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Xenos Reports Third Quarter Results
TORONTO, Ontario, August 8, 2007 —Xenos Group Inc. (TSX:XNS), today reported financial results for the third quarter and first nine months of its fiscal 2007 year.Xenos revenues for the third quarter ended June 30, 2007 rose to $3,803,000 as compared to revenues of $3,767,000 for the same quarter last year. Revenues for the nine months ended June 30, 2007 were $11,454,000 as compared to $10,514,000 for the first nine months of fiscal 2007.
Xenos reported a significantly improved EBITDA of $385,000 for its third quarter as compared to negative EBITDA of $786,000 for the third quarter ended June 30, 2006
This improvement, in part reflects the corporate reorganization undertaken in the second quarter that put Xenos on a solid footing for profitable growth. Total expenses were reduced by 30% to $3,024,000, from $4,326,000 in the third quarter of fiscal 2006. Year over year sales and marketing expenses were reduced to $1,512,000 from $2,716,000.
Xenos third quarter results were significantly impacted by the material decline of the U.S. dollar (7.7%) and UK pound sterling (6.0%) against the Canadian dollar during the quarter. The bulk of Xenos revenues are denominated in these currencies and constitute a significant portion of our balance sheet items. As a result, revenues were lower than they would have been on a constant currency basis and we were forced to take a significant write-down of foreign denominated assets (principally cash and receivables) at the end of the quarter. This write-down represents the bulk of the foreign exchange loss of $523,220 recorded in the financial statements.
The Company reported a third quarter net loss of $378,000, or ($0.04) per share, compared with a net loss of $1,374,000, or ($0.14) per share, for the third quarter of fiscal 2006.
As previously announced, an ECM migration project (valued at approximately US$700,000) signed late in the quarter, did not generate revenue in Q3, but represents an important win that will come into revenue in Q4 and Q1 of 2008.
“Stakeholders should not allow the currency issue to mask the very real improvement in operating results and outlook accomplished over the past three quarters,” said Stuart Butts, Chairman & CEO.
At June 30, 2007, Xenos reported no significant long-term debt and held cash of $7,594,000, or $0.76 per common share, an increase from $7,308,000, or $0.74 per common share at September 30, 2006.
Printable Version with Financial Highlights (PDF: 53 KB)
Conference Call
A conference call for shareholders, analysts and other members of the investment community has been scheduled for today at 10:00am (Eastern Time). Stuart Butts, Chairman, President & CEO, and George Kypreos, CFO, will discuss the financial results and provide updates on operations. To participate, please dial 416-644-3427, or 1-800-796-7558 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 August 15. Please dial 1-877-289-8525 and enter the reservation number 21242765# 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) high-performance data and document management solutions provide organizations with a powerful competitive advantage—adaptability. Xenos powers information supply chains—without re-engineering—by transforming and repurposing both static and transactional information.
Xenos solutions increase the efficiency, agility and accountability of organizations worldwide across a wide variety of industries including financial services, insurance, healthcare, telecommunications, manufacturing, logistics, transportation, retail and government sectors. Xenos has offices in Canada, the United States, the United Kingdom and France and sells and supports its solutions directly and through a global network of resellers and partners. For more information, visit www.xenos.com
Xenos trades on the Toronto Stock Exchange under the trading symbol 'XNS.'
For more information, visit www.xenos.com
For more information, please contact:
George Kypreos
Chief Financial Officer
Tel: +1 (905) 709-1020
Fax: +1 (905) 709-1023
E-mail: gkypreos@xenos.com
Investor Relations Contact:
Cory Pala
Xenos Group, Inc.
+1-416-657-2400
cpala@xenos.com
Printable Version (PDF: 53 KB)
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 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
