OSI Geospatial Inc. Reports 2010 First Quarter Results
OTTAWA, April 14 /CNW Telbec/ - OSI Geospatial Inc. (TSX: OSI) today announced its financial results for the first quarter of fiscal year 2010 ending February 28, 2010, reported in Canadian dollars and in accordance with Canadian Generally Accepted Accounting Principles (GAAP).
For the first quarter of 2010, OSI Geospatial Inc. reported consolidated revenue of $3.4 million compared to $5.7 million reported in the first quarter of 2009. The Company reported a net income of $4.0 million before taxes and a net income after taxes of $2.1 million compared with net loss of $844,000 before taxes and net loss after taxes of $697,000 in the first quarter of 2009. The first quarter of 2010 included a gain before tax of $5.2 million on the sale of its non-core soldier systems intellectual property ("IP").
For the first quarter of 2010, the net income attributable to common shareholders was $2.0 million or $0.04 per share, compared to a net loss of $853,000 or $0.02 per share in the first quarter of 2009.
OSI Geospatial is working to divest non-core assets that are not aligned with its maritime strategy. The funds from the sale of these non-core assets will be used to strengthen the Company's balance sheet, provide resources to further develop its core technologies and expand its marketing capabilities in support of developing its high-growth maritime niche markets.
"In early 2009, we communicated our intention to divest assets that do not support the development our maritime business. The sale of our soldier systems IP marks an important step in realizing this strategy and will provide the resources to move our maritime market growth strategy forward," said Ken Kirkpatrick, President and CEO. "Over the past three years, we have expanded our addressable maritime markets around the world and positioned the Company to take advantage of the growth opportunities that these markets present for our leading technologies."
First Quarter Highlights
- Signed a US$6.5 million contract to sell its soldier systems
intellectual property to Harris Corporation.
- Signed a $5.7 million contract to provide the U.S. Army with
engineering services to develop and support a deployed command and
control system.
- Secured follow-on contracts valued at approximately $1.8 million with
the U.S. Department of Defence to provide advanced training
technology development.
- Successfully completed engineering studies that were required to
determine the scope of work required to integrate ECPINS(R) into the
systems that are being delivered for the UK Navy Astute Submarine and
T45 Destroyer programs.
- Closed $1.6 million in mapping contracts.
About OSI Geospatial
OSI Geospatial Inc. delivers advanced geospatial systems and software that enable shared real-time situational awareness for military, safety and security applications. Our products and services enable our customers to integrate and visualize live data with any combination of sensor data, imagery, maps and charts. This capability provides our customers with enhanced operational performance, safety and security through shared real-time situational awareness. OSI Geospatial systems and software are in use by military, government, and commercial customers around the world. The Company is publicly traded on the Toronto Stock Exchange. For additional information please visit www.osigeospatial.com.
Forward-Looking Statements
This press release contains forward-looking statements and information which reflect the current view of OSI Geospatial Inc. ("OSI") with respect to future events and financial performance. Any such forward-looking statements are subject to risks and uncertainties, and OSI's actual results of operations could differ materially from historical results or current expectations. Additional information on these and other potential factors that could affect OSI's financial results are detailed in disclosure documents filed from time to time with the applicable Canadian securities regulatory authorities.
The Toronto Stock Exchange has neither approved nor disapproved the form or content of this release.
Copyright (C) 2010 OSI Geospatial Inc. and its affiliated or related companies. ECPINS and COP-IDS are registered trademarks of Offshore Systems Ltd., an OSI Geospatial company. iGEN is a registered trademark of CHI Systems Inc., an OSI Geospatial company. Other company brand, product and service names are for identification purposes only and may be either trademarks, service marks or registered trademarks of their respective owners. Data subject to change without notice.
OSI Geospatial Inc.
