Q2 results
MPACT IMMEDIA CORPORATION BOOSTS REVENUES BY 54 PER CENT IN
SECOND QUARTER OF 1998
1998-04-08
MONTREAL, QUEBEC
MPACT Immedia Corporation, a global provider of Electronic Commerce products
and services, reported today a strong increase in revenues and an improved
net profit in the second quarter of its 1998 fiscal year.
The Company attained record revenues of $6,524,024 for the second quarter of
this year compared to revenues of $4,226,483 for the same period last year --
a 54 per cent increase. MPACT Immedia has now recorded 26 consecutive
quarters, on a quarter-over-quarter basis, when recurring revenues have
increased. These recurring revenues constitute 85 per cent of total revenue.
MPACT Immedia posted an operating profit (EBITDA) of $973,318 during the
second quarter of this year, compared with an EBITDA of $13,899 in the same
quarter in 1997. The Company also showed a net profit of $151,458 or $0.01
per share in the second quarter of 1998, compared to a net loss of $2,025,122
or $0.12 per share in the same period last year. Last year's loss in the
second quarter included a one-time restructuring charge of $1.35 million.
"The key to MPACT Immedia's revenue and profit increases this year is the
upswing in transactions generated from our network services," declared Brian
Edwards, President and CEO. "A number of transaction-processing projects,
which were signed last year, have now been rolled out and they are all
contributing significant recurring revenues to the Company."
To illustrate the growth of the Company in the exploding Electronic Commerce
industry, Edwards pointed to the large number of new agreements finalized in
the second quarter of 1998 which include contracts with Royal Bank of
Scotland, Bank of Tokyo, the Employee Relocation Council in Washington, DC,
and the Universal Postal Union in Bern, Switzerland. Moreover, a significant
agreement with Compaq Computer Corporation of Houston, Tex., was announced in
mid-March for an Internet merchant-enabling initiative, called ClubWeb, for
small and medium-size businesses. This solution has integrated MPACT
Immedia's payment processing service, BuyWay, into its server system which
establishes BuyWay as one of the leading payment engines in the world.
On the financial side of the equation, Barry Engel, Executive Vice President
of Corporate Affairs, stated that: "MPACT Immedia's operating profit and net
profit are both exceeding the internal projections of the Company". Also in
the second quarter, CIBC Wood Gundy Securities Inc. initiated coverage on
MPACT Immedia. "We are determined to increase this market coverage in the
coming months," said Engel, who added that the Company had cash in the bank
of $4.5 million at quarter end.
MPACT Immedia Corporation, a worldwide leader in Electronic Commerce, offers
both EDI Commerce and Internet Commerce products and services through its
offices in Montreal, Livonia (Michigan), and Toronto. By marketing with
strategic partners, MPACT Immedia has developed a client list of many of the
Fortune 1000 companies including such global players as Royal Bank of Canada,
Bank of America, Citibank, Mercedes-Benz and Bell Atlantic. Its
advanced-technology EC solutions enable organizations to better compete in
the global marketplace.
To learn more about the Company's products and services, visit the Internet
website at www.mpactimmedia.com.
