Broadband Learning Corporation

Broadband Learning Corporation

November 28, 2008 13:12 ET

Broadband Learning Corporation Reports 2008 Q3 Results, Announces Management Change

SALT LAKE CITY, UTAH--(Marketwire - Nov. 28, 2008) - Broadband Learning Corporation ("Broadband Learning") (TSX VENTURE:BLC), a participant in the rapidly expanding distance learning market, today reported its unaudited financial results for the three and nine months ended September 30, 2008.

Three months ending September 30,
($000s, except per share amounts) 2008 2007
Sales $36 $1,044
Gross Profit (545) 326
Loss from operations (2,246) (343)
Net income (loss) ($2,246) ($332)
Earnings (loss) per share (basic & diluted) ($0.08) ($0.01)

Nine months ending September 30,
($000s, except per share amounts) 2008 2007
Sales $319 $2,183
Gross Profit (922) 753
Loss from operations (5,680) (1,312)
Net income (loss) ($5,680) ($1,288)
Earnings (loss) per share (basic & diluted) ($0.20) ($0.04)
Total assets $8,352 $3,409

Revenues for the third quarter and first nine months of 2008 are down significantly from 2007, reflecting the fact that through the end of May, 2008 the Company's full efforts were focused on executing the first phase of a roll-out of installation of the i-vu Systems. During the third quarter, Broadband Learning attempted to deal with i-vu over i-vu's failure to generate any revenues to date on this venture and i-vu's failure to make a number of payments due to Broadband Learning. On September 8, Broadband Learning received a demand for arbitration from attorneys representing i-vu which seeks termination of the Definitive Collaboration Agreement between i-vu and Broadband Learning. On September 14, the Company decommissioned elements of the Systems that had been installed to date. On September 18, i-vu commenced an action in the United States District Court for the District of Utah claiming damages relating to the decommissioning and requesting injunctive relief that would permit i-vu to operate the installed Systems. A hearing was held on September 26 and September 29, following which a ruling was issued on October 9 by the United States District Court denying i-vu's request for injunctive relief. Broadband Learning has filed answers and counterclaims to both the arbitration action and the federal court action in which it denies liability and asserts defences against i-vu's claims, and asserts counterclaims in excess of US$5 million against i-vu. An arbitrator has been appointed in this case and the case will proceed on a schedule determined by the arbitrator. Broadband Learning is now returning its attention to pursuing opportunities and sales in its more traditional areas of distance learning.

Gross Profit for the third quarter and first half of 2008 is down from 2007, reflecting the significant costs of maintaining the i-vu Systems that have not yet begun to generate revenues. In addition during the third quarter, inventory related to the i-vu venture was written down by $166 thousand resulting in a further reduction of Gross Profit for the quarter and the year.

Operating Loss and Net Loss for the third quarter and first half of 2008 all increased significantly from 2007 primarily because very substantial efforts and costs have been invested in this venture, while revenues have not yet commenced.

At a board meeting earlier this week, Edwin Giles submitted his resignation as president of Broadband Learning. Bob Dameron has been appointed president in addition to his responsibilities as CEO. Ed Giles will remain a director of Broadband Learning.

About Broadband Learning Corporation

Broadband Learning Corporation produces, delivers, supports and manages distance learning content for professionals, corporations and consumers using proprietary technology and worldwide distribution capabilities. Broadband Learning is addressing the professional development market by providing a patented Internet-based learning system with on-demand access, multimedia educational resources, and administrative management capabilities. Broadband University is a brand name used by Broadband Learning's wholly-owned subsidiary Broadband Learning Inc. to focus on the distance learning markets using patented technology under a license agreement with School Improvement Network, Inc. of Salt Lake City, Utah. In 2007, Broadband Learning formed a new subsidiary, BL Media Inc. to undertake the Company's digital media operations.

This press release may contain forward-looking statements relating to, among other things, Broadband Learning's expectations concerning future product demand and growth opportunities and customer acceptance of its products. These forward-looking statements are neither promises nor guarantees, but involve risks and uncertainties that may cause actual results to differ materially from those in the forward-looking statements. Broadband Learning disclaims any obligation to publicly update or revise any such statements.

This news release will not constitute an offer to sell or the solicitation of any offer to buy the securities in any jurisdiction. The securities offered will not be and have not been registered under the United States Securities Act of 1933 and may not be offered or sold in the United States.

The TSX Venture Exchange has neither approved nor disapproved the contents of this press release.

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