MONTREAL, Nov. 12 /PRNewswire-FirstCall/ -- Nstein Technologies inc. http://www.nstein.com/ (TSX-V: EIN), today announced its results for the third quarter of 2009 ending on September 30, 2009.
Nstein revenues for the third quarter of 2009 were $4.6 million, a 17% decrease from $5.6 million in the previous year. The Company posted earnings before financial charges, income tax, depreciation, amortization, exchange loss and restructuring charges (EBITDA) of $823,915 almost unchanged compared to a negative EBITDA of $818,202 for the third quarter of 2008. The net loss amounted to $1,298,145 or $0.025 per share, compared to a net loss of $1,056,073 or $0.021 per share for the same period the previous year.
"The recession continued to affect sales of new software licenses and related specialized services in the third quarter. Historically, new sales have been lower during the summer, and the current economic situation seems to have amplified this seasonal effect. Potential clients have postponed many projects, but we are confident that these sales will materialize by the end of the fiscal year. Despite the decrease in revenues, we have controlled our losses by applying cost-cutting measures in recent months. At the recession exit, the financial situation of the company remains sound and we will be well positioned when companies in the media sector resume investing in upgrading their digital operations. In addition, we recently announced initiatives intended to expand our offering to clients in the life sciences, government and enterprise sectors. Based on the strength of our experience in management of semantic content within the most demanding industry in this area, we are convinced that our solutions have great value for clients in these target sectors," said Luc Filiatreault, President and CEO of Nstein Technologies.
On September 30, 2009, the Company had cash of $5.7 million, working capital of $6.7 million, long-term debt of $0.3 million. It has access to a $1 million line of credit with a Canadian chartered bank. This line of credit was established during the third quarter and is currently unused.
About Nstein Technologies Inc.
Nstein Technologies (TSX: EIN) provides next generation content management solutions that help information-rich enterprises centralize, understand and manage vast amounts of content. At the heart of Nstein's solutions, semantic analysis allows information to be easily found and packaged together - so it can be connected to the right internal and external audiences. Nstein's Content Management and Web Publishing solutions both rely on Nstein's patented Text Mining Engine for semantic & text analysis. This unlocks content's value and allows clients (from an array of different industries) to leverage existing content to: create and deliver new products; facilitate internal and external research and knowledge sharing; and reduce content-related costs.
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NSTEIN TECHNOLOGIES INC. ------------------------------------------------------------------------- Consolidated Balance Sheets As at As at September 30 December 31 2009 2008 $ $ (unaudited) ------------------------------------------------------------------------- Assets Current assets Cash and cash equivalents 5,708,780 7,405,217 Term deposits 164,600 214,600 Accounts receivable 4,045,889 6,864,825 Refundable tax credits 1,859,236 984,478 Income taxes receivable - 335,656 Work in progress 765,080 680,639 Prepaid expenses 240,739 207,389 ------------------------------------------------------------------------- 12,784,324 16,692,804 Property, plant and equipment 591,706 736,506 Intangible assets 2,779,632 3,364,257 Goodwill 10,496,905 10,496,905 ------------------------------------------------------------------------- 26,652,567 31,290,472 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Liabilities Current liabilities Accounts payable and accrued liabilities 3,173,088 4,442,361 Deferred revenues 2,526,162 3,236,640 Future income tax liabilities 150,315 150,315 Current portion of long-term debt 257,034 330,503 ------------------------------------------------------------------------- 6,106,599 8,159,819 Long-term debt 311,090 520,799 Future income tax liabilities 463,994 571,071 ------------------------------------------------------------------------- 6,881,683 9,251,689 ------------------------------------------------------------------------- Shareholders' Equity Share capital 54,216,982 54,028,128 Other equity components 2,771,627 2,695,998 Contributed surplus 2,066,696 1,805,717 Deficit (39,284,421) (36,491,060) ------------------------------------------------------------------------- 19,770,884 22,038,783 ------------------------------------------------------------------------- 26,652,567 31,290,472 ------------------------------------------------------------------------- ------------------------------------------------------------------------- NSTEIN TECHNOLOGIES INC. ------------------------------------------------------------------------- Consolidated Statements Three months ending Nine months ending of Earnings and September 30 September 30 Deficit 2009 2008 2009 2008 $ $ $ $ (unaudited) (unaudited) (unaudited) (unaudited) ------------------------------------------------------------------------- Revenues 4,632,715 5,600,516 16,206,078 17,638,371 Cost of sales, net of tax credits 2,221,832 2,663,933 7,704,247 8,050,086 ------------------------------------------------------------------------- 2,410,883 2,936,583 8,501,831 9,588,285 ------------------------------------------------------------------------- Expenses