Message #8 From:
Stock News Bot Date: October 14, 2005 01:56:00 AM
MANS News Manaris Corporation Reports Strong Growth in Revenues for Fiscal 2005
MONTREAL--(BUSINESS WIRE)--Oct. 14, 2005--All amounts are expressed in US dollars unless otherwise indicated.
Two Acquisitions Provide Significant Growth of Asset Base and Expansion in Sources of Revenue
Manaris Corporation (OTCBB:MANS)(FRANKFURT WKN:255471) reported today that revenues for the year ended June 30, 2005 increased to $7.02M compared to revenues of $1.04M for the same period a year ago. Net losses for the year ended June 30, 2005 increased to $6.23M, or $0.15 per diluted share, compared to $4.59M, or $0.14 per diluted share, for the year ended June 30, 2004.
Net losses were generated mainly by our re-engineering of the C-Chip product line and by increased corporate expenses arising out of the two acquisitions and the February financing. Net cash used in operating activities of $2.66M and in acquisition activities of $2.74M were finance primarily by a private placement in February 2005 of $4.67M.
CONTINUED GROWTH AND FOCUS
In announcing the results, John G. Fraser, President and Chief Executive Officer said, "We are pleased with the progress we have made over the past few months. The acquisitions of Avensys Inc. and Chartrand Laframboise Inc. (CLI) have significantly contributed to the overall growth in our asset base. These two acquisitions were responsible for most of the increase in revenue in the year just ended. We expect continued growth and profitability from these two subsidiaries in the coming year."
Mr. Fraser continued: "In addition, we are confident that we will finally start to generate improved revenues over the next twelve months from C-Chip Technologies (North America), the subsidiary marketing and developing our original core business. We have made substantial investments in reengineering the C-Chip product line as we believe that there is a strong demand for its unique technological platform which enables users to efficiently access, control, manage and monitor different types of equipments at low costs.
In February 2005, we closed a private placement of $4.67M with eighteen institutional investors. In addition, subsequent to our year end of June 30, 2005, we concluded a Special Warrant Offering enabling our Company to raise approximately an additional $2.58M."
In September 2005, Stephane Solis resigned as President, CEO and director. He was replaced by John Fraser, a Director and Secretary of Manaris since January 2003.
Also in September 2005, Manaris ceased operations of Canadian Security Agency Inc. (CSA) and sold its client list to Securite Kolossal Inc. This decision was made in light of the Company's commitment to streamline operations, to focus on its strong subsidiaries, and to set the stage for profitable growth in the future.
FISCAL 2006 PRIORITIES
The Company has several priorities for fiscal 2006 for both the holding company as well as its subsidiaries. These include reducing costs for Manaris where possible and further leveraging the success of both Avensys and CLI as well as realizing C-Chip Technologies (North America)'s potential. Overall, corporate objectives will be to focus our activities and to drive towards profitability and continued growth.
About Manaris Corporation
Through its wholly-owned subsidiaries, Manaris Corporation offers a comprehensive suite of enterprise risk management services and solutions. C-Chip Technologies (North America) specializes in the high-tech sector of the security industry, with technology that allows business users to efficiently access, control, manage and monitor remote assets at low costs. Avensys enables businesses and corporations to monitor different types of environments, including Air, Soil, Water as well as buildings and infrastructures. Chartrand Laframboise Investigation provides corporations and institutions with security services including corporate investigation, surveillance, electronic monitoring and protection of personnel and premises.
FORWARD-LOOKING-STATEMENT: Except for factual statements made herein, the information contained in this press release consists of forward-looking statements that involve risks uncertainties, including the effect of changing economic conditions, competition within the credit and security industry, customer acceptance of products and other risks and uncertainties. Such forward looking statements are not guarantees of performance, and Manaris Corporation results could differ materially from those contained in such statements. These forward-looking statements speak only as of the date of this release and Manaris Corporation undertakes no obligation to publicly update any forward-looking statements to reflect new information, events or circumstances after the date of this release.
Manaris Corporation
(Formerly C-Chip Technologies Corporation)
(Formerly A Development Stage Company)
Consolidated Balance Sheets
June 30, June 30,
2005 2004
$ $
ASSETS
Current Assets
Cash 287,147 1,561,020
Accounts receivable, net of allowance
for doubtful accounts of $141,093
and $5,805, respectively 2,858,275 237,384
Other receivables (Note 7) 899,248 -
Inventories 1,097,776 155,680
Note receivable from a related
party (Note 9(b)) - 417,899
Prepaid expenses 143,717 45,554
Restricted marketable securities 81,606 -
------------------------------------------------------------
Total Current Assets 5,367,769 2,417,537
Property and Equipment (Note 8) 731,075 82,274
Intangible Assets (Note 6) 3,852,772 447,125
Goodwill (Notes 3 and 6) 9,727,454 107,000
Deferred Financing Costs 436,685 -
------------------------------------------------------------
Total Assets 20,115,755 3,053,936
------------------------------------------------------------
------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable 1,507,959 165,362
Accrued liabilities (Note 7) 2,021,127 232,705
Loans payable (Note 10) 1,598,273 221,490
Current portion of long-term debt 199,878 -
Current portion of
convertible debentures 893,436 -
Due to related parties (Note 9(a)) 476,646 230,726
------------------------------------------------------------
Total Current Liabilities 6,697,319 850,283
Long-term Debt (Note 11) 483,240 -
Convertible Debentures (Note 12) 1,687,304 -
------------------------------------------------------------
Total Liabilities 8,867,863 850,283
------------------------------------------------------------
Non-controlling Interest 18,033 -
------------------------------------------------------------
------------------------------------------------------------
