VIQ Solutions Inc. (TSX VENTURE:VQS) ("VIQ Solutions" or the "Corporation"), a
world leader in computer-based digital audio and video capture and management,
today reported its financial results for the three month period ended March 31,
2013. Results are reported in Canadian dollars and are prepared in accordance
with International Financial Reporting Standards ("IFRS").
"VIQ Solutions achieved solid financial results in the quarter resulting in
positive net income, EBITDA(1) and cash flow," said David Outhwaite, President
and Chief Executive Officer of VIQ Solutions. "With a full pipeline and growing
reputation around the world, we look to continue to build on the momentum we
established in 2012."
Financial Highlights for the Quarter
-- Revenue was $3.9 million for the three month period ended March 31, 2013
as compared to $4.0 million for the same period in 2012, representing a
decrease in revenue of 2%;
-- Selling and administrative expenses were $1.4 million three month period
ended March 31, 2013, unchanged from the same period in 2012;
-- Research and development expenses were $183,624 for the three month
period ended March 31, 2013 as compared to $182,528 for the previous
year as we continue to invest in new and existing products and services;
-- EBITDA for the three month period ended March 31, 2013 was $171,176 as
compared to $173,518 for the same period in 2012;
-- Net income for the three month period ended March 31, 2013 was $113,483
as compared to $113,902 for the same period in 2012; and
-- Cash flows from operating activities were $447,757 for the three month
period ended March 31, 2013 as compared to a cash use of $110,255 for
the same period in 2012 primarily due to changes in investment in
working capital.
Business Highlights for the Quarter
-- Improved ranking on the 2013 Branham300 list of Top 250 Canadian
Information and Communication Technology (ICT) companies, rising 16
spots in this years' edition to rank 149th;
-- Released our new product VIQ Infinit, an innovative digital media
capture and management platform which offers seamless integration with
advanced high-definition digital video systems, along with easily
accessible industry and language profiles for expanded market coverage
worldwide; and
-- Announced plans to implement cost efficiencies to reduce Spark &
Cannon's general and administrative expenses by approximately 33%,
through a combination of staff count reductions and decreasing the
amount of office space to be leased by Spark & Cannon while preserving
all of the strategic initiatives surrounding our core competencies.
Note
1. EBITDA is a non-IFRS earnings measure which does not have any standardized
meaning prescribed by IFRS and therefore may not be comparable to EBITDA
presented by other companies. EBITDA represents earnings before interest
expense, income taxes, depreciation and amortization. This measure is important
to management since it is used by potential investors to evaluate the
Corporation's operating performance and ability to incur and service debt, and
as a valuation metric. Investors are cautioned that this non-IFRS financial
measure should not be construed as an alternative to other measures of financial
performance calculated in accordance with IFRS.
Additional Information
The unaudited first quarter 2013 condensed consolidated interim financial
statements and results of operations and Management's Discussion and Analysis of
Results and Financial Condition for the three month period ended March 31, 2013
will be posted on VIQ Solutions' website (under Investor Relations) at
www.viqsolutions.com and on SEDAR's website at www.sedar.com. The financial
information included in this release is qualified in its entirety and should be
read together with the unaudited first quarter 2013 condensed consolidated
interim financial statements and the audited consolidated financial statements
for the year ended December 31, 2012, including the notes thereto.
About VIQ Solutions Inc.
VIQ Solutions is a global leader in computer-based digital audio and video
capture and management. We develop software solutions that capture, digitize,
and compress audio and video data, which is securely stored in a multi-tiered
server system where it is easily searchable and shareable. Our innovative media
processor technology allows users to remotely control audio-video capture in
multiple locations from a single satellite location, allowing large-scale and
complex installations to be managed efficiently by fewer resources. VIQ
Solutions' technologies are installed in courts, legislative assemblies, law
enforcement and hearing rooms around the world.
Forward-looking Statements
This release contains forward-looking statements and other statements concerning
the Corporation's objectives and strategies and management's beliefs, plans and
intentions about our achievements, goals, performance and other future events.
These statements involve risks and uncertainties, which may cause actual results
to differ materially from the statements made. When used in this press release,
the words "anticipate", "believe", "could", "estimate", "expect", "intend",
"may", "plan", "will", "would" and similar expressions are intended to identify
forward-looking statements. Such statements reflect VIQ Solutions' current views
with respect to future events and are subject to such risks and uncertainties.
Many factors could cause our actual results to differ materially from the
statements made due to a number of factors including risks related to our
ability to successfully execute our business plan which includes our revenue
growth, our liquidity, our operating results, our technology and products.
