Copernic Inc., (the "Company"), (NASDAQ: CNIC), a leading software
development company in the technology sector, specializing in
internet, desktop and mobile search products, today reported its
financial results for the second quarter ended June 30, 2009 (Q2).
Unless otherwise stated, all figures in this release are in US
dollars. For comparison purposes, historical data has been
re-casted to reflect the sale of Mamma.com and its Ad Network.
Financial Highlights
- Revenue from continuing operations was $0.4 million for Q2
2009, compared to $0.6 million in Q2 2008, a decline of 31,2%
- Gross margin from continuing operations in Q2 2009 was 96,1%
compared to 94,7% for Q2 2008
- Expenses from continuing operations in the second quarter of
2009 were at $1.2 million, compared to $1.3 million in the
comparable period
- Net loss from continuing operations of $0.7 million ($0.05 per
share) for the second quarter 2009 compared to net loss of $0.6
million ($0.05 per share) in the second quarter 2008
- Net income from discontinued operations of $4.5 million ($0.31
per share) for Q2 2009, compared to $0.1 million ($0.01 per share)
in Q2 2008
- Liquidities sufficient to meet normal operating requirements
until end of Q2 2010 were at $4.8 million as of June 30, 2009,
compared to $5.1 million as of December 31, 2008.
Recent Highlights
- Sold the assets of Mamma.com and its Ad Network which closed
an important chapter in the history of the Company
- Unveiled its new personal search portal called myCopernic that
is designed to provide solutions for today's challenges: mobility
and accessibility of personal data. It will also provide innovative
solutions to search and access information that help professionals
do business while being an integral part of the new Cloud Computing
paradigm
- Announced the availability of myCopernic on the Go! - the
first service available from the myCopernic personal search portal.
myCopernic on the Go! offers the end-user an intelligent solution
to search and access relevant information from virtually anywhere,
using any internet enabled device or wireless handset
- Announced that it intends to seek shareholder approval to
complete a share consolidation on the basis of one (1) post
consolidation common share for every two (2) to ten (10)
pre-consolidation shares. The exact consolidation factor will be
determined at the discretion of the board of directors
"The asset sale of Mamma.com and its Ad Network was successfully
completed at the end of the quarter. Management continues its cost
restructuring programs to size its remaining business particularly
when faced with the realities of poor sales growth due to the
continued unfavourable economic environment", stated Marc Ferland
President and CEO of Copernic.
Financial Results for the quarter ended June 30, 2009
Revenues from continuing operations in the second quarter of
2009 totaled $413,000, down from $600,000 in the second quarter of
2008 mainly due to a decline in software licensing revenues.
Revenues in Q2 2009 were lower than Q1 2009 by $100,000.
Gross margin from continuing operations in Q2 2009 was 96,1%
compared to 94,7% for Q2 2008.
Expenses in the second quarter of 2009 were at $1,153,000,
compared to $1,271,000. The difference is mainly due to the
continued cost reduction program.
Net loss from continuing operations in the second quarter 2009
was $703,000 ($0.05 per share), compared to a net loss of $634,000
($0.05 per share) in the same quarter 2008.
Net income from discontinued operation in the second quarter
2009 was $4,471,000 ($0.31 per share), compared to $112,000 ($0.01
per share) in the same quarter 2008. The company sold the assets of
Mamma.com and its Ad Network. The discontinued operation generated
a net income of $281,000 in Q2 2009 compared to $112,000 for the
same period last year, since public reporting costs and associated
consulting fees have been reported in continuing operations in
their entirety. The transaction generated a gain on a disposal of
assets of $4,190,000.
Net income in the second quarter 2009 was $3,768,000 ($0.26 per
share), compared to a net loss of $522,000 ($0.04 per share) in the
same quarter 2008.
