Exhibit 99.2
CONDENSED INTERIM CONSOLIDATED
FINANCIAL STATEMENTS (UNAUDITED)
For the three months ended March 31, 2014 and 2013
(Expressed in US dollars)
1
Norsat International Inc. |
Condensed Interim Consolidated Statements of Financial Position |
(Expressed in US Dollars - Unaudited) |
Notes | March 31, 2014 | December 31, 2013 | |||||
ASSETS | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 2,866,115 | $ | 3,272,595 | |||
Trade and other receivables | 5 | 7,417,143 | 6,821,155 | ||||
Inventories | 9,710,701 | 9,566,289 | |||||
Prepaid expenses and other | 376,301 | 572,038 | |||||
Current assets | 20,370,260 | 20,232,077 | |||||
Non-current assets | |||||||
Property and equipment, net | 997,223 | 1,055,160 | |||||
Intangible assets, net | 6,996,254 | 7,377,107 | |||||
Goodwill | 4,919,503 | 5,104,370 | |||||
Long-term prepaid expenses and other | 9,340 | 9,340 | |||||
Deferred income tax assets | 4,900,000 | 4,900,000 | |||||
Non-current assets | 17,822,320 | 18,445,977 | |||||
Total assets | $ | 38,192,580 | $ | 38,678,054 | |||
LIABILITIES | |||||||
Current liabilities | |||||||
Trade and other payables | $ | 2,200,416 | $ | 2,162,196 | |||
Accrued liabilities | 1,528,125 | 1,956,998 | |||||
Provisions | 699,662 | 851,437 | |||||
Taxes payable | 187,165 | 270,263 | |||||
Deferred revenue | 472,618 | 586,925 | |||||
Current liabilities before acquisition loan | 5,087,986 | 5,827,819 | |||||
Acquisition loan | 3,848,542 | 4,413,296 | |||||
Current liabilities | 8,936,528 | 10,241,115 | |||||
Non-current liabilities | |||||||
Long-term deferred revenue | 5,486 | 10,457 | |||||
Deferred income tax liabilities | 1,888,981 | 2,002,973 | |||||
Non-current liabilities | 1,894,467 | 2,013,430 | |||||
Total liabilities | 10,830,995 | 12,254,545 | |||||
SHAREHOLDERS' EQUITY | |||||||
Issued capital | 39,850,648 | 39,850,648 | |||||
Treasury shares | (318,255 | ) | (318,255 | ) | |||
Contributed surplus | 4,333,875 | 4,278,843 | |||||
Accumulated other comprehensive income | (2,609,180 | ) | (1,315,478 | ) | |||
Deficit | (13,895,503 | ) | (16,072,249 | ) | |||
Total shareholders' equity | 27,361,585 | 26,423,509 | |||||
Total liabilities and shareholders' equity | $ | 38,192,580 | $ | 38,678,054 |
See accompanying notes to the unaudited condensed interim consolidated financial statements.
Approved by the Board and authorized for issue on May 6, 2014
“ Fabio Doninelli” | “ James Topham” |
Board of Director | Board of Director |
2
Norsat International Inc. |
Condensed Interim Consolidated Statements of Earnings |
and Comprehensive Income |
(Expressed in US Dollars - Unaudited) |
Three months ended March 31 | |||||||
Notes | 2014 | 2013 | |||||
Revenue | 8 | $ | 9,117,705 | $ | 8,353,654 | ||
Cost of sales | 4 | 5,354,183 | 4,991,511 | ||||
Gross profit | 3,763,522 | 3,362,143 | |||||
Expenses: | |||||||
Selling and distributing expenses | 4 | 1,303,717 | 1,589,491 | ||||
General and administrative expenses | 4 | 859,282 | 1,029,777 | ||||
Product development expenses, gross | 4 | 695,437 | 878,398 | ||||
Less: Government contributions | 4 | (386,991 | ) | (625,713 | ) | ||
2,471,445 | 2,871,953 | ||||||
Earnings before other expenses | 1,292,077 | 490,190 | |||||
Loss on disposal of property and equipment | - | 8,367 | |||||
Interest and bank charges | 52,615 | 126,754 | |||||
Gain on foreign exchange | (867,492 | ) | (48,313 | ) | |||
Earnings before income taxes | 2,106,954 | 403,382 | |||||
Current income tax expense | - | 59,535 | |||||
Deferred income recovery | (69,792 | ) | (68,652 | ) | |||
Net earnings for the period | $ | 2,176,746 | $ | 412,499 | |||
Other comprehensive income | |||||||
Exchange differences on translation of operations in currencies other than US Dollars | (1,293,702 | ) | (376,835 | ) | |||
Total comprehensive income for the period | $ | 883,044 | $ | 35,664 | |||
Net earnings per share, basic and diluted | $ | 0.04 | $ | 0.01 | |||
Weighted average number of shares outstanding | |||||||
Basic | 57,674,356 | 58,036,732 | |||||
Diluted | 57,709,914 | 58,113,477 |
See accompanying notes to the unaudited condensed interim consolidated financial statements.
