Miranda Technologies Inc.
TSX : MT

Miranda Technologies Inc.

February 19, 2007 20:40 ET

Miranda reports results for the fourth quarter 2006

MONTREAL, Feb. 19 - Miranda Technologies Inc. (TSX:MT), a
global developer, manufacturer and marketer of high-performance hardware and
software for the television broadcast industry, today reported results for the
fourth quarter and full fiscal year ended December 31, 2006.



Highlights

- Sales of $28.8 million for the quarter, up 5% compared with the fourth
quarter of 2005
- Net income of $7.1 million for the quarter, up 45% compared with the
fourth quarter of 2005
- Fully diluted EPS for the quarter at $0.28, compared with $0.23 for the
fourth quarter of 2005
- Good results for the Vertigo range of products for the fourth quarter
and delivery of the first Kaleido-X
- For fiscal 2006, sales of $106.7 million, up 11% compared with 2005
- For fiscal 2006, net income of $19 million, up 16% compared with 2005


"We are satisfied with the Miranda results for the fourth quarter and for
fiscal 2006," said Strath Goodship, the President and CEO of Miranda. "The
company has experienced good overall organic growth and we are continuing to
innovate by introducing key products to the market. The acquisition of
VertigoXmedia has strengthened our offering, as was demonstrated by the
results obtained during the last quarter of 2006."

During the fourth quarter of 2006, sales totalled $28.8 million, for an
increase of 5% when compared with the same period in 2005 and 13% when
compared with the preceding quarter. Revenue for the year reached
$106.7 million, an increase of $10.2 million or 11% relative to 2005. The
strength of the Canadian dollar in 2006, when compared with American, European
and Japanese currencies, had the effect of reducing our annual sales by
$6.7 million, corresponding to 7% of 2005 revenue.

When we compare sales for the fourth quarters of 2005 and 2006 by
geographic segment, we see growth of $3.1 million or 21% for the Americas, an
increase of $0.5 million or 6% on sales in Europe, but a decline of
$2.2 million or 49% in Asia. It should be noted that the fourth quarter 2005
was exceptionally high for Asia due to several large contracts delivered
during that period.

"We are disappointed by our results in Asia. This market has been sporadic
with severe pricing pressure. In response, we are continuing to restructure
our Asian organization and are adding two additional senior sales executives
in the belief that long-term prospects warrant the investment", said Mr.
Goodship.

The allotment of quarterly sales by the Corporation is 64% for the
Americas, 28% for EMEA and 8% for Asia. For the year, these proportions are
61%, 29% and 10% respectively.

During the quarter, Miranda received orders from major clients such as ABC
Washington (US), Comcast (US), Daystar (US), DirecTV (US), Discovery Channel
(UK), Disney Channel-Europe, NHK (Japan), Telus Communications (Canada),
Tribune (US), Turner (Argentina) and VTR (Chile).

Revenue from the Vertigo range of products (products added to our offer
following the acquisition of VertigoXmedia in May 2006), $2.5 million for the
fourth quarter, are at forecast. For the year, the sale of these products
reached $3.8 million.

In the fourth quarter, we show a high gross margin of 64% resulting from a
favourable product mix having a higher ratio of software and services than
usual. Even excluding the reversal of a one-time reserve of approximately
$0.4 million, resulting from a successful transition to RoHS compliant
production processes, the gross margin is nevertheless 63%. For the year, the
gross margin is 61%, at the same level as in 2005.

Sales, general and administrative expenses were $6.6 million for the
fourth quarter, the same level when compared with the corresponding period a
year earlier.

Investment in Research and Development (R&D) moved from $3.5 million for
the fourth quarter of 2005 to $4.0 million for the same quarter in 2006.

"During the last quarter, we have increased R&D investment by 13% compared
with the same quarter in 2005. Miranda is making every effort to better
understand the needs of its clients and to quickly respond. We are undertaking
sizeable projects to develop integrated solutions. This level of investment
allows us to continue to innovate and accelerate the introduction of new
products. For instance, the positive reaction to the launch of the Kaleido-X,
our new top-of-the-line, multi-image platform, is very encouraging", said Mr.
Goodship.

We note a currency gain of $1.3 million in the fourth quarter. For the
same quarter in 2005, we recorded a loss of $0.7 million. A significant
portion of this currency gain comes from the favourable effect of the
conversion of assets held in the United Kingdom following the appreciation of
the British pound.

