CALGARY, March 26 /CNW/ - Imaging Dynamics Company Ltd. (IDC or the Company) (TSX: IDL) a global supplier in the high growth digital radiography (DR) equipment market, today reported financial results for the fourth quarter and the full year ended December 31, 2008.
2008 Year and Fourth Quarter Highlights
- Cash and cash equivalents increased by $0.4 million during fourth
quarter to $1.1 million at December 31, 2008 from $0.7 million at
September 30, 2008;
- Revenue for the fourth quarter increased by 47% when compared to the
third quarter of 2008 while maintaining gross margins;
- Sales and marketing, general and administrative, production and
manufacturing and research and development expenses were all down
year over year from 2007 to 2008 by 26.5 percent and quarter over
quarter from Q3 2008 to Q4 2008 by 11.3 percent;
- Purchase orders received during the fourth quarter and opening
backlog totaled $4.1 million ($3.1 million shipped and recognized,
$1.0 million booked to closing backlog);
- Receivables reduced by $7.3 million when compared to December 31,
2007 on the collection of $23.7 million and by $0.8 million compared
to September 30, 2008 on the collection of $4.4 million during the
fourth quarter;
- Inventory reduced by $7.9 million compared to December 31, 2007 and
by $4.5 million compared to September 30, 2008 which included a
$3.4 million write down of inventory during the fourth quarter;
- Reduced payables and accruals by $9.2 million compared to
December 31, 2007 and payables and accruals increased by $0.7 million
compared to September 30, 2008;
- Reduced expenses by 34.8 percent or $2.2 million compared to the same
quarter last year and by 33.7 percent or $8.1 million on a year to
date basis compared to the same period last year;
- Gross revenues were lower by 62.8 percent compared to the same
quarter last year and by 48.0 percent on a year to date basis
compared to the same period last year; which was largely due to the
decline in revenues in United States ("US") as a result of the
slowing economic conditions and Asia-Pacific due to business slow
down during the Beijing Olympics during the third quarter and foreign
exchange impact as majority of the sales are in US dollars (US dollar
was weak against the CDN dollar for most part of 2008 compared to
2007); and
- Gross margins were 21.1 percent for the quarter and on a year to date
basis were 26.3 percent which were also impacted due to; lower margin
sales during the year and the global pricing pressures on digital
radiography products, the continued utilization of inventory that was
purchased during previous quarters when the US-Canadian dollar
exchange rate was much higher and inventory adjustments during the
quarter to ensure proper valuation.
For the 2008 year, IDC reported a loss of $0.15 per share before interest and inventory and asset write down, for a full-year loss after interest and write downs of $0.21 per share on revenues of $16,876,980 as compared to a loss of $0.24 per share on revenues of $32,446,401 last year. For the fourth quarter, the Company reported a loss of $0.04 per share before interest and inventory and asset write down, and a loss after interest and write downs of $0.08 per share on revenues of $3,071,181 as compared to a loss of $0.10 per share on revenues of $8,263,103 in Q4 2007.
Commenting on the year end and fourth quarter 2008 results, Tom Boon, IDC's President & CEO said, "While our year over year results are clearly disappointing, we are not immune to the global economic challenges the diagnostic imaging industry is currently facing. However, I am very encouraged by our quarter over quarter results. Sales were up by 47% while maintaining our margins, cash was up, receivables and inventory were down - these are signs that the steps we have implemented are taking hold and their effects are making a positive impact. Most importantly, I am seeing early signs that the customer confidence in IDC is returning as demonstrated by the increased sales activity, the large China order recently received and the clear uptick in revenue. Our X-Series product performance is world class, the IDC brand is strong, our global channels are demonstrating more activity and our employees are exceeding my expectations given the organizational changes that were implemented during the past several quarters. These are early indicators that give me confidence that IDC will demonstrate improved results throughout 2009."
A conference call to review the results will take place on Friday, March 27, 2009 at 8:00 a.m. EDT (6:00 a.m. MDT). To participate in the call, please dial 416.644.3420 or 800.594.3790 approximately 5 minutes prior to the conference call.
Imaging Dynamics Company Ltd.
Consolidated Balance Sheets
As at December 31 2008 2007
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Assets
Current Assets
Cash and cash equivalents $ 1,104,268 $ 1,460,554
Receivables 4,954,233 12,219,209
Inventory 6,254,484 14,142,710
Prepaids and deposits 450,676 1,100,558
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12,763,661 28,923,031
Property, plant and equipment 1,136,216 1,880,932
Intangible assets 220,421 244,912
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$ 14,120,298 $ 31,048,875
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Liabilities and Shareholders' Equity
Current Liabilities
Short-term borrowing $ - $ 1,260,244
Payables and accruals 5,248,257 14,466,103
Customer deposits 427,080 345,140
Warranty 1,217,719 1,098,287
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6,893,056 17,169,774
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Shareholders' Equity
Share capital 70,246,559 65,983,374
Contributed surplus 5,474,899 4,743,668
Warrants 4,053,035 -
Deficit (72,547,251) (56,847,941)
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7,227,242 13,879,101
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$ 14,120,298 $ 31,048,875
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Imaging Dynamics Company Ltd.
Consolidated Statements of Operations,
Comprehensive Loss and Deficit
For the year ended December 31 2008 2007
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Revenues, net $ 16,876,980 $ 32,446,401
Cost of goods sold (12,431,854) (20,769,086)
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Gross profit 4,445,126 11,677,315
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Expenses
Sales and marketing 4,949,480 7,941,338
General and administrative 3,948,699 4,736,341
Production and manufacturing 1,741,511 1,650,895
Research and development 1,842,873 2,636,822
Foreign exchange (gain) loss (529,532) 1,347,633
Warranty 928,600 693,628
Stock-based compensation 731,231 1,338,311
Bad debts 1,121,179 1,814,953
Restructuring costs 467,607 -
Amortization of property, plant and equipment 710,219 685,004
Amortization of deferred development costs - 782,917
Amortization of intangible assets 24,491 38,805
Interest 303,698 409,450
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16,240,056 24,076,097
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Loss before interest and other items (11,794,930) (12,398,782)
Inventory write-down (3,421,218) (1,975,764)
Asset write-down (513,060) -
Interest and other income 29,898 109,174
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Net loss, being comprehensive loss $(15,699,310) $(14,265,372)
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Net loss per share
Basic and diluted $ (0.21) $ (0.24)
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Deficit, beginning of year $(56,847,941) $(42,582,569)
Net loss, being comprehensive loss (15,699,310) (14,265,372)
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Deficit, end of year $(72,547,251) $(56,847,941)
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Imaging Dynamics Company Ltd.
Consolidated Statement of Cash Flows
For the year ended December 31 2008 2007
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Increase (decrease) in cash and cash
equivalents are as follows:
Cash flows from operating activities
Net loss, being comprehensive loss $(15,699,310) $(14,265,372)
Items not affecting cash
Amortization 734,710 1,506,726
Asset write-down 310,101 -
Stock-based compensation 731,231 1,338,311
Warranty 119,432 280,414
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(13,803,836) (11,139,921)
Change in non-cash working capital 6,667,178 10,147,708
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(7,136,658) (992,213)
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Cash flows from financing activities
Proceeds from share issuances, net 8,316,220 448,568
Short-term borrowing, net (1,260,244) (3,036,789)
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7,055,976 (2,588,221)
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Cash flows used in investing activities
Intangible asset additions - (5,206)
Property, plant and equipment additions (275,604) (854,998)
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(275,604) (860,204)
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Net change in cash and cash equivalents (356,286) (4,440,638)
Cash and cash equivalents
Beginning of year 1,460,554 5,901,192
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End of year $ 1,104,268 $ 1,460,554
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About IDC:
IDC (Imaging Dynamics Company) is a medical technology company and innovative force in the fast-growing field of digital radiography (DR) technology. IDC's X-Series line of direct capture technology replaces conventional film-based image capture and provides a cost-effective alternative to cassette based computed radiography (CR) systems.
Each IDC DR solution provides high resolution radiographic images in the digital format required for today's electronic medical record networks, all without the use of film, environmentally harmful chemicals, cassettes or expensive imaging plates. IDC received the 2007 Frost & Sullivan Technology Innovation Award and the 2008 PROFIT 100 ranking as one of Canada's fastest-growing companies. IDC was also recognized by the 2008 Deloitte Technology Fast 500, which ranks the fastest growing technology, media, telecommunications and life sciences companies in North America.
IDC is based in Calgary, Alberta, Canada.
Statements in this release which describe IDC's intentions, expectations or predictions, or which relate to matters that are not historical facts are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performances or achievements of IDC to be materially different from any future results, performances or achievements expressed in or implied by such forward-looking statements. IDC may update or revise any forward-looking statements, whether as a result of new information, future events or changing market and business conditions. Known and unknown risks and uncertainties include: IDC's ability to manufacture its products with a sufficient level of quality and in volumes which satisfy market demand; the ability of IDC to establish direct and indirect sales channels; the ability of IDC to establish industry partnerships; IDC's ability to attract and retain key personnel; the strength and breadth of IDC's patents; and other factors relating to general economic conditions, specific industry conditions and IDC's particular situation.