Holiday Bells are Ringing with Envala's New Mobile Marketing Product, OSYS Chime(TM)
PORT RICHEY, Fla.--(BUSINESS WIRE)-- Envala, based in Port Richey, Fla., announced today the release of OSYS Chime(TM), a new mobile marketing and customer loyalty product that allows users to order "customers on demand" just in time for the holiday shopping season.
A combination of SMS texting, e-mail messaging and marketing consulting, Chime is perfect for restaurants, retailers, car washes, kiosks, specialty stores, fitness centers and golf courses - places needing onsite customers.
According to Dan Stewart, Envala's president and CEO, experts report that 94 percent of all texts are read within minutes of sending, and text marketing response rates can fluctuate from 10.5 percent to as high as 60 percent.1 Compared to a direct mail response rate of 1 1/2 - 2 percent, less the expenses of printing and mailing, Chime is an affordable direct marketing tool to target customers by location as well as time.
"Even at its lowest response rates, Chime blows direct mail out of the water!" Stewart said. "Make an early New Year's resolution and leave the slower and less targeted ways of direct marketing behind."
How OSYS Chime(TM) Works
When a Chime user enrolls, Envala prepares an e-mail and text marketing campaign and posts strategic messages in a Chime account online. Then, when a Chime business wants to target a group of opted-in customers, they simply point and click, or "ring the bell," as Stewart likes to say, and customers can react instantly to the customized message.
"If business is slow, send one of our tailored text messages - like 20% off all lunches today - to your customers with just a few clicks," Stewart said.
Chime for the Holidays
In conjunction with the Chime release, Envala is offering an extensive text-only version of Chime, "Chime for the Holidays," which includes 5,000 text messages to opted-in customers. To see how the program works, text HOLIDAYS to 24463.
"Chime gives business owners a way to order customers on demand," Stewart said. "For our customers, ringing holiday bells will take on a whole new meaning," he said.
For more information about OSYS Chime(TM) and "Chime for the Holidays," go to www.chimeloyalty.com. Envala strictly adheres to anti-spamming regulations in all of its products and services.
About Envala
Founded in 2007 by a team of Inc. 500|5000 award-winning entrepreneurs, Envala helps small businesses Get, Serve and Keep More Customers(TM). By combining the web-based tools and strategic consulting services of the OSYS(TM) System - "Our System, Your Success" - Envala simplifies and automates a variety of complex business processes, including database optimization, e-mail and SMS/mobile marketing. OSYS(TM) Shine, Chime and Mine support diverse companies in 29 states and four countries worldwide. Learn more at www.envala.com.
1 Journal of Targeting, Measurement & Analysis for Marketing; The Mobile Marketing Association
Source: Envala
Strong Earnings Contributions and From LJI's ENZO Division Increases Overall Margins and EPS
Highlights:
-- Revenues total $26.2 million in third quarter, with retail up 24% and
wholesale down 38% from Q3 of 2008
-- Gross profit rises 3%, reflecting revenue increases across both
wholesale and retail divisions
-- Net income rises 201%; EPS increases to $0.05 from $0.02 from year-ago
period
-- ENZO's same-store sales rise 18% year-over-year despite global recession
-- LJI raises guidance for fourth quarter with revenue expectations of over
$30 million and earnings of over $1.9 million, or $0.08 per diluted
share; Full-year 2009 revenues expected to exceed $100 million on
earnings of $3.35 million, or $0.14 per diluted share
-- Company's expansion strategy expected to include 100 new ENZO store
openings over next two years
HONG KONG--(BUSINESS WIRE)-- LJ International Inc. (LJI) (NASDAQ: JADE), a leading jewelry manufacturer and retailer, today reported financial results for its third quarter and nine months ended September 30, 2009.
Revenues for the third quarter of 2009 totaled $26.2 million, down 20% from $33.0 million in the third quarter of 2008. Revenues for LJI's wholesale operations were down 38%, to $14.7 million, from $23.6 million in the year-ago quarter. Revenues from LJI's ENZO retail division rose 24% to a third-quarter record $11.5 million, from $9.3 million in the year-ago quarter.