3
Norsat International Inc. |
Condensed Interim Consolidated Statements of Changes in Shareholders’ Equity |
(Expressed in US Dollars - Unaudited) |
Accumulated other | Total | ||||||||||||||||
Treasury | Contributed | comprehensive | shareholders' | ||||||||||||||
Notes | Issued capital | shares | surplus | income | Deficit | equity | |||||||||||
As at January 1, 2014 | $ | 39,850,648 | $ | (318,255 | ) | $ | 4,278,843 | $ | (1,315,478 | ) | $ | (16,072,249 | ) | $ | 26,423,509 | ||
Net earnings for the period | - | - | - | - | 2,176,746 | 2,176,746 | |||||||||||
Other comprehensive loss | - | - | - | (1,293,702 | ) | - | (1,293,702 | ) | |||||||||
Total | 39,850,648 | (318,255 | ) | 4,278,843 | (2,609,180 | ) | (13,895,503 | ) | 27,306,553 | ||||||||
Stock-based compensation | 6 | - | - | 55,032 | - | - | 55,032 | ||||||||||
As at March 31, 2014 | $ | 39,850,648 | $ | (318,255 | ) | $ | 4,333,875 | $ | (2,609,180 | ) | $ | (13,895,503 | ) | $ | 27,361,585 | ||
Accumulated other | Total | ||||||||||||||||
Treasury | Contributed | comprehensive | shareholders' | ||||||||||||||
Issued capital | shares | surplus | income | Deficit | equity | ||||||||||||
As at January 1, 2013 | $ | 39,850,648 | $ | (131,474 | ) | $ | 4,041,715 | $ | 251,826 | $ | (19,779,153 | ) | $ | 24,233,562 | |||
Net loss for the period | - | - | - | - | 412,499 | 412,499 | |||||||||||
Other comprehensive income | - | - | - | (376,835 | ) | - | (376,835 | ) | |||||||||
Total | 39,850,648 | (131,474 | ) | 4,041,715 | (125,009 | ) | (19,366,654 | ) | 24,269,226 | ||||||||
Stock-based compensation | 6 | - | - | 90,192 | - | - | 90,192 | ||||||||||
As at March 31, 2013 | $ | 39,850,648 | $ | (131,474 | ) | $ | 4,131,907 | $ | (125,009 | ) | $ | (19,366,654 | ) | $ | 24,359,418 |
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Norsat International Inc. |
Condensed Interim Consolidated Statements of Cash Flows |
(Expressed in US Dollars - Unaudited) |
Three months ended March 31 | |||||||
Notes | 2014 | 2013 | |||||
Cash and cash equivalents provided by (used in) | |||||||
Operating activities: | |||||||
Net earnings for the period | $ | 2,176,746 | $ | 412,499 | |||
Income taxes paid | (80,572 | ) | - | ||||
Non-cash adjustments to reconcile net earnings to net cash flows: | |||||||
Amortization | 319,432 | 332,334 | |||||
Foreign exchange gain | (867,492 | ) | (48,313 | ) | |||
Loan acquisition cost amortization | 6,786 | 6,787 | |||||
Loss on disposal of property and equipment | - | 8,367 | |||||
Current income tax expense | - | 59,535 | |||||
Deferred income tax recovery | (69,792 | ) | (68,652 | ) | |||
Share-based payments | 6 | 55,032 | 90,192 | ||||
Accretion of promissory notes | - | 31,871 | |||||
Government contribution | 5 | (386,991 | ) | (650,887 | ) | ||
Changes in non-cash working capital | 9 | (1,528,634 | ) | (1,642,964 | ) | ||
Net cash flows used in operating actitivies | (375,485 | ) | (1,469,231 | ) | |||
Investing activities: | |||||||
Purchase of intangible assets, property and equipment | (110,431 | ) | (36,164 | ) | |||
Proceeds from government contributions for acquisition of property and equipment | 26,551 | - | |||||
Proceeds from sale of property and equipment | - | 4,200 | |||||
Proceeds from sale of subsidiary | - | 13,583 | |||||
Net cash flows used in investing activities | (83,880 | ) | (18,381 | ) | |||
Financing activities: | |||||||
Repayment of acquisition loan | (480,000 | ) | (750,000 | ) | |||
Proceeds from government contributions | 5 | 456,121 | 61,094 | ||||
Payment of promissory note | - | (362,500 | ) | ||||
Net cash flows used in financing activities | (23,879 | ) | (1,051,406 | ) | |||
Effect of foreign currency translation on cash and cash equivalents | 76,764 | (37,132 | ) | ||||
Decrease in cash and cash equivalents | (406,480 | ) | (2,576,150 | ) | |||
Cash and cash equivalents, beginning of period | 3,272,595 | 5,053,445 | |||||
Cash and cash equivalents, end of period | $ | 2,866,115 | $ | 2,477,295 |
Supplemental cash flow and other disclosures (note 9)
See accompanying notes to the unaudited condensed consolidated financial statements.
