International Datacasting Corporation Announces Fiscal 2011 First Quarter Results

International Datacasting Corporation (TSX:IDC), a leader in providing advanced global solutions for the distribution of broadband content via satellite, announced its financial results for the three-month period ended April 30, 2010. All figures are stated in Canadian dollars.

Q1 Fiscal 2011 Highlights

Revenue was $5.4 million, compared to $5.1 million recorded in Q1 fiscal 2010.
Gross margin remained consistent at 49% year-over-year.
EBITDA was ($1.8m) compared to ($0.6m) in Q1 fiscal 2010.
Net loss $(2.1) million or $(0.04) per share, compared to net loss of $(0.8) million or $0.01 per share in Q1 fiscal 2010.

"Q1 was a disappointment and we need to do better" said Frederick Godard, IDC President and CEO. "We continue to streamline our operations, and these efficiency measures combined with a stronger revenue run-rate should result in a significant improvement in our performance over the balance of the year" he continued.

Revenues were $5.4 million for Q1 fiscal 2011, compared to $5.1 million in Q1 fiscal 2010. IDC continues to experience longer than normal sales cycles as clients continue to moderate their purchasing decisions. This amount is lower than the Company's expectation due to the delay of some orders for the upcoming FIFA World Cup, these orders were received and filled in Q2 fiscal 2011. The Company is closely monitoring expenses and capital expenditures in order to continue to grow the business while continuing to restructure operations.

Gross profit was $2.7 million in Q1 fiscal 2011. Gross margins were affected by the downward pressure on pricing, and the continued consolidation of business units. Management continues to work to improve gross margins over the long-term, but expects margins to continue to fluctuate with product mix and order timing on a quarterly basis.

Overall operating expenses for Q1 fiscal 2011 were $4.5 million, compared to $3.3 million in Q1 fiscal 2010. This includes the $0.7 million in costs for the previously announced corporate restructuring.

Selling, General and Administrative (SG&A) expenses were $2.2 million in Q1 fiscal 2011, compared to $2.0 million in Q1 fiscal 2010. Research and Development (R&D) costs were $1.3 million in fiscal 2011, compared to $1.0 million in Q1 fiscal 2010.

Earnings before interest, taxes, depreciation and amortization (EBITDA) was $(1.8) million in Q1 fiscal 2011, compared to $(0.6) million in Q1 fiscal 2010.

In Q1 fiscal 2011, the Company recorded a net loss of $2.1 million, or $0.04 per share, compared to a net loss of $0.8 million, or $0.01 per share, in Q1 fiscal 2010.

IDC's cash balance was $4.8 million at April 30, 2010, compared to $4.7 million at January 31, 2010, with $ 0.2 million of cash provided by operating activities in Q1 fiscal 2011, compared to $0.1 million of cash applied to operating activities in Q1 fiscal 2010. The Company remains free of long-term debt and has unused bank credit lines totaling $1.5 million

A complete set of unaudited consolidated financial statements and management's discussion and analysis for the three months ended April 30, 2010 will be available at [ www.sedar.com ]or on the Investor Information section of IDC's website at [ www.datacast.com ].

Conference Call

A conference call will be held on Wednesday, June 09, 2010 at 9:00 a.m. ET to discuss this announcement. The call may be accessed by dialing 647-427-0833 or 1-800-231-8191. A taped replay will be available for one week by dialing 416-849-0833 or 1-800-642-1687, reference number 79534402. To access the live webcast, please visit the Company's website at [ www.datacast.com ]or [ www.newswire.ca ]for directions.

Use of Non-GAAP Financial Information

Non-GAAP measures, such as EBITDA and backlog, are provided to enhance the overall understanding of our current financial performance and our prospects for the future. Specifically, we believe non-GAAP results provide useful information to both management and investors by excluding specific expenses we believe are not indicative of our core operating results. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with generally accepted accounting principles.

EBITDA (earnings before interest, taxes, depreciation and amortization) is not a recognized measure under Canadian generally accepted accounting principles (GAAP), does not have standardized meaning, and is unlikely to be comparable to similar measures used by other companies. Accordingly, investors are cautioned that EBITDA should not be construed as an alternative to revenue, net earnings or loss determined in accordance with GAAP as an indicator of the financial performance of the Company or as a measure of the Company's liquidity and cash flows.

About International Datacasting Corporation (IDC)

International Datacasting Corporation (TSX:IDC) is a global leader in providing IP-based datacasting solutions for content distribution. IDC has a broad portfolio of advanced technology products marketed under the names SuperFlex, Datacast XD, Tiernan, Logic Innovations and PROFline for implementing a wide range of satellite and other broadband content contribution and distribution networks. IDC's products are in demand for radio and television broadcast networks, distance learning, digital satellite news gathering and sport contribution, digital signage, digital cinema, IPTV distribution and other content distribution applications. IDC is headquartered in Ottawa, Canada, with operations in Arnhem, the Netherlands and in San Diego, California. The Company is in international in scope with installations in over 100 countries worldwide, has regional sales and service offices in the UK, Australia, Singapore and China as well as an established international network of value-added partners and distributors

This press release contains forward-looking statements that may involve risks and uncertainties. Actual results may differ materially. Factors that might cause a difference include, but are not limited to, competitive developments, risks associated with IDC's growth, the development of the satellite datacasting market, regulatory risks, intellectual property infringement and other factors. IDC assumes no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof. More detailed information about potential factors that could affect IDC's financial and business results is included in the public documents IDC files from time to time with Canadian securities regulatory authorities.