As expected, the drop in the Company's wholesale revenues was a direct reflection of the global recession, particularly as it relates to the industry-wide slump in demand for luxury items such as jewelry, especially across the United States, LJI's largest wholesale market. However, the decline was offset by continued double-digit revenue gains from its ENZO Division. The increasing success of ENZO is primarily attributable to the growing consumer acceptance of the ENZO brand across China as measured by better than expected sales at existing ENZO stores in addition to successful new store openings. At the end of the third quarter, LJI's ENZO Division had 92 stores in operation, down from 97 a year earlier.
Chairman and CEO - - LJI Positioned to Significantly Benefit from Recovery
"Today's figures clearly highlight how LJ International is uniquely positioned to be one of the first players in the jewelry industry to once again return to a period of rapid expansion and rising profitability as the global economy recovers from its recent slowdown," said LJI Chairman and Chief Executive Officer, Yu Chuan Yih. "On the wholesale side, the most notable aspect of the third-quarter results is in our ability to maintain profitability while we continue to reengineer our overall manufacturing and marketing systems. This is evidence of our 'right-sizing' in wholesale, where we have trimmed overhead to remain profitable in a weak market with healthy cash flows while gaining market share from less robust competitors. In retail, the continued strength of our ENZO retail stores across China, on an overall and comparable-store basis, reflects our success at gaining consumer acceptance and raising the average performance level of our stores. In short, ENZO has earned a significant running start on its planned expansion just as China's economy is once again beginning to emerge as one of the world's largest and most robust markets."
LJI Achieves Margin Improvements at Both Wholesale and ENZO Divisions
The increase in higher-margin retail sales from the Company's ENZO Division as well as a strong Christmas selling season from its wholesale operations resulted in a 3% increase in overall gross profits for the third quarter of 2009, to $9.4 million from $9.1 million in the third quarter of 2008.
The Company's wholesale operations generated $3.1 million in gross profits, or 21% of revenues, compared to $4.4 million, or 19% of revenues, a year earlier. The improvement in wholesale margins was primarily due to higher than expected last minute Christmas orders.
ENZO achieved gross profits of $6.3 million, or 55% of revenues, up from $4.7 million, or 50% of revenues, in the third quarter of 2008. The improvement in gross margins from ENZO was due primarily to changes in the retail chain's inventory mix as well as a continued focus on improving productivity at the store-level.
ENZO'S Record Third-Quarter Earnings Drive Over 200% Growth in Companywide Profits
Net income for the third quarter of 2009 rose 201% to $1.1 million, or $0.05 per fully diluted share, from $0.4 million, or $0.02 per fully diluted share, in the third quarter of 2008. The gain was due primarily to higher operating income, due primarily from growing contributions from the Company's ENZO retail jewelry chain.
Same-Store Sales Growth of 18% at ENZO Sets Path for Accelerated Growth
Same-store sales at ENZO rose 18% in the third quarter of 2009 to an annualized per-store average of $0.5 million from $0.4 million a year earlier. Annualized sales per square foot also rose 18% year-over-year, to $929 from $785 in 2008. The increase was primarily due to ENZO's strengthening brand recognition, new more desirable store locations, a focus on improving overall inventory turns, ongoing improvements in its inventory mix as well as an increase in the total number of transactions. The Company noted that its same-store figures for this period were based on 70 ENZO retail stores that were open for at least 13 months.
ENZO'S Healthy Balance Sheet to Provide Financial Flexibility to Support Growth Strategy
On the balance sheet, LJI reported cash and cash equivalents totaling $8.9 million on September 30, 2009, down from $13.3 million on December 31, 2008. Total current assets declined by $2.7 million to $119.2 million from $121.9 million at the end of 2008. Current liabilities were cut more sharply, to $43.7 million on September 30, 2009 from $49.9 million at the end of 2008. Reductions in this category included cuts in notes payable, to $5.7 million from $9.2 million, and in trade payables, to $14.9 million from $17.9 million. Total working capital was $75.5 million.
Long-term liabilities on September 30, 2009 totaled $2.8 million, compared to $2.2 million on December 31, 2008. The non-current portion of notes payable constituted the bulk of this long-term debt, at $2.7 million at the end of the third quarter and $2.1 million at the end of 2008.
Nine-Month Results Mirror Quarterly Trends
For the nine months ended September 30, 2009, revenues totaled $71.4 million, down 24% from $94.4 million in the comparable period of 2008. Wholesale revenues fell year-over-year by 46% to $37.3 million from $68.7 million. Retail revenues rose 32% to $34.1 million from $25.7 million.
