Mar. 8, 2011 (Canada NewsWire Group) --
(Not for dissemination in the United States of America)
The Company also announces pending sale of its investment in Adenyo
MISSISSAUGA, ON, March 8 /CNW/ - Pioneering Technology Corp. of Mississauga, Ontario (TSXV: PTE), ("Pioneering" or the "Company" "), an energy smart product innovation and consumer goods company, recently filed its sixth consecutive quarter with an operating profit (or EBITDA) of $10,672 in the first quarter of its fiscal 2011 year, which ended December 31, 2010. The Company's unaudited financial statements for the quarter, together with its Management's Discussion and Analysis of these results, are available for review under the Company's profile at www.sedar.com.
Revenue for Q1 FY2011 was $609,495, which was relatively unchanged from the same period a year ago (Q1 FY2010 - $618,862) and down 5% from the immediately preceding quarter (Q4 FY2010 - $641,457). Management believes the Company's flat revenue growth is only temporary as the sales pipeline of potential orders is strong and continues to grow. The Company's ability to grow further has now become constrained by a sales resource and channel partnership model that is staffed for delivering at the current volume levels. In order to meet the increased demand for its product the Company intends to shift its focus in 2011 towards:
-
increasing direct sales resources in both the US and Canada,
-
creating new end user demand in its traditional social and military
housing markets,
-
targeting larger channel partnerships with broader "feet-on-the-street"
sales coverage that are committed to marketing and selling the
Company's products, and
- developing retail sales opportunities as the Company's revenue is currently driven through commercial channels.
Management has begun implementing this shift and believes it will
deliver the top line growth necessary to meet its 2011 revenue targets.
While the Company generated positive EBITDA for the sixth consecutive quarter (EBITDA is defined as earnings excluding non-recurring items, non-cash items, taxes, interest and financing fees and amortization), an operating expense increase of $97,060 and increase in non-cash stock based compensation charge of $30,700 were the main reasons for a net loss during the quarter of $(57,111) versus a net profit of $65,703 in Q1 FY 2010. The increase in operating expenses is due to commission expenses of approximately $89,000 paid to a US based sales agent to market and sell the Company's new product, Safe-T-sensor into the US market. The stock compensation expense increase is due to stock options vesting for the recently hired COO/CFO.
Sale of Adenyo
On January 31, 2011, Motricity (Nasdaq:MOTR) announced it had signed an agreement to acquire Adenyo Inc. for initial consideration of US$100 million in cash and/or common stock of Motricity plus an earn-out provision pursuant to which Motricity would pay US$0 to $50 million, in cash, common stock, or a combination thereof, at Motricity's election, based on Adenyo's financial performance during the 12 month period following closing of the transaction. A minimum of 50% of the initial consideration will be cash; however, the cash component can be increased up to 100% at Motricity's election.
Pioneering presently owns 2,750,000 common shares of Adenyo, representing approximately 1.8% of the issued and outstanding common shares of Adenyo as at December 31, 2010. The deal is scheduled to close March 31, 2011 subject to closing conditions and receipt of regulatory approvals. The Company plans to use the proceeds it receives from the sale of its Adenyo shares pursuant to this transaction to redeem its outstanding preferred shares and to fund working capital requirements and operating expenses. The Company presently has 20,533,133 preferred Pioneering shares outstanding, redeemable at up to $0.06 per share.
About Pioneering Technology Corp:
Pioneering is an "Energy Smart" product innovation company based in
Mississauga, Ontario, that engineers and brings to market energy smart
solutions for consumer products making them safer, smarter and/or more
efficient. The patented Safe-T-element® cooking system is engineered to
help prevent stove top cooking fires, the number one cause of fire in
North America, and to reduce the amount of electricity required to
cook. The patent pending Safe-T-sensor is designed to detect burning
conditions in microwave ovens shutting it off before it causes a fire
or triggers a fire alarm. Pioneering trademarks include
Safe-T-element®, Safe-T-Sensor™, Powergrill™, Battery Eliminator®,
Powerpak™ and the Hydro-free Furnace Fan™. For more information visit: www.pioneeringtech.com.
Forward Looking Statements
The statements made in this press release include forward-looking
statements that involve a number of risks and uncertainties. These
statements relate to future events or future performance and reflect
management's current expectations and assumptions. A number of factors
could cause actual events, performance or results to differ materially
from the events, performance and results discussed in the
forward-looking statements, such as the economy, generally, competition
in the Corporation's target markets, the demand for the Corporation's
products, the availability of funding, the efficacy of the
Corporation's technology and governmental regulation. These
forward-looking statements are made as of the date hereof an, except as
required by applicable law, the Corporation does not assume any
obligation to update or revise them to reflect new events or
circumstances. Actual events or results could differ materially from
the Corporation's expectations and projections.
Non-GAAP Measures
EBITDA is not a measure recognized under Canadian generally accepted
accounting principles ("GAAP"). However, management of Pioneering
believes that most shareholders, creditors, other stakeholders and
investment analysts prefer to have these measures included as reported
measures of operating performance, a proxy for cash flow, and to
facilitate valuation analysis. EBITDA does not have any standard
meanings prescribed by GAAP and therefore may not be comparable to
similar measures presented by other issuers. Readers are cautioned that
EBITDA is not an alternative to measures determined in accordance with
GAAP and should not, on its own, be construed as indicators of
performance, cash flow or profitability. References to the
Corporation's EBITDA should be read in conjunction with the financial
statements and management's discussion and analysis of the Corporation
posted on SEDAR (www.sedar.com).
The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy and accuracy of this release.
Kevin Callahan, President & CEO at (905) 712-2061 ext. 222