IBEX Technologies Inc. (TSX VENTURE: IBT) today reported its
financial results for the nine months ended April 30, 2011.
FINANCIAL RESULTS FOR THE THIRD QUARTER OF FISCAL 2011
Sales for the quarter ended April 30, 2011 totaled $597,074, an
increase of 27% as compared to $469,502 in the same period of the
prior year. The increase in sales can be attributed to a return to
a normal ordering pattern by one of our major customers.
"We are pleased to see a return to more normal selling patterns,
however the strong Canadian dollar continues to have a negative
impact on our business profitability when compared to year-ago",
said Paul Baehr, IBEX President and CEO.
Excluding financial and R&D expenses, operating expenses for
the third quarter ended April 30, 2011 decreased 22% from $659,431
to $451,558. A significant portion of this reduction was due to an
inventory related accounting gain which will be reversed in the
next quarter.
The Company recorded net earnings of $131,577 compared to net
earnings of $137,927 for the same period year ago. This decrease in
net earnings is principally due to several factors such as:
-- lower currency gains related to forward contracts
-- increase in R&D expenses
-- increase in amortization expenses related to investments in new
equipment
Due primarily to investment in inventory and capital assets,
cash, cash equivalents, and marketable securities decreased 11%
during the quarter ended April 30, 2011 to $1,986,434 from
$2,231,287 as of January 31, 2011. The Company's working capital
was $2,750,754 as at the end of the third quarter ended April 30,
2011 up from $2,598,828 as at the end of the prior quarter ending
January 31, 2011. This increase in working capital traces to an
increase in current assets such as inventory and accounts
receivable.
FINANCIAL RESULTS FOR THE YEAR TO DATE
Reported sales for the nine months ended April 30, 2011 totaled
$1,485,699, a decrease of 25% as compared to $1,987,196 for the
same period in the prior year. This decrease in sales is
principally due to a reduction in orders in both the enzymes and
arthritis product lines. The reduction in the enzymes line was due
to a temporary adjustment of inventories by our key customers,
whose ordering pattern has now returned to normal. The reduction in
arthritis assays stemmed from a decrease in the number of arthritis
trials conducted by our key customers.
Research and development expenses for the nine months ended
April 30, 2011 totaled $225,021 compared to $7,980 in the nine
months ending April 31, 2010. In the third quarter of fiscal 2010,
the Company hired new scientific specialists to work on its
arthritis assays product line and should introduce new assays with
financial benefits in Fiscal 2012.
Net loss for the nine months ended April 30, 2011 was $199,641,
compared to net earnings of $634,797, for the same period in
previous fiscal year. This net loss is mainly due to lower currency
gains made on hedging against the US dollar, lower sales, and to
the increase in R&D expenses.
Excluding R&D and financial expenses, operating costs for
the nine months ended April 30, 2011 decreased to $1,503,945 from
$1,762,712, principally due to a higher inventory allocation (the
transfer of expenses to the balance sheet as a result of producing
in current quarters for sale in future quarters), as well as
reduced compensation costs.
Owing primarily to increased investment in inventory and capital
assets, cash, cash equivalents, and marketable securities decreased
34% over the nine months ended April 30, 2011 to $1,986,434 from
$3,033,556 on July 31, 2010. Working capital decreased to
$2,750,754 on April 30, 2011 from $3,278,875 as at July 31,
2010.
Financial Summary for the nine months ending
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April 30, 2011 April 30, 2010
Revenues $1,485,699 $1,987,196
(Loss) Earnings Before Interests, Tax,
Depreciation & Amortization ($99,730) $717,180
Depreciation & Amortization $117,655 $93,676
Net (Loss) Earnings ($199,641) $634,797
(Loss) Profit per Share ($0.01) $0.03
Cash, Cash Equivalents & Marketable
Securities $1,986,434 $2,973,894
Working Capital $2,750,754 $3,482,086
Outstanding shares at report date (Common
Shares) 24,703,244 24,703,244
LOOKING FORWARD
Fiscal 2011 looks to be a difficult year for IBEX due to
softness in the US business environment and the strong Canadian
dollar.
Despite a difficult outlook for Fiscal 2011, we have made two
important investments in our future. IBEX has recently completed a
project to add additional enzyme-related manufacturing capacity,
and has also re-established a small R&D group with the object
of adding to our line of arthritis immunoassays and also improving
our existing assays. We expect to introduce new assays in calendar
2011, with financial benefits accruing in the second half of Fiscal
2012.
ABOUT IBEX
The Company manufactures and markets a series of proprietary
enzymes (heparinases and chondroitinases). These enzymes are used
in pharmaceutical research, quality assurance, and in the case of
Heparinase I, in diagnostic devices which measure hemostasis in
patients.
IBEX also manufactures and markets a series of arthritis assays
which are widely used in pharmaceutical research. These assays
enable the measurement of both the synthesis and degradation of
cartilage components, and are powerful tools in the study of osteo-
and rheumatoid arthritis.
For more information, please visit the Company's web site at
www.ibex.ca.
