MARKHAM, ONTARIO--(Marketwire - Nov. 16, 2010) - Sangoma Technologies Corporation (TSX VENTURE:STC), today released highlights of its unaudited financial results for the quarter ended September 30, 2010.
|Sales||$||2.51 million||$||3.12 million||-19||%|
|Gross profit||$||1.82 million||$||2.37 million||-23||%|
|Net income before provision for taxes||$||0.10 million||$||0.88 million||-88||%|
|Net income||$||0.05 million||$||0.56 million||-90||%|
|EBITDA||$||0.53 million||$||1.18 million||-55||%|
|Net earnings per share (fully diluted)||$||0.002||$||0.019|
Sales for the first quarter of fiscal 2011 ended September 30, 2010 were a disappointing $2.51 million as compared with $3.12 million for the quarter ended September 30, 2009, a decrease of 19%. This decline in revenue was dominated by the North American market where sales decreased 45% versus the same quarter last year. North America generally (and the United States specifically) have experienced more dramatic and longer lasting effects of the world recession, and Sangoma's sales into these markets have suffered as a result. Further, Sangoma's tight control over marketing and sales activity for the past year or so during the downturn, and a lack of or delay in new product launches, has also had a pronounced effect. Sangoma is taking immediate action in an attempt to correct this issue with a well-considered series of new activities in these areas, under new leadership. Sales outside of North America grew by 28% over the same quarter last year, due primarily to efforts to add/motivate/incent new channel partners and because some of these international markets have recovered more quickly from the recession. While the company believes second quarter revenue may show improvement over the first quarter of fiscal 2011, it is unclear if the quarter ended September 30, 2010 may be reflective of future results. Sangoma will closely monitor the corrective action described above, but does not issue guidance because the size and timing of future orders are uncertain.
Gross margins and operating expenses were fairly consistent with the run-rate from recent quarters. EBITDA for the quarter was $0.53 million as compared to $1.18 million for the quarter ended September 30, 2009, a decrease of 55%.
On September 30, 2010 Sangoma had working capital of $10.66 million, as compared to $10.92 million on September 30, 2010. Working capital on September 30, 2010 included $7.61 million in cash and equivalents.
President and CEO, Bill Wignall, and CFO, David Moore will host a conference call on Wednesday, November 17, 2010 at 11 a.m. Eastern Standard Time to discuss the quarter's results. The dial-in number for the call is 1 800 319 4610. Investors are requested to dial in 5 to 10 minutes before the scheduled start time and ask to join the Sangoma call.
About Sangoma Technologies Corporation
Sangoma is the premium provider of voice and data connectivity components for software-based communication applications. Sangoma's data cards, voice cards, gateways and connectivity software are used in leading PBX, IVR, contact center and data-communication applications worldwide. The product line represents a comprehensive toolset for deploying cost-effective, powerful, and flexible software communication applications.
Founded in 1984, Sangoma Technologies Corporation is publicly traded on the TSX Venture Exchange (TSX VENTURE:STC). Additional information on Sangoma can be found at: www.sangoma.com.
Cautionary Statement Regarding Forward Looking Statements
This press release contains forward-looking statements, including statements regarding the future success of our business, development strategies and future opportunities.
Forward-looking statements include, but are not limited to, statements concerning estimates of expected expenditures, statements relating to expected future production and cash flows, and other statements which are not historical facts. When used in this document, the words such as "could", "plan", "estimate", "expect", "intend", "may", "potential", "should" and similar expressions indicate forward-looking statements.
Although Sangoma believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Forward-looking statements are based on the opinions and estimates of management at the date that the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in forward-looking statements. Sangoma undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by law.
Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other events contemplated by the forward-looking statements will not occur. Although Sangoma believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct as these expectations are inherently subject to business, economic and competitive uncertainties and contingencies. Some of the risks and other factors which could cause results to differ materially from those expressed in the forward-looking statements contained in the management's discussion and analysis include, but are not limited to changes in exchange rate between the Canadian Dollar and other currencies, changes in technology, changes in the business climate, changes in the regulatory environment, the decline in the importance of the PSTN and new competitive pressures. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement.