In-Touch Survey Systems Ltd. ("In-Touch") (TSXV: INX) announces that revenues remained stable at $10,657,475 in FY 2013 compared to $10,719,792 in FY 2012. Net earnings for 2013 were $131,675 compared to $1,032,218 in 2012, and net earnings per share for 2013 were $0.01 compared to $0.07 for 2012. Earnings from operating activities were $242,669 in 2013 compared to $761,362 in 2012. The Company-defined adjusted EBITDA, as described in the Company's Management Discussion and Analysis was $824,000 in FY 2013, compared to $1,204,000 in FY 2012.
"The year 2013 was defined by the acquisition and integration of the Field Research division of NAVEX Global, Inc. as well as adjusting to the changing marketplace around the Service Intelligence product lines. Net income and EBITDA were down in 2013 because of increased investment in product development, sales and marketing and the recording of a deferred tax asset in 2012. As was stated in our press release of November 21, 2013, we are in the process of replacing 25% of our historical volume. It is anticipated that this replacement will come from growth in the EventMatrix and IPSG products combined with new product introductions under the Service Intelligence brand. The investments made in 2013 have laid the groundwork for the EventMatrix growth and the Service Intelligence product introductions. In 2014 we plan to introduce one new innovative SaaS product and one new niche product in the auditing space to secure our future for 2015 and beyond", said Cameron Watt, President & Chief Executive Officer.
"In addition to the introduction of new products, and as previously announced, In-Touch will also 'spin-out' technologies into separate companies when we believe that an external corporate structure provides the greatest probability of success for the product and value for our shareholders. We anticipate the initial announcement of one of these new companies in the next month code named Project September ("PS"). PS is working on a SaaS product in the consumer privacy and personalization market," said Mr. Watt.
Gross margins increased significantly to 55% in 2013 compared to 49% in 2012 as overheads associated with the Service Intelligence business combination, were eliminated. The company expects 2014 gross margins in the range of 55 to 60 percent.
|Consolidated Statements of Comprehensive Earnings||2013||2012|
|Revenue||$ 10,657,475||$ 10,719,792|
|Cost of services||4,832,250||5,510,707|
|Total operating expenses||5,582,556||4,447,723|
|Earnings from operating activities||242,669||761,362|
|Change in fair value of contingent payment||27,257||(16,179)|
|Deferred tax recovery (expense)||(93,650)||407,950|
|Current income tax||-||(8,080)|
|Net earnings and other comprehensive earnings||$ 131,675||$ 1,032,218|
|Weighted average number of common shares - basic||14,907,978||14,028,257|
Certain statements included in this news release contain forward looking statements, which by their nature are necessarily subject to risks and uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such statements reflect the Company's current views with respect to future events, and are based on information currently available to the Company and on hypotheses which it considers to be reasonable; however, management warns the reader that hypotheses relative to future events which are beyond the control of management could prove to be false, given that they are subject to certain risks and uncertainties.
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