Highlights of the three and twelve month operating results are as follows:
(Thousands of US $, unless otherwise noted)
-------------------------------------------------------------------------
Three months ended Twelve months ended
September 30 September 30
------------------------------------------------
2009 2008 2009 2008
-------------------------------------------------------------------------
Revenue 11,798 11,096 46,810 47,693
-------------------------------------------------------------------------
Earnings (loss) before
interest, taxes,
amortization** 710 (112) 1,720 (143)
-------------------------------------------------------------------------
Profit (loss) before
income taxes 205 (405) 406 (1,674)
-------------------------------------------------------------------------
Profit (loss) 440 (431) 580 (1,703)
-------------------------------------------------------------------------
Earnings (loss) per
common share, basic $0.02 ($0.02) $0.02 ($0.06)
-------------------------------------------------------------------------
Earnings (loss) per
common share, diluted $0.01 ($0.02) $0.02 ($0.06)
-------------------------------------------------------------------------
Weighted average number
of shares - basic 26,954,083 26,954,083 26,954,083 26,954,083
-------------------------------------------------------------------------
Weighted average number
of shares - diluted 31,030,170 26,954,083 27,981,480 26,954,083
-------------------------------------------------------------------------
* Audited financial information is available at www.sedar.com.
** EBITDA is not a measure of performance under Canadian GAAP. EBITDA
should not be considered in isolation or as a substitute for Net
Earnings nor as a measure of operating performance or profitability.
Commenting on the results for the three and twelve months ended
"The Company in the fourth quarter experienced a significant turnaround from the same prior year period. Following a loss in the first quarter of 2009, the Company made great strides over the course of the year with growing profitability each quarter totaling full year earnings compared to losses in 2008."
"Our current projections indicate growth and increased customer diversity as we strive to take advantage of market opportunities by offering products featuring increasing appeal to consumers."
"LOREX is progressing with new product introductions that are easier to connect to the internet, and that can be used on a broad range of mobile phone platforms. Our line-up of cameras that transmit video with a digital wireless signal is expanding, as is our line-up of advanced internet protocol cameras which integrate seamlessly on information technology ("IT") platforms commonly found in businesses and homes. As stated in a prior news release, this past month we received engineering and design innovation awards at the 2010 International Consumer Electronics Show for each of our Link multi-platform digital video recorder (DVR) and LW2700 Multifunctional Digital Wireless Surveillance System. The LW2700 offers ease of set-up, use and is a competitively priced full recording solution with convenient SD card memory, already available in our retail channel. The high powered Link DVR offers an intuitive touch panel, easy connectibility to the internet and can be used on most existing mobile phone browsers including Blackberry(TM), iPhone(TM) and Windows Mobile(TM) smart-phones, and will be introduced through major national retailers and e-tailers in a variety of configurations beginning in the second quarter. We also successfully introduced in late 2009 a highly economical, fully featured DVR platform called the ECO, which we plan to offer in additional configurations through our retail channel."
"This past year and the subsequent period to date has had many highlights, as LOREX raised capital, changed the CEO, changed its lender, and returned to profitability, all while the North American economy continued to impact consumer buying patterns. While the market is experiencing growing competitive pressure we believe that LOREX is well positioned to take advantage of opportunities in 2010."
The fourth quarter results include an income tax recovery of approximately
About LOREX Technology Inc.:
LOREX Technology Inc. ('LOREX') (NEX:LOX.H) provides businesses and consumers with leading edge video surveillance security solutions and sells its products under the LOREX and Digimerge brands. The LOREX brand, which caters to both small business and consumer markets, is available in over 9,000 retail locations across
LOREX subsidiaries include; LOREX
The NEX has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
Certain information included in this news release contains statements that are forward-looking, such as statements relating to anticipated future revenues of the Company and the success of product offerings. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future, and, accordingly, such results may differ materially from those expressed in any forward-looking statements made by or on behalf of the Company.
LOREX TECHNOLOGY INC.
