MONTREAL, Feb. 28 /CNW Telbec/ - TECSYS Inc. (TSX: TCS), an industry-
leading supply chain management software company announced today its financial
results for the third quarter of fiscal 2006 ending January 31st, 2006. All
dollar amounts are expressed in U.S. currency and reported in accordance with
Canadian Generally Accepted Accounting Principles (GAAP) with a reconciliation
to the United States GAAP, and are unaudited.
Financial highlights for the three months include:
- Revenue increased to $9.7M from $5.3M in the same quarter of last year,
an 83% increase.
- Product revenue increased to $4.5M from $1.6M in Q3 of the previous
fiscal year, an increase of 178%.
- Services revenue increased to $4.9M from $3.6M in Q3 of the previous
fiscal year, an increase of 38%.
- Earnings from operations for the quarter were $221,000 compared to
$112,000 for the same period in the previous year.
- After an investment of $376,000 in TLA (TECSYS Latin America) and the
Company's Stock buy back of $120,000 during the quarter, cash increased
to $7.1M compared to $7.0M at the end of the prior fiscal quarter.
Financial highlights for the nine months include:
- Revenue for the nine months increased to $26.7M from $16.1M in the
comparable period of last year, an increase of 65%.
- Product revenue increased to $11.3M from $5.2M in the first nine months
of the previous year, an increase of 116%.
- Services revenue increased to $14.8M from $10.4M in the first nine
months of the previous year, an increase of 42%.
- Earnings from operations for the nine months were $353,000 compared to
$291,000 for the same period in the previous year.
"We are pleased with this resurgence in the supply chain management
industry. The combination of organic and acquisition-related growth has
resulted in an all-time high of our top line in this quarter. We are
continuing our drive for customer acquisition in North America, South America,
as well as, taking advantage of our new initiative in Europe to further our
penetration of the SCM market." said Peter Brereton, President and Co-CEO of
TECSYS Inc.
Other key achievements in the third quarter include:
New Accounts:
- A major distributor for the world's leading manufacturer of
construction, mining, agriculture and transportation equipment
serving Arizona, South-Eastern California and Northern Mexico.
- A Canadian-based North American designer and importer of home dDecor
products.
- A national wholesale distributor of office furniture and supplies in
the U.S. Midwest.
- A leading manufacturer and distributor of plumbing and hardware
products in California.
- A manufacturer and distributor of candles, accessories and planograms
in Ontario.
Product Upgrades and Deployments:
- The Company also signed a significant number of product upgrades for
all of its product lines and has successfully completed the
deployment of its solutions in a number of accounts during the
quarter.
Revenues in the third quarter of fiscal 2006 increased 83% to $9.7M
compared to $5.3M in the same period of fiscal 2005. Earnings from operations
for the reporting quarter were $221,000 compared to $112,000 in the
corresponding quarter of last year. Income from operations was impacted
favourably by $291,000 mainly as a result of a reversal of a restructuring
charge. After accounting for the exchange loss of $230,000 and net interest
income of $33,000, net earnings for the quarter were $5,000 or $0.00 per share
compared to $180,000 or $0.01 per share for the same period in the previous
year.
For the nine months ended January 31st, 2006, revenues increased 65% to
$26.7M compared to $16.1M in the same period of the prior fiscal year. As a
result of the strengthening of the Canadian dollar of approximately 7%
compared to the same period of last fiscal year, earnings from operations were
impacted unfavourably by an estimated $377,000, yet they increased by 21% to
$353,000 compared to $291,000 in the same period of fiscal 2005. Net earnings
for the nine months of fiscal year 2006 were $64,000 or $0.00 per share
compared to $0.00 or $0.00 per share for the same period in fiscal 2005.