Gross profit for the first nine months of 2009 was $26.2 million, down 6% from $28 million a year earlier. Wholesale gross margins were the same in both periods at 21% as was retail gross margins at 54%. The rising percentage of revenues from higher-margin ENZO retail stores raised overall gross margins to 37% from 30% a year earlier.
LJI Raises Fourth Quarter Financial Guidance with Revenue Expectations of Over $30 Million and Earnings of Nearly $1.9 Million, or $0.08 Per Fully Diluted Share
The Company today also raised its financial guidance for its fourth quarter ending December 31, 2009 with revenue expectations of over $30 million, which would result in total 2009 revenues of over $100 million. Wholesale revenues for the fourth quarter of 2009 are expected to total between $16.5 million to $17.5 million with ENZO fourth quarter revenues of between $13.3 million to $13.8 million. Net income is expected to reach between $1.7 million to $1.9 million, or between $0.06 to $0.08 per fully diluted share, in the fourth quarter of 2009, bringing net income for all of 2009 to approximately $3.4 million, or $0.14 per fully diluted share. The projected quarterly net income would represent an increase of over 40% from the year-ago quarter and 34% on an annualized basis.
Conference Call Information
The Company will conduct a conference call to review today's third quarter results at 4:30 pm ET by dialing (877) 407-9210 and asking for the LJ International Inc. call. Please call at least 10 minutes prior to the start time, or live over the Internet by visiting http://www.JADE 3Q09 Conference Call.com.
To be added to LJI's investor lists, please contact Haris Tajyar at htajyar@irintl.com or at 818-382-9702.
About LJ International Inc.
LJ International Inc. (LJI) (NASDAQ: JADE) is engaged in the designing, branding, marketing and distribution of a full range of jewelry. It has built its global business on a vertical integration strategy and an unwavering commitment to quality and service. Through its ENZO stores, LJI is now a major presence in China's fast-growing retail jewelry market. As a wholesaler, it distributes to fine jewelers, department stores, national jewelry chains and electronic and specialty retailers throughout North America and Western Europe. Its product lines incorporate all major categories, including earrings, necklaces, pendants, rings and bracelets.
Forward-looking Statements: This press release contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. LJ International ("Company") cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this Press Release or made by the Company's management involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond the Company's control. Words such as "estimate," "project," "plan," "believe," "expect," "anticipate," "intend," and similar expressions may identify forward-looking statements. The following factors, in addition to those included in the Company's filings with the Securities and Exchange Commission (SEC), in some cases have affected and in the future could cause the Company's actual results, such as its ability to open approximately 100 new ENZO retail stores by the end of 2011 as well as its financial guidance for both the third quarter of 2009 and beyond, to differ materially from those expressed or implied in any of the forward-looking statements included in this Press Release or otherwise made by management: the current global financial crisis and general economic conditions; changes in consumer spending patterns and consumer preferences; the effects of political and economic events and conditions in the U.S., China as well as other foreign jurisdictions in which the Company operates, including, but not limited to; the impact of competition and pricing; market price of key raw materials; ability to source or purchase raw materials, gemstones and other precious or semi-precious metals from its global supplier base; political instability; currency and exchange risks and changes in existing or potential duties, tariffs or quotas; availability of suitable store locations at appropriate terms; ability to develop new merchandise; ability to hire, train and retain associates; estimates of expenses which the Company may incur in connection with the closure of any underperforming ENZO stores and related direct-to-consumer operations; and the outcome of any pending or future litigation. Future economic and industry trends, both in the jewelry industry as well as geographically in the U.S. and China, which could potentially impact revenue and profitability, are difficult to predict. Therefore, there can be no assurance that the forward-looking statements included in this Press Release will prove to be accurate. In light of the significant uncertainties in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company, or any other person, that the Company's expansion plans, particularly its goal to open approximately 100 new ENZO stores by the end of 2011, will be achieved. The forward-looking statements herein are based on information presently available to the management of the Company. Except as may be required by applicable law, the Company assumes no obligation to publicly update or revise its forward-looking statements.
