VANCOUVER, British Columbia, Aug. 11, 2005 (PRIMEZONE) -- Visiphor Corporation ("Visiphor") (OTCBB:VISRF); (TSX-V:VIS); (XETRA:IGYA) announced today that its revenues for the first six months were $1,245,248, an increase of 106% over the previous year's period of $603,140 and an increase of 20% over the 2004 revenues for the entire year of $1,032,970. In addition, as of June 30, 2005 Visiphor has recorded deferred revenues of $671,578, which consist of cash received in advance of completion of projects currently in progress. The revenues plus the deferred revenue represent combined sales of $1,916,826 for the year-to-date. Visiphor has also received orders totaling an additional $1,900,000 that are not recorded in the financial statements at June 30, 2005. Consequently, Visiphor expects that revenues will increase in the final two quarters of 2005 when compared to the final two quarters of 2004 and will continue to increase as the company's new products and solutions continue to gain increasing customer acceptance.
Operating expenses totaled $4,261,730 for the six-month period in 2005, which is 24% higher than the 2004 operating expenses of $3,444,694. The 2005 expenses include stock-based compensation of $494,261 and $794,740 in amortization, which includes $645,426 in amortization costs for the intellectual property acquired in the Briyante acquisition. Excluding these non-cash charges the 2005 cash operating expenses total $2,972,730. The 2004 expenses include stock-based compensation of $782,984 and amortization of $775,932. Excluding these items, the cash operating expenses for 2004 were $1,885,778. The difference of $1,086,953 between 2005 and 2004 represents a 58% increase in operating expenses over the prior year. The increased costs over the prior period resulted from significant increases in staffing and related costs. Staff levels have increased from 35 at January 1, 2005 to 53 at June 30, 2005.
The Company's current net loss on a monthly basis is $500,000. Management believes that providing cash operating expense information may be helpful to investors with respect to the Company's results of operations, because it excludes certain non-cash amortization amounts that the Company has incurred primarily as a result of its acquisition of certain intellectual property of Briyante that prevents an accurate period-to-period comparison as well as stock-based compensation that does not require cash payments. When excluding such expenses, the Company's current rate of loss on a cash operating expense basis is $288,000 per month. The Company incurred a net loss for the six-month period ended June 30, 2005 of $3,016,481 or $0.12 per share, which is 6% larger than the net loss incurred during the period ended June 30, 2004 of $2,841,554 or $0.25 per share. Adjusting the loss to take into account the non-cash items described above, the losses become $1,727,482 for 2005 and $1,282,638 for 2004, representing a 35% increase.
The Company has received significant sales orders during the final quarter of 2004 and the first half of 2005; however, installation of a number of these contracts did not commence until 2005 and the revenue will not be recognized until the third and fourth quarters of 2005.
In the Company's most recent Form 10-KSB, management stated that it believed that the Company would be able to achieve break-even operations on an EBITDA basis during the second and third quarters of 2005. Due to the timing of the completion of existing contracts and its effect upon the recognition of revenue, management is revising this estimate. After excluding the Company's quarterly amortization expenses of $413,000 primarily associated with the Briyante acquisition and any stock-based compensation expense associated with granting options, management believes that it will achieve break-even operations on a cash operating basis during the fourth quarter of 2005.
The Company believes it has cash sufficient to fund its operations through August 31, 2005. The Company also has accounts receivable as at the date of this release of $747,000. The Company believes that the accounts receivable combined with the orders described above if completed will generate cash sufficient to fund its operations through December 31, 2005. If the accounts receivable are not collected, certain of the contracts are not completed, or no further sales are received the Company may need to raise additional funds through private placements of its securities or seek other forms of financing. There can be no assurance that such financing will be available to the Company on terms acceptable to it, if at all. If the Company's operations are substantially curtailed, it may have difficulty fulfilling its current and future contract obligations.
Full details of Visiphor financial results including a discussion of the related risk factors are available by reviewing the Company's Form 10Q-SB and Form 10K-SB filed on both the SEDAR and EDGAR filing systems.
There will also be a conference call held on Thursday, August 11, 2005 at 1:15 p.m. PDT to discuss and answer questions about the financial statements. To participate, dial 1-866-400-2280 approximately 5 minutes before the conference call is scheduled to begin. Callers outside the U.S. and Canada should dial 1-416-850-9143. An operator will be standing by to assist you.
About Visiphor Corporation
Based in Vancouver, British Columbia, Visiphor specializes in developing and marketing software products that enable integrated access to applications and databases. The company also develops solutions that automate law enforcement procedures and evidence handling. These solutions often incorporate Visiphor's proprietary facial recognition algorithms and tools. Using industry standard "Web Services," Visiphor delivers a secure and economical approach to true, real-time application interoperability. The corresponding product suite is referred to as the Briyante Integration Environment (BIE).
Numerous production deployments of BIE have demonstrated remarkable reductions in the time, complexity, and risk associated with defining, implementing, and supporting integrated access to physically and technologically disparate computers. The broad ranging applicability of BIE into a variety of areas (e.g., health care, financial services, government services, telecommunications, etc.) has been clearly demonstrated by recent, highly successful deployments in the United States and Canada. Visiphor's booking and facial recognition systems are deployed in Canada, the United Kingdom, United States, Mexico and the Far East.
Visiphor is a Microsoft Certified Partner.
For information about Visiphor or the company's products and services, please refer to www.visiphor.com.
ON BEHALF OF THE BOARD OF DIRECTORS "Roy Trivett" President and CEO, Visiphor Corporation
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.
Forward Looking Statements: This press release may contain statements that constitute "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements, to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from anticipated results include the risks and uncertainties described in Visiphor Technologies Inc.'s Form 10-KSB filed with the United States Securities and Exchange Commission. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.