5
Norsat International Inc. |
Notes to the Condensed Interim Consolidated Financial Statements |
Three months ended March 31, 2014 and 2013 |
(Expressed in US dollars - Unaudited) |
1. | Basis of Preparation |
These unaudited condensed interim consolidated financial statements for the three months ended March 31, 2014, including comparatives, have been prepared in accordance with International Accounting Standard (“IAS”) 34 “Interim Financial Reporting”. They do not include all of the information required in annual financial statements in accordance with International Financial Reporting Standards (“IFRS”), and should be read in conjunction with the Company’s 2013 annual audited consolidated financial statements which have been prepared in accordance with IFRS as issued by the International Accounting Standards Board (“IASB”).
The unaudited condensed interim consolidated financial statements for the three months ended March 31, 2014 have been approved and authorized for issue by the board of directors on May 6, 2014.
These unaudited condensed interim consolidated financial statements are presented in United States Dollars, except when otherwise indicated.
Seasonal fluctuations
Quarterly results from our four business segments fluctuate from quarter to quarter due to seasonal influences on sales volumes. In our Sinclair Technologies segment, the first and second quarters are historically the strongest, as most of Sinclair’s customers build inventories as they commence installation in the spring and winter seasons. Among our other two segments, the third and fourth quarters are typically the strongest, as these are traditionally the periods when military sales occur. The timing of contract awards also creates significant fluctuations in our quarterly results as some large contracts represent a significant share of sales for a given quarter. The timing of these orders is unpredictable.
2. | Significant Accounting Policies |
The unaudited condensed interim consolidated financial statements have been prepared using accounting policies consistent with those used in the preparation of the audited consolidated financial statements as at December 31, 2013.
3. | Significant Management Judgement and Estimation Uncertainty |
The preparation of unaudited condensed interim consolidated financial statements in conformity with IFRS requires the Company’s management to undertake a number of judgements, estimates and assumptions that affect amounts reported in the unaudited condensed interim consolidated financial statements and notes thereto. Actual amounts may ultimately differ from these estimates.
The judgements, estimates and assumptions applied in the unaudited condensed interim consolidated financial statements, including key sources of estimation uncertainty were the same as those applied in the Company’s last annual audited consolidated financial statements for the year ended December 31, 2013.
6
Norsat International Inc. |
Notes to the Condensed Interim Consolidated Financial Statements |
Three months ended March 31, 2014 and 2013 |
(Expressed in US dollars - Unaudited) |
4. | Cost of Sales and Expenses |
Three months ended March 31 | ||||||
2014 | 2013 | |||||
Cost of Sales | ||||||
Direct cost of sales | $ | 5,333,202 | $ | 4,958,468 | ||
Depreciation and amortization | 20,981 | 33,043 | ||||
$ | 5,354,183 | $ | 4,991,511 | |||
Selling and distributing expenses | ||||||
Direct expenses | $ | 1,120,058 | $ | 1,411,821 | ||
Depreciation and amortization | 183,659 | 194,636 | ||||
Less: Government contribution (Note 5) | - | (16,966 | ) | |||
$ | 1,303,717 | $ | 1,589,491 | |||
General and administrative expenses | ||||||
Direct expenses | $ | 951,845 | $ | 1,040,001 | ||
Capitalized to inventory/transfer to cost of sales | (126,357 | ) | (26,397 | ) | ||
Depreciation and amortization | 33,794 | 24,381 | ||||
Less: Government contribution (Note 5) | - | (8,208 | ) | |||
$ | 859,282 | $ | 1,029,777 | |||
Product development expenses, net | ||||||
Direct expenses | $ | 614,439 | $ | 798,124 | ||
Depreciation and amortization | 80,998 | 80,274 | ||||
$ | 695,437 | $ | 878,398 | |||
Government contribution (Note 5) | $ | (386,991 | ) | $ | (625,713 | ) |
$ | 308,446 | $ | 252,685 | |||
Supplementary information: | ||||||
Short-term employee benefits | $ | 2,874,130 | $ | 3,011,704 |
Short-term employee benefits include wages, salaries, bonus, sales commissions, social security contributions, extended health premiums, Medical Services Plan payments, Registered Retirement Savings Plan contributions and vacation accrual.