LJ INTERNATIONAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
Three months ended Nine months ended
September 30 September 30
2009 2008 2009 2008
US$ US$ US$ US$
Operating revenues
Wholesale 14,701 23,627 37,299 68,675
Retail 11,532 9,333 34,058 25,731
26,233 32,960 71,357 94,406
Costs of goods sold
Wholesale (11,634 ) (19,209 ) (29,633 ) (54,529 )
Retail (5,201 ) (4,665 ) (15,523 ) (11,920 )
(16,835 ) (23,874 ) (45,156 ) (66,449 )
Gross profit 9,398 9,086 26,201 27,957
Operating expenses
Selling, general and (4,651 ) (5,975 ) (13,891 ) (20,438 )
administrative expenses
Rental expenses (2,667 ) (2,316 ) (8,135 ) (6,598 )
Net (loss) gain on (289 ) 642 (503 ) 452
derivatives
Depreciation (493 ) (815 ) (1,713 ) (2,628 )
Total operating expenses (8,100 ) (8,464 ) (24,242 ) (29,212 )
Operating income (loss) 1,298 622 1,959 (1,255 )
Other income (expenses)
Interest income 48 36 142 168
Gain on currency - 92 - 1,473
translation
Gain on sales of - 49 - 49
securities
Gain on disposal of - - - 2,210
property
Interest expenses (215 ) (416 ) (640 ) (1,402 )
Total other income (167 ) (239 ) (498 ) 2,498
(expenses)
Income before taxes and 1,131 383 1,461 1,243
minority interests
Income taxes (11 ) (5 ) (26 ) (67 )
Income before minority 1,120 378 1,435 1,176
interests
Minority interests 6 (4 ) 13 (5 )
Net income 1,126 374 1,448 1,171
Earnings per share:
Basic 0.05 0.02 0.06 0.05
Diluted 0.05 0.02 0.06 0.05
Weighted average number
of shares used in 24,427,465 22,759,949 23,889,045 22,336,579
calculating diluted
earnings per share
LJ INTERNATIONAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
As of As of
September 30, 2009 December 31, 2008
(Unaudited) (Audited)
US$ US$
ASSETS
Current assets
Cash and cash equivalents 8,891 13,348
Restricted cash 6,427 6,493
Trade receivables, net of allowance for 19,531 20,570
doubtful accounts
Available-for-sale securities 2,354 2,288
Inventories 77,968 76,637
Prepayments and other current assets 3,998 2,609
Total current assets 119,169 121,945
Properties held for lease, net 725 750
Property, plant and equipment, net 6,158 6,863
Deferred tax assets 111 111
Goodwill, net 1,521 1,521
Total assets 127,684 131,190
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Bank overdrafts 2,857 2,724
Notes payable 5,680 9,194
Capitalized lease obligation, current 107 78
portion
Letters of credit 14,479 13,384
Trade payables 14,867 17,925
Accrued expenses and other payables 3,885 4,802
Income taxes payable 1,452 1,441
Deferred taxation 339 339
Total current liabilities 43,666 49,887
Long-term liabilities
Notes payable, non-current portion 2,700 2,115
Capitalized lease obligation, non-current 109 103
portion
Total liabilities 46,475 52,105
Minority interests 743 756
Shareholders' equity
Common stock, par value US$0.01 each,
Authorized 100 million shares;
Issued 23,761,172 shares as of September
30, 2009
and 22,911,172 shares as of December 31, 238 229
2008
Additional paid-in capital 55,902 55,286
Accumulated other comprehensive loss (290 ) (354 )
Retained earnings 24,616 23,168
Total shareholders' equity 80,466 78,329
Source: LJ International Inc.
BOISE, Idaho, Nov. 11 /PRNewswire-FirstCall/ -- Boise Inc. (NYSE: BZ) today announced plans for a secondary offering of 17 million shares of common stock. Pursuant to the offering, all of the shares will be sold by the selling stockholders, Boise Cascade Holdings, L.L.C., and trusts affiliated with Jason Weiss, one of Boise Inc.'s directors. All proceeds of the offering will go to the selling stockholders.
Boise Cascade Holdings, L.L.C. has granted the underwriters a 30-day option to purchase up to 2.55 million additional shares. After the offering, and assuming no exercise of the underwriters' option, Boise Cascade Holdings, L.L.C. is expected to own approximately 25% of Boise Inc.'s shares.
