Vigil Health Solutions Inc.

Vigil Health Solutions Inc.

August 11, 2008 10:14 ET

Vigil Health Solutions Reports First Quarter Results

Cash Flow Positive in Q1FY09, Bookings up 28% from Q1FY08

VICTORIA, BRITISH COLUMBIA--(Marketwire - Aug. 11, 2008) - Vigil Health Solutions Inc. ("Vigil") (TSX VENTURE:VGL) announces the results of operations for the quarter ending June 30, 2008.

"We are very encouraged to see positive cash flow in this quarter as well as the continued growth in sales bookings" stated Troy Griffiths, President and CEO.

Business highlights

- Positive cash flow of $50 thousand was achieved, primarily driven by increased receipts from progress billings and customer deposits for new orders.

- Sales bookings for the quarter were up 28% to $1.16 million compared to $0.9 million in Q1FY08.

- The Company held an order backlog of approximately $3.97 million at Q1FY09 compared to $1.92 million in Q1FY08.

- Deferred revenue increased 120% to $1.66 million reflecting the 46 projects in various stages of installation and progress billing, compared to $0.8 million and 23 projects in Q1FY08.

- Secured a new corporate in the quarter bringing the total to 18 corporate clients and received recurring sales bookings from 4 existing corporates.

Financial Results

Revenue for Q1FY09 was $701 thousand compared to $904 thousand in Q1FY08, a decrease of 23%. The decrease in project revenue reflects construction delays which resulted in a lower number of projects being commissioned in the period compared to Q1FY08. Revenue received from sales and maintenance contracts and replacement products grew by 105% to $155 thousand.

Bookings for the quarter were up 28% to $1.16 million compared to $902 thousand in Q1FY08.

Vigil had a backlog of approximately $3.97 million (including $1.66 million in deposits and progress billings, recorded as deferred revenue on balance sheet) in Q1FY09 compared to $1.92 million (including $756 thousand in deposits and progress billings, recorded as deferred revenue on balance sheet) in Q1FY08.

The gross margin percentage for Q1FY09 was 47% compared to 52% for Q1FY08. In the first quarter of fiscal 2008 gross margins were above management's expectations due to a favourable product mix for the projects commissioned in this quarter. While lower than the previous year the gross margin received in the current fiscal are in line with management's expectations of annual margins of between 42% and 47%.

Operating expenses for Q1FY09 were $614 thousand, up 17% from $524 thousand in Q1FY08. The growth in expenses was due to an increase in insurance costs (prior to the Company switching to a new lower cost insurance provider), advertising, sales travel expenses and research and development staffing.

Losses for Q1FY09 were $288 thousand, or $0.003 per share an increase of 235% compared to $86 thousand, or $0.001 per share for the same quarter in the previous year. The increase in losses can be attributed to the decrease in revenues relating to the lower number of projects commissioned. However, the high number of projects underway in the quarter and related deferred revenue resulted in a positive cash flow.

The following is a summary of our financial performance for the three months ended June 30, 2008. Detailed financial statements along with Management Discussion and Analysis have been filed with SEDAR and may be viewed at ( or on the Company web site (

Financial information will be mailed to entitled security holders on August 15, 2008. Or, upon notice to the Company, entitled security holders may request a copy of financials in advance.

Summary Financial Information

Three Months Ended
30-Jun-08 30-Jun-07

Revenue: $ 700,543 $904,078

Cost of sales: $ 371,870 $437,658

Gross Profit: $ 328,673 $466,420

Expenses: $ 614,315 $523,878

Loss before the following items: $(285,642) $(57,458)

Other income (expense): $ (2,489) $(28,623)

Loss for the period $(288,131) $(86,081)

About Vigil Health Solutions Inc.

Vigil offers a proprietary technology platform combining software and hardware to provide comprehensive solutions to the expanding aged care market. Vigil has established a growing presence in North America and an international reputation for being on the leading edge of systems design and integration. The Vigil Integrated Care Management System™ (Vigil® System) includes the award-winning Vigil Dementia System, a nurse call system, bed monitoring, resident check in, and the latest development the Vigil Wireless call system. The first to supply dementia specific care technology, Vigil facilitates the highest standard of care for cognitive residents while helping dementia residents enjoy a higher quality of life and greater dignity.

Certain statements contained in this news release, that are not based on historical facts, may constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). These forward-looking statements are not promises or guarantees of future performance but are only predictions that relate to future events, conditions or circumstances or our future results, performance, achievements or developments and are subject to substantial known and unknown risks, assumptions, uncertainties and other factors that could cause our actual results, performance, achievements or developments in our business or in our industry to differ materially from those expressed, anticipated or implied by such forward-looking statements.

Forward-looking statements include all financial guidance, disclosure regarding possible events, conditions, circumstances or results of operations that are based on assumptions about future economic conditions, courses of action and other future events. We caution you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made. These forward-looking statements appear in a number of different places in this presentation and can be identified by words such as "may", "estimates", "projects", "expects", "intends", "believes", "plans", "anticipates", or their negatives or other comparable words. Forward-looking statements include statements regarding the outlook for our future operations, plans and timing for the introduction or enhancement of our services and products, statements concerning strategies or developments, statements about future market conditions, supply conditions, end customer demand conditions, channel inventory and sell through, revenue, gross margin, operating expenses, profits, forecasts of future costs and expenditures, the outcome of legal proceedings, and other expectations, intentions and plans that are not historical fact.

The risk factors and uncertainties that may affect our actual results, performance, achievements or developments are many and include, amongst others, our ability to develop our sales force and generate revenue, the length of the sales cycle, management of the Company's growth, ability to recruit and retain staff, fluctuations in demand for current and future products, our ability to develop, manufacture, supply and market existing and new products that meet the needs of customers, volatility in the exchange rate, ability to secure financing, ability to secure product liability insurance, the continuous commitment of our customers, increased competition, changes in regulation and reliance on third party suppliers. These risk factors and others are discussed in the Risks and Uncertainties section of our "Management Discussion and Analysis" segment of our fiscal 2008 Annual Report. Many of these factors and uncertainties are beyond the control of the Company. Consequently, all forward-looking statements in this news release are qualified by this cautionary statement and there can be no assurance that actual results, performance, achievements or developments anticipated by the Company will be realized.

Forward-looking statements are based on management's current plans, estimates, projections, beliefs and opinions and, except as required by law, the Company does not undertake any obligation to update forward-looking statements should the assumptions related to these plans, estimates, projections, beliefs and opinions change.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

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