Safe Harbor Statement
All of the statements contained in this news release, other than
statements of fact that are independently verifiable at the date
hereof, are forward-looking statements. Such statements, based as
they are on the current expectations of management, inherently
involve numerous risks and uncertainties, known and unknown. Some
examples of known risks are: the impact of general economic
conditions, general conditions in the pharmaceutical industry,
changes in the regulatory environment in the jurisdictions in which
IBEX does business, stock market volatility, fluctuations in costs,
and changes to the competitive environment due to consolidation or
otherwise. Consequently, actual future results may differ
materially from the anticipated results expressed in the
forward-looking statements. IBEX disclaims any intention or
obligation to update these statements.
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CONSOLIDATED BALANCE SHEETS
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April 30, July 31,
UNAUDITED 2011 2010
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$ $
ASSETS
Current assets
Cash and cash equivalents 1,286,434 2,333,556
Marketable securities - 300,000
Accounts receivable 410,154 422,761
Inventories 452,229 226,364
Prepaid expenses 101,730 68,236
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Sub-total current assets 2,250,547 3,350,917
Long term deposit 10,500 8,650
Marketable securities 700,000 400,000
Property and equipment 1,128,007 760,384
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Total assets 4,089,054 4,519,951
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LIABILITIES
Current liabilities
Accounts payable and accrued liabilities 199,793 472,042
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Total liabilities 199,793 472,042
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SHAREHOLDERS' EQUITY
Capital stock 52,660,078 52,660,078
Contributed surplus 563,753 522,760
Deficit (49,334,570) (49,134,929)
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Total shareholders' equity 3,889,261 4,047,909
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Total liabilities and shareholders' equity 4,089,054 4,519,951
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CONSOLIDATED STATEMENTS OF DEFICIT April 30, April 30,
2011 2010
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$ $
Balance - Beginning of period (49,134,929) (49,641,291)
Net (loss) earnings for the period (199,641) 634,797
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Balance - End of period (49,334,570) (49,006,494)
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CONSOLIDATED STATEMENTS OF EARNING AND COMPREHENSIVE INCOME
UNAUDITED
Three months ended Nine months ended
April 30 April 30
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2011 2010 2011 2010
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$ $ $ $
Revenue 597,074 469,502 1,485,699 1,987,196
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Operating expenses
Research and Development
expenses (84,263) (7,980) (225,021) (7,980)
Selling, general and
administrative expenses
and cost of goods sold (401,562) (633,496) (1,385,840) (1,669,035)
Amortization of property
and equipment (49,996) (25,935) (117,655) (93,676)
Other interest and bank
charges (2,370) (3,161) (7,331) (9,796)
Foreign exchange gain 60,207 353,029 32,763 437,989
Writteoff of property
and equipment - (21,194) - (21,194)
Investment income 12,487 7,162 17,744 11,293
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Total operating expenses (465,497) (331,575) (1,685,340) (1,352,399)
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Net earnings (loss) and
other comprehensive
income 131,577 137,927 (199,641) 634,797
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Net earnings (loss) and
other comprehensive
income per share
Basic and diluted $ 0.01 $ 0.01 ($0.01) $ 0.03
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See accompanying notes
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CONSOLIDATED CASH FLOW
STATEMENTS Three months ended Nine months ended
April 30 April 30
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UNAUDITED 2011 2010 2011 2010
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$ $ $ $
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Cash flows provided by
(used in):
Operating activities
Net earnings (loss) for
the period 131,577 137,927 (199,641) 634,797
Items not affecting cash -
Amortization of property
and equipment 49,996 25,935 117,655 93,676
Stock-based compensation
costs - 9,375 40,993 70,155
Gain on disposal of
property and equipment - -
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Cash flow relating to
operating activities 181,573 173,237 (40,993) 798,628
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Net changes in non-cash
working capital items -
(Increase) decrease in
accounts receivable (101,014) (37,327) 12,607 443,184
(Increase) decrease in
inventories (162,241) 37,046 (225,865) (5,405)
(Increase) in prepaid
expenses (73,615) (92,826) (35,344) (39,470)
(Decrease) increase in
accounts payable and
accrued liabilities (61,757) 104,662 (272,249) (285,700)
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Net changes in non-cash
working capital balances
relating to operations (398,627) 11,555 (520,851) 112,609
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Cash flow relating to
operating activities (217,054) 184,792 (561,844) 911,237
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Investing activities
Additions to property and
equipment (27,799) (115,788) (485,280) (197,688)
- -
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Cash flow relating to
financing activities (27,799) (115,788) (485,280) (197,688)
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(Decrease) Increase in
cash and cash equivalents
during the quater (244,853) 69,004 (1,047,124) 713,549
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Cash and cash equivalents
- Beginning of period 2,231,287 2,904,890 3,033,558 2,260,345
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Cash and cash equivalents
- End of period 1,986,434 2,973,894 1,986,434 2,973,894
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The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this release.
Contacts: Paul Baehr President & CEO IBEX Technologies Inc.
514-344-4004 x 143
Ibex Technologies (TSXV:IBT)
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