MARKHAM, ONTARIO–(Marketwire – Nov. 28, 2012) – Sangoma Technologies Corporation (TSX VENTURE:STC), a leading provider of hardware and software components that enable or enhance IP Communications Systems for both voice and data, today announced highlights of its unaudited consolidated interim financial statements under IFRS for the first quarter of fiscal 2013, ended September 30, 2012.
Sales for the fourth quarter of fiscal 2012 were $3.02 million, just marginally higher than those of the same period last year. As in prior years, Sangoma’s sales in the first quarter were below those of the fourth quarter of the prior year, owing to seasonally lower demand during summer months, a trend that the company expects will continue.
“Our quarterly revenue was slightly below what we would have liked for a first quarter and also just slightly lower than we anticipated”, said Bill Wignall President and CEO of Sangoma. “We believe this is a timing issue due primarily to the lumpiness we have described over recent quarters, since Sangoma is now deriving revenues from some larger customers with longer sales cycles, and this can make it difficult to forecast when a particular order might be received. We remain focused on growth and we believe that our strategy of developing more products, for sales to more customer segments in more geographies, will deliver that growth in fiscal 2013. The ongoing economic climate makes this challenging, and while our revenue growth did not match our own expectations, even Sangoma’s modest growth in our first quarter continues to outperform our key competitors whose sales have been declining.”
|Q1 FY2013||Q1 FY2012||Change||Q4 FY2012||Change|
|Sales||$||3.02 m||$||3.01 m||0||%||$||3.71 m||(19||%)|
|Gross profit||$||2.16 m||$||2.19 m||(1||%)||$||2.36 m||(8||%)|
|Operating Expense||$||2.15 m||$||1.38 m||56||%||$||2.40 m||(10||%)|
|Operating Income1||$||0.01 m||$||0.81 m||(99||%)||-$0.04 m||(125||%)|
|Net income||$||0.01 m||$||0.46 m||(98||%)||-$0.31 m||(103||%)|
|Net earnings per||$||0.000||$||0.015||$||(0.010||)|
|share (fully diluted)|
|EBITDA1||$||0.13 m||$||0.68 m||(81||%)||$||0.09 m||44||%|
|1 Operating Income and EBITDA are metrics used by the Company to monitor its performance and the definitions may be found in the accompanying MD&A posted today at www.sedar.com.|
Gross profit was $2.16 million for the quarter or 72% of revenue, slightly below the 73% in the same period of 2012, and somewhat above the percentages experienced over recent quarters which are more representative of Sangoma’s business going forward.
Operating expense for the first quarter was $2.15 million, or about one-quarter of a million dollars below that of the immediately prior fourth quarter, as the company’s sales and marketing spending is aligned with quarterly revenues. Operating expenses were significantly above last year’s first quarter due principally to a large swing in the US/C$ exchange rate. Excluding this foreign exchange impact, the increase in operating expenses was 7% over last year, reflecting the slowing in the rate of expense growth as spending has neared equilibrium.
Operating Income was $0.01 million for the quarter, $0.80 million below that of the same quarter last year, driven primarily by the exchange rate impact noted above.
Net Income for the quarter ended September 30, 2012 was $0.01 million ($0.000 per share fully diluted), compared to net income of $0.46 million ($0.015 per share fully diluted) for the quarter ended September 30, 2011.
Sangoma continues to have a solid cash balance of $4.53 million and had working capital of $11.33 million on September 30, 2012 as compared to $11.39 million on June 30, 2012 one quarter ago.
President and CEO, Bill Wignall, and CFO, David Moore will host a conference call on December 3, 2012 at 11.30am Eastern Standard Time to discuss the quarterly and annual results. The dial-in number for the call is 1-800-319-4610 (International 1-604-638- 5340). Investors are requested to dial in 5 to 10 minutes before the scheduled start time and ask to join the Sangoma call.