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WellPoint Systems reports record revenue, EBITDA and net income for the quarter and nine months ended September 30, 2009

^{Published on 2009-11-23 05:04:22 - Market Wire}
 

 Third Quarter and Nine Month Financial Highlights ------------------------------------------------------------------------- Three Months Ended $ Change Six Months Ended $ Change September 30 September 30 In thousands (CDN$) 2009 2008 2008-2009 2009 2008 2008-2009 ------------------------------------------------------------------------- Revenue 9,921 7,826 2,095 29,038 27,615 1,423 Gross Profit 7,373 3,953 3,420 20,619 15,399 5,220 Adjusted EBITDA 2,947 (2,289) 5,236 7,562 (3,338) 10,900 Net Income 2,660 (8,955) 11,615 3,690 (13,652) 17,342 Adjusted EBITDA per share 0.06 (0.05) 0.11 0.16 (0.07) 0.23 Net Income per share 0.05 (0.19) 0.24 0.08 (0.30) 0.38 ------------------------------------------------------------------------- 

 Third Quarter Business Highlights - Increased net income for the third quarter of 2009 by $11.6 million ($0.23 per share) to $2.7 million ($0.05 per share), compared with a net loss of ($9.0) million ($0.19 per share) in the third quarter of 2008; - Net income for the nine months ended September 30, 2009 increased by $17.3 million ($0.38 per share) to $3.7 million ($0.08 per share), compared with a net loss of ($17.5) million ($0.30 share) for the same period in 2008; - Increased Adjusted EBITDA for the third quarter of 2009 by $5.2 million to $2.9 million, compared with an Adjusted EBITDA loss of ($2.3) million in the third quarter of 2008; - Received a US$3.3 million (CDN$3.6 million) indemnity payment from Export Development Canada ("EDC"); - Redeemed $1.3 million (net) of convertible debentures that came due; - Grew customer base by 12 companies, including five sales of WellPoint's Dynamics AX EAM and EFM products; - Sold additional licenses to 13 current customers; - Released WellPoint Integrated Suite (WIS) 5.2 which included enhancements to Energy Broker and Energy Financial Management such as data integration; improved budgetary processing enhanced reporting, enhanced tariff functionality and revised production forecasting. This release series also blends the Enterprise Asset Management product line with the WIS products such that a customer can purchase a fully-integrated system on the AX 2009 platform; - Released BOLO 9.3 which included enhancements to BOLO's Multicurrency, Asset Tracking, Revenue, Land, and Production Accounting features. As a part of WellPoint's continuing support of this product line, there were more than 250 small enhancements across the full suite of capabilities; and - Ranked 28th among the Deloitte Technology Fast 50(TM), a ranking of the 50 fastest growing technology companies in Canada. 

 - Establishing deeper partnerships across the globe, including expanded and new agent relationships in international markets. In 2010, the Company particularly intends to focus its activities on increasing market share and driving revenue from opportunities primarily in the North American, Middle Eastern and other international markets; - Increasing sales and marketing of WellPoint Energy Broker in the North American market and WellPoint EAM and WellPoint EFM solutions worldwide; - Continuing development and marketing of BOLO and IDEAS in their target markets to increase market share; - Continuing development and marketing of the WellPoint Energy Suite solutions to expand functionality and better conform with best practices in the computer software industry; and - Increasing sales and marketing of the WellPoint EAM solution to broad-based manufacturers through partner channels. 

 Notes (1) "EBITDA" is a financial measure that does not have any standardized meaning prescribed by Canadian generally accepted accounting principles ("GAAP") and may not be comparable to similar measures presented by other companies. EBITDA is a measure of the Company's operating profitability. EBITDA provides an indication of the results generated by the Company's principal business activities prior to how these activities are financed, assets are amortized or how results are taxed in various jurisdictions. Adjusted EBITDA is Standardized EBITDA(1), excluding foreign exchange gains primarily related to the US dollar denominated debt of the Company and can vary significantly depending on exchange rate fluctuations, which are beyond the control of the Company, and write downs of deferred development and intangible costs, goodwill impairment, financing costs, stock based compensation, fees and expenses on settlement of debt and losses on extinguishment of debt and after deducting the annual amount invested in respect of deferred development costs, which, with the implementation of International Financial Reporting Standards in the year ended December 31, 2011, will generally be required to be expensed on an annual basis. (2) "Gross Profit" is a financial measure that does not have any standardized meaning prescribed by GAAP and may not be comparable to similar measures presented by other companies. Gross profit is provided to assist investors in determining WellPoint's ability to generate earnings from the sales of its products and services. Gross profit is calculated by subtracting direct expenses from revenue. 

