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Mitec Telecom announces year-end and fourth quarter results for fiscal 2010

^{Published on 2010-07-28 06:35:48 - Market Wire}
 

 Annual Results -------------- 

 Fourth Quarter Results ---------------------- 

 Management Commentary --------------------- 

 - Selection as lead supplier for a core component (diplexers) for point- to-point radios by one of the world's largest and fastest growing telecom providers. To date, volume production has been set up in Mitec's Suzhou, China facility and remains on schedule for $3.0 million in orders for the balance of the year; - Selection as lead supplier for an additional core component (flexible waveguide) for point-to-point radios by the same customer referred to above. To date volume production has generated over $1.5 million in orders and should reach $2.0 million as anticipated; - Receipt of first commercial order for its Distributed Antenna System (DAS network) from a North American integrator. Although this technology has been field tested over the past several years, deliveries have now been made and Mitec is optimistic that its solution can be a significant entrant in this growing, valuable telecom market; - Selection as lead supplier and initial shipment of Long Term Evolution (LTE) 4G wireless network components to the same customer referred to above. These initial shipments, which totalled $1.7 million, are part of a larger volume initiative to support 4G growth worldwide with this customer; - Selection as supplier of low noise amplifiers as part of a European Telecom company's network upgrade with a value of $1.5 million; - Selection for mobile broadcast trials for a North American satellite radio service provider involving Mitec's proven, high performance filters. These trials are expected to generate a series of higher volume, follow-on orders in 2011. 

