CounterPath Solutions, Inc. (OTCBB: CTPS), a leading provider of VoIP (Voice over IP) and Video over IP SIP softphones, today announced the financial and operating results for its first quarter ended July 31, 2006.
“We are pleased to report another quarter of continued growth and record revenue,” commented Mark Bruk, chairman and chief executive officer. “Moreover, the quality of our customers continues to be outstanding as evidenced by tier one customers selecting our product for their softphone rollouts, and supporting our continued investment in new SIP technologies.”
First quarter highlights:
- Record quarterly revenues for the quarter ended July 31, 2006 of $1,760,881, an increase of 113% over the $827,296 recorded for the quarter ended July 31, 2005, and a 20% increase over the $1,467,850 in revenues recorded for the quarter ended April 30, 2006.
- Announcement of a per-subscriber softphone licensing deal with BT Retail (a division of leading UK-based British Telecommunications plc), which allows BT Retail’s consumer broadband customers to experience the benefits of a CounterPath softphone with BT’s new, enhanced VoIP service, including secure Internet voice calling and video messaging. BT is one of the world’s leading providers of communications solutions and services operating in 170 countries. For more information visit www.bt.com/broadbandtalk.
- Announcement of a collaborative effort with Intel Corporation integrating CounterPath’s eyeBeam™ 1.5 Video over IP SIP softphone with the Intel™ 600SM PCI Phone Adapter. The “phone-ready” PC’s (personal computers) will enable users to make calls utilizing standard phones, corded or cordless with their VoIP service. For more information visit www.intel.com/products/desktop/adapters/600sm/index.htm.
- Launching of X-Lite™ 3.0, our newest free SIP softphone building on the success achieved by the previous version of X-Lite which was launched in April 2003, and has since seen nearly two million downloads and is used by the majority of companies looking to test, build and deploy SIP-based solutions. X-Lite is also a favorite among end users of Asterisk™ (www.asterisk.org), recognized as the world’s leading open-source IP-PBX. For more information visit www.counterpath.com/xlite.
Financial Results – Unaudited
(All amounts in U.S. dollars and in accordance with U.S. GAAP unless otherwise specified)
For the three months ended July 31, 2006, we generated $1,760,881 in revenue compared to $827,296 for the three months ended July 31, 2005. This represents an increase of $933,585 or 113% from the same period last year. We generated $1,409,719 in software revenue for the three months ended July 31, 2006 compared to $710,678 for the three months ended July 31, 2005, representing an increase of $699,041 or 98% over the same period last year. The increase in software revenue was attributable to an increase in both the number of customers we sell to and the revenue per customer. For the three months ended July 31, 2006, we generated $351,162 in service revenue compared to $116,618 for the three months ended July 31, 2005 representing an increase of $234,544 or 201% over the same period last year. The significant increase in service revenue reflects the increase in services we provide primarily to our larger customers to enable them to deploy our software. Our total number of customers that have deployed our software increased by 22 over the quarter to 213 as at July 31, 2006.
Total expenses for the three months ended July 31, 2006 were $2,239,023 compared to $1,137,100 for the previous three months ended July 31, 2005, representing and increase of 97% or $1,101,923. Expenses for wages, commissions and benefits during the quarter were $1,156,218 compared to $695,253 for the three months ended July 31, 2005 reflecting the addition of engineering staff required for research and development and the addition of sales and marketing staff. Other expenses include a $266,429 non-cash expense for stock-based compensation compared to $72,586 recorded in the same quarter last year. During the quarter, we began expensing the fair value of our employee stock options.
The net loss for the three months ended July 31, 2006 was $478,142 ($0.01 per share) compared to $309,804 ($0.01 per share) recorded for the three months ended July 31, 2005.
As of July 31, 2006, we had $1,133,361 in cash and cash equivalents compared to $2,369,021 at April 30, 2006. Our working capital was $1,671,169 at July 31, 2006 compared to $1,975,881 at April 30, 2006, representing a decrease of $304,712 from the previous quarter.
Financial tables follow:
The Company’s Quarterly Report on Form 10-QSB for the quarter ended July 31, 2006 is available for viewing at www.sec.gov.
About CounterPath Solutions
CounterPath Solutions is a developer of award-winning, high-quality, carrier-grade VoIP (Voice over IP) and Video over IP SIP softphones for service providers, cable operators, Internet telephony service providers, IP PBX manufacturers and OEMs. CounterPath’s SIP softphones are available either pre-configured or as a software development kit (SDK), and provide VoIP (Voice over IP), Video over IP, IM (Instant Messaging), and Presence functionality. eyeBeam — CounterPath’s feature-rich SIP Video over IP softphone with IM and Presence — recently received both Communications Solutions’ Magazine’s and INTERNET TELEPHONY® Magazine’s “Product of the Year” Award for 2004. CounterPath’s Pocket PC SIP Softphone was recently named a 2005 Innovation Award winner from INTERNET TELEPHONY® magazine. With over 120 customers in more than 30 countries, CounterPath technology is deployed in more than 5,400,000 IP endpoints worldwide.