The EBITDA (earnings before interest, taxes, depreciation and
amortization) shows a substantial increase, rising to $10.4 million for the
quarter, compared to $7.7 million at the fourth quarter in 2005. This increase
is largely attributable to the increase in sales, the higher gross margin and
the currency exchange gain.

The tax expense for the fourth quarter is $3.1 million, or 30% of earnings
before income taxes - compared to a rate 27% in the corresponding quarter in
2005. For the year, the taxation rate is also 30%, compared with 31% for the
preceding year.

Net earnings for the fourth quarter of 2006 were $7.1 million, an increase
of 45% when compared with the same period in 2005. On a fully diluted basis,
net earnings per share moved from $0.23 in the fourth quarter of 2005 to $0.28
in 2006. For the year, fully diluted earnings per share were at $0.76 compared
with $0.83 in 2005; the decrease being explained by the dilution following the
Corporation's IPO in December 2005.

At the end of the fiscal period, the cash balance and short-term
investments reached $62.6 million; an increase of $3.9 million when compared
with the preceding year. Cash flow from operations was at $15.2 million,
taking into account the increased needs for working capital.

"The broadcast television market is continuing its transformation to
digital and high definition television as well as seeking cost effective
solutions to operate more efficiently", said Mr. Goodship. "These changes are
all bearers of significant business opportunities. Our cash on hand and our
product development capabilities position us well to take advantage and profit
from such opportunities in the future."

Forward-Looking Statement

This press release contains forward-looking statements reflecting
Miranda's objectives, estimates and expectations. Such statements may be
marked by the use of verbs such as 'believe', 'anticipate', 'estimate' and
'looking ahead', as well as the use of the conditional and future tenses. By
their very nature, such statements involve risks and uncertainty.
Consequently, results could differ materially from the Company's expectations.
Our Annual Information Form under "Risk Factors" -available on SEDAR at the
address www.sedar.com- deals with the risks that could cause significant
spreads between presented results and Miranda forecasts. The forward-looking
statements contained in this press release represent our current expectations
and, accordingly, are subject to change. However, we disclaim any intention
and assume no obligation for updating or revising any forward-looking
statements, whether as a result of new information, events or otherwise,
unless required by applicable securities legislation.

Conference Call

Miranda Technologies Inc. will hold a conference call tomorrow (February
20th) at 9 a.m. EST with financial analysts to present the results of the
fourth quarter 2006. People wishing to join the call are invited to call
514-807-8791 (in Montreal and overseas) or 1-800-733-7571 (elsewhere in North
America).

The call will also be accessible via the Web at the following addresses:
www.miranda.com or www.q1234.com.

The conference call will be rebroadcast on the Web, at the same addresses,
for a period of 60 days. A recording of the teleconference will also be
accessible on Tuesday Feb. 20th 2007 from 12 o'clock to 11:59 p.m. on Tuesday
Feb. 27th 2007, by calling 1-877-289-8525 and by entering the code 21218898#
on the telephone keypad.

About Miranda

Miranda Technologies Inc. (TSX: MT) develops, manufactures and markets
high-performance material and software for the television broadcast industry.
Its products are purchased by content creators, broadcasters, specialty
channels and television service providers to enable and enhance the transition
to a complex, multi-channel digital and HDTV broadcast environment. This
equipment allows clients to generate additional revenue while reducing costs
through the more efficient distribution and more effective management of
content, as well as by automation of previously manual processes. The
Corporation has approximately 400 employees at its Head Office in Montreal,
and in its offices in Wallingford (United Kingdom), Springfield (United
States), Paris (France), Tokyo (Japan), Beijing (China) and Hong Kong. Miranda
became a public company in December of 2005 and is listed on the Toronto Stock
Exchange. For more information, please consult www.miranda.com.

The consolidated financial information set out below for the fourth
quarter and the fiscal year ending December 31, 2006 is unaudited, presented
in Canadian dollars and prepared in accordance with generally accepted
Canadian accounting principles. The following information should be considered
in relation with the Corporation's audited financial statements and attached
Notes, which will be filed on SEDAR in the coming weeks.



Unaudited Consolidated Financial Statements of

MIRANDA TECHNOLOGIES INC.