International Datacasting Corporation
Unaudited Consolidated Balance Sheets as at
		April 30, 2010			January 31, 2010
ASSETS
Current Assets
	Cash	$	4,763,486		$	4,675,868
	Amounts receivable		4,749,277			6,171,603
	Inventories		5,503,862			5,260,362
	Prepaid expenses and other assets - current portion		485,038			527,228
	Future tax asset		40,672			40,672
Total Current Assets			15,542,335			16,675,733

Equipment			2,552,376			2,724,108
Prepaid expenses - long term portion			127,764			142,102
Future tax asset long term portion			2,059,328			2,059,328
Intangible assets			465,250			542,792
Goodwill			399,925			399,925
Total Non-Current Assets			5,604,643			5,868,255

Total Assets		$	21,146,978		$	22,543,988

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
	Accounts payable and accrued liabilities	$	4,393,225		$	4,238,427
	Customer deposits		131,215			78,745
	Other liabilities		-			1,814
	Obligations under capital leases - current portion		77,416			83,542
	Deferred revenue		1,211,406			514,096
Total Current Liabilities			5,813,262			4,916,624

Long Term Liabilities
	Obligations under capital leases		78,117			92,930
	Future tax liability		93,050			108,558
Total Non-Current Liabilities			171,167			201,488
Total Liabilities			5,984,429			5,118,112

Shareholders' Equity
	Capital stock		22,972,043			22,965,108
	Contributed surplus		3,049,079			2,999,748
	Accumulated other comprehensive income		(191,067	)		23,277
	Accumulated deficit		(10,667,506	)		(8,562,257	)
Total Shareholders' Equity			15,162,549			17,425,876

Total Liabilities and Shareholders' Equity		$	21,146,978		$	22,543,988





International Datacasting Corporation
Unaudited Consolidated Statements of Operations and Comprehensive Loss
For The Three Months Ended

		April 30, 2010			April 30, 2009

Revenue		$	5,396,056		$	5,110,203
Cost of revenue			2,737,533			2,625,909
Gross profit			2,658,523			2,484,294
Operating expenses
Selling, general and administrative			2,225,037			1,960,451
Research and development, net of investment tax credits			1,318,893			1,032,057
Amortization			303,979			322,087
Restructuring Costs (Note 8)			670,607			-
			4,518,516			3,314,595
Operating (loss)			(1,859,993	)		(830,301	)
Interest income (expense)
	Long-term		(3,776	)		(5,818	)
	Short-term		7,228			16,315
Unrealized gain on revaluation of held-for-trading investment			-			48,608
Foreign exchange (loss)			(65,497	)		(108,423	)
(Loss) before income taxes and extraordinary (loss)			(1,922,038	)		(879,619	)
Income tax (expense) recovery			(9,062	)		60,194
(Loss) before extraordinary (loss)			(1,931,100	)		(819,425	)
Extraordinary (loss) (Note 9)			(174,149	)		-

Net (loss)		$	(2,105,249	)	$	(819,425	)

Other comprehensive (loss) income
Unrealized gain on revaluation of available-for-sale investment			-			176,897
Unrealized (loss) gain on translation of self sustaining
foreign operations			(214,344	)		7,288
Other comprehensive (loss) income			(214,344	)		184,185

Comprehensive (loss)		$	(2,319,593	)	$	(635,240	)

Net (loss) per share
Basic		$	(0.04	)	$	(0.01	)
Diluted		$	(0.04	)	$	(0.01	)
Net (loss) per share before extraordinary (loss)
Basic		$	(0.03	)	$	(0.01	)
Diluted		$	(0.03	)	$	(0.01	)
Weighted average number of
shares outstanding
	Basic (Note 10)		56,994,913			56,740,719
	Diluted (Note 10)		57,907,413			58,289,004





International Datacasting Corporation
Unaudited Consolidated Statements of Cash Flows
For The Three Months Ended
			April 30, 2010			April 30, 2009

Operating Activities
	Net (loss) earnings		$	(2,105,249	)	$	(819,425	)
	Add items not requiring an outlay of cash:
		Amortization		303,979			322,087
		Bad debt expense		-			41,759
		Unrealized gain on revaluation of held-for-trading investment		-			(48,608	)
		Future income taxes		(15,508	)		(62,421	)
		Stock-based compensation		50,766			67,849
		Extraordinary loss		174,149			-
Net change in operating components of working capital net ofeffects of business acquisition of Tiernan (Note 7)				1,812,422			408,875

Cash (applied to) provided by operating activities				220,559			(89,884	)

Investing activities
Additions to equipment				(74,098	)		(147,089	)
Purchase of available-for-sale investment				-			(198,103	)
Purchase of held-for-trading investment				-			(51,897	)

Cash applied to investing activities				(74,098	)		(397,089	)

Financing activities
Repayments of obligations under capital leases				(20,939	)		(50,308	)
Issue of common shares, net of issue costs				5,500			56,411

Cash applied to financing activities				(15,439	)		6,103

Effect of foreign exchange rate changes on cash				(43,404	)		(8,717	)

Increase (decrease) in cash during the period				87,618			(489,587	)

Cash - Beginning of year				4,675,868			7,554,296

Cash - End of year			$	4,763,486		$	7,064,709

Interest paid				3,776			5,818
Income taxes paid				139,010			2,227

Contributing Sources

Market Wire

N@N

International Datacasting Corporation Announces Fiscal 2011 First Quarter Results