About TECSYS
------------
TECSYS is a leading, fast-growing supply chain management software
provider that delivers powerful enterprise distribution, warehouse and
transportation logistics software solutions. The company's customers include
about 800 mid-size and Fortune 1000 corporations in healthcare, giftware,
office products, third-party logistics, and general wholesale high-volume
distribution markets. TECSYS' shares are listed on the Toronto Stock Exchange
under the ticker symbol TCS.
The statements in this news release relating to matters that are not
historical fact are forward looking statements that are based on management's
beliefs and assumptions. Such statements are not guarantees of future
performance and are subject to a number of uncertainties, including but not
limited to future economic conditions, the markets that TECSYS Inc. serves,
the actions of competitors, major new technological trends, and other factors
beyond the control of TECSYS Inc., which could cause actual results to differ
materially from such statements. All names, trademarks, products, and services
mentioned are registered or unregistered trademarks of their respective
owners.
<<
Consolidated Balance Sheets
Prepared in Accordance with
Canadian Generally Accepted Accounting Principles
-------------------------------------------------------------------------
(in thousands of U.S. dollars)
January 31, April 30,
2006 2005
(unaudited)
------------------------
------------------------
Assets
Current assets
Cash and cash equivalents 9 1,054
Short-term and other investments 6,497 5,435
Accounts receivable 8,178 7,000
Other accounts receivable 225 177
Tax credits receivable 2,063 1,241
Inventory 235 162
Prepaid expenses 528 749
------------------------
17,735 15,818
Restricted cash equivalents and other investments 589 815
Property, plant and equipment, net 2,022 2,044
Intangible assets 2,049 2,239
Long-term investments 363 -
Goodwill 2,042 1,827
Deferred development costs 60 -
------------------------
24,860 22,743
------------------------
------------------------
Liabilities
Current liabilities
Accounts payable and accrued liabilities 5,929 4,890
Current portion of long-term debt 523 106
Deferred revenue 2,055 1,868
------------------------
8,507 6,864
Long-term debt - 410
Other long-term liabilities 130 548
------------------------
8,637 7,822
------------------------
Shareholders' Equity
Capital stock 38,340 39,019
Contributed surplus 7,100 6,624
Cumulative translation adjustment 2,934 1,493
Deficit (32,151) (32,215)
------------------------
16,223 14,921
------------------------
24,860 22,743
------------------------
------------------------
Consolidated Statements of Deficit
Prepared in Accordance with
Canadian Generally Accepted Accounting Principles
-------------------------------------------------------------------------
(in thousands of U.S. dollars)
Nine Months Nine Months
Ended Ended
January 31, January 31,
2006 2005
(unaudited) (unaudited)
------------------------
Balance - Beginning of period as
originally stated (32,215) (27,764)
Adjustment resulting from a change
in accounting policy regarding
stock-based compensation - (4,785)
------------------------
Beginning balance as restated (32,215) (32,549)
Net earnings for the period 64 -
------------------------
Balance - End of period (32,151) (32,549)
------------------------
------------------------
Consolidated Statements of Operations
Prepared in Accordance with
Canadian Generally Accepted Accounting Principles
-------------------------------------------------------------------------
(in thousands of U.S. dollars,
except share and per share data)
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
January 31, January 31, January 31, January 31,
2006 2005 2006 2005
(unaudited) (unaudited) (unaudited) (unaudited)
-----------------------------------------------
-----------------------------------------------
Revenue
Products 4,543 1,632 11,259 5,223
Services 4,915 3,552 14,815 10,403
Reimbursable expenses 255 119 612 517
----------------------- -----------------------
9,713 5,303 26,686 16,143
Cost of revenue
Products 2,471 471 5,738 1,635
Services 3,439 1,855 9,889 5,369
Reimbursable expenses 255 119 612 517
----------------------- -----------------------
6,165 2,445 16,239 7,521
----------------------- -----------------------
Gross margin 3,548 2,858 10,447 8,622
