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Xenos Reports Fiscal 2006 First Quarter Results
TORONTO, Ontario, February 13, 2006 - Xenos Group Inc. (TSX:XNS), a leading provider of solutions that automate the processing and delivery of electronic data and documents, today reported financial results for its fiscal first quarter.
For the fiscal first quarter ended December 31, 2005, Xenos reported an increase in revenues to $3,619,000, compared to revenues of $3,525,000 for the same quarter last year. The Company reported negative EBITDA of $828,000, compared to negative EBITDA of $239,000 for the same period last year and a first quarter net loss of $927,000, or ($0.09) per share, compared with a net loss of $508,000, or ($0.05) per share, for the first quarter of fiscal 2005. Xenos maintains a strong balance sheet, with a cash position of $11.1 million, or $1.12 per common share and no long-term debt.
The increased loss was primarily the result of increased investment in marketing coupled with the decline in the relative value of the $US. Sales and marketing expenses increased by 30% to $2,281,000 from $1,760,000 in the same quarter last year.
We made some important sales of our new technologies during the quarter. Aggregate revenues from Xenos d2e Vision™, Xenos infoWEB™ and the Xenos terminalONE™ suite were $1,434,000 representing a gain of 65% from the prior year period. Particularly gratifying were new license sales of Xenos terminalONE to customers in the healthcare, ports and logistics market spaces.
As part of the Company's new marketing campaign, major media placements featuring print and electronic media, formulated during the last quarter, have begun appearing in the current quarter. This media campaign represents the largest discretionary marketing expenditure in the Company's history.
"We believe that we have taken a quantum leap in refining and delivering our message and asserting our value proposition," explained Stuart Butts, Chairman and CEO. "At the end of the quarter we released our new corporate positioning, 'Powering the Information Supply Chain™'. We believe that this unique market positioning will enable us to better exploit our technologies by increasing sales to existing customers and markets while developing new customers in new markets."
The 'Powering the Information Supply Chain™' as a defining concept has quickly gained resonance with the Company's target market.
"We anticipate that the balance of the year will show returns on this investment and drive improved financial performance," added Mr. Butts.
Printable Version with Financial Highlights (PDF: 40 KB)
Conference Call
A conference call for shareholders, analysts and other members of the investment community has been scheduled today at 10:00 am (Eastern Time). Stuart Butts, Chairman and CEO, Jim Farmer, President and Rob Kunihiro, Chief Financial Officer will discuss the financial results and provide updates on operations. To participate, please dial 800-814-4890, or locally 416-644-3426, approximately 10 minutes before the conference call.
The conference can also be heard over the Internet at www.xenos.com. A recording of the conference call will be available through February 20. Please dial 877-289-8525 and enter the reservation number 21176454# to listen to the rebroadcast. The call will also be archived for 30 days on the Xenos web site at www.xenos.com.
About Xenos
Xenos (TSX:XNS) is a leading global provider of high-performance software solutions that automate the processing and delivery of data and documents. Xenos solutions enable organizations to leverage existing business investments and create powerful new Information Supply Chains that streamline and simplify the conversion of data and content into actionable business information. Embraced across a wide variety of industries, including financial services, healthcare and government, Xenos powers the business critical applications for a responsive enterprise and delivers the new competitive advantage - e-AdaptabilityT. Xenos has offices in Canada, the United States, the United Kingdom and France. For more information visit www.xenos.com.
Contact:
Robert Kunihiro
Chief Financial Officer
Xenos Group, Inc.
(905) 709-1020
rkunihiro@xenos.com
Investor Relations Contact:
Corbet Pala
Xenos Group, Inc.
416-657-2400
cpala@xenos.com
Certain statements made in this press release are forward-looking within the meaning of certain securities laws. Such forward-looking statements are based on a number of assumptions and involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company or developments in the Company's business or its industry to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. The Company urges you not to place undue reliance on these estimates, opinions and projections. The Company assumes no obligation to update forward-looking statements if assumptions or these plans, estimates, opinions or projections should change.
The Company's external auditors, Grant Thornton LLP, have not performed a review of the interim consolidated financial statements for the three months ended December 31, 2005. These statements have been prepared by management and include the selection of appropriate accounting principles, judgments and estimates necessary to prepare these financial statements in accordance with Canadian generally accepted accounting principles ("GAAP").
The Company uses financial measures including, but not limited to, "EBITDA" to supplement its consolidated financial statements, which are presented in accordance with GAAP. EBITDA is not a recognized measure under GAAP and should not be construed as an alternative to net income (loss). Xenos' method of calculating EBITDA may differ from other companies and accordingly may not be comparable to measures used by other companies. Cash per share is a non-GAAP measure and is calculated by dividing the cash and short term investments by the number of common shares outstanding.
For further information, visit www.xenos.com
© 2005 Xenos Group Inc. All rights reserved.