 MITEC TELECOM INC. CONSOLIDATED BALANCE SHEETS (in thousands of Canadian dollars) Audited As at As at April 30, April 30, 2010 2009 $ $ ------------------------------------------------------------------------- ASSETS Current Cash 1,886 4,485 Short-term investments 181 181 Trade receivables 5,732 5,592 Other receivables 288 126 Income tax recoverable 380 323 Inventories 5,447 8,088 Prepaid expenses and other assets 493 629 ------------------------------------------------------------------------- Total current assets 14,407 19,424 Property, plant and equipment 4,510 5,493 Intangible assets 1,762 3,263 Goodwill - 1,991 Investments 25 25 Future income tax - 125 ------------------------------------------------------------------------- 20,704 30,321 ------------------------------------------------------------------------- ------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Current Credit facility 733 - Accounts payable and accrued liabilities 6,061 5,449 Current portion of long-term debt - 1,215 ------------------------------------------------------------------------- Total current liabilities 6,794 6,664 Long-term debt 1,157 - ------------------------------------------------------------------------- 7,951 6,664 ------------------------------------------------------------------------- Shareholders' equity Common shares 132,142 132,142 Warrants 1,152 1,925 Equity component of convertible debentures 768 14 Contributed surplus 10,802 9,836 Deficit (131,427) (119,980) Accumulated other comprehensive loss (684) (280) ------------------------------------------------------------------------- Total shareholders' equity 12,753 23,657 ------------------------------------------------------------------------- 20,704 30,321 ------------------------------------------------------------------------- ------------------------------------------------------------------------- MITEC TELECOM INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (in thousands of Canadian dollars, except per share data and number of shares) Unaudited Audited For For the three months ended the twelve months ended April 30, April 30, 2010 2009 2010 2009 $ $ $ $ ------------------------------------------------------------------------- Sales 6,358 6,927 25,424 40,348 Cost of sales 5,403 5,844 21,756 31,836 ------------------------------------------------------------------------- Gross profit 955 1,083 3,668 8,512 ------------------------------------------------------------------------- Expenses Research and development 777 1,137 3,559 4,369 Selling and administrative 1,794 2,087 6,712 7,510 Financial expenses 299 178 834 853 Foreign exchange loss (gain) 287 (470) 969 (1,706) Loss on disposal and impairment of property, plant and equipment 33 80 8 470 Impairment of intangible assets 724 50 724 50 Impairment of goodwill 1,991 1,607 1,991 1,607 Stock-based compensation 44 45 193 607 ------------------------------------------------------------------------- 5,949 4,714 14,990 13,760 ------------------------------------------------------------------------- Loss before income taxes (4,994) (3,631) (11,322) (5,248) Income tax expense (recovery) 242 (523) 125 (640) ------------------------------------------------------------------------- Net loss for the year (5,236) (3,108) (11,447) (4,608) Net change in the unrealized (loss) gain on translating financial statements of self-sustaining foreign operations (21) (575) (404) 614 ------------------------------------------------------------------------- Comprehensive loss for the year (5,260) (3,683) (11,851) (3,994) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Basic and diluted loss per outstanding common share (0.02) (0.01) (0.05) (0.02) ------------------------------------------------------------------------- Weighted average number of outstanding common shares 220,666,756 220,666,756 220,666,756 220,658,990 ------------------------------------------------------------------------- MITEC TELECOM INC. CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (in thousands of Canadian dollars, except for number of shares) Audited Equity component of conver- tible de- Common shares Warrants bentures Number Number (000) $ (000) $ $ ------------------------------------------------------------------------- Balance, April 30, 2008 220,312 132,097 38,016 1,931 46 Issued upon conversion of convertible debentures 354 45 - - (32) Expired warrants - - (187) (6) - Stock-based compensation - - - - - Other comprehensive profit for the year - - - - - Net loss for the year - - - - - ------------------------------------------------------------------------- ------------------------------------------------------------------------- Balance, April 30, 2009 220,666 132,142 37,829 1,925 14 Issued under a convertible debenture financing - - - - 754 Expired warrants - - (14,226) (773) - Stock-based compensation - - - - - Other comprehensive loss for the year - - - - - Net loss for the year - - - - - ------------------------------------------------------------------------- Balance, April 30, 2010 220,666 132,142 23,603 1,152 768 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Accu- mulated other Contri- compre- Share- buted hensive holders' surplus Deficit loss equity $ $ $ $ ------------------------------------------------------------------------- Balance, April 30, 2008 9,223 (115,372) (894) 27,031 Issued upon conversion of convertible debentures - - - 13 Expired warrants 6 - - - Stock-based compensation 607 - - 607 Other comprehensive profit for the year - - 614 614 Net loss for the year - (4,608) - (4,608) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Balance, April 30, 2009 9,836 (119,980) (280) 23,657 Issued under a convertible debenture financing - - - 754 Expired warrants 773 - - - Stock-based compensation 193 - - 193 Other comprehensive loss for the year - - (404) (404) Net loss for the year - (11,447) - (11,447) ------------------------------------------------------------------------- Balance, April 30, 2010 10,802 (131,427) (684) 12,753 ------------------------------------------------------------------------- ------------------------------------------------------------------------- MITEC TELECOM INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands of Canadian dollars) Unaudited Audited For For the three months ended the twelve months ended April 30, April 30, 2010 2009 2010 2009 $ $ $ $ ------------------------------------------------------------------------- CASH FLOW FROM OPERATING ACTIVITIES Net loss for the period (5,236) (3,108) (11,447) (4,608) Items not affecting cash Amortization 405 478 1,714 2,327 Loss on disposal and impairment of property, plant and equipment 33 80 8 470 Impairment of intangibles assets 724 50 724 50 Impairment of goodwill 1,991 1,607 1,991 1,607 Income tax charge (recovery) 242 (523) 125 (640) Stock-based compensation 140 45 193 607 Accretion expense 44 104 448 636 ------------------------------------------------------------------------- (1,657) (1,267) (6,244) 449 Changes in non-cash working capital balances related to operating activities 746 2,246 2,787 435 ------------------------------------------------------------------------- (911) 979 (3,457) 884 ------------------------------------------------------------------------- CASH FLOW FROM INVESTING ACTIVITIES Additions to property, plant and equipment (5) (437) (166) (786) Additions to intangible assets - (3) (10) (3) Proceeds on disposal of property, plant and equipment 14 2 31 15 Purchase of short-term investment - (337) (181) (516) - 335 181 412 ------------------------------------------------------------------------- 9 (440) (145) (878) ------------------------------------------------------------------------- CASH FLOW FROM FINANCING ACTIVITIES Convertible debentures issued - - 1,678 - Repayment of long-term debt - (68) (1,400) (458) Credit facility 733 - 733 - ------------------------------------------------------------------------- 733 (68) 1,011 (458) ------------------------------------------------------------------------- (Loss) gain on foreign cash and cash held 19 153 (8) 153 ------------------------------------------------------------------------- Net decrease in cash (150) 624 (2,599) (299) Cash, beginning of the year 2,036 3,861 4,485 4,784 ------------------------------------------------------------------------- Cash, end of the period 1,886 4,485 1,886 4,485 ------------------------------------------------------------------------- -------------------------------------------------------------------------