Three-month and twelve-month periods ended December 31, 2006 and 2005

Consolidated Balance Sheets
(In thousands of Canadian dollars)

December 31, 2006 and 2005
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-------------------------------------------------------------------------
2006 2005
-------------------------------------------------------------------------
(Unaudited) (Audited)

Assets

Current assets:
Cash and cash equivalents $ 40,378 $ 58,664
Short-term investments 22,179 -
Accounts receivable 17,710 17,201
Inventories 15,292 9,281
Income taxes receivable 5,279 3,287
Prepaid expenses 886 805
Future income taxes 625 1,519
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102,349 90,757

Capital assets 13,498 12,139
Intangible assets 7,937 612
Goodwill 3,933 -
Future income taxes - 4,643
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$ 127,717 $ 108,151
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-------------------------------------------------------------------------

Liabilities and Shareholders' Equity

Current liabilities:
Accounts payable and accrued charges $ 14,649 $ 16,006
Deferred revenues 298 2,182
Income taxes payable 1,015 1,845
Future income taxes - 814
-----------------------------------------------------------------------
15,962 20,847

Deferred revenues 1,040 590
Future income taxes 2,313 2,148

Shareholders' equity:
Share capital (note 2) 111,784 107,611
Contributed surplus (note 2) 1,216 531
Deficit (4,598) (23,576)
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108,402 84,566
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$ 127,717 $ 108,151
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Consolidated Statements of Income
(Unaudited)

Three-month and twelve-month periods ended December 31, 2006 and 2005
(In thousands of Canadian dollars, except per share amounts)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Three-month periods ended Twelve-month periods ended
December 31, December 31,
-------------------------- ---------------------------
2006 2005 2006 2005
-------------------------------------------------------------------------
Sales $ 28,783 $ 27,328 $ 106,675 $ 96,503

Cost of sales 10,317 10,127 41,505 37,439
-------------------------------------------------------------------------
18,466 17,201 65,170 59,064

Operating expenses:
Selling, general
and administrative 6,568 6,566 28,789 23,792
Research and
development 3,950 3,501 15,300 12,883
Research and
development tax
credits (915) (875) (3,915) (6,000)
Interest (830) 59 (2,268) 508
Foreign exchange
(gain) loss (1,274) 654 (2,302) 1,747
Stock-based
compensation 308 117 744 457
Amortization of
intangible assets 449 460 1,809 1,837
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Income before
income taxes 10,210 6,719 27,013 23,840

Income taxes:
Current 1,940 390 5,210 4,610
Future 1,143 1,413 2,825 2,873
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3,083 1,803 8,035 7,483
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Net income $ 7,127 $ 4,916 $ 18,978 $ 16,357
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Net earnings per
share
(note 2 (c)):
Basic $ 0.29 $ 0.25 $ 0.78 $ 0.90
Diluted 0.28 0.23 0.76 0.83
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Basic weighted
average number
of common shares
outstanding 24,690,529 19,393,672 24,384,951 18,245,236
Diluted weighted
average number
of common shares
outstanding 25,106,554 21,386,050 25,097,351 19,772,766
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Consolidated Statements of Deficit
(Unaudited)

Three-month and twelve-month periods ended December 31, 2006 and 2005
(In thousands of Canadian dollars)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Three-month periods ended Twelve-month periods ended
December 31, December 31,
-------------------------- ---------------------------
2006 2005 2006 2005
-------------------------------------------------------------------------
Deficit, beginning
of period $ (11,725) $ (27,421) $ (23,576) $ (38,862)

Net income 7,127 4,916 18,978 16,357

Redemption of
warrants - (1,071) - (1,071)
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Deficit,
end of year $ (4,598) $ (23,576) $ (4,598) $ (23,576)
-------------------------------------------------------------------------
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Consolidated Statements of Cash Flows
(Unaudited)

Three-month and twelve-month periods ended December 31, 2006 and 2005
(In thousands of Canadian dollars)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Three-month periods ended Twelve-month periods ended
December 31, December 31,
-------------------------- ---------------------------
2006 2005 2006 2005
-------------------------------------------------------------------------
Cash flows from
operating
activities:
Net income $ 7,127 $ 4,916 $ 18,978 $ 16,357
Adjustments for:
Depreciation
of capital
assets 575 458 1,960 1,594
Amortization of
intangible
assets 449 460 1,809 1,837
Stock-based
compensation 308 117 744 457
Future income
taxes 1,143 1,413 2,825 2,873
Other - (2) (100) 57
Effect of
exchange rates
on cash and
cash equivalents (980) 586 (1,217) 1,180
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8,622 7,948 24,999 24,355
Net change in
operating
working capital
items (3,553) (173) (9,806) (7,838)
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5,069 7,775 15,193 16,517

