Magor Announces Fiscal Q3 2016 Results
OTTAWA, Ont. – March 30, 2016 – Magor Corporation (TSX-V: MCC), a technology leader in visual collaboration solutions, today announced the third quarter (Q3) financial results for the three and nine month periods ended January 31st, 2016.
“Timing of some orders received in Q3 came in too late for shipping the associated hardware, but did result in the Company growing the backlog going into Q4,” said Mike Pascoe, President and CEO of Magor Corporation. “In addition, we are seeing a growing amount of recurring revenue business which results in an initial sale of lower margin hardware without the software revenue. Subsequent quarters for those sales then become predictable high margin software revenue and over time recurring software becomes a larger portion of the overall revenue mix. We are also pleased to see the significant growth in orders over the last few months with the RCMP as they move forward on their nationwide deployment plan.”
During the Quarter
- A regional Middle Eastern service provider completed their trial of Magor’s Aerus cloud-based Service Delivery Platform and has commenced marketing and selling these services to their customers. Magor will commence recording revenues from this partnership arrangement in the fourth quarter of fiscal 2016
- As reported on Dec. 9th, the RCMP placed orders for an additional 29 systems for their national network. This was further augmented with an additional 45 systems in January.
Subsequent to the Quarter
- The Company entered into agreements, with a company controlled by the Chairman of the Company, to borrow $490,000 by way of promissory notes bearing interest at 12% per annum.
- The Company announced that it has filed amended and restated unaudited interim financial statements and related management’s discussion and analysis (“MD&A”) for the three month period ended July 31, 2015 (Q1) and for the three and nine month periods ended October 31, 2015 (Q2).
- Additional bookings were received from the RCMP for 57 systems as they continue to add to their national network.
- Order backlog as at January 31, 2016 was $713,069 compared to $514,460 as at October 31, 2015 representing a 39% increase.
- Total revenues for the three month period ended January 31, 2016 of $365,118 compared to $810,862 for the three months ended January 31, 2015. Total year-to-date revenues for the nine month period ended January 31, 2016 of $868,564 compared to $1,048,091 for the prior year.
- Software revenue for the three month period ended January 31, 2016 of $27,792 compared to $630,697 for the three months ended January 31, 2015. This decrease resulted from a one-time sale of perpetual licenses in fiscal 2015 of approximately $600,000 combined with decline in the sale of perpetual licenses as customers’ transition to SaaS contracts.
- Recurring revenues grew by 8.4% to $123,432 for the three month period ended January 31, 2015 compared to $113,921 for the comparable quarter in the prior year. Year-to-date recurring revenues for the nine month period increased by 54.2% to $388,355 compared $251,829 for the prior year.
- Gross margin percentages for the three and nine month periods ended January 31, 2016 were 37% and 49% respectfully compared to 85% and 68% in the prior year due to the higher mix of lower margin hardware sales in fiscal 2016 and inventory write-downs recorded in the current fiscal year.
- Operating expenses for the three month and nine month period ended January 31, 2016 decreased by $189,509 and $904,462, or 13% and 20% respectively.
- Net loss and total comprehensive income for the three month period ended January 31, 2016 of $1,868,619, or ($0.04) per share compared to a net loss of $1,016,817, or ($0.02) per share for the same period in the prior year driven by the significant decrease in gross margins combined with higher other expenses in the areas of interest expense, stock option expense and the loss related to change in fair value of Class A Shares.
- As at January 31st, 2016, the Company had cash on hand of $82,062 compared to $201,086 as at April 30, 2015.
About Magor Corporation:
Magor enables people to engage in high-quality visual conversations while simultaneously sharing, viewing and editing relevant collaborative material on desktops, laptops, tablets, smartphone applications, whiteboards and other devices. Magor fits any workflow so that users have the freedom to work together naturally anytime, regardless of location, network or device. To find out more about Magor Corporation (TSX-V: MCC), visit our website at www.magorcorp.com.
For further information, please contact:
President and CEO
+1 613 686-1731
Virtus Advisory Group Inc.
+1 416 995-8651
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