CounterPath Reports First Quarter Fiscal 2011 Financial Results
VANCOUVER, Sept. 14 /PRNewswire-FirstCall/ - CounterPath Corporation ("CounterPath" or the "Company") (OTCBB: CPAH; TSX-V: CCV), a leading provider of desktop and mobile VoIP software products and solutions, today announced financial and operating results for the first quarter of fiscal year 2011.
Financial and operating highlights for the first quarter ended July 31, 2010 include:
- Revenue for the first quarter of $2.2 million compared to revenue of
$2.1 million for the quarter ended July 31, 2009.
- A net loss for the first quarter of $1.4 million ($0.04 per share)
compared to a net loss of $1.2 million ($0.04 per share) for quarter
ended July 31, 2009.
- The launching of Bria iPhone Edition for Apple's iPhone, iPad and
iPod Touch. Bria iPhone Edition is a highly secure, standards-based
VoIP softphone that works over both 3G and Wi-Fi networks and
supports Apple's new iOS 4 with multitasking support.
- The entering into of an agreement with a significant Original
Equipment Manufacturer (OEM) providing for sale of our softphone
suite and server software suite for desktop and mobile applications.
- The launching of a retail version of the Bria for Linux softphone and
the deployment of the enterprise version by two Fortune 500
customers. Bria for Linux gives enterprises a new option for
extending VoIP across multiple operating systems and enabling them to
reduce communications and travel costs, while improving productivity
and responsiveness.
- The announcement of Bria for Genesys with the first release targeted
for a major airline and entertainment company leveraging
CounterPath's voice and video capabilities with Genesys' Contact
Center Solution.
"We are pleased with the progress made this quarter highlighted by improving revenue, new product introductions and strong customer traction," stated Donovan Jones, President and CEO, CounterPath. "Our revenue grew 8% over the same quarter last year buoyed by strong desktop softphone sales through our OEM channels. We've expanded our revenue opportunities with new product launches such as Bria for the iPhone and Bria for the Linux operating system and expect to announce further product offerings in the near future. Our efforts to leverage our internal sales team with external distribution channels is starting to provide significant revenues as enterprises seek to leverage the Internet to save money on communications costs while improving their productivity with our solutions," continued Jones.
Financial Results - (Unaudited)
(All amounts in U.S. dollars and in accordance with accounting principles generally accepted in the United States ("GAAP") unless otherwise specified.)
For the quarter ended July 31, 2010, revenue was $2.2 million compared to $2.1 million for the quarter ended July 31, 2009. Software revenue for the quarter ended July 31, 2010 was $1.8 million compared to $1.1 million for the same quarter last year. Service revenue for the quarter ended July 31, 2010 was $0.4 million compared to $0.9 million for same quarter last year.
Operating expenses for the quarter ended July 31, 2010 were $3.7 million compared to $2.9 million for the same quarter last year. Inclusive in operating expenses of $3.7 million were non-cash expenses of $0.5 million, including $0.2 million from amortization of intangible assets acquired from NewHeights Software Corp., FirstHand Technologies Inc. and BridgePort Networks, Inc. and a non-cash $0.3 million stock-based compensation expense.
Sales and marketing expenses were $0.9 million for the quarter ended July 31, 2010 compared to $0.8 million for same quarter last year due to increased personnel costs. For the quarter ended July 31, 2010, research and development expenses were $1.1 million compared to $0.8 million in the same quarter last year due to $0.3 million onetime gain that resulted from the settlement of a research contract with a third party that benefited the quarter ended July 31, 2009. General and administrative expenses were $1.0 million, compared to $0.6 million for the same quarter last year.
The net loss for the quarter ended July 31, 2010 was $1.4 million, or a loss of $0.04 per share, compared to a net loss of $1.2 million, or a loss of $0.04 per share for the quarter ended July 31, 2009.
At July 31, 2010, the Company had $1.2 million in cash, compared to $1.6 million at April 30, 2010. At July 31, 2010, the Company's working capital was $0.6 million, compared to $0.8 million at April 30, 2010.
About CounterPath
CounterPath Corporation is a leading provider of innovative desktop and mobile VoIP software products and solutions. The Company's product suite includes SIP-based softphones, server applications and Fixed Mobile Convergence (FMC) solutions that enable service providers, enterprises and Original Equipment Manufacturers (OEM) to cost-effectively integrate voice, video, presence and Instant Messaging (IM) applications into their VoIP offerings and extend functionality across both fixed and mobile networks.
CounterPath's customers include some of the world's largest telecommunications service providers and network equipment providers including AT&T, Verizon, BT (British Telecommunications PLC), Deutsche Telekom, Cisco Systems, Mitel and Nortel.
Visit www.counterpath.com.
Non-GAAP Financial Measures
This news release contains "non-GAAP financial measures". The non-GAAP financial measures in this news release consist of non-GAAP operating expenses and non-GAAP operating losses, which exclude non-cash stock-based compensation, amortization and impairment of intangible asset charges relative to operating expenses and operating losses calculated in accordance with GAAP. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. CounterPath utilizes both GAAP and non-GAAP financial measures to assess what it believes to be its core operating performance and to evaluate and manage its internal business and assist in making financial operating decisions. CounterPath believes that the inclusion of non-GAAP financial measures, together with GAAP measures, provides investors with an alternative presentation useful to investors' understanding of CounterPath's core operating results and trends.
