Amadeus Achieves Substantial Revenue Growth in Q1
Quarter Highlights:
- A growth of 464% of the total revenues and more than 100% for revenues of software licenses, those numbers compared to the Q1 of last year
- Decrease of 63% of the loss before interest, income taxes and amortization compared to Q1 of last year
- Restructuring of management, sales and marketing team
First quarter Financial Results
Amadeus’s revenues increased by 463.6% to $1,426,376 for the quarter ended September 30, 2005, compared with $253,096 for the same quarter last year. This increase is attributable mainly to the services revenues jumping from $4,980 in the first quarter of 2005 to $1,135,713 for the same period in 2006, following the acquisition of M3K Solutions on June 1, 2005. Otherwise, software licensing revenues increase by 102.9% resulting from strategic changes in the sales team, the marketing effort in the United States and the stronger recognition of eQCM® web solution to handle compliance issues.
Research and development expenses decreased by 2.7% to $204,413 in the quarter from $210,076 in the first quarter of 2005. Investment in research and development is a priority for Amadeus management.
Due mainly to the strengthening of the sales force to better serve the U.S. market and from additional expenses incurring in managing a public company, operating expenses increased by 48% to total $701,206 for the first quarter of 2006, compared with $473,737 for the same quarter in fiscal 2005.
Depreciation and amortization expenses rose 512.2% to $195,745 in the quarter from $31,976 in 2005. This increase is attributable to the amortization of the identifiable intangible assets arising from the acquisition of M3K Solutions in June 2005.
As a result, Amadeus incurred a net loss of $465,802 or $0.01 per share in the first quarter of 2006, compared with a net loss of $590,316 or $0.03 per share the previous year. The loss before financial expenses, income tax on earning and amortization (EBITDA) decrease from 63.3% to $179,393 compare with $488,822 in the corresponding quarter last year. The weighted average number of common shares issued and outstanding rose from 19,237,253 the first quarter of 2005 to 34,831,379, in the quarter ended September 30, 2005, due to the issue of 7,050,000 and 2,756,463 common shares respectively in connection with the qualifying transaction and the concurrent private placement in December 2004, and to the issue of 5,428,571 common shares as part of the acquisition of M3K Solutions in June 2005.
Financial Position
The Company had total assets of $6,443,093 as at September 30, 2005, up from $6,307,971 on June 30, 2005. Current assets amounted to $2,592,945 as at September 30, 2005, versus $2,230,906 a quarter earlier.
Total liabilities amounted to $6,618,901 at the close of quarter the first of 2006, compared with $6,042,317 as at June 30, 2005. As for current liabilities, they totalled $3,061,647 as at September 30, 2005, versus $2,338,443 a quarter earlier. Amadeus posted a working capital deficiency of $468,702 as at September 30, 2005.
Shareholders’ equity deficit is $175,808 at the end of the first quarter, down from equity of $265,654 as at June 30, 2005. The number of common shares issued and outstanding stood at 34,381,378 by the close of the first quarter of 2006.
Outlook
«Over the coming quarters, we will be increasing our marketing efforts of compliance process control in the American market. We will continue the integration of our consultation activities in regards to corporate governance (Sarbanes Oxley and law 198) to our software application in order to offer more complete and competitive solution. We are determined to become profitable on the EBITDA level over the coming quarters by significantly increasing our software revenues and managing in a conservative manner. We will also remain on the lookout for strategic partnerships that will benefit Amadeus” states Mr. Benoît Côte, Chairman of the Board.
Subsequent Event
As of November 9, 2005 Amadeus announced an Independent Software Vendor (ISV) relationship with EMC to develop and sublicense applications on the EMC Documentum platform. Integrating eQCM with the EMC Documentum platform will enable organizations to create, manage, deliver and archive content that drives business operations without expensive customization; providing a unique approach that moves organizations to a higher level of compliance maturity.
On October 18, 2005 Amadeus announced the restructuring of its executive management team to accelerate global business operations. « Since the recent acquisition of M3K Solutions and the recent expansion of global operations, Amadeus had a unique opportunity to streamline the existing management team and refocus resources to improve the company's market approach » mentioned Mr. Benoît Côte.
Forward-looking statements
Forward-looking statements contained in this press release involve known and unknown risks, uncertainties or other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
About Amadeus International
Amadeus International is a pioneer and leader in compliance process control solutions. Its flagship product, eQCM®, is a flexible, Web-based integrated suite of applications that allow organizations to map regulated business processes such as CAPA, non-conformances, customer complaints, audits, and other related quality and business processes. The application suite is coupled with powerful business intelligence capabilities, enterprise content management, and related technologies that help organizations achieve sustained compliance. Amadeus International's global headquarters are located in Quebec City. Amadeus solutions are distributed across four continents.
Financial Highlights
|
Quarter ended September 30, 2005 |
Quarter ended September 30, 2004 |
|
|
|
Revenues |
$1,426,376 |
$253,096 |
Gross profit |
$726,226 |
$194,991 |
Operating expenses |
$905,619 |
$683,813 |
EBITDA * |
$(179,393) |
$(488,822) |
Net loss |
$(465,802) |
$(590,316) |
Weighted average number of shares issued and outstanding |
34,831,379 |
19,237,253 |
|
As at September 30, 2005 |
As at September 30, 2004 |
Total assets |
$6,443,093 |
$3,727,192 |
Long-term debt |
$1,286,688 |
$109,428 |
Shareholders’ equity (Deficit) |
$(175,808) |
$(507,152) |
* Definition of EBITDA: Earnings (loss) before financial expenses, income tax on earning and amortization. EBITDA is presented as an additional measurement of earnings in
order to assist the reader to establish the Company’s ability to generate cash from activities and to acquit its financial charges. It is also an indicator generally used for purposes of evaluation. Canadian generally accepted accounting principles give no standard interpretation to this measurement and it cannot therefore be compared to similar measurements used by other enterprises.
Information:
Frédéric Garand, Vice President and Chief Financial Officer
Tel.: (418) 525-0606, ext. 268
frederic.garand@amadeussolutions.com
Isabelle Rivoal, Marketing and Communications Manager
Tel.: (418) 525-0606,ext. 2231
isabelle.rivoal@amadeussolutions.com