----------------------- -----------------------
Operating expenses
Sales & marketing 1,605 1,156 4,573 3,476
General & administration 708 445 2,186 1,511
Gross research & development 1,177 996 3,276 2,838
Research & development
tax credits (144) (124) (544) (299)
Deferred development costs (60) - (60) -
Stock-based compensation 36 42 105 155
Amortization of property,
plant and equipment 151 150 427 420
Amortization of intangible
assets 145 81 422 230
Restructuring charges (291) - (291) -
----------------------- -----------------------
3,327 2,746 10,094 8,331
----------------------- -----------------------
Earnings from operations 221 112 353 291
Interest income 44 50 129 141
Interest expense (11) (12) (42) (29)
Foreign exchange losses (230) 30 (357) (403)
Share of net loss of
company subject to
significant influence (19) - (19) -
----------------------- -----------------------
Net earnings for the
period 5 180 64 -
----------------------- -----------------------
----------------------- -----------------------
Weighted average number of
common shares outstanding
- basic 13,762,084 14,110,177 13,820,843 14,142,590
----------------------- -----------------------
- diluted 13,802,597 14,153,445 13,868,272 14,226,766
----------------------- -----------------------
----------------------- -----------------------
----------------------- -----------------------
Basic and diluted net
earnings per common share
(in US dollars) $0.00 $0.01 $0.00 $0.00
----------------------- -----------------------
----------------------- -----------------------
Consolidated Statements of Cash Flows
Prepared in Accordance with
Canadian Generally Accepted Accounting Principles
-------------------------------------------------------------------------
(in thousands of U.S. dollars)
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
January 31, January 31, January 31, January 31,
2006 2005 2006 2005
(unaudited) (unaudited) (unaudited) (unaudited)
-----------------------------------------------
-----------------------------------------------
Cash flows from
Operating activities
Net earnings for the period 5 180 64 -
Adjustments for
Amortization of property,
plant and equipment 151 150 427 420
Amortization of
intangible assets 145 81 422 230
Stock-based compensation 36 42 105 155
Unrealized foreign
exchange losses 24 9 46 95
Restructuring charges (366) - (366) -
Deferred development costs (60) - (60) -
Share of net loss of
company subject to
significant influence 19 - 19 -
Changes in non-cash working
capital items related to
operations
Decrease (increase) in
accounts receivable 161 89 (341) 716
Decrease (increase) in
other accounts receivable (40) 7 (30) 157
Decrease (increase ) in
tax credits receivable (313) 808 (675) 376
Increase in inventory (140) - (57) -
Decrease (increase) in
prepaid expenses 135 (15) 279 77
Increase in long-term
accounts receivable - (42) - (48)
Increase (decrease) in
accounts payable and
accrued liabilities 877 (556) 531 (1,173)
Decrease in deferred
revenue (102) (219) (75) (397)
-----------------------------------------------
532 534 289 608
-----------------------------------------------
Financing activities
Repayment of long-term
debt and capital lease
obligations (6) (6) (43) (101)
Purchase of common shares
for cancellation (120) (277) (308) (280)
-----------------------------------------------
(126) (283) (351) (381)
-----------------------------------------------
Investing activities
Decrease (increase) in
short-term and other
investments (792) 1,638 (336) (172)
Acquisitions of property,
plant and equipment (89) (75) (214) (168)
Acquisitions of
intangible assets (10) (7) (29) (16)
Long-term investments (376) - (376) -
Business combinations
and purchase price
adjustment - - (33) 368
-----------------------------------------------
(1,267) 1,556 (988) 12
-----------------------------------------------
Effect of foreign exchange
rate fluctuations on cash
and cash equivalents (6) (21) 5 42
-----------------------------------------------
Change in cash and cash
equivalents (867) 1,786 (1,045) 281
Cash and cash equivalents
- Beginning of Period 876 883 1,054 2,388
-----------------------------------------------
Cash and cash equivalents
- End of Period 9 2,669 9 2,669
-----------------------------------------------
-----------------------------------------------
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