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iMagicTV
news release
Investor Relations Contact: Media Contact:
Tracy Torena Rob Begg
iMagicTV iMagicTV
800-660-0333 800-660-0333
ttorena@imagictv.com rbegg@imagictv.com
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iMagicTV Reports Fourth Quarter and Year End Results
All amounts in U.S. Dollars
SAINT JOHN, NEW BRUNSWICK, CANADA - April 9, 2002 - iMagicTV (Nasdaq:
IMTV and TSE: IMT), a provider of software products that allow telephone
companies and other service providers to deliver multi-channel television and
interactive media services, today announced its financial results for the fourth
fiscal quarter and year ended February 28, 2002.
Revenues for the fourth quarter were $1.4 million compared with $3.3
million in the fourth quarter of last year. Approximately $1.0 million of this
quarter's revenue was attributable to a non-recurring advance payment for
subscriber royalties from a customer. Revenues for the year were $4.2 million
compared with $7.8 million for last year, excluding equipment revenue of $1.2
million for last year. As of February 28, 2002, iMagicTV had $46.0 million in
cash and short-term investments, compared to $48.4 million on November 30, 2001.
The net loss for the fourth quarter was $2.2 million, or $0.09 per basic
share, compared to a net loss of $3.3 million, or $0.13 per basic share, in the
fourth quarter of last year. The net loss for the year was $18.7 million, or
$0.76 per basic share, compared to a net loss of $11.5 million, or $0.58 per
basic share, for 2001.
"We are encouraged by the continued interest in the iMagicTV solution and
we are hopeful that additional market trials and commercial rollouts with major
global telecommunications companies will occur this year. Nonetheless, last year
was a trying time both for our company and the telecommunications industry in
general," said Marcel LeBrun, iMagicTV president and chief executive officer.
"While the slowdown in capital spending in telecommunications has directly
impacted our financial performance during the year, we believe the business case
for our solution continues to improve and that our solution remains an
attractive opportunity for service providers around the world. We believe we are
well poised to benefit from broadband entertainment as service providers move to
commercial deployment."
iMagicTV Reports Fourth Quarter Results
Page 2
April 9, 2002
"Given the continued uncertainty in the telecommunications market and
delays in the commercial deployment of broadband entertainment services in the
near term, we remain committed to conserving our cash balance," LeBrun added.
"As a result of our cost containment actions, including our restructuring plan
in November 2001, our core operating expenses were down 22 percent from the
third quarter and 44 percent from the fourth quarter of fiscal 2001. Even though
we have significantly reduced our operating costs, our priority on research and
development and sales and marketing is unchanged. We continue to focus on the
products, services and customers that show the most promise for a move to
commercial deployment of digital TV."
About iMagicTV
iMagicTV (Nasdaq: IMTV and TSE: IMT) provides software products and
related services that enable telephone companies and other service providers to
deliver multi-channel digital television and interactive media services to their
subscribers over a broadband network infrastructure. iMagicTV's software can be
deployed over high-speed broadband networks including ADSL, VDSL, wireless,
Ethernet and Fiber to the Home (FTTH) technologies.
Incorporated in 1997, iMagicTV maintains its global headquarters in Saint
John, New Brunswick, Canada, its European headquarters in Cambridge, UK and its
Asia Pacific headquarters in Singapore. The Company also has offices located in
the United States. For more information, visit www.imagictv.com.
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Cautionary Note Regarding Forward-looking Statements Under the Private
Securities Litigation Reform Act of 1995: Information in this release that
involves iMagicTV's projections, expectations, beliefs, hopes, plans, intentions
or strategies regarding the future are forward-looking statements that involve
risks and uncertainties, including the occurrence and results of future market
trials. These statements include statements about iMagicTV's strategies in the
marketplace, its market position, its relationship with customers and its
expectations regarding future market trials and commercial deployments of its
solution. All forward-looking statements included in this release are based upon
information available to iMagicTV as of the date of the release, and we assume
no obligation to update any such forward-looking statement. These statements are
not guarantees of future performance and actual results could differ materially
from our current beliefs and expectations as stated in this release. These and
other factors, which are discussed in the Company's filings with the U.S.
Securities and Exchange Commission (SEC), are risks associated with our business
that may affect our operating results.
iMagicTV Reports Fourth Quarter Results
Page 3
April 9, 2002
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ImagicTV Inc.