Cash flows from
financing
activities:
Repayment of
long-term debt - (7,822) (502) (12,291)
Reimbursement of
loan granted to
management - - 2,366 -
Issuance of
common shares 62 50,000 1,483 50,000
Tax benefits
related to the
exercise of
stock options 265 - 265 -
Share issuance
costs - (4,905) - (4,905)
Redemption of
warrants - (1,071) - (1,071)
-----------------------------------------------------------------------
327 36,202 3,612 31,733

Cash flows from
investing
activities:
Additions to capital
assets (632) (1,213) (3,105) (2,221)
Proceeds from sale
of investment - - 100 200
Additions to
short-term
investments (22,179) - (22,179) -
Additions to
intellectual
property - - (192) -
Business
acquisition
including
bank
indebtedness - - (12,932) -
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(22,811) (1,213) (38,308) (2,021)

Effect of exchange
rates on cash
and cash equivalents 980 (586) 1,217 (1,180)
-------------------------------------------------------------------------
Net (decrease)
increase in cash
and cash
equivalents (16,435) 42,178 (18,286) 45,049

Cash and cash
equivalents,
beginning of
period 56,813 16,486 58,664 13,615
-------------------------------------------------------------------------
Cash and cash
equivalents,
end of period $ 40,378 $ 58,664 $ 40,378 $ 58,664
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Cash and cash
equivalents are
comprised of:
Cash $ 15,988 $ 13,737 $ 15,988 $ 13,737
Cash equivalents 24,390 44,927 24,390 44,927

$ 40,378 $ 58,664 $ 40,378 $ 58,664
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-------------------------------------------------------------------------


Notes to Consolidated Financial Statements
(Unaudited)

Three-month and twelve-month periods ended December 31, 2006 and 2005
(In thousands of Canadian dollars, except per share amounts)
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Miranda Technologies Inc. (the "Company") is incorporated under Part 1A of
the Companies Act (Québec). The Company develops, manufactures and markets
high performance solutions for the television broadcast industry.

1. Basis of presentation:

The accompanying unaudited interim consolidated financial statements of
the Company have been prepared in accordance with Canadian generally accepted
accounting principles on a basis consistent with those followed in the most
recent audited annual consolidated financial statements. These unaudited
interim consolidated financial statements do not include all information and
note disclosures required by Canadian generally accepted accounting principles
for annual financial statements, and, therefore, should be read in conjunction
with the December 31, 2005 audited consolidated financial statements and the
notes thereto.

The sales are subject to seasonal fluctuations. Normally, the first
quarter of each year is the weakest and business is more evenly spread over
the remaining quarters.


2. Share capital:

(a) Issued and paid share capital:
-------------------------------------------------------------------------
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Common
share Contributed
Number amount surplus
-------------------------------------------------------------------------
Issued and outstanding as at
December 31, 2005 23,951,855 $ 107,611 $ 531

Shares issued pursuant to the
exercise of stock options 754,958 1,807 (324)

Stock-based compensation - - 744

Tax benefits related to the
exercise of stock options - - 265

Reimbursement of loan granted
to management - 2,366 -
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Issued and outstanding as at
December 31, 2006 24,706,813 $ 111,784 $ 1,216
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(b) Stock option plan:

The Company established a stock option plan to attract, retain and provide
an incentive to the employees, directors, officers and consultants, by
providing these persons with the opportunity, through stock options, to
acquire an ownership interest in the Company. The current stock option plan
was adopted in June 2003 to replace prior plans and has been amended and
restated in November 2005 to conform to applicable securities rules and
practices for public companies. The stock option plan is administered by the
Board of Directors. The Board of Directors may determine, in accordance with
the terms of the stock option plan, the terms relating to each option,
including the number of shares subject to each option, exercise price and
expiration date of each option and the extent to which each option is
exercisable during the term of the option. The term of an option granted after
November 2005 cannot exceed 5 years (10 years under the previous plan) and
will usually be vested over three years. All of the options granted pursuant
to the stock option plan before the November 2005 amendment have vested upon
closing of the initial public offering of the Company.

A total of 2,395,185 common shares is reserved for issuance upon exercise
of options issued under the stock option plan. After taking into account
issued and cancelled options, 708,777 common shares are available for issuance
under this stock option plan.