Goldman, Sachs & Co. is acting as sole book-running manager in connection with the offering. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Effective registration statements relating to these securities are on file with the U.S. Securities and Exchange Commission. A copy of the prospectus and preliminary prospectus supplement may be obtained when they are available by contacting the following:
Goldman, Sachs & Co., Attention: Prospectus Department, 85 Broad Street, New York, NY 10004, facsimile +1-212-902-9316, e-mail prospectus-ny@ny.email.gs.com.
You may also obtain the prospectus and preliminary prospectus supplement when they are available on the U.S. Securities and Exchange Commission's Web site at http://www.sec.gov.
About Boise Inc.
Headquartered in Boise, Idaho, Boise Inc. (NYSE: BZ) manufactures packaging products and papers including corrugated containers, containerboard, label and release and flexible packaging papers, imaging papers for the office and home, printing and converting papers, newsprint, and market pulp.
Forward-Looking Statements
All statements contained in this press release that are not historical facts are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. They are not guarantees of future events. Rather, they are based on current expectations, estimates, beliefs, and assumptions and are subject to uncertainties that are difficult to predict. As a result, actual events or results may differ materially from the statements made. Forward-looking statements made in this press release include that the selling stockholders may sell shares of Boise Inc. common stock, the expected number of shares to be sold, that Boise Cascade Holdings, L.L.C. may grant the underwriters an option to purchase additional shares, and that the underwriters may exercise this option to purchase additional shares from Boise Cascade Holdings, L.L.C. We have based these forward-looking statements upon our assumptions about and assessment of the future, which may or may not prove true. These statements also involve a number of risks and uncertainties, including but not limited to, whether the selling stockholders can sell the shares of common stock at a price that is acceptable, whether the underwriters are able to sell the shares as described, and whether there is adequate demand to justify the exercise of the underwriters' option to purchase additional shares. For further information about the risks associated with this transaction and with our business, in general, please refer to our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission.
SOURCE Boise Inc.
Increases Adjusted EBITDA by 47 Percent to $1.2 Million
Achieves $0.03 Earnings per Share
Initiates Strategy to Scale the Business with Planned Acquisition of WBS Connect
MCLEAN, Va.--(BUSINESS WIRE)-- Global Telecom & Technology, Inc. ("GTT"), (OTCBB: GTLT), a leading global network integrator that provides its clients with a broad portfolio of wide-area network and mobility services, announced today results for the third quarter ended September 30, 2009.
-- Revenue totaled $16.0 million, compared to $16.9 million in the third
quarter of 2008. Revenue was negatively impacted by the weakening of the
Euro and British Pound Sterling to the U.S. Dollar since last year.
-- Gross margin of 28.5 percent declined slightly compared to 29.3 percent
in 2008.
-- As a percentage of revenue, selling, general and administrative ("SG&A")
expenses, excluding non-cash compensation, decreased significantly to
21.0 percent in 2009, compared to 24.5 percent in 2008.
-- Adjusted Earnings Before Interest Taxes Depreciation and Amortization
("EBITDA")* increased 47.0 percent to $1.2 million in 2009 compared to
$0.8 million in 2008.
* See "Annex A: Non-GAAP Financial Information--Adjusted EBITDA" for more information regarding the computation of Adjusted EBITDA.
"In the third quarter, we delivered our ninth consecutive period of strong financial results," stated Richard D. Calder, Jr., president and chief executive officer. "With improved cost controls and operational efficiencies, Adjusted EBITDA increased 47 percent over last year and 13 percent sequentially. We also generated positive operating and net income for the quarter and year-to-date, posting a positive bottom-line for the second straight quarter with earnings per share of $0.03. In addition, during the quarter we continued to sign new customers and expand services to our existing base.
"Now that we are operating at a quarterly Adjusted EBITDA level in excess of $1 million, we are ready to begin scaling the business and drive operational leverage through the acquisition of companies with complementary networking services. Our recently announced definitive agreement to acquire WBS Connect is an important step toward creating a much larger, more profitable company."
"Through sustained positive Adjusted EBITDA and effective working capital management, we further strengthened our balance sheet in the third quarter," said Eric Swank, chief financial officer. "We ended the quarter with $5.9 million in cash, a $1.2 million increase over the prior quarter. These steadily improving results have put us in a strong position to both continue growing organically and take advantage of opportunities to scale more quickly."