5. | Government Contributions |
a.)Strategic Aerospace & Defense Initiative (“SADI I”)
The Company entered into an agreement with the Canadian Federal Minister of Industry (the “Minister”) through the Strategic Aerospace & Defense Initiative (“SADI”) in September 2008 and subsequently amended in October 2011. The Company has claimed the maximum funding of Cdn$5,975,200 under this agreement as at December 31, 2012. Starting in 2013, the Company is obligated to make annual repayments over the defined Repayment Period, with the following terms:
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Norsat International Inc. |
Notes to the Condensed Interim Consolidated Financial Statements |
Three months ended March 31, 2014 and 2013 |
(Expressed in US dollars - Unaudited) |
• | The Repayment Period began January 1, 2013 and will continue for 15 years, or until such time as the maximum amount of Cdn$8,962,800 (representing 1.5 times the contributions received) of the actual amounts disbursed by the Minister (Cdn$5,975,200) is repaid, whichever occurs earlier. |
• | Annual repayment amounts under the SADI I repayment period are calculated based on a repayment rate of 0.94% multiplied by gross business revenue as defined in the SADI I agreement multiplied by the adjustment rate (based on the growth of gross business revenue over the previous year). The adjustment factor is based on year-over-year change of gross business revenue. |
As at March 31, 2014, the Company has calculated the SADI I repayment amount as $nil as the 2014 year-to-date gross business revenue as at March 31, 2014 did not meet the criteria for repayment pursuant to the SADI I agreement.
b.)Strategic Aerospace & Defense Initiative (“SADI II”)
On March 28, 2013, the Company entered into an agreement with the Minister through the SADI whereby the Minister will provide funding of 30% of eligible spending related to the research and development of the aerospace, defence, space or security (“A&D”) technology development projects to a maximum funding amount of Cdn$13,270,265 for eligible costs starting from July 27, 2012 up to and including December 31, 2017 (“SADI II”). The Company is obliged to repay the funding over the SADI II defined Repayment Period.
For the three months ended March 31, 2014, the Company has recorded $386,991 (March 31, 2013 -$625,713) as a reduction to product development expenses in the condensed interim consolidated statements of earnings and comprehensive income and $26,561 (March 31, 2013 - $11,812) as a reduction to property and equipment costs relating to SADI II. As at March 31, 2014, $242,000 (December 31, 2013 -$343,311) remains in trade and other receivables relating to this project for costs incurred.
SADI II repayment is contingent on performance benchmarks established at the end of the Company’s fiscal 2017 year end and is capped at the lesser of 1.5 times the contribution received (actual amounts disbursed by the Minister) and the amounts actually repaid over a period of 15 years, commencing in 2018. Annual repayment amounts are calculated based on a percentage of gross business revenue as defined in the agreement multiplied by the adjustment rate (based on the growth of gross business revenue over the previous year).
As at March 31, 2014, the Company did not accrue any liability for repayment relating to SADI II as the amount to be repaid cannot yet be determined since the repayment amount is contingent on 2018 financial results compared to those achieved in 2017.
