Intrinsyc Technologies Reports 2015 Fiscal First Quarter Financial ResultsFriday, May 22, 2015
Company Attains Significant New Product Development Agreements and Customer Design Wins for Embedded Computing Boards
Vancouver, BC, May 22, 2015--(T-Net)--Intrinsyc Technologies Corporation (TSX: ITC), a leading provider of solutions for the development of intelligent connected devices; today announced its financial results for the first quarter ended March 31, 2015.
Revenue was $2.3 million in the first quarter 2015 consistent with $2.3 million in the first quarter of 2014 but down 12% quarter over quarter, from $2.6 million.
Gross margin improved significantly to 47% from 41% in the previous and year ago quarter.
As a result of improvement in gross margin, the Company achieved EBITDA of $86,826 during the first quarter of 2015, representing the sixth consecutive quarter of positive EBITDA by the Company.
Financial information is reported in United States dollars and in accordance with International Financial Reporting Standards (“IFRS”).
“We are pleased with our continued achievement of positive EBITDA, and we continue to focus on revenue growth,” stated Tracy Rees, Intrinsyc President and CEO. “Year to date, the Company has made numerous positive achievements and is experiencing several indications of improved future revenue performance, including; improving sales bookings, increased number of customer design wins, and signed agreements with two major customers that we expect to purchase significant units of Intrinsyc's embedded computing boards in 2016 and beyond.”
“Intrinsyc is continuing to execute on our strategic initiatives to transform the Company's business from a limited engineering services offering without recurring revenue; to complete product realization capability from design to production, added Rees. “A successful transformation will enable the attainment of long-term client relationships with a repeat revenue model, and lead to higher revenue and EBITDA performance.”
Three Month Comparative Results
The Company reported revenue of $2.3 million, consistent with the same period in the prior year but down 12% quarter-over-quarter, from $2.6 million. The decline in revenue was due to the discontinued distribution of M2M communication modules from AnyDATA Corporation which reached end of life in the previous quarter.
Gross margin was 47%, which was higher than the 41% gross margins in the comparable periods. Gross margin improvement was attributable to the reduction of hardware revenue, and improvement in cost basis of engineering services due to lower value of Canadian currency versus the United States currency.
EBITDA was $86,826, a decrease from $102,131 in the same period in the prior year but up from $31,081 in the prior quarter.
The Company had net loss of $328,335 compared to net loss of $159,725 in the same period in the prior year and a net loss of $136,035 in the fourth quarter of fiscal 2014.
Financial Position as at March 31, 2015
Working capital as of March 31, 2015 was $8.6 million (which included cash and cash equivalents of $3.9 million and short term investments of $2.3 million). This is compared to net working capital of $8.8 million as of December 31, 2014 (which included cash and cash equivalents of $4.3 million and short-term investments of $2.5 million).
Financial Statements and Management Discussion & Analysis
Please see the audited consolidated financial statements and related Management's Discussion & Analysis (“MD&A”) for more details. The unaudited interim condensed consolidated financial statements for the three months ended March 31, 2015 and related MD&A have been reviewed and approved by Intrinsyc's Audit Committee and Board of Directors. Intrinsyc recognizes that the majority of its investors are now accessing Intrinsyc's corporate and financial information either through pushed news services, directly from www.intrinsyc.com or SEDAR. Thus, Intrinsyc has prepared this truncated news release to alert investors to its results and that a more detailed explanation and analysis is readily available in the MD&A. These reports have been filed on SEDAR at www.sedar.com and also posted atwww.intrinsyc.com.
The following and preceding discussion of financial results includes reference to Gross Margin, EBITDA and Working Capital, which are all non-IFRS financial measures. The measure of gross margin is provided as management believes this is a good indicator in evaluating the operating performance of the Company. EBITDA is defined as operating income (loss) less other operating expenses. The measure is provided as a proxy for the cash earnings from the operations of the business as operating loss for the Company includes non-cash amortization and depreciation expense and share-based compensation which are classified as other operating expenses. The measure of working capital is provided as management believes this is a good indicator of the operating liquidity available to the Company.
This press release contains statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking information under applicable Canadian securities legislation that involve risks and uncertainties. Such forward-looking statements or information may include financial and other projections as well as statements regarding the Company's future plans, objectives, performance, revenues, growth, profits, operating expenses or the company's underlying assumptions. The words “may”, “would”, “could”, “will”, “likely”, “expect,” “anticipate,” “intend”, “plan”, “forecast”, “project”, “estimate” and “believe” or other similar words and phrases may identify forward-looking statements or information. Persons reading this press release are cautioned that such statements or information are only predictions, and that the Company's actual future results or performance may be materially different. Factors that could cause actual events or results to differ materially from those suggested by these forward-looking statements include, but are not limited to: the need to develop, integrate and deploy software solutions to meet the Company's customer's requirements; the possibility of development or deployment difficulties or delays; a customer's decision to cancel or fail to proceed with a commitment to purchase units of the Company's products contained in an executed purchase order; the dependence on the Company's customer's satisfaction; the timing of entering into significant contracts; customers' continued commitment to the deployment of the Company's solutions; reliance on products manufactured by other companies for resale or distribution and reliance on third-party suppliers; the performance of the global economy and growth in software industry sales; market acceptance of the Company's products and services; the success of certain business combinations engaged in by the Company or by its competitors; possible disruptive effects of organizational or personnel changes; technological change, new products and standards; risks related to international expansion; concentration of sales; international operations and sales; dependence upon key personnel and hiring; reliance on a limited number of suppliers; industry growth; competition; intellectual property; product defects and product liability; currency exchange rate risk; and other factors described in the Company's reports filed on SEDAR, including its Annual Information Form and financial report for the year ended December 31, 2014. This list is not exhaustive of the factors that may affect the Company's forward-looking information.
These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information. All forward-looking statements made in this press release are qualified by this cautionary statement and there can be no assurance that actual results or developments anticipated by the Company will be realized. The Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
About Intrinsyc Technologies Corporation
Intrinsyc Technologies is a product development company that provides comprehensive and tailored solutions that enable the development and production of next-generation intelligent connected devices. Solutions span the development life cycle from concept to production and help device makers and technology suppliers create compelling differentiated products with faster time-to-market. Intrinsyc is publicly traded (TSX: ITC) and is headquartered in Vancouver, BC, Canada.
For more information, please contact:
Chief Financial Officer
Intrinsyc Technologies Corporation
 Non-IFRS measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Gross margin referenced here relates to revenues less cost of sales.
 Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. This measure does not have a comparable IFRS measure. EBITDA referenced here relates to operating income (loss) less other operating expenses.
 Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. This measure does not have a comparable IFRS measure. Working capital is defined as current assets less current liabilities.
Vancouver, BC (Wireless)
Intrinsyc Technologies Corporation
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