COMTEX
News Network, Inc.
Release: IMMEDIATE
For: Comtex News Network
(Symbol: CMTX)
Contact: Amber Gordon
agordon@comtex.com
703-797-8011
COMTEX REPORTS 1ST QUARTER FISCAL 2006 EARNINGS
ALEXANDRIA, VA, November 14, 2005 - Comtex News Network, Inc. (OTC BB: CMTX), a
leading provider of economically useful electronic real-time news, content and
market alerts, today announced financial results for its first fiscal 2006
quarter.
Comtex reported approximately $2 million in revenue for the first
quarter of fiscal 2006, ended September 30, 2005, which was essentially
unchanged from the comparable quarter of the previous fiscal year. For the
quarter ended September 30, 2005, Comtex reported operating income of $104,000
and net income of $63,000, or $0.01 per share, versus operating income of
$132,000 and net income of $96,000, or $0.01 per share, for the first quarter of
the previous fiscal year. The decreases in operating and net income are
primarily the result of reporting stock-based compensation in accordance with
FASB issued SFAS No. 123R, which requires that the issuance of stock options be
accounted for using specific new regulations. Comtex adopted this standard on
its effective date, July 1, 2005. Had these regulations been adopted during the
previous year, net income for the first quarter of fiscal 2005, ended September
30, 2004, would have been $13,000.
For the quarters ended September 30, 2005 and 2004, EBITDA (as defined
and explained in the accompanying note to the table below) increased to $327,000
from $311,000. This change is reflective both of decreased depreciation and
amortization and increased stock-based compensation charges.
"Comtex is pleased to continue to provide targeted, economically useful
news products," said Chip Brian, Comtex's President and COO. "We've recently
welcomed several new, exciting clients and we continue to focus on strengthening
our legacy news products and developing innovative products for all our
clients."
About Comtex
Comtex (www.comtex.com) provides real-time news, SmarTrendSM Alerts and
economically useful information to businesses whose customers need more than
just facts. Comtex customers receive select content from key sources which is
further enhanced with stock tickers and an extended lexicon of relevant terms.
With a specialization in the financial news and content marketplace, Comtex
receives, enhances, combines and filters news and content received from national
and international news bureaus, agencies and publications, and distributes more
than one million total stories per day. Comtex's state-of-the-art technology
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Comtex Announces 1st Quarter Financial Results Page 2
November 14, 2005
delivers this relevant content and reliable service in real-time. Comtex (OTC
BB: CMTX) has offices in New York City and Alexandria, Virginia.
SmarTrendSM and CSTASM are service marks of Comtex News Network, Inc.
Please Note: Except for the historical information contained herein, this press
release contains forward-looking statements within the meaning of Section 21E of
the Securities and Exchange Act of 1934, as amended, that involve a number of
risks and uncertainties. These forward-looking statements may be identified by
reference to a future period by use of forward-looking terminology such as
"anticipate," "expect," "could," "intend," "may" and other words of a similar
nature. These statements involve risks and uncertainties that could cause actual
results to differ materially from those contemplated herein, including the
occurrence of unanticipated events or circumstances relating to the fact that
Comtex is in a highly competitive industry subject to rapid technological,
product and price changes. Other factors include the possibility that demand for
the Company's products may not occur or continue at sufficient levels, changing
global economic and competitive conditions, technological risks and other risks
and uncertainties, including those detailed in the Company's filings with the
Securities and Exchange Commission. Comtex undertakes no obligation to update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise.
FINANCIAL TABLE FOLLOWS
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Comtex Announces 1ST Quarter Financial Results Page 3
November 14, 2005
Comtex News Network, Inc.
Selected Financial Information
(unaudited)
Three Months
Ended September 30,
---------------------------------
2005 2004
---- ----
Revenues $ 1,996 $ 1,987
Operating Income 104 132
Net Income $ 63 $ 96
---------------------------------
Net Income Per Share
Basic $ 0.01 $ 0.01
---------------------------------
Diluted $ 0.01 $ 0.01
---------------------------------
Weighted Avg. # Shares:
Basic 13,600 13,599
---------------------------------
Diluted 14,784 14,707
---------------------------------
Reconciliation to EBITDA:
Net Income $ 63 $ 96
Stock-based compensation 117 -
Depreciation & Amortization 106 180
Interest/Other Expense 25 35
Income Taxes 16 -
---------------------------------
EBITDA $ 327 $ 311
---------------------------------
Please Note: EBITDA consists of earnings before interest and other expense,
interest and other income, income taxes, stock-based compensation, depreciation
and amortization and impairment charges. EBITDA is not a term defined by
generally accepted accounting principles, and as a result, our measure of EBITDA
might not be comparable to similarly titled measures used by other companies.
However, we believe that EBITDA is relevant and useful information, which is
often reported and widely used by analysts, investors and other interested
parties in our industry. Accordingly, we are disclosing this information to
permit a more comprehensive analysis of our operating performance.
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