VANCOUVER, Sept. 14 /PRNewswire-FirstCall/ -- CounterPath Solutions, Inc. (OTCBB: CTPS), a leading provider of VoIP (Voice over IP) and Video over IP SIP softphones, today announced the financial and operating results for its first quarter ended July 31, 2006.
"We are pleased to report another quarter of continued growth and record revenue," commented Mark Bruk, chairman and chief executive officer. "Moreover, the quality of our customers continues to be outstanding as evidenced by tier one customers selecting our product for their softphone rollouts, and supporting our continued investment in new SIP technologies."
First quarter highlights:
- Record quarterly revenues for the quarter ended July 31, 2006 of
$1,760,881, an increase of 113% over the $827,296 recorded for the
quarter ended July 31, 2005, and a 20% increase over the $1,467,850
in revenues recorded for the quarter ended April 30, 2006.
- Announcement of a per-subscriber softphone licensing deal with BT
Retail (a division of leading UK-based British Telecommunications
plc), which allows BT Retail's consumer broadband customers to
experience the benefits of a CounterPath softphone with BT's new,
enhanced VoIP service, including secure Internet voice calling and
video messaging. BT is one of the world's leading providers of
communications solutions and services operating in 170 countries. For
more information visit http://www.bt.com/broadbandtalk.
- Announcement of a collaborative effort with Intel Corporation
integrating CounterPath's eyeBeam(TM) 1.5 Video over IP SIP softphone
with the Intel(R) 600SM PCI Phone Adapter. The "phone-ready" PC's
(personal computers) will enable users to make calls utilizing
standard phones, corded or cordless with their VoIP service. For more
information visit
http://www.intel.com/products/desktop/adapters/600sm/index.htm.
- Launching of X-Lite(TM) 3.0, our newest free SIP softphone building
on the success achieved by the previous version of X-Lite which was
launched in April 2003, and has since seen nearly two million
downloads and is used by the majority of companies looking to test,
build and deploy SIP-based solutions. X-Lite is also a favorite among
end users of Asterisk(R) (http://www.asterisk.org/), recognized as the
world's leading open-source IP-PBX. For more information visit
http://www.counterpath.com/xlite.
Financial Results - Unaudited
(All amounts in U.S. dollars and in accordance with U.S. GAAP unless
otherwise specified)
For the three months ended July 31, 2006, we generated $1,760,881 in revenue compared to $827,296 for the three months ended July 31, 2005. This represents an increase of $933,585 or 113% from the same period last year. We generated $1,409,719 in software revenue for the three months ended July 31, 2006 compared to $710,678 for the three months ended July 31, 2005, representing an increase of $699,041 or 98% over the same period last year. The increase in software revenue was attributable to an increase in both the number of customers we sell to and the revenue per customer. For the three months ended July 31, 2006, we generated $351,162 in service revenue compared to $116,618 for the three months ended July 31, 2005 representing an increase of $234,544 or 201% over the same period last year. The significant increase in service revenue reflects the increase in services we provide primarily to our larger customers to enable them to deploy our software. Our total number of customers that have deployed our software increased by 22 over the quarter to 213 as at July 31, 2006.
Total expenses for the three months ended July 31, 2006 were $2,239,023 compared to $1,137,100 for the previous three months ended July 31, 2005, representing and increase of 97% or $1,101,923. Expenses for wages, commissions and benefits during the quarter were $1,156,218 compared to $695,253 for the three months ended July 31, 2005 reflecting the addition of engineering staff required for research and development and the addition of sales and marketing staff. Other expenses include a $266,429 non-cash expense for stock-based compensation compared to $72,586 recorded in the same quarter last year. During the quarter, we began expensing the fair value of our employee stock options.
The net loss for the three months ended July 31, 2006 was $478,142 ($0.01 per share) compared to $309,804 ($0.01 per share) recorded for the three months ended July 31, 2005.
As of July 31, 2006, we had $1,133,361 in cash and cash equivalents compared to $2,369,021 at April 30, 2006. Our working capital was $1,671,169 at July 31, 2006 compared to $1,975,881 at April 30, 2006, representing a decrease of $304,712 from the previous quarter.