Conference Call Information
GTT will hold a conference call on Thursday, November 12 at 8:30 a.m. Eastern Time (5:30 a.m. PT) to discuss its results for the third quarter and the definitive agreement to acquire WBS Connect, announced on November 3, 2009. To hear the conference call live, interested parties may dial 1.888-359-3622 or +1.719.325.2427 and enter passcode 9831049. A simultaneous live webcast of the call will be available over the Internet at www.gt-t.net, under the Investor Relations section of the site. A replay of the call will be available for one month. Interested parties can access the call replay by dialing 1.888.203.1112 or +1.719.457.0820 and using the passcode 9831049. In addition, a replay of the webcast will be available on GTT's website at www.gt-t.net.
About GTT
GTT is a global network integrator that provides its clients with a broad portfolio of wide-area network and wireless mobility services. With over 800 worldwide supplier relationships, GTT combines multiple networks and technologies to deliver cost-effective solutions specifically designed for each client's unique requirements. GTT enhances client performance through its proprietary systems, comprehensive project management, and 24x7 operations support.
Headquartered just outside Washington, D.C. in McLean, Virginia, with offices in London and Dusseldorf, GTT provides service to more than 300 enterprise, government, and carrier clients in over 80 countries, worldwide. For more information visit the GTT website at www.gt-t.net.
Forward-Looking Statements
This release includes certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, which reflect the current views of Global Telecom & Technology, Inc., with respect to current events and financial performance. You can identify these statements by forward-looking words such as "may," "will," "expect," "intend," "anticipate," "believe," "estimate," "plan," "could," "should," and "continue" or similar words. These forward-looking statements may also use different phrases. From time to time, Global Telecom & Technology, Inc., which we refer to as "we", "us" or "our" and in some cases, "GTT" or the "Company", also provides forward-looking statements in other materials GTT releases to the public or files with the United States Securities & Exchange Commission ("SEC"), as well as oral forward-looking statements. You should consult any further disclosures on related subjects in our quarterly reports on Form 10-Q and current reports on Form 8-K filed with the SEC. Such forward-looking statements are and will be subject to many risks, uncertainties and factors relating to our operations and the business environment that may cause our actual results to be materially different from any future results, express or implied, by such forward-looking statements. Factors that could cause GTT's actual results to differ materially from these forward-looking statements include, but are not limited to, the following: our ability to obtain capital; our ability to develop and market new products and services that meet customer demands and generate acceptable margins; our reliance on several large customers; our ability to negotiate and enter into acceptable contract terms with our suppliers; our ability to attract and retain qualified management and other personnel; competition in the industry in which we do business; failure of the third-party communications networks on which we depend; legislation or regulatory environments, requirements or changes adversely affecting the businesses in which we are engaged; our ability to maintain our databases, management systems and other intellectual property; our ability to maintain adequate liquidity and produce sufficient cash flow to fund our capital expenditures and debt service; technological developments and changes in the industry; our ability to complete acquisitions or divestures and to integrate any business or operation acquired; our ability to overcome significant operating losses; and general economic conditions. Additional information concerning these and other important factors can be found under the heading "Risk Factors" in GTT's annual and quarterly reports filed with the Securities and Exchange Commission including, but not limited to, its Annual Report on Form 10-K. Statements in this release should be evaluated in light of these important factors.
Global Telecom & Technology, Inc.
Consolidated Balance Sheets
(Amounts in thousands, except for share and per share data)
September 30, 2009 December 31, 2008
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 5,879 $ 5,786
Accounts receivable, net 6,334 8,687
Deferred contract costs 1,143 1,226
Prepaid expenses and other current assets 580 853
Total current assets 13,936 16,552
Property and equipment, net 1,048 1,302
Intangible assets, net 3,049 4,051
Other assets 406 692
Goodwill 22,000 22,000
Total assets $ 40,439 $ 44,597
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 7,420 $ 11,931
Accrued expenses and other current 6,135 6,654
liabilities
Deferred revenue 3,834 3,961
Total current liabilities 17,389 22,546
Long-term debt 8,796 8,796
Deferred revenue and other long-term 1,770 1,126
liabilities
Total liabilities 27,955 32,468
Commitments and contingencies
Stockholders' equity:
Common stock, par value $.0001 per share,
80,000,000 shares authorized, 15,366,685 2 1
and 14,942,840 shares issued and
outstanding
Additional paid-in capital 58,004 57,584
Accumulated deficit (45,286 ) (45,954 )
Accumulated other comprehensive income (236 ) 498
Total stockholders' equity 12,484 12,129
Total liabilities and stockholders' $ 40,439 $ 44,597
equity
Global Telecom & Technology, Inc.
