TORONTO, Aug. 10 /PRNewswire-FirstCall/ -- Belzberg Technologies Inc. (TSX -BLZ), a provider of technology-based equity and options trading services, announced today that in the second quarter ended June 30, 2009, the net loss was $1.4 million as compared to a net loss of $0.4 million same quarter last year. These results represent an improvement over the net loss of $1.8 million in the first quarter of 2009.
"Your management continues to focus on improving operations and controlling costs in this challenging market environment," said Judith Robertson, President and CEO. "Lower revenues compared to the first quarter (net of pass-throughs) were principally a result of lower US trading volumes and Canadian subscription fees which is consistent with industry-wide trends. Unfortunately, the significant improvements we made to operating expenses and new client growth were not enough to off-set the volume decline in the second quarter."
Major achievements in the second quarter include: - Expenses (excluding restructuring charges) declined $0.7 million from the first quarter. - Added 10 new clients in the second quarter across equities and options. - Added 2 new clearing clients. - Planning for an important new technology upgrade in the third quarter.
"We are excited by the new technology upgrade planned for September, 2009," said Judith Robertson, President and CEO. "It is the first firm-wide release that incorporates new features and functionality for both equity and options traders along with an improved user interface. This represents an important milestone for the Company and will assist in its efforts to gain and retain clients."
Total revenues for the second quarter, including pass-throughs on which the Company makes no margin, increased 21% to $10.8 million versus $9.0 million in the same year-ago period. Revenues net of pass-throughs decreased by 12% to $5.8 million from $6.6 million in the same year-ago period. A strengthening US dollar positively impacted revenues before pass-throughs by approximately $0.6 million.
Diluted loss per share for the second quarter was $(0.09) per share as compared to a loss of $(0.03) per share in the same year-ago period.
------------------------------------------------------------------------- Financial Highlights (in millions of dollars, Three months ended Six months ended except per share data) June 30, June 30, (unaudited) 2009 2008 2009 2008 ------------------------------------------------------------------------- Revenue $ 10.8 $ 9.0 $ 22.1 $ 18.6 Revenue before pass-throughs $ 5.8 $ 6.6 $ 12.4 $ 14.1 Net earnings (loss) $ (1.4) $ (0.4) $ (3.2)* $ 0.7 Diluted earnings (loss) per share $ (0.09) $ (0.03) $ (0.22) $ 0.05 ------------------------------------------------------------------------- ------------------------------------------------------------------------- * Includes restructuring charges of $0.8 million Business Line Revenues
Total equity and clearing revenues before pass-throughs were $2.3 million in the second quarter of 2009 compared to $2.1 million in the same year-ago quarter. A strengthening US dollar positively impacted equity and clearing revenues by approximately $0.3 million.
Total revenue of option contracts before pass-throughs traded both electronically and non-electronically was $2.3 million in the second quarter of 2009 compared to $2.7 million in the same year-ago quarter. A strengthening US dollar positively impacted option revenues by approximately $0.3 million.
Total subscription based revenue was $1.2 million in the second quarter of 2009 compared to $1.8 million in the same year-ago quarter.
Average total daily volume of electronic equity and index options contracts traded both electronically and non-electronically on the floor of the CBOE and on other exchanges were 206,000 contracts per day in the second quarter of 2009 as compared to 266,000 contracts per day in the same year-ago quarter.
About Belzberg Technologies
Belzberg Technologies Inc. is a provider of technology-based brokerage services, trading equities and options through Electronic Brokerage Systems, Belzberg Technologies' wholly owned broker-dealer. Electronic Brokerage Systems is a member of most North American stock exchanges, options exchanges and clearing organizations, including the NYSE, NASDAQ, CBOE, NSCC and OCC. Using Belzberg's suite of integrated trading tools and network connectivity, Belzberg's customers have direct access to all North American equities and options markets. The firm's client-base includes over 200 leading U.S and international brokerage houses and financial institutions. Belzberg Technologies is listed on the Toronto Stock Exchange (Ticker-BLZ) - additional information is available at http://www.belzberg.com/.
