Paul,
Q-MEDIA'S NET EARNINGS UP 175% IN RECORD FIRST QUARTER
Q-Media Services Corporation today announced record revenues and
earnings for the first quarter of 1999.
First Quarter Highlights (three months ended October 31, 1998
compared with three months ended October 31, 1997)
* Revenues were $26.8 million compared with $7.9 million, an
increase of 238%.
* EBITDA(1) were $3,060,000 compared with $943,000, up 225%.
* Net earnings were $1,614,000 compared with $588,000(2), an
increase of 175%.
* Net earnings per share were $0.15 basic and $0.09 fully diluted
compared with $0.08(2) basic and fully diluted(3).
Robert M. Lawrie, President, said both revenues and earnings were
ahead of budget for the first quarter of fiscal 1999. The strong
growth resulted from vigorous internal expansion combined with Q-
Media's acquisition program, which added two new operations in
fiscal 1998. Additional push came from strong demand for services
at all facilities in addition to several new customer wins, he
said.
One of the factors that is driving demand is Q-Media's ongoing
expansion of its services, including increased CD ROM capacity.
During the first quarter, the Company's two new CD ROM
manufacturing facilities at Seattle and Austin went into
production and are ramping up capacity successfully.
As anticipated, gross margins were down marginally during the
first quarter, reflecting the addition of operations at Irvine,
CA, acquired in July, 1998 as well as startup operations of the
new CD ROM facilities. Integration of the Irvine operation is
proceeding well and it is performing as expected. In addition,
the two new CD ROM facilities should be operating at optimal
capacity in the second half of this fiscal year, which should
also improve overall profitability.
The outlook is for continued strong revenue and earnings growth
in fiscal 1999. As in previous years, the second quarter is
expected to be somewhat softer than the first quarter because of
the holiday slowdown.
Q-Media Services Corporation is a leading outsourced provider to
the growing software industry. Its full range of services include
software replication (CD-ROM and other media), packaging
solutions, warehousing and inventory management, and order
fulfillment. It operates regional manufacturing facilities in
close proximity to customers in North America's major software
growth areas: Vancouver, B.C.; Seattle, Washington; San Jose and
Irvine, California; and Austin, Texas.
Shares of Q-Media Services Corporation are traded on the Toronto
Stock Exchange under the symbol (QMS). U.S. S.E.C. exemption:
12g3-2(b) 82-3761.
1 Earnings before interest, taxes, depreciation and
amortization (EBITDA)
2 Net earnings and net earnings per share for fiscal 1998 were
restated according to Q-Media's change in goodwill policy.
3 Per share values reflect the Company's one for five share
consolidation
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FOR FURTHER INFORMATION PLEASE CONTACT:
Marla Gale or Jon W. Kieran, Investor Relations (416) 868-1079
Hume, Kieran Inc. |
