Infowave reports solid third quarter 1999 results
BURNABY, BC, Oct. 27 /CNW/ - Infowave Software, Inc. (TSE/VSE: IW) today
reported financial results for the quarter and nine-months ended September 30,
1999. The company posted strong growth in its retail products, customized OEM
printing solutions and wireless computing solutions.
``All of us at Infowave are proud of our performance in the third
quarter,' said Jim McIntosh, president and CEO. ``The Imaging retail business
continued to post strong growth and the OEM business kicked into gear with one
large project recovering impressively from a slow start in the second quarter.
We expect our Imaging business to track strong demand for Apple computers in
the fourth quarter. We are also incredibly excited about our wireless
business. During the third quarter, our wireless development team launched
Symmetry and Infowave for the Net which enables Infowave to now provide secure
wireless access to all of the applications and content that are driving demand
for wireless data. A respected research firm recently declared 2000 as the
year of wireless data and Infowave will be a force because, unlike any other
company, we deliver `the right information to the right device at the right
time'. And we can do it right now. The $7.2 million financing that was closed
early in the quarter provides the resources to aggressively build distribution
channels and make this technology available to mobile professionals
worldwide.'
Third Quarter Highlights
- Consolidated third quarter sales of $3.8 million jumped 70% over the
previous quarter and contributed to year-to-date sales growth of 13%
over 1998. The revenue growth was bolstered by continued high margins
with year-to-date gross profit up 32 % to $5.2 million.
- Infowave received conditional listing approval from the Toronto Stock
Exchange on July 19th and its common shares started trading on the TSE
under the symbol ``IW' on October 14th...exactly two years to the day
following Infowave's 1997 IPO on the Vancouver Stock Exchange.
- Infowave closed the final tranche of a $7.2 million financing on July
8th and the final prospectus was receipted on September 24th. The
offering was placed primarily with institutional investors in Canada
(40%), Europe (40%) and the United States (20%).
Imaging
- Third quarter shipments of Infowave's award-winning PowerPrint
software kits were up 36% over the third quarter of 1998 and total
unit shipments of retail products in 1999 were up 22% over 1998.
Management expects to post record-setting retail shipments in the
fourth quarter, coinciding with heavy demand for new computers being
introduced by Apple.
- Leveraging the continued success of its retail products, Infowave's
Imaging business was profitable for the fifth quarter in a row,
posting earnings of $0.04 per share.
- Infowave's Imaging OEM business surged in the third quarter as
customized printing solutions were delivered to Hewlett-Packard,
Canon, New Motion and Tectona. OEM sales were up 46% over the first
and second quarter combined.
- In September, Infowave signed a reseller agreement with Tectona
Electronics, Inc. with Tectona agreeing to distribute Infowave's
PowerPrint(R) software throughout Asia. The contract was worth $2
million over a one-year term with approximately 95% of the deal
representing incremental business.
- Infowave added New Motion to its impressive list of OEM partners that
already includes Hewlett-Packard, Brother, Samsung, Ricoh, CoStar,
Lexmark and Canon. New Motion includes Infowave's award-winning
PowerPrint(TM) software in-box with its iDock(TM) to enhance printing
compatibility with the fast growing iMac(R).
Wireless
- Infowave's third quarter Wireless sales tripled over the previous
quarter to $146,044 and management expects continued growth in the
fourth quarter. Year-to-date wireless business is up 82% over 1998.
- With the launch of Infowave for the Net, Infowave completed the
development of its suite of corporate wireless computing solutions. In
addition to providing the most advanced wireless solution for
Microsoft Exchange, Infowave can now deliver secure wireless access to
corporate intranets and web-based applications. These are the
principal applications driving demand for wireless data. Infowave also
added support for a second wireless data network, CDPD, and is
targeting tier one and tier two resellers to build distribution into
Corporate America.
- In September Infowave signed a strategic licensing agreement with Mi8
Corporation, a leading Application Service Provider (ASP) based in New
York. Forrester Research, Inc. has reported that the overall market
for outsourced software applications will grow to over $21 billion by
2001 and Infowave is targeting the fast-growing ASP sector as an
important distribution channel for its wireless computing solutions.
Infowave receives a monthly software rental fee for every Mi8 customer
that uses Infowave's software.
- Infowave and Glenayre launched Symmetry at PCS'99 Expo in September.
Symmetry provides interactive wireless access to Microsoft Outlook
email, schedules, contacts and calendar from pagers and PCS phones.
The GartnerGroup commented that ``Symmetry is the only product of its
kind in the marketplace.' Infowave and Glenayre are targeting paging
carriers and PCS carriers worldwide.
- Infowave's wireless business continued to raise its profile at leading
industry events. During the quarter, Infowave exhibited or presented
at Microsoft Fusion 99 in San Francisco, Microsoft Global Summit in
San Francisco, The Mobile & PDA Expo in New York, MobiComm '99 in
Seattle, Microsoft Exchange Conference in Atlanta, Personal
Communications Showcase Exposition in New Orleans and NetWorld+Interop
in Atlanta.