Forward looking statement disclaimer
Except for historical information contained herein, the matters discussed in this press release are based on forward-looking statements that involve risk and uncertainty. A variety of important factors could cause results to differ materially from such statements, including but not limited to economic, competitive, governmental and technological factors affecting the company's operation, markets, products, prices and other factors.
Notice
The consolidated financial statements have not been reviewed by an external auditor
BELZBERG TECHNOLOGIES INC. Consolidated Balance Sheets (in thousands of Canadian dollars) ------------------------------------------------------------------------- June 30, December 31, 2009 2008 (Unaudited) (Audited) ----------- ----------- ASSETS CURRENT Cash and cash equivalents $ 13,464 $ 19,452 Cash and cash equivalents segregated under regulations and other 2,890 184 Cash and cash equivalents on deposit with clearing and depository organizations 5,100 1,989 Receivable from brokers, dealers and clearing organizations 1,938 1,774 Accounts receivable 4,977 5,973 Prepaid expenses and other receivables 715 534 Other assets 823 1,565 Income taxes receivable 104 89 Investment tax credits recoverable 34 84 ------------------------------------------------------------------------- 30,045 31,644 CAPITAL ASSETS 3,111 3,326 INVESTMENT 30 38 INVESTMENT TAX CREDITS RECOVERABLE 1,634 1,580 FUTURE INCOME TAX ASSETS 4,681 3,289 GOODWILL 1,608 1,608 OTHER INTANGIBLE ASSETS, NET 370 473 ------------------------------------------------------------------------- $ 41,479 $ 41,958 ------------------------------------------------------------------------- ------------------------------------------------------------------------- LIABILITIES CURRENT Accounts payable and accrued liabilities $ 6,364 $ 6,350 Payable to customers and correspondents 2,624 183 Payable to brokers, dealers and clearing organizations 26 131 ------------------------------------------------------------------------- 9,014 6,664 FUTURE INCOME TAX LIABILITIES 511 244 ------------------------------------------------------------------------- 9,525 6,908 ------------------------------------------------------------------------- SHAREHOLDERS' EQUITY CAPITAL STOCK 23,920 23,930 CONTRIBUTED SURPLUS 3,829 3,686 RETAINED EARNINGS 4,205 7,434 ------------------------------------------------------------------------- 31,954 35,050 ------------------------------------------------------------------------- $ 41,479 $ 41,958 ------------------------------------------------------------------------- ------------------------------------------------------------------------- BELZBERG TECHNOLOGIES INC. Consolidated Statements of Operations and Retained Earnings (in thousands of Canadian dollars except per share amounts) (Unaudited) ------------------------------------------------------------------------- Three months ended Six months ended June 30, June 30, 2009 2008 2009 2008 ---------- ---------- ---------- ---------- REVENUE Transaction fees: Equity order flow and clearing $ 6,242 $ 3,157 $ 12,532 $ 6,936 Options and futures contracts 2,997 3,672 6,186 7,288 ------------------------------------------------------------------------- 9,239 6,829 18,718 14,224 Subscription fees 1,223 1,787 2,618 3,640 Other revenue 360 358 772 700 ------------------------------------------------------------------------- TOTAL REVENUE 10,822 8,974 22,108 18,564 ------------------------------------------------------------------------- EXPENSES Exchange, clearing and brokerage fees 5,478 3,136 11,022 5,456 Compensation and related benefits 3,162 2,951 6,917 5,731 Telecommunication and datafeed services 2,067 1,662 4,117 3,216 Administrative and other expenses 1,052 1,416 2,242 2,509 Restructuring expenses - - 839 - Government assistance (95) - (95) - Amortization of capital assets 534 465 1,057 928 Amortization of intangible assets 55 47 110 85 Foreign exchange loss 364 58 532 117 ------------------------------------------------------------------------- 12,617 9,735 26,741 18,042 ------------------------------------------------------------------------- EARNINGS (LOSS) BEFORE THE UNDERNOTED (1,795) (761) (4,633) 522 Interest expense 12 - 18 - Interest income (44) (149) (131) (336) ------------------------------------------------------------------------- (32) (149) (113) (336) ------------------------------------------------------------------------- EARNINGS (LOSS) BEFORE INCOME TAXES (1,763) (612) (4,520) 858 PROVISION FOR (RECOVERY OF) INCOME TAXES Current - - - 7 Future (358) (184) (1,291) 161 ------------------------------------------------------------------------- (358) (184) (1,291) 168 ------------------------------------------------------------------------- NET EARNINGS (LOSS) (1,405) (428) (3,229) 690 RETAINED EARNINGS (DEFICIT), BEGINNING OF PERIOD 5,610 (7,566) 7,434 (8,684) REDUCTION OF STATED CAPITAL - 16,000 - 16,000 ------------------------------------------------------------------------- RETAINED EARNINGS, END OF PERIOD 4,205 8,006 4,205 8,006 ------------------------------------------------------------------------- ------------------------------------------------------------------------- EARNINGS (LOSS) PER SHARE: Basic $ (0.09) $ (0.03) $ (0.22) $ 0.05 Diluted $ (0.09) $ (0.03) $ (0.22) $ 0.05 ------------------------------------------------------------------------- ------------------------------------------------------------------------- WEIGHTED AVERAGE NUMBER OF COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING: (in thousands) Basic 14,829 14,846 14,832 14,819 Diluted 14,829 14,938 14,832 14,936 ------------------------------------------------------------------------- ------------------------------------------------------------------------- BELZBERG TECHNOLOGIES INC. Consolidated Statements of Cash Flows (in thousands of Canadian dollars) (Unaudited) ------------------------------------------------------------------------- Three months ended Six months ended June 30, June 30, 2009 2008 2009 2008 ---------- ---------- ---------- ---------- CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES Net earnings (loss) $ (1,405) $ (428) $ (3,229) $ 690 Items not affecting cash Amortization of capital assets 534 465 1,057 928 Amortization of intangible assets 55 47 110 85 Unrealized foreign exchange loss (gain) 68 49 382 (195) Gain on sale of investment - - (5) - Stock-based compensation 80 39 143 78 Future income taxes (111) (178) (1,125) 134 Changes in non-cash working capital items 7,159 (568) (2,093) 1,021 ------------------------------------------------------------------------- 6,380 (574) (4,760) 2,741 ------------------------------------------------------------------------- INVESTING ACTIVITIES Purchase of capital assets (415) (218) (842) (1,242) Purchase of intangibles - (171) (7) (212) Purchase of investment - - (2) - Proceeds from sale of investment - - 15 - ------------------------------------------------------------------------- (415) (389) (836) (1,454) ------------------------------------------------------------------------- FINANCING ACTIVITIES Repayment of obligations under capital lease - - - (27) Repurchase of common shares - (37) (10) (273) Proceeds from the exercise of stock options - 14 - 364 ------------------------------------------------------------------------- - (23) (10) 64 ------------------------------------------------------------------------- Effect of exchange rate changes on cash and cash equivalents (68) (49) (382) 195 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 5,897 (1,035) (5,988) 1,546 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 7,567 23,662 19,452 21,081 ------------------------------------------------------------------------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 13,464 $ 22,627 $ 13,464 $ 22,627 ------------------------------------------------------------------------- ------------------------------------------------------------------------- CASH AND CASH EQUIVALENTS: Cash $ 4,648 $ 4,983 $ 4,648 $ 4,983 Cash equivalents 8,816 17,644 8,816 17,644 ------------------------------------------------------------------------- $ 13,464 $ 22,627 $ 13,464 $ 22,627 ------------------------------------------------------------------------- ------------------------------------------------------------------------- SUPPLEMENTAL CASH FLOW INFORMATION Interest received $ 49 $ 164 $ 139 $ 345 Interest paid 12 - 18 - Income taxes paid - 77 15 130
Belzberg Technologies Inc.
CONTACT: Judith Robertson, Chief Executive Officer, Phone: (416)
360-1812, E-mail: investorinfo@belzberg.com