CONSOLIDATED BALANCE SHEETS
(Expressed in U.S. dollars - unaudited)
-------------------------------------------------------------------------
September 30 September 30
2009 2008
-------------- --------------
Assets
Current assets:
Cash $ 315,293 $ 347,467
Accounts receivable 6,751,116 5,349,192
Inventory 8,635,047 8,468,575
Prepaid expenses and deposits 823,485 865,259
Future income taxes 94,709 15,435
-------------------------------------------------------------------------
16,619,650 15,045,928
Capital assets 365,924 398,463
Intangible assets 8,152 34,019
Future income taxes 436,456 253,265
Goodwill 710,069 718,309
-------------------------------------------------------------------------
$ 18,140,251 $ 16,449,984
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Liabilities and Shareholders' Equity
Current liabilities:
Bank indebtedness $ 6,162,184 $ 6,895,675
Accounts payable and accrued liabilities 6,028,536 5,375,340
-------------------------------------------------------------------------
12,190,720 12,271,015
Future income taxes 10,709 47,924
Shareholders' Equity
Capital stock 9,746,310 9,746,310
Preferred share subscriptions 1,119,087 -
Contributed surplus 1,328,941 1,223,227
Accumulated other comprehensive income 1,498,883 1,495,486
Deficit (7,754,399) (8,333,978)
-------------------------------------------------------------------------
5,938,822 4,131,045
-------------------------------------------------------------------------
$ 18,140,251 $ 16,449,984
-------------------------------------------------------------------------
-------------------------------------------------------------------------
LOREX TECHNOLOGY INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Expressed in U.S. dollars - unaudited)
-------------------------------------------------------------------------
3 Months Ended 12 Months Ended
September 30 September 30
2009 2008 2009 2008
------------- ------------- ------------- -------------
Revenue $ 11,797,932 $ 11,095,908 $ 46,810,408 $ 47,692,698
Cost of sales 7,933,729 7,331,641 31,235,958 32,417,657
------------- ------------- ------------- -------------
Gross profit 3,864,203 3,764,267 15,574,450 15,275,041
Expenses:
Marketing, selling
and operations 1,963,651 2,441,709 9,351,222 10,326,865
Administration 1,166,017 787,026 3,517,046 3,374,612
Research and
development 269,501 465,115 912,015 1,478,054
Interest 447,683 181,941 1,036,365 919,724
Amortization 57,102 110,848 277,957 611,069
Loss (gain) on
foreign exchange (245,007) 182,793 73,794 238,402
------------- ------------- ------------- -------------
3,658,947 4,169,432 15,168,399 16,948,726
------------- ------------- ------------- -------------
Profit (loss) for
the period before
income taxes 205,256 (405,165) 406,051 (1,673,685)
Income taxes
(recovery) (234,528) 25,900 (173,528) 29,518
Profit (loss) for
the period 439,784 (431,065) 579,579 (1,703,203)
Other comprehensive
loss (note 2) (21,910) (10,256) 3,397 (2,785)
------------- ------------- ------------- -------------
Comprehensive
income (loss) $ 417,874 $ (441,321) $ 582,976 $ (1,705,988)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Profit (loss) per
common share -
basic $ 0.02 $ (0.02) $ 0.02 $ (0.06)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Profit (loss) per
common share -
diluted $ 0.01 $ (0.02) $ 0.02 $ (0.06)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Number of common
shares
Weighted average
basic 26,954,083 26,954,083 26,954,083 26,954,083
Weighted average
diluted 31,030,170 26,954,083 27,981,480 26,954,083
Total outstanding 26,954,083 26,954,083 26,954,083 26,954,083
LOREX TECHNOLOGY INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(Expressed in U.S. dollars - unaudited)
-------------------------------------------------------------------------
Class B Preferred
Common preferred share Contributed
shares shares subscriptions surplus
-------------------------------------------------------------------------
$ $ $ $
Three months ended
September 30
Balance, June 30,
2008 9,641,415 104,895 - 1,172,944
-------------------------------------------------------------------------
Loss for the quarter - - - -
Unrealized losses on
foreign currency
translation of
self sustaining
operations - - - -
-------------------------------------------------------------------------
Comprehensive loss - - - -
-------------------------------------------------------------------------
Options granted/
forfeited - - - 50,283
-------------------------------------------------------------------------
Balance,
September 30, 2008 9,641,415 104,895 - 1,223,227
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Balance, June 30,
2009 9,641,415 104,895 - 1,336,364
-------------------------------------------------------------------------
Loss for the quarter - - - -
Unrealized losses on
foreign currency
translation of
self sustaining
operations - - - -
-------------------------------------------------------------------------
Comprehensive loss - - - -
-------------------------------------------------------------------------
Options granted/
forfeited - - - (7,423)
Receipts issued for
preferred share
subscriptions - - 1,119,087 -
-------------------------------------------------------------------------
Balance,
September 30, 2009 9,641,415 104,895 1,119,087 1,328,941
-------------------------------------------------------------------------
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Twelve months ended
September 30
Balance,
September 30, 2007 9,641,415 104,895 - 912,165
-------------------------------------------------------------------------
Loss for the year - - - -
Unrealized losses on
foreign currency
translation of
self sustaining
operations - - - -
-------------------------------------------------------------------------
Comprehensive loss - - - -
-------------------------------------------------------------------------
Options granted/
forfeited - - - 311,062
-------------------------------------------------------------------------
