RICHMOND, British Columbia, Nov. 6, 2007 (PRIME NEWSWIRE) -- CON-SPACE Communications Ltd. (TSX-V:CCB), (http://www.con-space.com ), a world leader in specialized voice communication products, technical search, surveillance and inspection systems, today announced fourth quarter and annual consolidated financial results for the period ended June 30, 2007.
"What a strong and exciting year we had," said Jim Swanson, Chairman of CON-SPACE. "We had many highlights the most prominent being the acquisition of Search Systems, Inc. of Bakersfield, CA at the beginning of the fourth quarter. We added a new President, Mike Thirlwell and also a new Controller, Wendy Kloeble plus we introduced many new products to address new markets and made several other improvements within the Company.
"Our annual results tell a story of growth and profits though we continue to deal with the ever-increasing Canadian dollar. Our sales grew 32.1% to $7,256 k over the 2006 year of $5,490 k and our total assets increased 312.3% to $18,728 k from 2006 year end of $4,543 k."
Annual Results
As a percent of sales ($7,256 k) CON-SPACE had 0.3% increase in gross profit (3,346 k), a 1.0% increase in operating expenses (2,998 k), a 0.6% decline in both operating income ($348 k) and net income ($213 k) for the year.
Income before interest, income taxes, depreciation and amortization (EBITDA) for the year was $903 k compared to $418 k in the prior year up 116.0%. Net income for the year was $214 k versus a $195 k for the respective prior year up 9.5%.
Earnings per share ended at $0.02 per share the same as for 2006 however, the average number of common shares outstanding increased from 10,724,179 in 2006 to 11,660,951 this year.
Fourth Quarter Results
For the three months ended June 30, 2007, the company achieved sales of $2,529 k, up 73.1% over the same quarter in 2006 ($1,461 k) and 41.8% ahead of the 2007 3rd quarter ($1,784 k). The increase in revenue up to the end of the 3rd quarter was 17.5% and without the effect of Search Systems in the fourth quarter the increase was 8.5%. This was not as high as had been expected and resulted due to no major orders having been received by Search Systems during the fourth quarter.
Fourth quarter operating expenses increased 41.7% to $1,196 k from $844 k in Q4 2006. This increase was a result of the addition of Search Systems.
Net income for the fourth quarter of 2007 was $159 k, or $0.01 per share. This compares to net earnings of $14 k or $0.00 per share during the same quarter in 2006.
Outlook
Although first quarter is a seasonally slower period for CON-SPACE, the company anticipates that fiscal 2007 will present important opportunities for profitable growth. The new products added at the tail end of the fiscal year are making a positive mark in their targeted markets. The sales teams on both sides of the ocean are very active and expectations based on current sales and outstanding quotes for both CON-SPACE and SSI products are high. The Company's OEM program continues to grow and the new products are attracting more buyers, especially for their line of propriety Throat Microphones. All in all, the sales outlook for 2008 is positive and the results are expected to move CON-SPACE to a new and higher level within the markets it serves.
The completion and filing of this year's audited consolidated financial statements past the 120 day filing deadline was a result of challenges presented due to the acquisition of Search Systems, its financial integration, additional complexities with cross border tax provision reporting, coordination of the audits of subsidiaries and a change in senior accounting personnel. All these items have been recognized and are being addressed for future financial reporting.
About CON-SPACE
CON-SPACE is recognized worldwide as the leading designer and manufacturer of specialized voice communication equipment, technical search, surveillance and inspection systems used by police, fire, rescue, government agencies, militaries, municipalities and general industry. The Company has distribution throughout North America, Great Britain, Australia, and parts of Asia, South America, and Europe. The Company also supplies many other manufacturers with Private Labeled products.
This press release is available on the company's official on-line investor relations site for investor commentary, feedback and questions. Investors are asked to visit http://www.agoracom.com and view the CON-SPACE Investor Contact & Information Centre. Alternatively, investors are asked to e-mail all questions and correspondence to CCB@Agoracom.com
"Forward-looking" statements in this release involve risks and uncertainties associated with, among others, economic, industry conditions, technological development, and competition and should not be relied upon as actual results may differ materially from those projected.
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