CounterPath Corporation (“CounterPath” or the “Company”) (OTCBB: CPAH; TSX-V: CCV), a leading provider of desktop and mobile VoIP software products and solutions, today announced financial and operating results for the third quarter of fiscal year 2010.
Financial and operating highlights for the third quarter ended January 31, 2010 include:
- Revenue for the third quarter of $1.4 million compared to revenue of $1.9 million for the second quarter of fiscal 2010 and $2.0 million for the third quarter of fiscal 2009.
- A considerable reduction in expenses as non-GAAP operating expenses for the third quarter were $2.6 million, down from $3.6 million in non-GAAP operating expenses for the quarter ended January 31, 2009.
- A net loss for the third quarter of $1.8 million ($0.06 per share) compared to a net loss of $2.2 million ($0.08 per share) for the quarter ended January 31, 2009.
- The launch of Bria for Asterisk, a co-branded, open standards-based softphone that interoperates seamlessly with Asterisk telephony platforms enabling SMBs and enterprises to implement a complete end-to-end VoIP solution that is powerful and easy to install.
- The launch of Bria 3.0 multimedia VoIP softphone for both Mac and PC platforms with new features such as high-definition (HD) video, user customization and presence alert, all designed to enhance the overall user experience and the enterprise feature set.
- Subsequent to the quarter, the granting of a fundamental patent which extends CounterPath’s portfolio of patents and exclusive licenses covering its fixed-mobile convergence solutions.
“While we had a number of orders which were delayed resulting in lower revenues for this quarter, we are seeing increased sales activity,” stated Donovan Jones, President and CEO, CounterPath. “There is strong interest in our end-to-end solutions and the market momentum is favorable. Our industry leading, patent protected VoIP, mobile VoIP and fixed mobile convergence applications continue to represent compelling solutions for improving both enterprise and consumer productivity while reducing costs,” continued Jones.
(All amounts in U.S. dollars and in accordance with accounting principles generally accepted in the United States (“GAAP”) unless otherwise specified. Consolidated financial results include the financial results of NewHeights Software Corporation from August 2, 2007 and the financial results for FirstHand Technologies Inc. and BridgePort Networks, Inc., from February 1, 2008.)
For the quarter ended January 31, 2010, revenue was $1.4 million compared to $2.0 million for the same quarter last year. Software revenue for the quarter ended January 31, 2010 was $1.0 million compared to $1.3 million for the same quarter last year. Service revenue for the quarter ended January 31, 2010 was $0.3 million compared to $0.7 million for same quarter last year.
Operating expenses for the quarter ended January 31, 2010 were $3.2 million compared to $4.3 million for the same quarter last year. Operating expenses for the quarter included a non-cash expense of $0.2 million for amortization of intangible assets and a non-cash stock-based compensation expense of $0.3 million. The quarter-over-quarter decrease in operating expenses was primarily due to significant employee rationalization completed over the previous quarters.
Sales and marketing expenses were $0.6 million for the quarter ended January 31, 2010 compared to $0.8 million for same quarter last year. For the quarter ended January 31, 2010, research and development expenses were $0.8 million and general and administrative expenses were $0.9 million, compared to $1.1 million and $1.5 million, respectively, for the same quarter last year.
The net loss for the quarter ended January 31, 2010 was $1.8 million, or a loss of $0.06 per share, compared to a net loss of $2.2 million, or a loss of $0.08 per share, for the quarter ended January 31, 2009.
At January 31, 2010, the Company had $2.4 million in cash, compared to $2.9 million at April 30, 2009. At January 31, 2010, the Company’s working capital was $1.1 million, compared to $1.6 million at April 30, 2009.
CounterPath Corporation is a leading provider of innovative desktop and mobile VoIP software products and solutions. The Company’s product suite includes SIP-based softphones, server applications and Fixed Mobile Convergence (FMC) solutions that enable service providers, enterprises and Original Equipment Manufacturers (OEM) to cost-effectively integrate voice, video, presence and Instant Messaging (IM) applications into their VoIP offerings and extend functionality across both fixed and mobile networks.
CounterPath’s customers include some of the world’s largest telecommunications service providers and network equipment providers including AT&T, Verizon, BT (British Telecommunications PLC), Deutsche Telekom, Cisco Systems and Mitel.
Non-GAAP Financial Measures
This news release contains “non-GAAP financial measures”. The non-GAAP financial measures in this news release consist of non-GAAP operating expenses which exclude non-cash stock-based compensation, amortization and impairment of intangible asset charges relative to operating expenses and operating losses calculated in accordance with GAAP. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. CounterPath utilizes both GAAP and non-GAAP financial measures to assess what it believes to be its core operating performance and to evaluate and manage its internal business and assist in making financial operating decisions. CounterPath believes that the inclusion of non-GAAP financial measures, together with GAAP measures, provides investors with an alternative presentation useful to investors’ understanding of CounterPath’s core operating results and trends.
This news release contains “forward-looking statements”. Statements in this news release, which are not purely historical, are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future, such as the following: (1) There is strong interest in our end-to-end solutions and the market momentum is favorable.
It is important to note that actual outcomes and the Company’s actual results could differ materially from those in such forward-looking statements. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others: (1) the failure to develop new and innovative products using the Company’s technologies, (2) the Company’s ability to remain competitive as other parties develop and release competitive products, (3) the Company’s ability to retain the employees necessary to continue research and development of current and new products, (4) the success by the Company of the sales of its current and new products, (5) the impact of technology changes on the Company’s products and on the VoIP industry, (6) the compatibility of the Company’s products with new computer operating systems, (7) the rate of adoption by service providers and the general public of VoIP as a replacement for regular and cellular phone service, (8) general economic conditions as they affect CounterPath and its current and prospective customers, including a continued downturn in general economic conditions internationally, (9) the ability of the Company to control costs operating, general administrative and other expenses, and (10) insufficient investor interest in the Company’s securities which may impact on the Company’s ability to raise additional financing as required. Readers should also refer to the risk disclosures outlined in the Company’s quarterly reports on Form 10-Q, annual reports on Form 10-K and the Company’s other disclosure documents filed from time-to-time with the Securities and Exchange Commission at www.sec.gov and the Company’s interim and annual filings and other disclosure documents filed from time-to-time on SEDAR at www.sedar.com.
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Chief Financial Officer
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