Forward-Looking Statements
This news release contains "forward-looking statements". Statements in this news release, which are not purely historical, are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future, such as the following: (1) We've expanded our revenue opportunities with new product launches such as Bria for the iPhone and Bria for the Linux operating system and expect to announce further product offerings in the near future.
It is important to note that actual outcomes and the Company's actual results could differ materially from those in such forward-looking statements. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others: (1) the failure to develop new and innovative products using the Company's technologies, (2) the Company's ability to remain competitive as other parties develop and release competitive products, (3) the Company's ability to retain the employees necessary to continue research and development of current and new products, (4) the success by the Company of the sales of its current and new products, (5) the impact of technology changes on the Company's products and on the VoIP industry, (6) the compatibility of the Company's products with new computer operating systems, (7) the rate of adoption by service providers and the general public of VoIP as a replacement for regular and cellular phone service, (8) general economic conditions as they affect CounterPath and its current and prospective customers, including a continued downturn in general economic conditions internationally, (9) the ability of the Company to control costs operating, general administrative and other expenses, and (10) insufficient investor interest in the Company's securities which may impact on the Company's ability to raise additional financing as required. Readers should also refer to the risk disclosures outlined in the Company's quarterly reports on Form 10-Q, annual reports on Form 10-K and the Company's other disclosure documents filed from time-to-time with the Securities and Exchange Commission at www.sec.gov and the Company's interim and annual filings and other disclosure documents filed from time-to-time on SEDAR at www.sedar.com.
Disclaimer: Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
COUNTERPATH CORPORATION
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS
(Stated in U.S. Dollars)
July 31, April 30,
2010 2010
------------ ------------
Assets (Unaudited)
Current assets:
Cash $ 1,209,989 $ 1,556,813
Accounts receivable (net of allowance
for doubtful accounts of $1,111,698
and $1,116,119, respectively) 2,458,703 2,345,633
Investment tax credits recoverable 125,970 129,285
Other current assets 140,333 221,041
------------ ------------
Total current assets 3,934,995 4,252,772
Deposits 99,972 101,994
Equipment 115,979 111,150
Intangible assets (net of accumulated
amortization of $4,449,281 and
$4,243,641, respectively) 2,482,693 2,930,616
Goodwill 8,515,922 8,740,025
Other assets 53,434 58,817
------------ ------------
Total Assets $ 15,202,995 $ 16,195,374
------------ ------------
------------ ------------
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued liabilities $ 2,504,980 $ 2,667,997
Unearned revenue 726,348 655,361
Customer deposits 2,018 5,127
Accrued warranty 126,811 120,963
------------ ------------
Total current liabilities 3,360,157 3,449,448
Deferred lease inducements 3,987 4,677
Convertible debentures 483,300 -
Unrecognized tax benefit 98,575 98,575
------------ ------------
Total liabilities 3,946,019 3,552,700
Stockholders' equity:
Preferred stock, $0.001 par value
Authorized: 100,000,000
Issued and outstanding:
July 31, 2010 - 1; April 30, 2010 - 1 - -
Common stock, $0.001 par value
Authorized: 83,076,900
Issued and outstanding:
July 31, 2010 - 33,088,375;
April 30, 2010 - 33,015,627 33,088 33,016
Additional paid-in capital 52,363,560 51,902,471
Accumulated deficit (41,207,206) (39,779,781)
Accumulated other comprehensive loss
- currency translation adjustment 67,534 486,968
------------ ------------
Total stockholders' equity 11,256,976 12,642,674
------------ ------------
Liabilities and Stockholders' Equity $ 15,202,995 $ 16,195,374
------------ ------------
------------ ------------
COUNTERPATH CORPORATION
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME (LOSS)
(Stated in U.S. Dollars)
(Unaudited)
Three Months Ended
July 31,
--------------------------
2010 2009
------------ ------------
Revenue:
Software $ 1,819,152 $ 1,141,343
Service 400,433 909,114
------------ ------------
Total revenue 2,219,585 2,050,457
Operating expenses:
Cost of sales (includes depreciation of
$3,994 and $2,121 and amortization of
intangible assets of $205,640 and
$205,972 for three months ended
July 31, 2010 and 2009 respectively) 746,030 642,728
Sales and marketing 865,683 759,005
Research and development 1,063,647 820,128
General and administrative 995,462 622,399
Restructuring costs - 44,912
------------ ------------
Total operating expenses 3,670,822 2,889,172
------------ ------------
Loss from operations (1,451,237) (838,715)
Interest and other income (expense), net:
Interest income 52,079 27,758
Interest expense (221) (1,666)
Foreign exchange loss (28,046) (429,713)
------------ ------------
Net loss for the period $ (1,427,425) $ (1,242,336)
------------ ------------
------------ ------------
Other comprehensive income (loss):
Foreign currency translation adjustments (419,434) 2,110,896
------------ ------------
Comprehensive income (loss) $ (1,846,859) $ 868,560
------------ ------------
------------ ------------
Net loss per share:
Basic and diluted $ (0.04) $ (0.04)
------------ ------------
------------ ------------
Weighted average common shares outstanding: 33,066,204 28,968,332
SOURCE CounterPath Corporation
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