Consolidated Statements of Operations
(Amounts in thousands, except for share and per share data)
Three Months Ended Nine Months Ended
September 30, September 30, September 30, September 30,
2009 2008 2009 2008
Revenue: $ 16,010 $ 16,882 $ 47,868 $ 50,441
Operating
expenses:
Cost of 11,445 11,937 34,369 35,571
revenue
Selling,
general and 3,492 4,510 10,941 14,223
administrative
expense
Impairment of
goodwill and - 41,854 - 41,854
intangible
assets
Depreciation
and 443 435 1,347 1,812
amortization
Total
operating 15,380 58,736 46,657 93,460
expenses
Operating 630 (41,854 ) 1,211 (43,019 )
income (loss)
Other income
(expense):
Interest (219 ) (203 ) (651 ) (602 )
expense, net
Other income (18 ) - 89 1
(expense), net
Total other
income (237 ) (203 ) (562 ) (601 )
(expense)
Income (loss)
before income 393 (42,057 ) 649 (43,620 )
taxes
Provision for
(benefit from) 1 (433 ) (19 ) (888 )
income taxes
Net income $ 392 $ (41,624 ) $ 668 $ (42,732 )
(loss)
Earnings
(loss) per
share:
Basic $ 0.03 $ (2.78 ) $ 0.04 $ (2.88 )
Diluted $ 0.03 $ (2.78 ) $ 0.04 $ (2.88 )
Weighted
average
shares:
Basic 15,346,917 14,959,715 15,235,459 14,835,224
Diluted 15,653,177 14,959,715 15,405,377 14,835,224
ANNEX A: Non-GAAP Financial Information
Adjusted EBITDA
Adjusted EBITDA represents operating income before depreciation and amortization on a non-GAAP (accounting principles generally accepted in the United States of America) combined basis for the periods presented, and adjusted to exclude certain one-time expenses including costs associated with employee terminations and other non-recurring items and non-cash compensation. GTT presents Adjusted EBITDA as a supplemental measure of GTT's performance. GTT also presents Adjusted EBITDA because GTT believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in its industry and in measuring the ability of issuers to meet debt service obligations.
In evaluating Adjusted EBITDA, you should be aware that in the future GTT may incur expenses similar to the adjustments in this presentation. GTT's presentation of Adjusted EBITDA should not be construed as an inference that GTT's future results will be unaffected by unusual or non-recurring items. Adjusted EBITDA is not a measurement of GTT's financial performance under GAAP and should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with GAAP.
The following is a reconciliation of Adjusted EBITDA to operating loss (in thousands):
Three Months Ended Nine Months Ended
September September 30, 2008 September 30, September 30, 2008
30, 2009 2009
Operating
income $ 630 $ (41,854 ) $ 1,211 $ (43,019 )
(loss)
Depreciation
and 443 435 1,347 1,812
amortization
Impairment
of goodwill
and - 41,854 - 41,854
intangible
assets
Non-cash 125 380 420 742
compensation
Adjusted $ 1,198 $ 815 $ 2,978 $ 1,389
EBITDA
Source: Global Telecom & Technology, Inc.
TORONTO, ONTARIO -- (MARKET WIRE) -- 11/11/09 -- Wilmington Capital Management Inc. (TSX: WCM)(TSX: WCM.A)(TSX: WCM.B) today announced a net loss before tax of $294 thousand for the nine months ended September 30, 2009, compared to net income of $242 thousand in the same period in 2008. Including tax provisions, the company recorded a net loss of $221 thousand compared to $294 thousand in 2008. Net loss per Class A and Class B share for the nine months ended September 30 was $0.03, compared to $0.04 per share in the same period last year. The decrease in net income before taxes was due to the receipt during the first quarter of 2008 of minimum rent guarantee payments totaling $303 thousand relating to the sale of 181 University Avenue by the company in 2006. In addition, income tax expense during the first quarter of 2008 included a non-cash charge of $466 thousand, reflecting a revaluation of the difference between book value and tax value of the company's net assets.