For more information on this press release, please contact:
Barry V. Engel John Davidson
Executive Vice-President, Corporate Affairs Director of Communications
(514) 397-9747 (ext. 202) (514) 397-9747 (ext. 210)
Email: Email:
engel.barry@mpact.net davidson.john@mpact.net
MPACT Immedia Corporation
Consolidated Statements of Income
Quarterly Report for the Year Ending August 31, 1998
2nd Quarter
(Canadian Dollars) (Unaudited)
February 1998 February 1997
Revenue
Network services $5,133,442 $3,142,065
Software and related services 1,390,582 1,084,418
------------- -----------
Total Revenue 6,524,024 4,226,483
Costs and expenses
Network services 1,496,733 692,395
Software and related services 525,065 578,587
Selling, general and administrative 3,528,908 2,941,602
-------------- -----------
Total costs and expenses 5,550,706 4,212,584
-------------- -----------
Operating income 973,318 13,899
Interest income (97,552) (83,078)
Interest and financial charges 248,276 119,844
Restructuring charges ,0 1,350,000
Depreciation and amortization 671,136 652,255
------------- ------------
Income (loss) before income tax 151,458 (2,025, 122)
Provision for current income tax 20,813 0
Recovery of current income tax
due to the application of prior
years' losses (20,813) 0
------------- ------------
0 0
------------- ------------
Net income (loss) $151,458 ($2,025,122)
============= ============
Net income (loss) per share $0.01 ($0.12)
============= ============
6 months 6 months
Revenue
Network services $9,769,003 $4,658,536
Software and related services 2,455,249 2,415,953
------------- ------------
Total Revenue 12,224,252 7,074,489
Costs and expenses
Network services 2,678,612 974,787
Software and related services 1,331,576 1,408,503
Selling, general and administrative 6,524,951 4,794,528
------------- ------------
Total costs and expenses 10,535,139 7,177,818
------------- -------------
Operating income (loss) 1,689,113 (103,329)
Interest income (185,006) (202,684)
Interest and financial charges 410,577 133,854
Restructuring charges 0 1,350,000
Depreciation and amortization 1,291,644 924,671
------------- ------------
Income (loss) before income tax 171,898 (2,309, 170)
Provision for current income tax 30,360 0
Recovery of current income tax
due to the application of prior
years' losses (30,360) 0
------------- ------------
0 0
------------- ------------
Net income (loss) $171,898 ($2,309,170)
============= =============
Net income (loss) per share $0.01 ($0.14)
============= =============
MPACT Immedia Corporation
Consolidated Statement of Cash Flows
Quarterly Report for the Year Ending August 31, 1998
2nd Quarter
(Canadian dollars) (Unaudited)
February 1998 February 1997
6 months 6 months
Cash flows from operations
Net income/(loss) $171,898 ($2,311,882)
Depreciation and amortization 1,291,644 924,671
Changes in working capital items (1,621,828) (519,584)
--------------- --------------
Uses from operations (158,286) (1,906,795)
--------------- --------------
Cash flows from investing
Advance to Immedia Telematics Inc. (1,347, 875) (1,513, 225)
Capital purchases (2,009, 943) (798,006)
Acquisition of subsidiaries 0 (6,058, 168)
-------------- -------------
Uses from investing (3,357,818) (8,369, 399)
-------------- -------------
Cash flows from financing
Long-term debt 1,213,781 764,855
Installment on long-term debt (1,150, 432) (300,846)
Issue of common shares 360,943 78,906
Shares issued for acquisition of subsidiary 0 5,980,000
-----------------------------
Sources from financing 424,292 6,522,915
-------------- -------------
Decrease in cash (3,091,812) (3,753,279)
Beginning cash position 7,102,138 11,686,312
-------------- --------------
Ending cash position $4,010,326 $7,933,033
============== ==============
Cash position
Cash and term deposits 1,520,326 5,643,033
Term deposit 3,000,000 3,000,000
Bank indebtedness (510,000) (710,000)
-------------- --------------
$4,010,326 $7,933,033
============== ==============
MPACT Immedia Corporation
Consolidated Balance Sheet
Quarterly Report for the Year Ending August 31, 1998
As at February 28
(Canadian Dollars) (Unaudited)
1998 1997
ASSETS
Current assets
Cash and short term investments $1,520,326 $5,643,033
Term deposit, 3,000,000 3,000,000
Trade accounts receivable 5,214,063 5,331,685
Other receivables 3,588,848 3,481,921
Assigned income tax credits receivable 2,506,228 1,598,781
Prepaid expenses 271,096 296,297
------------ ------------
Total current assets 16,100,561 19,351,717
Capital assets 5,977,736 8,646,987
Goodwill 0 5,321,189
------------ ------------
Total assets $22,078,297 $33,319,893
============= ============
LIABILITIES and SHAREHOLDERS' EQUITY
Current liabilities
Bank indebtedness $510,000 $710,000
Accounts payables and accrued liabilities 3,387,475 3,843,752
Deferred revenue 1,116,127 1,013,600
Current portion of long-term debt 1,709,767 398,598
------------- ------------
Total current liabilities 6,723,369 5,965,950
Long term debt 2,596,512 3,261,265
Shareholders' equity
Capital stock 26,754,853 25,916,824
Deficit (13,996,437) (1,824,146)
------------- ------------
Total shareholders' equity 12,758,416 24,092,678
------------- ------------
Total liabilities and shareholders' equity $22,078,297 $33,319,893
============= ============
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