News & Events Info
Xenos Reports Fiscal 2006 Second Quarter Results
TORONTO, Ontario, May 11, 2005 - Xenos Group Inc. (TSX:XNS), a leading provider of solutions that capture, transform, transport and present electronic data and documents, thereby Powering the Information Supply ChainT, today reported financial results for the second quarter and six-month period ended March 31, 2006.
For the fiscal second quarter ended March 31, 2006, Xenos reported revenues of $3,128,000 compared to revenues of $3,206,000 for the same quarter last year. The Company reported negative EBITDA of $1,316,000, compared to negative EBITDA of $643,000, for the same period last year and a second quarter net loss of $1,734,000, or ($0.18) per share, compared with a net loss of $997,000, or ($0.10) per share for the second quarter of fiscal 2005.
For the first six months of fiscal 2006, Xenos reported revenues of $6,747,000 and a net loss of $2,661,000, or ($0.27) per share. This compares to revenues of $6,731,000 and a net loss of $1,505,000, or ($0.15) per share, for the same period last year.
"Our second quarter results were below our targets as a result of a few factors," said Stu Butts, Chairman and CEO. "Professional and consulting services revenue were softer during the quarter. This has been corrected and our services group, expanded by several new hires is now expected to be fully-booked through the current quarter."
The Company spent 33% more on marketing, sales and promotion during the quarter than during the corresponding quarter last year. This significant increase in activity has not yet been converted to new license revenue as the impact of these lead generating and prospect qualifying programs is not immediate. The Company took action during the quarter to accelerate conversion to sales through intensive work within market segments that it considers most promising for growth. Additionally, Xenos is investing in a high level campaign to enhance Xenos brand equity. Investors can watch for Xenos in the pages of Information Week and Computerworld, among other mass circulation IT publications. Mr. Butts added, "We are pleased to report that new lead generation is currently encouraging. Overall, our investment in market-related activities is beginning to bear fruit in terms of increased profile within our markets, leading to both new direct sales and a number of significant new partnership opportunities."
"In addition, the continuing depreciation of the US dollar decreases our Canadian dollar revenues and makes year over year comparisons seem weaker than they are in terms of actual ongoing business activity. While we continue our policy of hedging our US currency exposure we continue to be impacted by the effects of the extended trend that we have experienced over the past three years."
Xenos maintains a strong balance sheet, with a cash position of $10.5 million, or $1.06 per common share and no long-term debt.
Printable Version with Financial Highlights (PDF: 51 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 866-249- 2165 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 May 18. Please dial 877-289-8525 and enter the reservation number 21188214# 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.
For more information, please contact:
Robert Kunihiro
Chief Financial Officer
Xenos Group, Inc.
(905) 709-1020
rkunihiro@xenos.com
Investor Relations Contact:
Cory 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 and six months ended March 31, 2006. 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
© 2006 Xenos Group Inc. All rights reserved.