Contingencies and Commitments (Notes 1 and 16)
Stockholders' Equity
Common Stock, 100,000,000 shares
authorized with a par value of
$0.00001; 54,782,802 and 39,595,803
issued and outstanding, respectively 548 396
Additional Paid-in Capital 24,142,078 8,536,780
Deferred Compensation - (25,974)
Accumulated Other Comprehensive
Income (Loss) (364,415) 9,860
Deficit (12,548,352) (6,317,409)
------------------------------------------------------------
Total Stockholders' Equity 11,229,859 2,203,653
------------------------------------------------------------
Total Liabilities and
Stockholders' Equity 20,115,775 3,053,936
------------------------------------------------------------
Manaris Corporation
(Formerly C-Chip Technologies Corporation)
(Formerly A Development Stage Company)
Consolidated Statements of Operations
For the Years Ended
June 30,
2005 2004
$ $
Revenue
Product 3,580,619 210,222
Service 3,440,609 830,676
------------------------------------------------------------
Total Revenue 7,021,228 1,040,898
------------------------------------------------------------
Cost of Revenue
Product 2,255,020 102,487
Service 2,411,480 559,352
------------------------------------------------------------
Total Cost of Revenue 4,666,500 661,839
------------------------------------------------------------
Gross Margin 2,354,728 379,059
------------------------------------------------------------
Operating Expenses
Depreciation and amortization 461,819 177,456
Selling, general
and administrative 4,154,720 1,858,367
Acquired in-process research
and development 386,749 -
Impairment of goodwill and other
intangible assets 180,974 278,852
Impairment of long-lived assets 15,487 -
Impairment of note receivable 383,536 -
Research and development 731,865 351,584
Stock based compensation(1) 1,216,542 856,384
------------------------------------------------------------
Total Operating Expenses 7,531,692 3,522,643
------------------------------------------------------------
Loss from Operations (5,176,964) (3,143,584)
Other Expenses
Contingency loss 192,549 -
Interest expense 288,735 11,901
Debenture accretion 609,225 16,625
Discount on conversion of debt - 1,418,451
------------------------------------------------------------
Net Loss Before Income Tax Benefit (6,267,473) (4,590,561)
Income Tax Benefit (37,787) -
------------------------------------------------------------
Net Loss Before
Non-controlling Interest (6,229,686) (4,590,561)
------------------------------------------------------------
------------------------------------------------------------
Non-controlling Interest 1,257 -
------------------------------------------------------------
------------------------------------------------------------
Net Loss (6,230,943) (4,590,561)
------------------------------------------------------------
------------------------------------------------------------
Comprehensive Loss (Note 14) (6,605,218) (4,580,701)
------------------------------------------------------------
------------------------------------------------------------
Net Loss Per Share - Basic and Diluted (0.15) (0.14)
------------------------------------------------------------
------------------------------------------------------------
Weighted Average
Shares Outstanding 41,022,000 33,450,000
------------------------------------------------------------
------------------------------------------------------------
(1) Stock based compensation is
excluded from the following:
Selling, general and
administration 1,216,542 856,384
------------------------------------------------------------
------------------------------------------------------------
Manaris Corporation
(Formerly C-Chip Technologies Corporation)
(Formerly A Development Stage Company)
Consolidated Statements of Cash Flows
For the Years Ended
June 30,
2005 2004
$ $
Operating Activities
Net loss (6,230,943) (4,590,561)
Adjustments to reconcile net loss
to cash used in operating activities
Contingent consideration
paid in shares 148,000 303,000
Stock based compensation 1,068,542 553,384
Expenses settled with issuance
of common shares 79,200 261,534
Discount on conversion of debt - 1,418,451
Depreciation and amortization 461,819 177,456
Amortization deferred
financing costs 56,525 -
In-process research
and development 386,749 -
Non-controlling interest 1,257 -
Accretion of debenture 609,225 16,625
Impairment of goodwill and other
intangible assets 180,974 278,852
Impairment of long-lived assets 15,487 -
Impairment of promissory note 383,536 -
Changes in operating assets
and liabilities
(Increase) in accounts receivable (852,061) (82,816)
Decrease (increase) in inventory 28,811 (142,340)
Decrease in other receivable 114,607 -
Decrease (increase) in prepaid
and other assets 81,686 (33,108)
Increase in due to related parties 245,920 -
Increase in accounts payable and
accrued liabilities 558,958 25,734
------------------------------------------------------------
Net Cash Used In
Operating Activities (2,661,708) (1,813,789)
------------------------------------------------------------
Investing Activities
Acquisition of companies, net
of cash acquired (2,741,657) -
Purchase of property and equipment (36,689) (28,429)
Payment received on note receivable - 55,372
Acquisition of customer list (26,644) -
------------------------------------------------------------
Net Cash Provided by (Used) in
Investing Activities (2,804,990) 26,943
------------------------------------------------------------
Financing Activities
Repayments on bank credit line (318,555) (62,250)
Repayment of debt (84,267) -
Related party advances - (2,840)
Deferred financing costs related to
senior convertible debenture (413,681) -
Proceeds from loans 445,561 -
Proceeds from senior
convertible debenture 4,675,000 -
Proceeds from issuance of common
shares, net - 3,054,973
Proceeds from exercise of stock
options and warrants 205,014 339,618
------------------------------------------------------------
Net Cash Provided By
Financing Activities 4,509,072 3,329,501
------------------------------------------------------------
Effect of Exchange Rate
Changes on Cash (316,247) 9,860
------------------------------------------------------------
------------------------------------------------------------
Increase (Decrease) in Cash (1,273,873) 1,552,515
Cash - Beginning of Year 1,561,020 8,505
------------------------------------------------------------
Cash - End of Year 287,147 1,561,020
------------------------------------------------------------
------------------------------------------------------------
