Q-Media's Annual Revenues Up 122% To Top $100 Million Mark;
With E.P.S. Of $0.30
Tuesday, October 26, 1999, 9:00 AM EDT
Vancouver, B.C.
Q-Media Services Corporation today reported record results for
the year ended July 31, 1999, including revenues of $101.8
million, up 122% from the previous year, and fully diluted
earnings per share of $0.30.
Fourth Quarter Highlights: (three months ended July 31,1999
compared with three months ended July 31, 1998)
* Revenues were $24.0 million compared with $14.7 million, an
increase of 63%.
* Earnings before interest, taxes, depreciation and
amortization (EBITDA) were $2.6 million compared
with $2.0 million, an increase of 29%.
* Earnings from operations were $1.5 million, compared with
$1.3 million.
* * Net earnings were $683,000 compared with $863,000.
* Net earnings per share were $0.07 basic and $0.08 fully
diluted, after add-back of convertible debenture
interest, compared with $0.08 basic and $0.05 fully diluted.
1999 Highlights: (year ended July 31, 1999 compared with year
ended July 31, 1998)
* Revenues were $101.8 million compared with $45.8 million, an
increase of 122%.
* EBITDA were $10.4 million compared with $5.7 million, an
increase of 82%.
* Earnings from operations were $6.2 million compared with
$3.2 million.
* * Net earnings were $4.5 million compared with a net loss of
$4.9 million.
* Net earnings per share, after add-back of convertible
debenture interest, were $0.43 basic and $0.30
fully diluted compared with a net loss per share of $0.54
(basic and fully diluted).
Robert M. Lawrie, President, said fiscal 1999 represented a new
level of achievement for Q-Media as revenues passed the $100
million mark, exceeding consensus forecasts by 25%. The
outstanding results are a reflection of Q-Media's continual
emphasis on putting customers first in delivering its software
manufacturing and other turnkey services. EBITDA of $10.4
million, and net earnings of $4.5 million from the year just
ended also attest to the highly effective combination of the
Company's strong internal growth and its external,
acquisition-driven growth strategy, he added.
Net earnings of $4.5 million for fiscal 1999 are particularly
gratifying considering that the Company's taxes increased by $1.6
million for fiscal 1999 from $31,000 in fiscal 1998. However,
net earnings were lower than expected in the fourth quarter as a
restructuring of the Company's U.S. holdings was instituted,
which increased taxes for the quarter. Despite this one-time
charge, the Company was able to achieve its aggressive target of
$0.30 for fully diluted earnings per share.
Areas of focus in fiscal 1999 included the engineering of systems
infrastructure to support Q-Media's continuing rapid organic
growth and integration of the Company's two newest acquisitions
in Irvine, CA, and Seattle, WA.
To improve customer service further and to foster closer
partnerships, an innovative internet-based ordering, fulfillment
and inventory-tracking system was initiated in Irvine during the
year. Customer feedback from trials of this real-time, on-line
interface has been highly positive. This streamlining of
processes will reduce overhead substantially going forward,
including an estimated $200,000 in annual system maintenance
costs. The Company anticipates implementing this system in at
least one other location during fiscal 2000.
On the internal expansion front, the Company moved its East
Vancouver head office and manufacturing and service operations to
a larger, built-to-suit facility in the Vancouver suburb of
Richmond subsequent to year end. In response to increased
customer demand, CD-ROM manufacturing capability was added to
this location, raising the Company's annual CD-ROM capacity from
27 million to 42 million. The first customer orders were
processed in September, with optimal capacity to be reached over
the next six months.
The escalating demand for CD-ROM's from Q-Media's customers also
prompted the installation of CD-mastering capability in Richmond.
Previously outsourced, this new service affords Q-Media greater
control over the supply chain process and consequently, even
tighter order turnaround.
The outlook for fiscal 2000 is highly positive, with continued
revenues and earnings growth anticipated.
Q-Media Services Corporation is a leading outsourced service
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; Austin, Texas; and Nashville, Tennessee.
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.
_______________________________________________________________
* Net earnings for the fourth quarter and fiscal 1999 reflect
a one-time tax charge due to a restructuring of Q-Media's
U.S. holdings. |