Liquidities totaled $4,767,000 which was a decrease of $406,000
from March 31, 2009. During Q2 2009, the Company paid its Directors
& Officers Insurance for the current year, audit, legal fees
and other costs related to 2008 year-end. Liquidities including
temporary investment of $4,000,355 should be entirely available by
the end of Q3 2009.
About Copernic Inc.
Copernic Inc. specializes in developing, marketing and selling
cutting-edge search technology, providing innovative home and
business software products and solutions for desktop, web and
mobile users, through its online properties www.copernic.com.
More information can be found at www.copernic.com.
Statements contained in this press release, which are not
historical facts, are forward-looking statements as that term is
defined in the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements are subject to risks and
uncertainties that can cause actual results to differ materially
from estimated results. Such risks and uncertainties are detailed
in the Company's filings with the Securities and Exchange
Commission and the Ontario Securities Commission. The Company
expressly disclaims any intent or obligation to update any
description of the scope, focus or subject matter of the statements
in this press release.
Copernic Inc.
Condensed Consolidated Balance Sheets
-------------------------------------------------------------------------
(unaudited) (expressed in U.S. dollars and in accordance with generally
accepted accounting principles in Canada)
As at As at
June 30, December 31,
2009 2008
$ $
Assets
Current assets
Cash and cash equivalents 766,782 2,067,705
Temporary investments 4,000,355 3,005,227
Accounts receivable 667,665 907,560
Income taxes receivable 204,785 110,121
Balance of sale receivable 1,473,055 -
Prepaid expenses 252,768 170,864
-------------------------------------------------------------------------
7,365,410 6,261,477
Balance of sale receivable 2,974,175 -
Property and equipment 168,243 240,094
Intangible assets 557,775 918,485
Goodwill 3,362,003 3,362,003
-------------------------------------------------------------------------
14,427,606 10,782,059
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Liabilities
Current liabilities
Accounts payable and accrued liabilities 1,102,487 991,142
Deferred revenue 131,137 156,789
Deferred rent 2,706 4,805
Current portion of obligations under
capital lease 64,021 57,267
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1,300,351 1,210,003
-------------------------------------------------------------------------
Obligations under capital lease 9,401 39,992
Future income taxes 152,497 259,848
-------------------------------------------------------------------------
Commitments
Shareholders' Equity
Capital stock
Authorized
Unlimited common shares, no par value
Issued and outstanding
14,637,531 common shares 96,556,485 96,556,485
Additional paid-in capital 5,802,254 5,747,028
Accumulated other comprehensive income 561,137 561,137
Accumulated deficit (89,954,519) (93,592,434)
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12,965,357 9,272,216
-------------------------------------------------------------------------
14,427,606 10,782,059
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Copernic Inc.
Condensed Consolidated Statements of Operations
-------------------------------------------------------------------------
(unaudited) (expressed in U.S. dollars and in accordance with generally
accepted accounting principles in Canada)
For the six months ended For the three months ended
June 30, June 30,
-------------------------------------------------------------------------
2009 2008 2009 2008
$ $ $ $
Revenues 926,790 1,027,269 413,360 599,557
-------------------------------------------------------------------------
Cost of revenues 29,443 63,483 16,243 31,489
-------------------------------------------------------------------------
Gross Margin 897,347 963,786 397,117 568,068
-------------------------------------------------------------------------
Expenses
Marketing, sales and
services 285,150 260,606 120,912 36,065
General and
administration 1,146,610 1,616,580 531,932 674,370
Product development
and technical
support 556,941 1,047,499 280,367 288,729
Amortization of
property and
equipment 54,231 65,167 28,235 32,691
Amortization of
intangible assets 355,864 490,253 178,106 245,233
Restructuring
charges 25,622 - 5,210 -
Interest and other
income (23,682) (99,869) (9,263) (21,382)
Gain on disposal of
an investment (169,239) - - -
Loss (gain) on
foreign exchange 10,008 (28,041) 17,993 15,693
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2,241,505 3,352,195 1,153,492 1,271,399
-------------------------------------------------------------------------
Loss from operations
before income taxes
and discontinued
operations (1,344,158) (2,388,409) (756,375) (703,331)
Current income taxes 1,498 8,622 - 3,356
Recovery of future
income taxes (107,351) (145,301) (53,676) (72,651)
-------------------------------------------------------------------------
Net loss from
continuing
operations (1,238,305) (2,251,730) (702,699) (634,036)
Net income from
discontinued
operations 4,876,220 643,140 4,470,784 111,637
Net income (loss)
for the period 3,637,915 (1,608,590) 3,768,085 (522,399)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Basic and diluted
loss from
continuing
operations
per share (0.08) (0.15) (0.05) (0.05)
Basic and diluted
earnings (loss)
per share 0.25 (0.11) 0.26 (0.04)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Weighted average
number of common
shares outstanding
Basic 14,637,531 14,637,531 14,637,531 14,637,531
Diluted 14,639,886 14,637,531 14,645,816 14,637,531
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Copernic Inc.