Should one or more of these risks or uncertainties materialize, or should
assumptions underlying the forward-looking statements prove incorrect, actual
results may vary materially from those described herein as intended, planned,
anticipated or expected. VIQ Solutions does not intend and does not assume any
obligation to update these forward-looking statements.
VIQ Solutions Inc.
Condensed Consolidated Interim Balance Sheets
(Expressed in Canadian dollars)
(Unaudited)
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March 31, December 31,
2013 2012
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Assets
Current assets
Cash $ 1,552,655 $ 1,129,107
Trade and other receivables 2,102,705 1,989,208
Inventories 6,008 6,287
Prepaid expenses 75,393 112,980
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3,736,761 3,237,582
Non-current assets
Restricted cash 158,945 155,190
Property and equipment 679,131 700,110
Goodwill 1,635,210 1,614,278
Deferred tax assets 231,339 225,877
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$ 6,441,386 $ 5,933,037
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Liabilities
Current liabilities
Trade and other payables $ 1,329,303 $ 1,078,996
Income taxes payable 132,114 128,995
Provisions 556,202 622,727
Unearned revenue 293,230 147,291
Deferred lease incentives 21,314 20,966
Current portion of obligations under finance
lease 59,455 60,103
Current portion of long-term debt 22,692 22,692
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2,414,310 2,081,770
Non-current liabilities
Provisions 145,274 131,615
Deferred lease incentives 24,929 29,582
Obligations under finance lease 61,834 70,929
Long-term debt 42,389 48,062
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Total liabilities 2,688,736 2,361,958
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Equity
Capital stock 11,578,213 11,578,213
Contributed surplus 1,839,861 1,818,206
Accumulated other comprehensive income 188,685 142,252
Deficit (9,854,109) (9,967,592)
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3,752,650 3,571,079
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Total equity and liabilities $ 6,441,386 $ 5,933,037
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VIQ Solutions Inc.
Condensed Consolidated Interim Statements of Comprehensive Income
(Expressed in Canadian dollars)
(Unaudited)
---------------------------------------------------------------------------
Three months ended March
31
2013 2012
---------------------------------------------------------------------------
Revenue $ 3,906,662 $ 3,969,214
Cost of sales 2,246,161 2,286,589
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Gross profit 1,660,501 1,682,625
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Expenses
Selling, general and administrative expenses 1,354,314 1,391,754
Research and development expenses 183,624 182,528
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1,537,938 1,574,282
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Income from operations 122,563 108,343
Interest income 7,484 9,424
Interest expense (7,699) (8,566)
Foreign exchange gain (loss) (8,865) 4,701
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Net finance income (loss) (9,080) 5,559
Net income for the period $ 113,483 $ 113,902
Item that may be reclassified to profit or loss:
Exchange differences on translating foreign
operations 46,433 (16,000)
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Comprehensive income for the period $ 159,916 $ 97,902
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Net income per share
Basic and diluted $ 0.00 $ 0.00
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Weighted average number of common shares
outstanding - basic 90,957,000 90,638,538
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Weighted average number of common shares
outstanding - diluted 90,957,000 90,707,886
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VIQ Solutions Inc.
Condensed Consolidated Interim Statements of Cash Flows
(Expressed in Canadian dollars)
(Unaudited)
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Three months ended March
31
2013 2012
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Cash provided by (used in):
Operating activities
Net income for the period $ 113,483 $ 113,902
Items not affecting cash:
Depreciation 49,994 51,050
Stock-based compensation 21,655 43,286
Provisions 13,659 8,564
Amortization of deferred lease incentive (4,305) (5,868)
Unrealized foreign exchange loss (gain) (817) (4,514)
Changes in non-cash operating working capital 254,088 (316,675)
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Cash from (used in) operating activities 447,757 (110,255)
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Investing activities
Purchase of property and equipment (16,257) (15,437)
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Cash used in investing activities (16,257) (15,437)
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Financing activities
Repayment of long-term debt (5,673) (5,673)
Proceeds from stock options exercised for cash - 81,000
Finance lease payments (15,958) (17,155)
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Cash provided by (used for) financing activities (21,631) 58,172
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Net increase (decrease) in cash during the period 409,869 (67,520)
Cash, beginning of period 1,129,107 1,646,138
Effect of exchange rate changes on cash 13,679 (1,315)
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Cash, end of period $ 1,552,655 $ 1,577,303
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FOR FURTHER INFORMATION PLEASE CONTACT:
VIQ Solutions Inc.
David Outhwaite
President & CEO
(905) 948-8266 ext. 250
douthwaite@viqsolutions.com
VIQ Solutions Inc.
Karen Hersh
Chief Financial Officer
(905) 948-8266 ext. 240
khersh@viqsolutions.com
www.viqsolutions.com
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