Net loss for the three months ended September 30, 2009 was $65 thousand or $0.01 per Class A and Class B shares, compared with a net loss of $67 thousand or $0.01 per share for the same period in 2008.
Wilmington holds an 8% fully diluted interest in Parkbridge Lifestyle Communities Inc. (PRK.TO), an owner operator of manufactured home and recreational communities. During the third quarter, Parkbridge completed an equity offering of 5,000,000 common shares at a price of $4 per common share. The company acquired 250,000 common shares of this equity offering. Wilmington also owns land leased to commercial property owners which is located at 370 Third Street in San Francisco, California. Wilmington is considering alternatives to maximize the value for shareholders of its real estate investment, which could include the sale or restructuring of this holding.
The company's objective is to generate appreciation in value from its existing investments as opposed to current income. Accordingly, net income is expected to be minimal. In this regard, as at September 30, 2009, the fair value of the company's investment in Parkbridge of $21.5 million reflects unrealized capital gains of $4.4 million.
CONSOLIDATED STATEMENTS OF
OPERATIONS
Three months ended Nine months ended
(unaudited) September 30 September 30
$thousands, except per share
amounts 2009 2008 2009 2008
--------------------------------------------------------------------------
Income
Investment and other $ (7) $ 21 $ (35) $ 83
Income producing properties 317 310 1,024 1,213
--------------------------------------------------------------------------
310 331 989 1,296
--------------------------------------------------------------------------
Expenses
Operating 22 35 143 118
Interest 357 411 1,140 936
--------------------------------------------------------------------------
379 446 1,283 1,054
--------------------------------------------------------------------------
Net (loss) income before
income taxes (69) (115) (294) 242
Income tax recovery (expense) 4 48 73 (536)
--------------------------------------------------------------------------
Net loss $ (65) $ (67) $ (221) $ (294)
--------------------------------------------------------------------------
Net loss per Class A and Class
B share $ (0.01) $ (0.01) $ (0.03) $ (0.04)
--------------------------------------------------------------------------
CONSOLIDATED BALANCE
SHEETS
(unaudited)
September 30 December 31
$thousands 2009 2008
--------------------------------------------------------------------------
Assets
Cash and cash
equivalents $ 1,388 $ 3,542
Investment in Parkbridge
Lifestyle Communities Inc. 21,485 13,344
Income producing
property 19,328 22,088
Other assets 242 414
Future income taxes - 78
--------------------------------------------------------------------------
$ 42,443 $ 39,466
--------------------------------------------------------------------------
Liabilities &
Shareholders' Equity
Accounts payable and
other liabilities $ 647 $ 1,269
Future income taxes 1,027 -
Secured debt 20,288 23,153
Loan payable 10,428 10,694
--------------------------------------------------------------------------
32,390 35,116
Shareholders' equity 10,053 4,350
--------------------------------------------------------------------------
$ 42,443 $ 39,466
--------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME (LOSS)
Three months ended Nine months ended
(unaudited) September 30 September 30
$thousands 2009 2008 2009 2008
--------------------------------------------------------------------------
Net loss $ (65)$ (67) $ (221)$ (294)
--------------------------------------------------------------------------
Other comprehensive
income (loss)
Foreign currency
translation (43) 49 (44) 81
Available-for-sale
securities 1,560 (3,098) 7,141 (6,615)
Future income taxes in
above items (245) 519 (1,173) 1,108
--------------------------------------------------------------------------
1,272 (2,530) 5,924 (5,426)
--------------------------------------------------------------------------
Comprehensive income
(loss) $1,207 $ (2,597) $ 5,703 $ (5,720)
--------------------------------------------------------------------------
Joseph F. Killi, President and Chief Executive Officer will be available at 416-867-9370 to answer any questions on the company's financial results.
This news release contains forward-looking statements concerning the company's business and operations. The company cautions that, by their nature, forward-looking statements involve risk and uncertainty and the company's actual results could differ materially from those expressed or implied in such statements. Reference should be made to the most recent Annual Information Form for a description of the major risk factors.
Contacts: Wilmington Capital Management Inc. Joseph F. Killi President and Chief Executive Officer 416-867-9370
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