The following table summarizes information on stock options outstanding at
December 31, 2006:

-------------------------------------------------------------------------
-------------------------------------------------------------------------
Weighted
average
Number exercise
of options price
-------------------------------------------------------------------------

Balance, beginning of period 1,286,444 $ 2.37

Granted 399,750 16.67

Exercised (754,958) 1.96
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Balance, end of period 931,236 $ 8.84
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-------------------------------------------------------------------------

The outstanding options at December 31, 2006 are presented in the table
below:

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-------------------------------------------------------------------------
Number of Number of Residual
outstanding vested life
Exercise price options options (years)
-------------------------------------------------------------------------
$1.71 241,486 241,486 6.6
$3.96 115,000 115,000 8.2
$3.96 175,000 175,000 8.5
$16.46 324,000 - 4.2
$17.08 50,000 - 4.2
$18.82 20,000 - 4.4
$17.24 5,750 - 4.6
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931,236 531,486
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-------------------------------------------------------------------------

Compensation cost charged against income was $308 (2005 - $117) and $744
(2005 - $457) for the three and twelve-month periods ended December 31, 2006,
respectively. The offsetting credit has been recorded as contributed surplus.

The fair value of the stock options was estimated using the Black-Scholes
option pricing model using the following assumptions:

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-------------------------------------------------------------------------
2006
-------------------------------------------------------------------------
Risk-free interest rate 3.25% to 3.30%
Dividend yield 0%
Expected life 3.5 years
Expected volatility 50%
Weighted average fair value of each
option at grant date $6.66 to $7.37
-------------------------------------------------------------------------
-------------------------------------------------------------------------

(c) Earnings per share:

The following table provides the reconciliation between basic and diluted
earnings per share:

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Three-month periods ended Twelve-month periods ended
December 31, December 31,
-------------------------- ---------------------------
2006 2005 2006 2005
-------------------------------------------------------------------------

Net income $ 7,127 $ 4,916 $ 18,978 $ 16,357
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Basic weighted
average number
of common shares
outstanding 24,690,529 19,393,672 24,384,951 18,245,236
Dilutive effect:
Outstanding
stock options 416,025 1,992,378 712,400 1,527,530
-------------------------------------------------------------------------

Diluted weighted
average number
of common shares
outstanding 25,106,554 21,386,050 25,097,351 19,772,766
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Basic earnings
per share $ 0.29 $ 0.25 $ 0.78 $ 0.90
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Diluted earnings
per share $ 0.28 $ 0.23 $ 0.76 $ 0.83
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-------------------------------------------------------------------------


3. Financial instruments:

Foreign exchange contracts:

As at December 31, 2006, the Company entered into the following foreign
exchange contracts expiring before June 30, 2007:

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Currencies Notional Average Average Advantage Average
(sold/bought) amount rate floor rate ceiling
-------------------------------------------------------------------------
US$/CDN$ $ 9,000 $ 1.1347 $ - $ - $ -

Euro/CDN$ 6,000 - 1.4750 1.4850 1.5600

US$/CDN$ 5,500 - 1.1312 - 1.1779
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4. Segmented information:

The Company determined that it operates in a single reportable segment,
the broadcast equipment segment, and it derives its revenues from the sale of
hardware and software solutions including related services, training and
commissioning.

-------------------------------------------------------------------------
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Three-month periods ended Twelve-month periods ended
December 31, December 31,
-------------------------- ---------------------------
Sales 2006 2005 2006 2005
-------------------------------------------------------------------------

Canada $ 3,194 $ 656 $ 12,315 $ 5,969
United States 14,479 14,155 48,785 51,361
Other foreign
countries:
Europe,
Middle East,
Africa ("EMEA") 8,095 7,612 31,081 25,912
Asia 2,251 4,428 10,695 12,136
Americas 764 477 3,799 1,125
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$ 28,783 $ 27,328 $ 106,675 $ 96,503
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Capital assets and December 31, December 31,
intellectual property 2006 2005
-------------------------------------------------------------------------
Intan- Intan-
Capital gible Capital gible
assets assets Goodwill assets assets
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Canada $ 12,183 $ 7,937 $ 3,933 $ 11,389 $ -
United States 50 - - 53 -
Other foreign
countries:
EMEA 1,171 - - 672 612
Asia 94 - - 25 -
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$ 13,498 $ 7,937 $ 3,933 $ 12,139 $ 612
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Sales are attributed to the geographic locations based on the location of
the customers.

5. Comparative figures:

Certain comparative figures for 2005 have been restated to conform with
the financial statement presentation adopted for the current period.