Enablence Technologies Inc.

Enablence Technologies Inc.

September 22, 2009 18:51 ET

Enablence Technologies Inc. Announces Results for FY 2010 First Quarter Ending July 31, 2009: Cost Reductions Drive Lower Net Loss Despite Revenue Decline

OTTAWA, ONTARIO--(Marketwire - Sept. 22, 2009) - Enablence Technologies Inc. ("Enablence" or the "Company") (TSX VENTURE:ENA), a leading supplier of fiber-to-the-home (FTTH) equipment for triple-play residential and business services and optical components and subsystems for access, metro and long-haul markets, announced today financial results for the first quarter of fiscal year 2010 ending July 31, 2009.

FQ1-10 FQ4-09 FQ1-09
Revenue $12,586 $14,049 $7,634
Operating loss $8,082 $9,315 $7,574
Net loss $6,883 $12,808 $6,844
EPS ($0.03) ($0.06) ($0.04)

Revenues for the first quarter of fiscal 2010 increased by 65% to $12.6 from $7.6 million during the same period in fiscal 2009, but dropped by 10% from the fourth quarter of fiscal 2009. The net loss for the first quarter fiscal 2010 was $6.9 million (of which $1.4 million comprised of non-cash charges) compared to net loss of $12.8 million (of which $5.3 million comprised of non-cash charges) in the previous quarter and $6.8 million (of which $2.3 million comprised of non-cash charges) in first quarter fiscal 2009. The Company's loss per share for first quarter fiscal 2010 decreased to $0.03 compared to $0.06 in the previous quarter and $0.04 during the same period in fiscal 2009.

Enablence's cash & cash equivalents increased by $3.5 million in FQ1/10 to $15 million on July 31, 2009, reflecting $13 million of net cash proceeds on shares issued during the quarter less cash used to fund operations and working capital.

The highlights during the first quarter fiscal 2010 were:

- The announcements of major new business wins in Europe, Middle East and U.S.

- The successful issue of common shares, raising net cash proceeds of $13 million to fund the Company's growth and operations

- Implementation of cost reduction programs, resulting in a $1.8 million reduction in R&D and SG&A expenses from FQ4/09 to FQ1/10

- Initiatives to improve product/customer mix in the Components Division, resulting in 13% point improvement in gross margins in FQ1/10 compared with FQ4/09.

"Despite the revenue drop from previous quarter, we were able to improve gross margins and control our operating costs," said Arvind Chhatbar, CEO of Enablence. "As a result, we reduced our operating expenditures by $1.8 million contributing to the reduction in our operating loss by $1.2 million in the first quarter. We anticipate that this trend will continue in the next quarter as a result of additional actions taken to benefit from integration of our activities" added Mr. Chhatbar. "We are also expecting that as our revenue picture begins to move on a growth trajectory, the combination of top line growth and cost reductions will have further positive impact on our overall financial performance in the coming quarters."

About Enablence Technologies Inc.

Enablence Technologies Inc., (TSX VENTURE:ENA) a publicly traded company headquartered in Ottawa, Canada, designs, manufactures and sells optical components, subsystems and systems to a global customer base.

Enablence's Systems Division has an expanding fiber-to-the-premise (FTTP) product portfolio featuring a variety of architectural options. It enables service providers to evolve their access networks from traditional copper-based networks to advanced optical communications access networks that are based on state-of-the-art IP and Ethernet standards, for triple-play voice, video and data services including HDTV, IP Telephony and ultrafast internet access. The Division's network equipment has been deployed with 420 service providers worldwide that serve over 4 million subscribers.

Enablence's Optical Components and Subsystems Division is a global leader in applying Planar Lightwave Circuit (PLC) technology to integrate multiple components into a single optical chip to reduce footprint and costs. Network and equipment designers around the world turn to Enablence for a variety of components and subsystems for access, metro and long-haul including transceivers, splitters, waveguides, optical channel monitors, multiplexers, ROADMs, switches, tunable dispersion compensators, and photodiodes. The Division serves over 120 system and subsystem developers and its products have been integrated in all major communications networks worldwide, serving tens of millions of subscribers.

Forward-looking Statements

This press release may contain forward looking statements that are made as of the date hereof and are based on current expectations, forecasts and assumptions which involve risks and uncertainties associated with our business and the economic environment in which the business operates. All such statements are made pursuant to the 'safe harbour' provisions of, and are intended to be forward-looking statements under, applicable Canadian securities legislation. Any statements contained herein that are statements of historical facts may be deemed to be forward-looking statements. By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties. We caution our readers of this press release not to place undue reliance on our forward looking statements as a number of factors could cause actual results or conditions to differ materially from current expectations. Please refer to the risks set forth in the Company's continuous disclosure documents that can be found on SEDAR www.sedar.com. Enablence does not intend, and disclaims any obligation, except as required by law, to update or revise any forward looking statements whether as a result of new information, future events or otherwise.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Enablence Technologies Inc.
    Ron Benn
    Vice President, Finance