Condensed Consolidated Statement of Operations
(In thousands of U.S. dollars, except per share amounts)
Three months ended Twelve months ended
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February 28, February 28, February 28, February 28,
2002 2001 2002 2001
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(unaudited) (unaudited)
Revenues:
License fees $ 109 $ 1,053 $ 631 $ 4,770
Royalty fees 1,039 1,075 1,197 1,288
Services 277 1,098 2,387 1,791
Equipment - 43 - 1,150
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Total revenues 1,425 3,269 4,215 8,999
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Cost of revenues:
Services 304 1,031 2,274 2,248
Equipment - 36 - 1,068
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Total cost of revenues 304 1,067 2,274 3,316
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Gross profit 1,121 2,202 1,941 5,683
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Operating expenses:
Sales and marketing 1,191 2,836 8,510 7,430
Research and development 1,191 2,095 6,176 7,221
General and administrative 872 841 4,164 2,313
Depreciation 470 376 1,864 1,169
Stock-based compensation charge (recovery) (178) 196 276 543
Restructuring costs - - 1,162 -
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Total operating expenses 3,546 6,344 22,152 18,676
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Loss from operations (2,425) (4,142) (20,211) (12,993)
Interest income, net 173 870 1,656 1,133
Foreign exchange gain (loss), net (46) (32) (28) 426
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Loss before income taxes (2,298) (3,304) (18,583) (11,434)
Recovery of (provision for) income taxes 59 11 (121) (24)
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Net loss for the period $ (2,239) $ (3,293) $ (18,704) $ (11,458)
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Basic and diluted net loss per share $ (0.09) $ (0.13) $ (0.76) $ (0.58)
============ ============ ============ ============
Weighted average number of shares used in
computing basic and diluted net loss
per share (000s) 24,632 24,593 24,606 19,796
============ ============ ============ ============
Adjusted net loss:
Net loss for the period $ (2,239) $ (3,293) $ (18,704) $ (11,458)
Add back of non-cash based charges:
Stock-based compensation charge (recovery) (178) 196 276 543
Depreciation 470 376 1,864 1,169
Add back of non-recurring charges:
Restructuring costs - - 1,162 -
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Adjusted net loss $ (1,947) $ (2,721) $ (15,402) $ (9,746)
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Adjusted basic and diluted net loss per share $ (0.08) $ (0.11) $ (0.63) $ (0.49)
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iMagicTV Reports Fourth Quarter Results
Page 4
April 9, 2002
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ImagicTV Inc.
Condensed Consolidated Balance Sheet
(In thousands of U.S. dollars)
February 28, February 28,
2002 2001
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Assets
Current assets:
Cash and cash equivalents $ 45,641 $ 46,414
Short-term investments 359 14,346
Accounts receivable, trade 448 5,680
Instalment receivables - 705
Inventory - 295
Prepaid expenses, deposits and other receivables 904 1,436
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Total current assets 47,352 68,876
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Capital assets 2,133 2,970
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Total assets $ 49,485 $ 71,846
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Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 667 $ 1,055
Accrued liabilities 1,083 3,823
Deferred revenue and customer deposits 437 1,119
Current portion of long-term debt 9 72
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Total current liabilities 2,196 6,069
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Long-term debt 1,496 1,577
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Shareholders' equity:
Authorized:
Unlimited common shares, no par value
Unlimited preferred shares, no par value
Issues and outstanding:
24,669,336 Common Shares
(February 28, 2001 - 24,592,624) 85,698 87,678
Deferred stock-based compensation (393) (2,670)
Accumulated deficit (38,986) (20,282)
Reporting currency translation adjustments (526) (526)
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Total shareholders' equity 45,793 64,200
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Total liabilities and shareholders' equity $ 49,485 $ 71,846
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iMagicTV Reports Fourth Quarter Results
Page 5
April 9, 2002
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NOTE TO MEDIA, ANALYSTS AND INVESTORS:
Media, analysts and investors are invited to participate in a conference call to
review iMagicTV's fiscal 2002 fourth quarter financial results.
Tuesday, April 9, 2002 - 4:30 pm (Eastern Time)
To participate in this conference call, please call the following approximately
five minutes before the call (4:25 pm Eastern Time):
913-981-5509
If you experience problems during the call or reaching the number above, please
call Kristina Korte at Corporate Communications Inc. at (615) 254-3376.
You can also access the conference call via an audio Web cast by visiting the
following link:
http://companyboardroom.com
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A replay of the conference call will be available at this web site for a period
of 30 days.
A telephonic replay of the conference call will be available for seven days
after the call and can be accessed by calling 719-457-0820 and entering the
passcode 710783.
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