(Incorporated under the laws of the Province of British Columbia, Canada)
Interim Consolidated Balance Sheets (Unaudited)
February 28, November 30,
In thousands of Canadian dollars 2010 2009
-------------------------------------------------------------------------
Assets
------
Current assets
Cash and cash equivalents $ 2,852 $ 315
Restricted cash 263 -
Accounts receivable and unbilled revenue 4,832 5,880
Inventory 1,053 1,139
Prepaid expenses and deposits 480 375
Current portion of future income tax asset 181 1,041
----------------------------
9,661 8,750
Restricted cash 373 -
Deferred development costs 546 653
Future income tax asset 80 113
Equipment and furnishings 1,334 1,473
Intangible and other assets 380 446
Goodwill 4,305 4,324
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$ 16,679 $ 15,759
----------------------------
----------------------------
Liabilities
-----------
Current liabilities
Bank indebtedness $ - $ 599
Factored advances payable 74 240
Accounts payable and accrued liabilities 2,637 3,806
Income taxes payable 1,068 -
Unearned revenue 279 550
Current portion of deferred rent 41 41
Current portion of capital lease
obligation 54 68
----------------------------
4,153 5,304
Deferred rent 249 260
Capital lease obligation 48 54
Unearned revenue 150 178
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4,600 5,796
----------------------------
Shareholders' Equity
--------------------
Issued and outstanding
Class A, Series A preference shares 30 30
Class B, Series 2 preference shares 3,237 5,383
Common shares 30,769 29,876
----------------------------
34,036 35,289
Warrants 4,546 4,546
Contributed surplus 4,603 3,322
Accumulated deficit (29,759) (31,838)
Accumulated other comprehensive loss (1,347) (1,356)
----------------------------
12,079 9,963
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$ 16,679 $ 15,759
----------------------------
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OSI Geospatial Inc.
Interim Consolidated Statements of Income (Loss) and Deficit (Unaudited)
In thousands of Canadian dollars, Three months ended February 28,
except share related data 2010 2009
-------------------------------------------------------------------------
Revenue
Maritime navigation and tactical solutions $ 1,406 $ 3,522
Advanced technology research and development 1,924 1,943
Mapping 114 259
----------------------------
3,444 5,724
Cost of sales 2,338 4,005
----------------------------
Gross profit 1,106 1,719
----------------------------
Expenses (income)
General and administrative 1,267 1,209
Sales and marketing 665 813
Engineering 176 301
Amortization 87 113
Interest expense 38 31
Foreign exchange gain (10) -
Technology Partnerships Canada royalty 69 96
----------------------------
2,292 2,563
----------------------------
Net loss before other items (1,186) (844)
Gain on sale of intellectual property 5,227 -
----------------------------
Net income (loss) before income taxes 4,041 (844)
----------------------------
Future income tax (recovery) 888 (152)
Current income tax expense 1,071 5
----------------------------
Income tax expense (recovery) 1,959 (147)
----------------------------
Net income (loss) 2,082 (697)
Accumulated deficit, beginning of period (31,838) (24,121)
Dividends on Class B preference shares (3) (3)
----------------------------
Accumulated deficit, end of period $ (29,759) $ (24,821)
----------------------------
----------------------------
Net income (loss) attributable to common
shareholders
Basic $ 1,951 $ (853)
Diluted 2,082 (853)
Earnings (loss) per share
Basic $ 0.04 $ (0.02)
Diluted 0.04 (0.02)
Weighted average number of common shares
outstanding
Basic 48,733,766 46,956,439
Diluted 57,659,553 46,956,439
OSI Geospatial Inc.
Interim Consolidated Statements of Cash Flows (Unaudited)
Three months ended February 28,
In thousands of Canadian dollars 2010 2009
-------------------------------------------------------------------------
Cash flows from (used in) operating
activities
Net income (loss) for the period $ 2,082 $ (697)
Items not affecting cash
Amortization 124 161
Gain on disposal of intellectual property (5,227) -
Stock-based compensation 28 -
Future income taxes 888 (152)
----------------------------
(2,105) (688)
----------------------------
Changes in non-cash operating working
capital items
Accounts receivable 1,036 2,014
Inventory 86 356
Prepaid expenses and deposits (103) (220)
Accounts payable and accrued liabilities (1,164) (1,331)
Income taxes payable 1,070 5
Deferred rent (10) (10)
Unearned revenue (299) 10
----------------------------
616 824
----------------------------
(1,489) 136
----------------------------
Cash flows from (used in) investing
activities
Increase in restricted cash (638) -
Development costs deferred (25) (18)
Additions to equipment and furnishings (10) (30)
Additions to intangibles and other assets - (2)
Proceeds from disposal of intellectual
property and related tangible assets,
net of costs to dispose 5,444 -
----------------------------
4,771 (50)
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Cash flows used in financing activities
Repayment of bank indebtedness (599) (66)
Factored advances payable (165) -
Repayment of capital lease obligation (20) (14)
Class B preference share dividends declared
and paid (3) (3)
----------------------------
(787) (83)
----------------------------
Effect of foreign exchange on cash
balances 42 (3)
----------------------------
Increase in cash and cash equivalents 2,537 -
Cash and cash equivalents - beginning of
period 315 -
----------------------------
Cash and cash equivalents - end of period $ 2,852 $ -
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For further information: Sandy Oneschuk, Investor Relations, (613) 287-8004 or 1-888-880-9797, (613) 287-0466 (FAX), [email protected]
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