intelligent Identification
Environment (IIE(TM)) suite of software solutions to send images and data and
to receive responses from the Georgia Bureau of investigations automated
fingerprint identification system (AFIS). The certification of
IntelliScreen(TM), IntelliBook(TM) and IntelliServ(TM) has allowed ComnetiX to
become a valuable source for software centric identification solutions for
law-enforcement and government agencies in this segment and position them for
further market penetration in the region.
Orders from various law enforcement and state agencies across New York
built on an already solid client base and demonstrate that ComnetiX continues
to be the solution provider of choice in the region. The orders consist of new
business for the Company's Intelligent Identification Environment suite of
software solutions as well as for the provision of maintenance and system
upgrades to existing customers in the State.
ComnetiX continued to make headway into the Western US market with
significant awards in California and Nevada. The company's IIE suite of
products and services won out over other solutions providers in competitive
bid situations for each award and the wins have bolstered confidence that
understanding and interest for these products is increasing throughout the
region. The company also received certification from the California Department
of Justice (DOJ) for the seventh live scan device it offers to customers. This
certification highlights ComnetiX' ability to offer the broadest range of live
scan devices in the California market.
The Company established Canada's first comprehensive electronic
fingerprinting services during its fiscal year 2006, with offices from
Vancouver to Halifax and with an estimated 55 percent of the private
fingerprinting market in the country. ComnetiX was also selected to
participate in a Real Time Identification (RTID) Release 0.5 Pilot by the
Royal Canadian Mounted Police (RCMP) for the processing of civil applicant
submissions. Participation gave the Company the opportunity to familiarize
itself with new technological requirements to be implemented in the RTID
Release 1.0 and the new National Police Service (NPS) Automated Fingerprint
Identification System (AFIS).
About ComnetiX(TM) Inc. (www.comnetix.com)
ComnetiX(TM) Inc. provides secure identification and authentication
solutions to both the public and private sectors throughout North America.
ComnetiX offers multimode biometric identification solutions for use in areas
such as applicant screening, financial services, health care, transportation,
airlines and airports, casinos and gaming, and energy and utilities. Clients
include American Airlines, Lehman Brothers, New York City Health and Hospital
Corporation, New York State Division of Criminal Justice Services, Toronto
Police Services Board, Boston Police Department and the Royal Canadian Mounted
Police. ComnetiX is also Canada's premier applicant fingerprinting services
company, facilitating tens of thousands of criminal background checks each
year through its chain of ten offices across Canada. In addition ComnetiX has
established more than 40 applicant fingerprinting services locations
throughout the United States.
Statements made in this news release that relate to future plans, events
or performances are forward-looking statements. Any statement in this release
containing words such as "believes," "plans," "expects" or "intends" and other
statements that are not historical facts are forward-looking, and these
statements involve risks and uncertainties and are based on current
expectations. Consequently, actual results could differ materially from the
expectations expressed in these forward-looking statements.
<<
COMNETIX INC.
Consolidated Statements of Operations and Deficit
Years Ended August 31, 2006 and 2005
-------------------------------------------------------------------------
Three Months Ended Fiscal Year Ended
--------------------------- ---------------------------
August 31, August 31, August 31, August 31,
2006 2005 2006 2005
------------- ------------- ------------- -------------
SALES $ 2,766,812 $ 2,450,971 $ 12,492,141 $ 10,260,086
EXPENSES
Cost of hardware
sold 636,679 607,276 3,674,801 2,860,358
Wages 1,194,300 1,368,528 6,552,812 5,553,158
Sales, general
and
administrative 1,071,845 1,376,432 5,088,043 4,029,766
Interest 19,065 9,820 98,031 14,343
Amortization of
capital assets 49,105 41,340 202,531 146,434
Amortization of
intangible
assets 155,109 62,558 586,896 81,408
Stock
compensation
expense 110,653 261,662 1,015,255 735,436
Restructuring
expense (14,808) - 184,919 -
--------------------------------------------- ---------------------------
$ 3,221,948 $ 3,727,616 $ 17,403,288 $ 13,420,903
--------------------------------------------- ---------------------------
LOSS FROM
OPERATIONS (455,136) (1,276,645) (4,911,147) (3,160,817)
INTEREST INCOME 12,100 157,058 66,355 226,498
--------------------------------------------- ---------------------------
LOSS BEFORE TAXES
FOR THE PERIOD (443,036) (1,119,587) (4,844,792) (2,934,319)
FUTURE TAX
RECOVERY (91,888) 56,058 165,416 56,058
--------------------------------------------- ---------------------------
NET LOSS FOR THE
PERIOD (534,924) (1,063,529) (4,679,376) (2,878,261)
DEFICIT, BEGINNING
OF YEAR (15,456,715) (10,248,734) (11,312,263) (8,434,002)
--------------------------------------------- ---------------------------
DEFICIT, END OF
YEAR $(15,991,639) $(11,312,263) $(15,991,639) $(11,312,263)
--------------------------------------------- ---------------------------
--------------------------------------------- ---------------------------
LOSS PER COMMON
SHARE - BASIC $ (0.04) $ (0.09) $ (0.33) $ (0.21)
LOSS PER COMMON
SHARE - DILUTED $ (0.04) $ (0.08) $ (0.33) $ (0.21)
--------------------------------------------- ---------------------------
--------------------------------------------- ---------------------------
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING
(000's) 14,341 13,611 14,125 13,617
--------------------------------------------- ---------------------------
--------------------------------------------- ---------------------------
COMNETIX INC.
Consolidated Balance Sheets
August 31, 2006 and 2005
-------------------------------------------------------------------------
2006 2005
------------- -------------
ASSETS
CURRENT
Cash $ 536,154 $ 828,170
Short term investments 1,014,648 5,554,466
Accounts receivable 3,525,874 3,067,393
Inventory 436,009 545,459
Prepaid expenses 169,575 156,819
-------------------------------------------------------------------------
5,682,260 10,152,307
CAPITAL ASSETS 578,023 609,168
INTANGIBLE ASSETS 2,835,527 3,422,421
GOODWILL 4,719,630 4,896,706
-------------------------------------------------------------------------
$ 13,815,440 $ 19,080,602
-------------------------------------------------------------------------
-------------------------------------------------------------------------
LIABILITIES
CURRENT
Bank indebtedness $ 502,483 $ 548,331
Accounts payable and accrued liabilities 2,025,929 3,470,263
Current portion of capital lease obligation - 4,115
Current portion of notes payable 27,633 560,175
Deferred revenue 1,954,489 1,774,150
-------------------------------------------------------------------------
4,510,534 6,357,034
-------------------------------------------------------------------------
LONG TERM
Capital lease obligation - 1,697
Future income tax liability 763,860 929,275
Notes payable 82,898 134,796
-------------------------------------------------------------------------
846,758 1,065,768
-------------------------------------------------------------------------
5,357,292 7,422,802
-------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
SHARE CAPITAL 18,877,885 18,655,443
CONVERTIBLE DEBENTURE 1,688,618 1,688,618
CUMULATIVE TRANSLATION ADJUSTMENT 524,379 -
WARRANTS 251,906 620,206
CONTRIBUTED SURPLUS 3,106,999 2,005,796
DEFICIT (15,991,639) (11,312,263)
-------------------------------------------------------------------------
8,458,148 11,657,800
-------------------------------------------------------------------------
$ 13,815,440 $ 19,080,602
-------------------------------------------------------------------------
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