8
Norsat International Inc. |
Notes to the Condensed Interim Consolidated Financial Statements |
Three months ended March 31, 2014 and 2013 |
(Expressed in US dollars - Unaudited) |
6. | Issued Capital |
Share Purchase Option Plan
Share purchase options outstanding as at March 31, 2014 are as follows:
Share purchase options outstanding | Number of options | Weighted average exercise price | ||||
Cdn$ | ||||||
Balance, December 31, 2013 | 2,070,159 | $ | 0.62 | |||
Granted | 287,160 | 0.53 | ||||
Expired | (5,000 | ) | 0.68 | |||
Forfeited | (57,000 | ) | 0.62 | |||
Balance, March 31, 2014 | 2,295,319 | $ | 0.65 |
The following table summarizes information pertaining to the Company’s share purchase options outstanding at March 31, 2014:
Options outstanding | Options exercisable | ||||||||||||||
Range of | Number of | Weighted average | Weighted | Number of | Weighted | ||||||||||
exercise prices | options | remaining contractual | average | options | average | ||||||||||
Cdn$ | outstanding | life(years) | exercise price | exercisable | exercise price | ||||||||||
Cdn$ | Cdn$ | ||||||||||||||
$0 to $0.49 | 402,000 | 2.80 | 0.48 | 376,000 | 0.48 | ||||||||||
$0.50 to $0.99 | 1,893,319 | 2.85 | 0.64 | 1,011,200 | 0.73 | ||||||||||
2,295,319 | 2.84 | 0.61 | 1,387,200 | 0.66 |
The exercise price of all share purchase options granted during the period are equal to the closing market price at the grant date. The Company calculates share based payment from the vesting of stock options using the Black Scholes Option Pricing Model with assumptions noted below and records related compensation expense as follows for the three months ended March 31, 2014 and 2013:
Three months ended March 31 | ||||||
2014 | 2013 | |||||
Total compensation - options | $ | 14,992 | $ | 71,830 |
The weighted average assumptions used to estimate the fair value of options granted during the three months ended March 31, 2014 and 2013 were:
Three months ended March 31 | ||||
2014 | 2013 | |||
Risk free interest rate | 1.33% | 1.25% | ||
Expected life | 3.1 | 3.1 | ||
Vesting period | 2 years | 2 years | ||
Expected volatility | 50% | 52% | ||
Expected dividends | Nil | Nil | ||
Average fair value | Cdn$0.19 | Cdn$0.20 | ||
Forfeiture rate | 18% | 18% |
A total of 287,160 stock purchase options were granted at an exercise price of Cdn$0.53 and a fair value of Cdn$0.19 during the three months ended March 31, 2014, of which 160,144 stock purchase options were granted to senior management and directors at an average price of Cdn $0.53 and fair value of Cdn $0.19.
9
Norsat International Inc. |
Notes to the Condensed Interim Consolidated Financial Statements |
Three months ended March 31, 2014 and 2013 |
(Expressed in US dollars - Unaudited) |
Options vest in 2 years and expire 5 years from the grant date.
Option pricing models require the input of highly subjective assumptions including the expected price volatility. Changes in the subjective input assumptions can materially affect the fair value estimate, and therefore the existing models may not necessarily provide a reliable measure of the fair value of the Company’s share purchase options.
Restricted Share Unit (“RSU”) Plan
On February 28, 2014, the Company granted 250,343 RSUs to its employees with a fair value of $0.55 per share, of which 205,788 RSUs were issued to directors and senior management. One third of the RSUs will vest on February 27, 2015, one third on February 26, 2016 and the remaining one third on November 11, 2016.
RSUs outstanding as at December 31, 2013 and March 31, 2014 are as follows:
# of RSUs outstanding | |||
Balance, December 31, 2013 | 712,175 | ||
Granted | 250,343 | ||
Balance, March 31, 2014 | 962,518 |
The Company charged share-based payments of $40,040 (2013 - $18,362) to operating expenses in connection with the Company’s RSU plan, with a corresponding increase in contributed surplus.
7. | Earnings per Share |
The reconciliation of the numerators and denominators of the basic and diluted earnings per share calculations was as follows for the three months ended March 31, 2014 and 2013:
Three months ended March 31 | |||||
2014 | 2013 | ||||
Numerator | |||||
Net earnings from continuing operations | $ | 2,176,746 | $ | 412,499 | |
Denominator: | |||||
Weighted average number of shares outstanding used to compute basic EPS | 57,674,356 | 58,036,732 | |||
Dilution from exercise of stock options | 35,558 | 76,745 | |||
Weighted average number of shares outstanding used to compute diluted EPS | 57,709,914 | 58,113,477 | |||
Net earnings per share | |||||
Basic and diluted | $ | 0.04 | $ | 0.01 |
The calculation of assumed exercise of stock options includes the effect of the dilutive options. Where their effect was anti-dilutive because their exercise prices were higher than the average market price of the Company’s common shares at the end of the periods shown in the table, assumed exercise of those particular stock options were not included.
