iWeb reports 2010 third quarter results

MONTREAL, Aug. 24 /CNW Telbec/ - iWeb Group Inc. (TSX-V: IWB) ("iWeb" or the "Company"), a provider of IT infrastructure and Internet hosting services to clients in 150 countries, announced its results for the third quarter of 2010.

Financial highlights for 2010 third quarter:

    
    -   Revenues increased to $7.5M, from $7.2M in Q3 2009
    -   $2M Adjusted EBITDA, or 27% of revenue
    -   Operating loss of $152,000, down from an operating profit of $261,000
        one year prior
    -   Net loss of $645,000, compared to net earnings of $1M in Q3-2009,
        due mostly to exchange rate variations on long-term debt in USD
    

"iWeb has been pursuing several key operational targets throughout the third quarter, like the reorganisation of many internal technological resources and securing the financing for ongoing projects", said Eric Chouinard, President and Chief Executive Officer of iWeb, adding that "many important technological developments, related to iWeb's new data center in Montreal, have been deployed during the quarter. iWeb expects the results of these developments to act as a catalyst for its return to growth" added the Company's cofounder, named to "Canada's Top 40 Under 40(TM)" in June, a recognition of his accomplishments with iWeb.

    
    Key Financial Data (in thousands, except "per share" amounts)
    -------------------------------------------------------------

                                                          Third Quarter
                                                       ended June 30, 2010

                                                    Q3 - 2010      Q3 - 2009

    Revenues                                           $7,494         $7,179
    Operating Profit (Loss)                             $(152)          $261
    Net Earnings (Loss)                                 $(645)        $1,023
    Earnings (Loss) per share - basic                $(0.0229)       $0.0366
    Adjusted EBITDA(1)                                 $2,043         $1,629
    Adjusted EBITDA / Revenues                           27.3%          22.7%
    Cash flows from operations                           $263         $2,066

                                                        As at          As at
                                                      June 30,  September 30,
                                                         2010           2009

    Total Assets                                      $38,854        $32,990
    Long-term debt, including derivatives             $20,775        $17,524
    Shareholders' equity                               $6,637         $6,365
    Cash and cash equivalent and term deposits         $1,609         $2,215

    1-  The Company defines Adjusted EBITDA as Earnings before interest
        expenses, income taxes, depreciation and amortization, stock-based
        compensation, unrealized exchange gain/loss, loss on write-off of
        assets and straight-line amortization of rental expense.


    Third Quarter 2010 Financial Review:
    ------------------------------------
    

Revenues increased 4% to $7.5M from $7.2M during the same quarter of 2009. Using the 2009 USD/CAD exchange rates, revenues would have increased 18% to $8.5M.

Adjusted EBITDA is $2M, representing 27% of revenues for the quarter, compared to $1.6M (23% of revenue) for Q3 2009.

Decrease in operating profit (loss of $152,000 in Q3-2010) compared to Q3-2009 is mainly explained by the rental expense of the new data center and a less favorable impact of the exchange rate variations between the USD and the CAD, on the Company's operations.

Compared to the net profit of slightly over $1M reported for Q3 2009, the Company reports a net loss of $645,000 for this quarter. The variation between the quarters is mostly attributable to the changes in the rate of conversion of the long-term debt in USD that must be converted to CAD for reporting purposes, while the balance is attributable to the operating loss.

Complete interim financial statements and Management's Discussion and Analysis (MD&A) of the Company are available on iWeb's investor web site (http://investors.iweb.com) and SEDAR (http://www.sedar.com).

About iWeb Group Inc. (iWeb.com)

iWeb.com is a worldwide provider of Internet hosting services and IT Infrastructure, and one of Canada's 100 fastest growing companies according to PROFIT Magazine. From 2004 to 2009, the Company's compounded annual growth rate has been above 75%. With the opening of its fourth secured data center in Montreal, iWeb's capacity will near 35,000 dedicated servers.

Founded in 1996 in Montreal, iWeb now generates more than 60% of its revenues from abroad; and employs over 185 full-time employees providing Dedicated Server Hosting, Co-location and Web Hosting services to more than 22,000 customers in 150 countries. iWeb's shares are listed on the TSX Venture Exchange (TSX-V: IWB).

For further information: Philip Tousignant, Chief Financial Officer, iWeb Group Inc., [phone] ext. 2149, [email protected]; Bernard Dahl, Investor Relations/Media Relations, Presentis, [phone], [email protected]