VICTORIA, B.C., Sept. 27 /CNW/ - VCom Inc. (TSX: VCM) today announced
that its 2006 fiscal year financial statements and Management's Discussion and
Analysis for the year ended June 30, 2006 have been filed on the SEDAR system.
The highlights provided in this press release should be read in conjunction
with the Company's final prospectus dated November 3, 2005, relating to our
initial public offering of shares, and our audited annual consolidated
financial statements and accompanying notes for the years ended June 30, 2006
and June 30, 2005. Our audited annual consolidated financial statements and
accompanying notes for the year ended June 30, 2006 are available at:
http://www.vcom.com/invest/latest_finan.html
The webcast can be viewed at:
http://services.choruscall.com/links/vcom060927.html
All dollar amounts are in Canadian dollars. This is VCom's first annual
report filed as a public company.
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FINANCIAL HIGHLIGHTS
- Total revenue for the 2006 fiscal year was $80.0 million,
representing a 27% increase over revenue for the fiscal year ended
June 30, 2005.
- Increased productivity and economies of scale allowed the Company
to increase sales and maintain gross margin in spite of the 880
basis point appreciation in the average value of the Canadian
dollar during the 2006 fiscal year as compared to the previous
year. Without the foreign exchange effect and non-recurring items,
VCom's year-over-year growth would have exceeded 40% in the 2006
fiscal year.
- Gross margin was 38%, within our model of 35 to 39%.
- Net income for the 2006 fiscal year was $10.6 million or
$0.50 per share. Excluding the effects of non-cash stock based
compensation expense, adjusted net income for the 2006 fiscal year
was $11.6 million or $0.55 per share. As stated in our final
prospectus, net income for the year ended June 30, 2005 benefited
from recognition of unearned revenue on the termination of an OEM
supply contract. Excluding the effect of non-cash stock based
compensation expense and that non-recurring event in the 2005
fiscal year, our adjusted net income of $11.6 million this fiscal
year represents an increase of 32% over the adjusted net income
for the fiscal year ended June 30, 2005.
- Shareholders' equity almost doubled in the year ended June 30,
2006 to $76.4 million as compared to $38.5 million at June 30,
2005. The increase was a result of operating profits and
successful completion of our initial public offering.
OPERATIONAL HIGHLIGHTS
- VCom continues to make progress in introducing new products in
digital video markets while controlling operational expenses.
Operating expenses in the year ended June 30, 2006 were 20% of
total revenue (excluding the 1% of sales in non-cash stock-based
compensation).
- VCom ended the fiscal year with 593 employees, representing a 20%
increase from the 495 personnel at June 30, 2005.
- The fourth quarter of fiscal year 2006 was the second three-month
period in which YourLink reported a positive EBITDA, which
contributed to an improvement in consolidated EBITDA.
- On July 1st, the day after the Company's 2006 fiscal year ended,
it acquired WaveRider Communications (Canada) Inc. for a total
consideration of $1.6 million. This transaction will result in an
estimated extraordinary gain of $6.7 million or $0.32 per share in
the first quarter of our 2007 fiscal year.
- Total research and development costs net of deferrals,
amortization of deferred development costs and income tax credits
for the year ended June 30, 2006 were $7.6 million, or 9% of
revenue, an increase of 106% from the $3.7 million, or 6% of
revenue, for the year ended June 30, 2005. The increased
expenditures for research and development reflect VCom's
fulfillment of commitments in its prospectus dated November 3,
2005 to increase its expenditures in this area.
- At the conclusion of fiscal 2006 VCom had evaluation orders for
WiMAX gear in place with 7 customers, 4 WiMAX field trials
worldwide, and discussions were in the advanced stages for an
additional 11 field trials and evaluation orders. The company
signed a major distributor agreement with MRO-TEK for the
deployment of 3.5 GHz WiMAX networks throughout India. Four of
these agreements or field trials are targeted at large nationwide
broadband infrastructure deployments and initiatives.
- In fiscal 2006, VCom's CableVista Edge decoder received approval
from Cox, Adelphia and other major MSOs.
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On November 14, 2005, the Company successfully completed its initial
public offering of 3,335,000 common shares at a purchase price of
$7.50 per share for gross proceeds of $25,012,500. On November 25, 2005, our
underwriters exercised their over-allotment option by purchasing an additional
500,250 common shares (of which 225,250 were issued by VCom and 275,000 were
sold by its principal shareholders) at $7.50 per share. The Company's common
shares began trading on November 14, 2005 on the Toronto Stock Exchange under
the symbol "VCM".
About VCom
We design, manufacture and sell products that enable broadband access to
cable, wireless and telephony networks. Our hardware products incorporate
embedded software developed by us to meet the complex requirements of
next-generation, high-speed digital networks. Service providers use our
solutions to deliver services to a converging worldwide broadband market,
including what are commonly known as "triple play" (voice, video and data) and
"quadruple play" (voice, video, data and wireless) services. Our solutions
allow service providers to rapidly and cost-effectively bridge the final
network segment that connects a system directly to end-users, commonly
referred to as "the last mile", by overcoming the bottleneck resulting from
insufficient carrying capacity in legacy last-mile infrastructures. Visit VCom
at www.vcom.com.
Forward-Looking Statements
This news release contains forward-looking statements which are not
historical facts, but are based on certain assumptions and reflect VCom's
current expectations. These forward-looking statements are subject to a number
of risks and uncertainties that could cause actual results or events to differ
materially from current expectations, including those detailed under "Risk
Factors" in Management's Discussion and Analysis for the fiscal year ended
June 30, 2006, a copy of which is available on SEDAR at www.sedar.com. Except
as required by law, VCom disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise. Given these risks and uncertainties, investors
should not place undue reliance on forward-looking statements as a prediction
of actual results.
