Wi-LAN Inc (:WIN)
Shares Issued 93,505,167
Last Close 6/3/2008 $2.00
Wednesday June 04 2008 - News Release
Mr. Tyler Burns reports
WI-LAN REPORTS SECOND QUARTER 2008 FINANCIAL RESULTS
Wi-LAN Inc. has released financial results for the second quarter ended April 30, 2008.
Revenue for the second quarter of fiscal year 2008 was $3.2-million. Operating expenses in the second quarter were $4.6-million. Total expenses were $9.1-million, which included $500,000 of stock-based compensation expense, and $4.1-million of depreciation and amortization expense, both non-cash charges. Interest income amounted to $800,000 during the quarter. Net earnings amounted to a loss of $4.1-million or four cents per basic and diluted share. Pro forma earnings amounted to a loss of $500,000 or one cent per diluted share.
Revenues for the six months ended April 30, 2008, were $8-million. Operating expenses for the first half of the year were $8.3-million. Total expenses were $17.5-million, including $1-million of stock-based compensation expense, and $8.2-million of depreciation and amortization expense, both non-cash charges. Interest income amounted to $1.8-million during the six months ended April 30, 2008. Net earnings amounted to a loss of $6-million or six cents per share for the six months ended April 30, 2008. Pro forma earnings for the same period were $1.5-million or two cents per share.
In the second quarter of fiscal year 2008, cash and cash equivalents decreased by $600,000 to $91.8-million at April 30, 2008. Over the six-month period ended April 30, 2008, the company generated positive cash flow of $300,000. The company's cash equivalents include treasury bills, term deposits and guaranteed investment certificates.
Second quarter 2008 highlights:
- Added 10 wireless licensees;
- Added seven V-chip licensees;
- Patent licensing industry veteran, Robert Bramson, elected to Wi-LAN's board of directors.
"I am pleased with the progress that our business has continued to make this quarter," said Jim Skippen, president and chief executive officer. "The number and variety of signings to date has established a solid recurring revenue base and reinforces our overall strategy. Our business has now reached a maturity level that permits us to be more confident in our licensing program.
"The confidence that we have in our business is demonstrated, in part, by our decision to provide more fulsome financial disclosure, including our first-ever release of annual revenue and pro forma earnings guidance as well as our current backlog position."
2008 financial guidance
The company's estimated revenue backlog represents its estimates of revenues yet to be recorded from signed licence agreements. These estimates consider the market forecasts for the technologies covered within the company's patent portfolio, publicly available, and, in certain cases, privately provided forecasts for existing licensees' product sales, and the relevant licence rates in effect in these signed agreements. The timing of licence agreement closings, breadth and depth of product portfolios licensed, and other external market forces may cause the company's estimated revenue backlog to vary from one quarter to the next. As at April 30, 2008, the company's estimated revenue backlog position was approximately $140-million. The company expects this estimated revenue backlog will be recognized over the remaining terms of the licence agreements, which range from four to eight years.
The company's revenues result from the licensing of intellectual property which, by its very nature, is directly affected by the timing of the closure of licence agreements, the nature and extent of specific licences, including actual rates, product sales by licensees, which can be subject to seasonality, and overall market demands, as well as the timeliness of the receipt of licensee royalty reports. Thus, quarter-to-quarter fluctuations in revenue are normal and should be expected. Management believes that the strength of its business should be measured by annual revenues and growth in estimated revenue backlog.
Revenues for the fiscal year are expected to be within the range of $15-million to $20-million. Operating expenses, excluding stock-based compensation, are expected to be in the range of $16-million to $19-million. Pro forma earnings are expected to be within the range of $2-million to $5-million.
Conference call information
Wi-LAN will conduct a conference call to discuss its financial results today at 10 a.m. ET. Wi-LAN president and chief executive officer, Mr. Skippen, and chief financial officer, Shaun McEwan, will be on the call.
Calling information
Callers from Canada or the United States, dial 1-866-585-6398 (toll-free).
Callers from other locations, dial 416-849-9626 (international).
Replay information
The call will be accessible by telephone until 11:59 p.m. on June 11, 2008.The replay number (toll-free) is 1-866-245-6755, or (international) 416-915-1035. The passcode is 419243.
CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT (in thousands of dollars, except per share amounts)
Three months ended Six months ended April 30, April 30, 2008 2007 2008 2007
Revenues $3,245 $75 $7,986 $49,340Income/(expenses) fromthe followingOperating expensesStock-based compensation (450) (135) (1,017) (278)Other operating expenses (4,574) (2,063) (8,299) (5,310) ----- ----- ----- ----- Total operating expenses (5,024) (2,198) (9,316) (5,588)Depreciation & amortization (4,061) (1,056) (8,204) (1,802)Interest income, net 789 904 1,780 1,071 Earnings/(loss) before ----- ----- ----- -----income taxes (5,051) (2,275) (7,754) 43,021Provision for income taxrecovery/(expense)Current (184) - (542) -Future 1,146 - 2,292 (16,726) ----- ----- ----- ----- 962 - 1,750 (16,726) Net and comprehensive ----- ----- ----- ----- earnings/(loss) (4,089) (2,275) (6,004) 26,295(Deficit), beginning ofperiod (139,890) (137,022) (137,975) (165,592)(Deficit), end of period $(143,979) $(139,297) $(143,979) $(139,297)Earnings/(loss) per sharebasic and dilutedBasic $(0.04) $(0.03) $(0.06) $0.39Diluted $(0.04) $(0.03) $(0.06) $0.37