<<
STATEMENTS OF OPERATIONS
Three months ended Nine months ended
September 30 September 30
1999 1998 1999 1998
---------------------------------------------------
Sales $3,771,312 $3,886,886 $8,561,634 $7,612,198
Cost of Goods Sold 1,919,655 1,921,943 3,271,241 3,604,511
-------------------------------------------------------------------------
Gross Profit 1,851,657 1,964,943 5,290,393 4,007,687
Research and
Development 912,676 870,824 2,856,122 2,342,604
-------------------------------------------------------------------------
Sales and Marketing 1,137,301 1,051,807 3,106,024 2,776,835
General and
Administrative 761,966 407,528 2,062,568 1,338,779
-------------------------------------------------------------------------
Operating Profit (Loss) (960,287) (365,216) (2,734,321) (2,450,531)
Other Income (Expenses) 66,279 46,498 106,077 92,990
-------------------------------------------------------------------------
Net Income (Loss) (894,008) (318,718) (2,628,244) (2,357,541)
-------------------------------------------------------------------------
Earnings (Loss)
per Share $ (0.06) $ (0.02) $ (0.17) $ (0.19)
STATEMENTS OF CASH FLOWS
Three months ended Nine months ended
September 30 September 30
1999 1998 1999 1998
---------------------------------------------------
Operations:
Net Income (Loss) $ (894,007) $ (318,719) $(2,628,244) $(2,357,541)
Items not Involving
Cash 135,769 101,014 397,054 317,568
Non-cash Working
Capital 151,173 (1,672,929) 1,336,833 (2,428,010)
-------------------------------------------------------------------------
(607,065) (1,890,634) (894,357) (4,467,983)
Investments (235,932) (98,503) (568,254) (546,033)
Financing 3,877,085 3,466,308 6,786,806 6,582,229
-------------------------------------------------------------------------
Increase (Decrease)
in Cash 3,034,088 1,477,171 5,324,195 1,568,213
Cash, Beginning
of Period 3,893,032 545,410 1,602,925 454,368
-------------------------------------------------------------------------
Cash, End of Period $6,927,120 $2,022,581 $6,927,120 $2,022,581
BALANCE SHEETS
As at September 30
1999 1998
-------------------------------
ASSETS
Current Assets:
Cash $6,927,120 $2,742,581
Accounts Receivable 2,596,222 3,364,918
Inventory 1,019,716 1,862,836
Prepaid Expenses 426,607 218,656
----------------------------------------------------------------------
10,969,665 8,188,991
Capital Assets 1,226,161 985,458
Deferred Charges 71,514 258,183
----------------------------------------------------------------------
Total Assets $12,267,340 $9,432,632
LIABILITIES AND SHAREHOLDERS
EQUITY
Current Liabilities $1,559,396 $3,410,229
Total Liabilities 1,559,396 3,410,229
Share Capital 17,144,878 10,342,441
Retained Earnings (Deficit) (6,436,934) (4,320,038)
----------------------------------------------------------------------
Shareholders' Equity 10,707,944 6,022,403
----------------------------------------------------------------------
$12,267,340 $9,432,632
>>
About Infowave
Infowave was founded in 1984 and is headquartered in Vancouver, Canada.
Infowave's Wireless Division builds mobile business solutions that use the
power of wireless communications to extend the reach of enterprise computing.
Infowave for Exchange and Infowave for the Net are advanced and secure
wireless solutions for connecting mobile workers to key corporate information
and applications. Infowave's Imaging Division builds award-winning printing
solutions - PowerPrint(R) and StyleScript(R) software kits provide Apple(R)
Macintosh(R) users with improved print quality and access to more than 1,600
printers.
Note: Infowave, the Infowave logo, PowerPrint and StyleScript are
trademarks of Infowave Software, Inc. All other trademarks are the property of
their respective owners. Some of the above trademarks may be registered in
certain jurisdictions. This news release contains forward-looking statements
regarding management's expectations for shipments of both Imaging and Wireless
products in the fourth quarter ending December 31,1999. These statements
involve risks and uncertainties including that there can be no assurance that
Imaging products will post record-setting retail shipments and that sales of
Wireless products will increase in the fourth quarter over the third quarter
or year over year. In addition, there are other risks such as the heavy
reliance on sales of Apple Macintosh computers, the reliance on sales of
Microsoft Exchange, the ability to develop and supply products without error
or defects that achieve market acceptance and competitors who may produce
products that are superior or gain greater market acceptance due to pricing,
sales channels or other factors. Actual results could differ materially from
the Company's expectations. Forward-looking statements are based on the
expectations and opinions of Infowave's management on the date the statements
are made, and Infowave assumes no obligation to update forward-looking
statements should circumstances in management's expectations or opinions
change.
For further information: Corporate: Infowave Software, Inc., Todd
Carter, CFO, cfo@infowave.com, (800) 463-6928; Investor Relations: The
Investor Relations Group, Steve Hanson, irg@invrel.com, (800) 444-9214; The
Investor Relations Group, (604) 689-5255 |
