Infowave Reports Highest Sales in 15-Year History and Fourth-Quarter Profit
Record 1998 Performance Fuelled by Demand for Infowave Printing Solutions
BURNABY, BRITISH COLUMBIA--(BUSINESS WIRE)--March 3, 1999--Infowave (VSE:IWM - news) Infowave Software, Inc. (VSE: IWM - news) today reported financial results for the fourth quarter and year ended December 31, 1998. The company posted annual and quarterly sales records and fourth quarter profit. Infowave's record performance in 1998 was fuelled by solid growth in all segments of its Imaging Division.
''All of us at Infowave are very pleased to have delivered this level of performance in our first full year as a publicly-traded company,'' said Jim McIntosh, President and CEO. ''And Infowave is positioned for another great year. The momentum that we established in our printing business during 1998 has carried over into 1999 and our wireless computing business continues to gain endorsements and customers. We expect to post solid sales growth in 1999 and our operating plan calls for consolidated profitability.''
Fourth quarter sales of $7.1 million were up 441 percent over the fourth quarter of 1997 and up 82 percent over the previous quarter. Fourth quarter unit shipments of Infowave's printing solutions were nearly double the previous quarter - a record quarter itself - and were up nearly 12 times over the fourth quarter of 1997. Total 1998 sales of $14.7 million were up 173 percent over 1997. Annual shipments quadrupled to more than 200,000 units.
Surging demand for Infowave's printing solutions translated into earnings of $0.03 per share in the fourth quarter, the first profitable quarter for the company since the first quarter of 1996. This compares to a loss of $0.02 per share in the previous quarter and a loss of $0.08 per share in the fourth quarter of 1997. Infowave cut annual losses in half to $0.14 per share in 1998 from $0.29 per share in 1997. EBITDA for the year was a loss of $0.11 versus a loss of $0.25 in 1997. Infowave invested $0.26 per share in research and development in 1998.
Infowave ended 1998 with a stronger balance sheet than when it began the year. Working capital improved from $782,539 to $5,422,907 and net tangible assets increased from $1,466,382 to $6,380,422. Infowave's cash position increased by $1,148,557 in 1998. The company has no long-term debt.
IMAGING DIVISION
Total 1998 shipments through Infowave's various retail distribution channels increased 52 percent to over 60,000 units. Demand for Infowave's private-label printing solutions from Original Equipment Manufacturers (OEM) continued in the fourth quarter. Total annual OEM sales of $7 million represented new business for Infowave in 1998 and were generated primarily by licensing and development agreements negotiated during the first half of the year with Apple Computer, Inc. and Hewlett-Packard Company. During the year the Imaging Division completed development of a custom chip for PowerPrint, developed various customized OEM printing kits and introduced six new retail product releases.
WIRELESS DIVISION
Wireless sales during the quarter were $56,985 with annual sales of $261,572 up 100 percent over 1997. Infowave introduced two new versions of its wireless software during the year that added increasing functionality and security - in particular, Windows NT authentication and Certicom encryption. Infowave also incorporated source code and architectural design elements derived from the source code license acquired from Wynd Communications in April. Infowave Office Enabler earned Microsoft BackOffice and Windows CE certification in 1998 and the company enters 1999 with four active customers, two active pilots and two beta programs in place.
Statements of Operations and Cash Flows
Three months ended Twelve months ended
December 31 December 31
1998 1997 1998 1997
Revenue $7,077,233 $1,309,466 $14,689,431 $5,391,107
Cost of Goods
Sold 3,288,865 511,727 6,893,377 2,196,752
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Gross Profit 3,788,368 797,739 7,796,054 3,194,355
Research and
Development 968,813 616,812 3,311,417 2,025,018
Sales and
Marketing 1,499,736 715,201 4,276,571 2,585,013
Administration 810,494 386,254 2,130,036 1,188,323
Other Expenses
(Income) (2,023) (31,762) (75,776) (37,297)
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Net Profit
(Loss) 511,348 (888,766) (1,846,194) (2,566,702)
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Earnings (Loss)
per share 0.03 (0.08) (0.14) (0.29)
Cash Flow from
Operations $(435,102) $(789,284)$(4,917,611)$(1,759,463)
Cash Flow from
Investing (47,554) (102,841) (593,587) (296,400)
Cash Flow from
Financing 63,000 2,168,604 6,659,755 1,987,979
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Increase (Decrease)
in Cash (419,656) 1,276,479 1,148,557 (67,884)
Cash, Beginning
of Period 2,022,581 (822,111) 454,368 522,252
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Cash, End
of Period 1,602,925 454,368 1,602,925 454,368
Balance Sheets
As at December 31
1998 1997
Current Assets $9,062,070 $1,472,390
Capital Assets 957,515 683,843
Other Assets 216,329 331,333
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Total Assets 10,235,914 2,487,566
Current Liabilities 3,639,163 689,851
Other Liabilities -- --
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Total Liabilities 3,639,163 689,851
Share Capital 10,405,441 3,760,211
Retained Earnings (Deficit) (3,808,690) (1,962,496)
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Shareholders Equity 6,596,751 1,797,715
ABOUT INFOWAVE
Infowave is a world-class software developer. Founded in 1984, the company is headquartered in Vancouver, Canada and has two operating divisions. Infowave's Imaging Division builds award-winning printing solutions that dominate the Apple® Macintosh® market. Infowave's PowerPrint® and StyleScript® software kits provide Mac® users with improved print quality and access to more than 1,600 printers. Infowave's products are available through distribution channels in over 40 countries around the world. Infowave's Wireless Division builds mobile business solutions that create competitive advantage for companies on the move. Infowave Office Enabler(TM) is the most powerful and secure solution for wirelessly extending Microsoft® Exchange®, the fastest-growing messaging and business collaboration tool in the world.
(C) 1999 Infowave Software, Inc.- Infowave, the Infowave logo, Infowave Office Enabler, PowerPrint, StyleScript and PowerPlot 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 may contain certain forward-looking statements that involve risks and uncertainties such as competitive factors, technological developments and market demand. Actual results could differ materially from the Company's expectations. The Vancouver Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
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