Selling and administrative 2,553,672 3,029,453 7,804,763 9,414,442 Research and development, net of tax credits 679,921 725,332 1,932,184 2,635,713 Depreciation of property, plant and equipment 49,248 81,255 179,659 226,431 Amortization of intangible assets 193,148 246,127 603,912 673,143 Loss on disposal of property, plant and equipment 1,205 - 6,587 - Exchange loss (gain) 257,051 (2,729) 346,249 (83,023) Financial (revenues) expenses 10,096 (49,204) 50,084 (103,942) Restructuring fees - - 478,826 419,156 ------------------------------------------------------------------------- 3,744,341 4,030,234 11,402,264 13,181,920 ------------------------------------------------------------------------- Loss before income tax 1,333,458 1,093,651 2,900,433 3,593,635 ------------------------------------------------------------------------- Recovery of income tax Future income tax (35,313) (37,578) (107,072) (93,945) ----------------------------------------------------------------------- (35,313) (37,578) (107,072) (93,945) ------------------------------------------------------------------------- Net loss and comprehensive loss for the period 1,298,145 1,056,073 2,793,361 3,499,690 ------------------------------------------------------------------------- Deficit - Beginning of period 37,986,276 36,785,291 36,491,060 34,341,674 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Deficit - End of period 39,284,421 37,841,364 39,284,421 37,841,364 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Basic and diluted net loss share 0.025 0.021 0.054 0,071 Basic and diluted weighted average number of shares outstanding 52,098,939 51,340,575 51,902,453 49,609,672 ------------------------------------------------------------------------- ------------------------------------------------------------------------- NSTEIN TECHNOLOGIES INC. ------------------------------------------------------------------------- Consolidated Statements Three months ending Nine months ending of Cash Flows September 30 September 30 2009 2008 2009 2008 $ $ $ $ (unaudited) (unaudited) (unaudited) (unaudited) ------------------------------------------------------------------------- Cash flows from operating activities Loss for the period (1,298,145) (1,056,073) (2,793,361) (3,499,690) Items not affecting cash and cash equivalents Interest capitalized on long-term debt 1,473 3,633 8,635 18,254 Unrealized exchange loss (gain) (2,722) (28,987) (1,956) 40,917 Depreciation of property, plant and equipment 49,248 81,255 179,659 226,431 Amortization of intangible assets 193,148 246,127 603,912 673,143 Loss disposal of property, plant and equipment 1,205 - 6,587 - Stock-based compensation costs 107,192 116,326 337,358 382,483 Compensation costs related to the deferred share unit plan for directors 6,765 - (99,704) 75,500 Costs related to the employee stock purchase plan 31,362 22,332 93,468 57,128 Recovery of income tax (35,313) (37,578) (107,072) (93,945) ------------------------------------------------------------------------- (945,787) (652,965) (1,772,474) (2,119,779) ------------------------------------------------------------------------- Change in non-cash operating working capital items Accounts receivable 2,362,305 954,342 2,818,936 2,671,783 Refundable tax credits (225,759) (321,144) (874,758) (63,183) Income tax receivable - - 335,656 - Work in progress 91,524 (125,281) (84,441) (689,059) Prepaid expenses (34,682) 74,721 (33,350) (43,370) Accounts payable and accrued liabilities (496,184) (18,386) (919,248) (202,456) Deferred revenues (948,984) (521,737) (710,478) 341,010 ------------------------------------------------------------------------- 748,220 42,515 532,317 2,014,725 ------------------------------------------------------------------------- (197,567) (610,450) (1,240,157) (105,054) ------------------------------------------------------------------------- Cash flows from financing activities Variation in bank loans - - - (452,742) Payments on long-term debt (90,377) (83,878) (298,967) (272,844) Payment on Balance of purchase price of a subsidiary - (533,210) - (1,613,801) Issuance of common shares, net of issue expenses 32,529 17,332 94,635 (20,762) ------------------------------------------------------------------------- (57,848) (599,756) (204,332) (2,360,149) ------------------------------------------------------------------------- Cash flows from investing activities Variation in term deposits - (50,000) 50,000 (29,214) Business acquisitions, net of cash and cash equivalents (32,585) (73,475) (250,325) (2,722,169) Additions to property, plant and equipment (11,000) (79,037) (69,156) (174,175) Additions to intangible assets - (6,787) (20,670) (35,013) Proceeds from the sale of property, plant and equipment 14,076 - 38,203 - ------------------------------------------------------------------------- (29,509) (209,299) (251,948) (2,960,571) ------------------------------------------------------------------------- Decrease in cash and cash equivalents (284,924) (1,419,505) (1,696,437) (5,425,774) Cash and cash equivalents - Beginning of period 5,993,704 7,724,586 7,405,217 11,730,855 ------------------------------------------------------------------------- Cash and cash equivalents - End of period 5,708,780 6,305,081 5,708,780 6,305,081 ------------------------------------------------------------------------- -------------------------------------------------------------------------
NSTEIN TECHNOLOGIES INC.
CONTACT: Bruno Martel, Chief Financial Officer, Investor Relations,
Nstein Technologies inc., (514) 908-5406, bruno.martel@nstein.com