Condensed Consolidated Statements of Cash Flows
-------------------------------------------------------------------------
(unaudited) (expressed in U.S. dollars and in accordance with generally
accepted accounting principles in Canada)
For the six months ended For the three months ended
June 30, June 30,
-------------------------------------------------------------------------
2009 2008 2009 2008
$ $ $ $
Cash flows from
(used for)
Operating activities
Loss from continuing
operations (1,238,305) (2,251,730) (702,699) (634,036)
Adjustments for
Amortization of
property and
equipment 54,231 65,167 28,235 32,691
Amortization of
intangible assets 355,864 490,253 178,106 245,233
Employee stock-
based
compensation 55,226 11,662 29,681 (428)
Future income
taxes (107,351) (145,301) (53,676) (72,651)
Gain on disposal
of an investment (169,239) - - -
Unrealized loss
(gain) on foreign
exchange 3,706 (2,431) 5,744 3,753
Net change in non-
cash working
capital items 41,371 (725,997) (165,588) (1,027,962)
-------------------------------------------------------------------------
Cash and cash
equivalent used for
operating
activities from
continuing
operations (1,004,497) (2,558,377) (680,197) (1,453,400)
-------------------------------------------------------------------------
Investing activities
Net change in cash
and cash
equivalents from
discontinued
operations 583,704 681,080 303,092 250,008
Proceeds on the
disposal of an
investment 169,239 - - -
Purchase of
intangible assets (3,224) (5,056) (2,622) -
Purchase of property
and equipment (23,474) (7,785) (12,549) (5,920)
Net decrease
(increase) in
temporary
investments (995,128) 3,965,384 6,208 -
-------------------------------------------------------------------------
Cash and cash
equivalents from
(used for)
investing
activities (268,883) 4,633,623 294,129 244,088
-------------------------------------------------------------------------
Financing activities
Repayment of
mobligations under
capital lease (27,543) (28,470) (14,056) (15,464)
-------------------------------------------------------------------------
Cash and cash
equivalent used for
financing activities (27,543) (28,470) (14,056) (15,464)
-------------------------------------------------------------------------
Net change in cash
and cash
equivalents during
the period: (1,300,923) 2,046,776 (400,124) (1,224,776)
Cash and cash
equivalents -
Beginning of
period 2,067,705 2,907,028 1,166,906 6,178,580
-------------------------------------------------------------------------
Cash and cash
equivalents - End
of period 766,782 4,953,804 766,782 4,953,804
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Cash and cash
equivalents
comprise:
Cash 466,694 1,252,811 466,694 1,252,811
Short-term
investments 300,088 3,700,993 300,088 3,700,993
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766,782 4,953,804 766,782 4,953,804
Contacts: Copernic Inc. Jean-Rock Fournier, CA Vice President
Finance and Chief Financial Officer 418-527-0528 or Toll Free:
877-289-4682 jrfournier@copernic.com www.copernic.com
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