Message #8 From:
NewsBot Date: November 14, 2006 05:00:00 AM
DWVS News DataWave Reports 20th Consecutive Quarter of Profitability
WAYNE, N.J.--(BUSINESS WIRE)--DataWave Systems Inc. (OTCBB: DWVS), a premier provider of
prepaid and stored value delivery systems, today reported financial
results for the second quarter and six months ended September 30, 2006.
Total revenue for the second quarter of fiscal 2007 increased 31% to
$10.9 million, compared to $8.4 million for the same period in fiscal
2006. Operating income for the second quarter of fiscal 2007 was
$550,000 versus operating income of $435,000 for the same period last
year. Net income for the second quarter of fiscal 2007 was $493,000, or
$0.01 per diluted share, versus net income of $297,000, or $0.01 per
diluted share, for the same period last year.
Total revenue for the six months ended September 30, 2006 increased 39%
to $21.3 million, compared to $15.3 million for the same period in
fiscal 2006. Operating income for the six months ended September 30,
2006 was $817,000 versus operating income of $533,000 for the same
period last year. Net income for the six months ended September 30, 2006
was $781,000, or $0.01 per diluted share, versus net income of $434,000,
or $0.01 per diluted share, for the same period last year. The Company
generated approximately $3.1 million of cash flow from operations during
the six months, resulting in approximately $9.6 million of cash and cash
equivalents as of September 30, 2006.
As of September 30, 2006, the Company had more than 6,100 terminals
installed, and more than 1,200 host-to-host or distributor locations.
Daily transactions processed for the quarter averaged more than 52,200
compared with 39,200 a year ago.
Josh Emanuel, Chairman and Chief Executive Officer, stated, “Having
penetrated the majority of all major retailers in Canada, we are
leveraging our dominant position within Canada and our strong retail
relationships in order to introduce new products such as cash cards and
third party gift cards through our existing network, as well as new
channel partners throughout North America. Overall, we have built a
highly scaleable business model, which leverages operating expenses, as
illustrated by the 53% gain in operating income we produced on a 39%
increase in revenue for the first six months of fiscal 2007, and
generates substantial cash flow, providing us more than sufficient
capital to continue our strong organic growth.”
DataWave’s 2006 annual meeting of stockholders
will be held on Thursday, December 14, 2006. A proxy statement has been
filed with the SEC and will be mailed to stockholders prior to the
meeting.
About DataWave
DataWave has been an innovator and developer of prepaid and stored-value
programs and merchandising solutions since it was founded in 1994.
DataWave pioneered systems that allow for point-of-sale activation of
high value, high shrinkage products, such as cash cards, prepaid phone
cards and prepaid wireless time. These systems work equally well over
the Internet, through intelligent freestanding vending machines and POSA
terminals, or with various card activation devices, including cash
registers.
This press release contains “forward-looking
statements” as defined by the Private
Securities Litigation Reform Act of 1995.Words such as “expect”,
“believe”, “anticipate”,
“may”, “will”,
“plan”, “intend”,
“estimate”, “could”,
and other similar expressions are intended to identify these
forward-looking statements.In particular, statements in this
release regarding expansion of the Company’s
retail network, plans by the Company for introduction of third-party
gift cards and cash cards and the Company’s
anticipated organic revenue growth rate are forward looking.Statements
in this press release, and elsewhere, that look forward in time or
include anything other than historical information involve risks and
uncertainties that may affect the Company’s
actual results of operations.These statements by the Company are
subject to certain risks, including, among others, future demand for its
products and brand, competition from other businesses providing similar
products, the ability to maintain profitability and control expenses and
the Company’s ability to successfully execute
its business strategy. These and other risks and uncertainties are
discussed in more detail in the Company’s
periodic reports filed with the Securities and Exchange Commission under
the Securities Exchange Act of 1934, as amended, which are available at
the SEC website at www.sec.gov.
“DataWave” is a
registered trademark of the Company. All other trademarks and trade
names referred to are the property of their respective owners.
(tables follow)
DATAWAVE SYSTEMS INC.
CONSOLIDATED BALANCE SHEETS
As at September 30, 2006 and March 31,2006
(Expressed in United States dollars, except share amounts)
(Unaudited)
September 30
2006
March 31
2006
Assets
Current
Cash and cash equivalents
$
9,596,494
$
6,967,032
Restricted cash
202,000
203,807
Accounts receivable and other
9,252,695
7,472,542
Inventories
7,485,307
6,308,442
Prepaid expenses and deposits
507,406
383,332
Deferred income taxes
229,938
229,938
Total current assets
27,273,840
21,565,093
Machinery and equipment, net
2,453,180
2,278,016
Equity investment
488,503
194,850
Goodwill
1,913,536
1,881,910
Intangible assets, net
681,676
828,764
Other assets
157,689
179,433
Total assets
$
32,968,424
$
26,928,066
Liabilities
Current
Accounts payable and accrued liabilities
$
22,475,336
$
17,890,603
Deferred revenue
1,306,104
1,095,544
Other current liabilities
33,384
95,786
Total current liabilities
23,814,824
19,081,933
Deferred income taxes
335,678
320,780
Deferred inducement
377,563
365,911
Total liabilities
24,528,065
19,768,624
Stockholders' equity
Common shares
Authorized, 100,000,000 common shares, $0.001 par value
Issued 54,326,834 shares issued and outstanding at September 30,
2006 and March 31, 2006
54,327
54,327
Additional paid-in capital
18,876,341
18,512,908
Accumulated other comprehensive income
752,405
616,375
Accumulated deficit
(11,242,714)
(12,024,168)
Total stockholders' equity
8,440,359
7,159,442
Total liabilities and stockholders' equity
$
32,968,424
$
26,928,066
DATAWAVE SYSTEMS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three and six month period ended September 30, 2006 and 2005
(Expressed in United States dollars, except share amounts)
(Unaudited)
Three months ended
September 30,
Six months ended
September 30,
2006
2005
2006
2005
Revenue
Sales
$
8,337,581
$
6,333,326
$
16,580,524
$
11,386,914
Net agency sales
2,447,789
2,018,358
4,564,282
3,917,176
Other
126,823
-
126,823
-
Total revenue
10,912,193
8,351,684
21,271,629
15,304,090
Operating costs and expenses
Cost of revenues (exclusive of depreciation and amortization)
