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Matrikon reports increased earnings in 1Q 2008
 
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Highlights
  • Record revenue for a quarter period of $19.62 million compared to $18.81 million in Q1-07
  • Net income of $2.24 million or $0.07 per share compared to $1.80 million or $0.06 per share in Q1-07
  • Gross margin of 56% compared to 59% in Q1-07
  • Record software license revenue of $4.21 million compared to $3.72 million in Q1-07
  • Record support revenue of $2.10 million compared to $1.81 million in Q1-07
  • Overhead expenses, including stock-based compensation and amortization, were reduced to 40% of revenue compared to 49% of revenue in Q1-07

    Edmonton, Alberta – January 14, 2008 - Matrikon reported financial results for the first quarter of fiscal year 2008, which ended November 30, 2007.

    First quarter revenue was a record $19.62 million compared to $18.81 million in Q1-07 and $18.44 million in Q4-07. Net income in the first quarter was $2.24 million or $0.07 per share, compared to $1.80 million or $0.06 per share in Q1-07 and a net loss of $0.25 million or $0.01 per share in Q4-07.

    Matrikon president and CEO Nizar J. Somji commented on the quarter: “Our results in the first quarter validate the steps we took to improve operations and profitability. Our Products|Solutions strategy is now firmly entrenched and our strong Products growth in Q1 suggests that the separation of our businesses was the right move to unleash the potential of our Products business while enabling our Solutions business to better meet customer needs.

    We have significantly lowered our operating expenses by aligning our cost structure to our revenue and by ensuring that the investments we do make are the right ones to drive our business forward. Even while we were realigning our business, our opportunities remained strong and we pursued them aggressively.

    Our priority now is to continue to build on the momentum of the first quarter. We will maintain our focus on cost containment, and continue to seek means of improving project execution efficiency and driving improvements in both our Products and our Solutions businesses. We will continue to capitalize on our opportunities as we aspire to be THE best company to work for and to do business with in our industry.”

    Additional Highlights
  • Record software license and support revenue contributed to record revenue in the quarter.
  • Gross margin was 56%, with 92% gross margin on software license revenue, 91% on support revenue, 41% on consulting revenue and 28% on equipment revenue. Software license gross margin was affected by an increase in the sale of products containing third party components.
  • Overhead expenses were significantly reduced in Q1-08. They were $7.82 million or 40% of revenue compared to $9.25 million or 49% of revenue in Q1-07 and $9.51 million or 52% of revenue in Q4-07.
  • Cash provided by operations was $2.51 million compared to $2.70 million in Q1-07 and $0.31 million in Q4-07.

    Conference Call and Webcast
    Matrikon President, CEO and interim CFO Nizar J. Somji will hold a conference call to discuss first quarter results on Tuesday, January 15, 2008 at 8:30 am Eastern time (6:30 am Mountain time). To participate live, call 416-644-3416 in the Toronto area and 1-800-732-9303 for all other areas.

    A replay will be available until midnight, January 22, 2008. To access the playback service, please dial 416-640-1917 in Toronto or 1-877-289-8525 elsewhere. The reservation number is 21257550 followed by the pound sign.

    The conference call will also be webcast and podcast at: www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2127180
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