COUNTERPATH SOLUTIONS, INC.
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS
(Stated in U.S. dollars)
(Unaudited)
July 31, April 30,
2006 2006
------------ ------------
ASSETS
Current
Cash and cash equivalents $ 1,133,361 $ 2,369,021
Accounts receivable 1,664,858 477,814
Prepaid expenses and deposits 121,839 104,927
------------ ------------
2,920,058 2,951,762
Deposits 73,187 -
Equipment 345,005 300,077
Other assets 9,351 8,165
------------ ------------
$ 3,347,601 $ 3,260,004
------------ ------------
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LIABILITIES
Current
Accounts payable and accrued liabilities $ 984,777 $ 754,589
Due to related parties 21,711 34,929
Unearned revenue 105,425 115,214
Customer deposits 51,995 138
Warranty payable 84,981 71,011
------------ ------------
1,248,889 975,881
Convertible debenture 1,904,684 1,887,582
------------ ------------
3,153,573 2,863,463
------------ ------------
STOCKHOLDERS' EQUITY
Common stock, $0.001 par value
Authorized:
415,384,500 shares
Issued:
37,940,983 shares
(April 30, 2006: 37,915,462) 37,941 37,915
Additional paid-in capital 3,026,851 2,750,494
Deficit (2,795,731) (2,317,589)
Accumulated other comprehensive loss (75,033) (74,279)
------------ ------------
194,028 396,541
------------ ------------
$ 3,347,601 $ 3,260,004
------------ ------------
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CounterPath Solutions, Inc.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
(Stated in U.S. dollars)
(Unaudited)
Three months ended
July 31, July 31,
2006 2005
------------ ------------
Revenues
Software $ 1,409,719 $ 710,678
Service 351,162 116,618
------------ ------------
1,760,881 827,296
------------ ------------
Expenses
Amortization 75,005 50,807
Bad debts 24,466 20,152
Computer expenses 23,636 1,259
Consulting fees 220,470 104,136
Foreign exchange loss 22,297 1,900
Interest on convertible debenture 42,102 -
Licenses and permits 94,514 (30,000)
Office and miscellaneous 31,921 20,935
Professional fees 69,720 58,673
Public relations 44,576 17,529
Rent 61,333 40,557
Stock-based compensation 266,429 72,586
Telephone and internet 23,897 16,716
Travel and promotion 68,469 59,885
Wages, commissions and benefits 1,156,218 695,253
Warranty expense 13,970 6,118
Write-off of trademark - 594
------------ ------------
2,239,023 1,137,100
------------ ------------
Net loss for the period (478,142) (309,804)
Other comprehensive loss
Foreign currency translation adjustments (754) (1,735)
------------ ------------
Comprehensive loss $ (478,896) $ (311,539)
------------ ------------
------------ ------------
Basic and diluted loss per share $ (0.01) $ (0.01)
------------ ------------
------------ ------------
Weighted average number of shares outstanding 37,926,439 37,915,462
------------ ------------
------------ ------------
The Company's Quarterly Report on Form 10-QSB for the quarter ended July 31, 2006 is available for viewing at http://www.sec.gov/.
About CounterPath
CounterPath Solutions, Inc., formerly Xten Networks, Inc., is a developer of award-winning, carrier-grade VoIP and Video over IP SIP softphones for telecom and Internet telephony service providers, cable operators, IP-PBX manufacturers and infrastructure manufacturers. CounterPath's SIP softphones and softphone SDKs (Software Development Kits), which provide VoIP, Video over IP, IM (Instant Messaging) and Presence functionality and can be preconfigured to our customer's VoIP service, are predominantly licensed on a per-seat or per-subscriber basis either co-branded or private labeled. CounterPath's technology is deployed by over 210 customers in more than 49 countries. Additional information about CounterPath and CounterPath's products and services is available at http://www.counterpath.com/.
CONTACT: Leila Neale, +1-604-320-3344 x114,