Balance,
September 30, 2008 9,641,415 104,895 - 1,223,227
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Profit for the year - - - -
Unrealized losses on
foreign currency
translation of
self sustaining
operations - - - -
-------------------------------------------------------------------------
Comprehensive income - - - -
-------------------------------------------------------------------------
Options granted/
forfeited - - - 105,714
Receipts issued for
preferred share
subscriptions - - 1,119,087 -
-------------------------------------------------------------------------
Balance,
September 30, 2009 9,641,415 104,895 1,119,087 1,328,941
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Accumulated
other
comprehensive
income (loss) Deficit Total
-----------------------------------------------------------
$ $ $
Three months ended
September 30
Balance, June 30,
2008 1,505,741 (7,902,916) 4,522,079
-----------------------------------------------------------
Loss for the quarter - (431,062) (431,062)
Unrealized losses on
foreign currency
translation of
self sustaining
operations (10,255) - (10,255)
-----------------------------------------------------------
Comprehensive loss (10,255) (431,062) (441,317)
-----------------------------------------------------------
Options granted/
forfeited - - 50,283
-----------------------------------------------------------
Balance,
September 30, 2008 1,495,486 (8,333,978) 4,131,045
-----------------------------------------------------------
-----------------------------------------------------------
Balance, June 30,
2009 1,520,793 (8,194,183) 4,409,284
-----------------------------------------------------------
Loss for the quarter - 439,784 439,784
Unrealized losses on
foreign currency
translation of
self sustaining
operations (21,910) - (21,910)
-----------------------------------------------------------
Comprehensive loss (21,910) 439,784 417,874
-----------------------------------------------------------
Options granted/
forfeited - - (7,423)
Receipts issued for
preferred share
subscriptions - - 1,119,087
-----------------------------------------------------------
Balance,
September 30, 2009 1,498,883 (7,754,399) 5,938,822
-----------------------------------------------------------
-----------------------------------------------------------
Twelve months ended
September 30
Balance,
September 30, 2007 1,498,271 (6,630,775) 5,525,971
-----------------------------------------------------------
Loss for the year - (1,703,203) (1,703,203)
Unrealized losses on
foreign currency
translation of
self sustaining
operations (2,785) - (2,785)
-----------------------------------------------------------
Comprehensive loss (2,785) (1,703,203) (1,705,988)
-----------------------------------------------------------
Options granted/
forfeited - - 311,062
-----------------------------------------------------------
Balance,
September 30, 2008 1,495,486 (8,333,978) 4,131,045
-----------------------------------------------------------
-----------------------------------------------------------
Profit for the year - 579,579 579,579
Unrealized losses on
foreign currency
translation of
self sustaining
operations 3,397 - 3,397
-----------------------------------------------------------
Comprehensive income 3,397 579,579 582,976
-----------------------------------------------------------
Options granted/
forfeited - - 105,714
Receipts issued for
preferred share
subscriptions - - 1,119,087
-----------------------------------------------------------
Balance,
September 30, 2009 1,498,883 (7,754,399) 5,938,822
-----------------------------------------------------------
-----------------------------------------------------------
LOREX TECHNOLOGY INC.
CONSOLIDATED STATEMENTS OF CASH FLOW
(Expressed in U.S. dollars - unaudited)
-------------------------------------------------------------------------
3 Months Ended 12 Months Ended
September 30 September 30
2009 2008 2009 2008
------------- ------------- ------------- -------------
Cash provided by
(used in):
Operating activities
Profit (loss) for
the period $ 439,784 $ (431,065) $ 579,579 $ (1,703,203)
Items not
involving cash:
Amortization of
capital and
intangible assets 57,098 110,843 277,957 611,069
Stock option
expense and stock
based compensation (3,765) 49,129 112,928 305,881
Future income taxes (301,067) (76,785) (301,067) (76,785)
Change in non-cash
operating working
capital:
Accounts
receivable (1,807,885) 219,170 (1,340,291) 2,476,973
Inventory 318,134 1,684,129 (114,951) 3,169,394
Prepaid expenses
and deposits 644,378 (298,688) 39,244 (113,532)
Accounts payable
and accrued
liabilities (577,408) 15,453 673,016 (1,083,252)
------------- ------------- ------------- -------------
(1,230,731) 1,272,186 (73,585) 3,586,545
Financing
activities:
Increase
(decrease) in
bank indebtedness 364,350 (1,034,569) (744,597) (3,436,357)
Preferred share
subscriptions 1,016,432 - 1,016,432 -
------------- ------------- ------------- -------------
1,380,782 (1,034,569) 271,835 (3,436,357)
Investing
activities:
Purchase of
capital assets (154,869) (63,237) (229,162) (220,750)
------------- ------------- ------------- -------------
(154,869) (63,237) (229,162) (220,750)
Effect of
foreign currency
translation on
cash balances 120 (44,885) (1,262) (2,183)
------------- ------------- ------------- -------------
Increase (decrease)
in cash (4,698) 129,495 (32,174) (72,745)
Cash, beginning
of period 319,991 217,972 347,467 420,212
------------- ------------- ------------- -------------
Cash, end of
period $ 315,293 $ 347,467 $ 315,293 $ 347,467
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Supplemental cash
flow information:
Interest paid $ 157,325 $ 141,014 $ 642,464 $ 785,525
Income taxes paid $ 20,000 $ 21,041 $ 160,359 $ 30,530
For further information: Jordan Schwartz, Chief Financial Officer, LOREX Technology Inc., Phone: (905) 946-8589 ext 168, [email protected], www.lorextechnology.com
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