10
Norsat International Inc. |
Notes to the Condensed Interim Consolidated Financial Statements |
Three months ended March 31, 2014 and 2013 |
(Expressed in US dollars - Unaudited) |
8. | Segmented Information |
The accounting policies of the segments are the same as those described in the summary of significant accounting policies as described in our annual audited consolidated financial statements for the year ended December 31, 2013.
The following tables set forth sales and gross profit information by operating segments for the three months ended March 31, 2014 and 2013:
Three months ended March 31 | |||||
2014 | 2013 | ||||
Sales to external customers | |||||
Sinclair Technologies | $ | 5,619,184 | $ | 5,576,292 | |
Satellite Solutions | 644,825 | 1,372,862 | |||
Microwave Products | 2,853,696 | 1,404,500 | |||
$ | 9,117,705 | $ | 8,353,654 | ||
Gross Profit | |||||
Sinclair Technologies | $ | 2,247,815 | $ | 2,419,196 | |
Satellite Solutions | 193,574 | 391,948 | |||
Microwave Products | 1,322,133 | 550,999 | |||
$ | 3,763,522 | $ | 3,362,143 |
Total assets related to operations for each segment are calculated based on the percentage of total sales to external customers of each segment (Sinclair Technologies, Satellite Solutions, and Microwave Products) over total consolidated sales, whereas property, equipment, and intangible assets of each segment reflect the carrying value of the assets.
Sinclair | Satellite | Microwave | Consolidated | ||||||
As at March 31, 2014 | |||||||||
Total assets related to operations | $ | 22,477,057 | $ | 2,896,585 | $ | 12,818,938 | $ | 38,192,580 | |
Property and equipment, net | 321,095 | 124,619 | 551,509 | 997,223 | |||||
Intangible assets, net | 6,949,818 | 8,559 | 37,877 | 6,996,254 | |||||
As at December 31, 2013 | |||||||||
Total assets related to operations | $ | 22,800,887 | $ | 5,492,025 | $ | 10,385,142 | $ | 38,678,054 | |
Property and equipment, net | 163,976 | 308,266 | 582,918 | 1,055,160 | |||||
Intangible assets, net | 7,325,348 | 17,904 | 33,855 | 7,377,107 |
The Company generated revenues from external customers located in the following geographic locations:
Three months ended March 31 | |||||
2014 | 2013 | ||||
Canada | $ | 1,661,520 | $ | 2,091,585 | |
United States | 5,171,999 | 4,816,974 | |||
Europe and other | 2,284,186 | 1,445,095 | |||
$ | 9,117,705 | $ | 8,353,654 |
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Norsat International Inc. |
Notes to the Condensed Interim Consolidated Financial Statements |
Three months ended March 31, 2014 and 2013 |
(Expressed in US dollars - Unaudited) |
Substantially all of the Company’s property and equipment, intangible assets and goodwill are located in Canada.
Customer Concentration:
For the three months ended March 31, 2014 and 2013, one customer and two customers respectively of the Sinclair Technologies operating segment individually represented 10% or more of total consolidated revenue. The one customers represented a total of 11% of total consolidated revenue (three months ended March 31, 2013 – two customers 25%).
9. | Supplemental cash flow and other disclosures |
Three months ended March 31 | ||||||
2014 | 2013 | |||||
Change in non-cash operating working capital: | ||||||
Trade and other receivables | $ | (816,447 | ) | $ | 290,794 | |
Inventories | (288,961 | ) | (215,635 | ) | ||
Prepaid expenses and other | 159,048 | 58,189 | ||||
Accounts payable and accrued liabilities | (304,782 | ) | (1,732,075 | ) | ||
Provisions | (158,214 | ) | 10,184 | |||
Deferred revenue | (119,278 | ) | (54,421 | ) | ||
$ | (1,528,634 | ) | $ | (1,642,964 | ) | |
Supplementary information: | ||||||
Interest paid | $ | 33,132 | $ | 109,503 |
10. | Related Party Transactions |
Compensation of key management personnel including the Company’s President and Chief Executive Officer, Chief Financial Officer and General Manager are as follows:
Three months ended March 31 | |||||
2014 | 2013 | ||||
Short-term employee benefits | $ | 281,443 | $ | 305,092 | |
Share based payments | 33,885 | 27,404 | |||
Total | $ | 315,328 | $ | 332,496 |
The amounts disclosed in the above table are the amounts recognized as an expense during the reporting period related to key management personnel.
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