 The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release. WELLPOINT SYSTEMS INC. Consolidated Balance Sheets (Unaudited) (in thousands of dollars) ------------------------------------------------------------------------- September 30 December 31 2009 2008 ------------------------------------------------------------------------- Assets Current assets: Cash $ 1,228 $ 406 Accounts receivable 3,002 3,532 Prepaid expenses 597 746 ----------------------------------------------------------------------- 4,827 4,684 Property and equipment 949 1,106 Deferred development costs 1,540 2,119 Intangible assets 11,764 15,384 Goodwill 21,487 24,442 Future income taxes 1,194 132 ------------------------------------------------------------------------- $ 41,761 $ 47,867 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Liabilities and Shareholders' Equity Current liabilities: Accounts payable and accrued liabilities ' $ 4,668 $ 5,718 Current income tax liability 92 106 Deferred revenue 2,361 4,876 Other deferred credits 55 55 Notes payable 225 - Current portion of long term notes payable 5,347 99 Current portion of capital lease obligations 57 46 Convertible debentures 1,519 1,358 ----------------------------------------------------------------------- 14,324 12,258 Long term notes payable - 6,005 Capital lease obligations 51 58 Other deferred credits 36 77 Convertible debentures 24,598 26,476 ------------------------------------------------------------------------- 39,009 44,874 Shareholders' equity: Share capital 14,620 14,497 Contributed surplus 1,733 1,624 Convertible debentures 8,996 8,996 Accumulated other comprehensive income (418) 3,744 Deficit (22,179) (25,868) ------------------------------------------------------------------------- (22,597) (22,124) ------------------------------------------------------------------------- Total shareholders' equity 2,752 2,993 ------------------------------------------------------------------------- $ 41,761 $ 47,867 ------------------------------------------------------------------------- ------------------------------------------------------------------------- WELLPOINT SYSTEMS INC. Consolidated Statements of Operations and Retained Earnings (deficit) (unaudited) (in thousands of dollars, except per share amounts) ------------------------------------------------------------------------- Three months ended Six months ended September 30 September 30 2009 2008 2009 2008 ------------------------------------------------------------------------- Revenue License $ 4,771 $ 1,411 $ 11,330 $ 7,384 Maintenance 2,570 2,459 8,351 7,157 Professional services 2,580 3,955 9,357 13,074 ------------------------------------------------------------------------- 9,921 7,825 29,038 27,615 Direct costs 2,548 3,873 8,419 12,216 ------------------------------------------------------------------------- Gross profit 7,373 3,952 20,619 15,399 Expenses: Sales, general and administrative 2,794 3,935 7,867 11,394 Interest 1,580 959 4,498 2,821 Research and development 1,324 1,674 4,181 3,780 Depreciation and amortization 805 1,121 2,549 3,416 Facilities 354 429 1,118 1,327 Financing and amortization of debt and note payable issue costs 59 137 203 390 Foreign exchange loss (gain) (1,689) 739 (2,517) 1,039 Fees and expenses on settlement of long term note payable - - - 615 Writedown of deferred development costs - 4,227 - 4,227 ------------------------------------------------------------------------- 5,227 13,221 17,899 29,009 ------------------------------------------------------------------------- Net income (loss) before income taxes 2,146 (9,269) 2,720 (13,610) ------------------------------------------------------------------------- Income taxes Current expense 92 166 92 299 Future expense (reduction) (606) (479) (1,062) (257) ------------------------------------------------------------------------- (514) (313) (970) 42 ------------------------------------------------------------------------- Net income (loss) 2,660 (8,956) 3,690 (13,652) Deficit, beginning of period (24,839) (8,562) (25,869) (3,866) ------------------------------------------------------------------------- Deficit, end of period $ (22,179) $ (17,518) $ (22,179) $ (17,518) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Net income (loss) per share Basic and diluted $ 0.05 $ (0.19) $ 0.08 $ (0.30) ------------------------------------------------------------------------- -------------------------------------------------------------------------