Wi-LAN Inc.
TSX : WIN

Wi-LAN Inc.

January 11, 2007 08:00 ET

Wi-LAN Announces Fiscal 2006 Financial Results

Company Reports Earnings of $14 Million in Fiscal 2006

OTTAWA, CANADA--(CCNMatthews - Jan. 11, 2007) - Wi-LAN Inc. (TSX:WIN) ("Wi-LAN" or "the Company") today announced financial results for the fiscal year ended October 31, 2006. All financial amounts are expressed in thousands of Canadian dollars, except per share amounts or unless otherwise noted.

FINANCIAL HIGHLIGHTS

OPERATIONS



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Years ended October 31 2006 2005 2004
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Revenues $2,108 $- $-
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Earnings/(loss) from continuing
operations before income tax 9,561 (4,173) (2,925)
Provision for future income tax recovery 16,726 - -
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Earnings/(loss) from continuing
operations 26,287 (4,173) (2,925)
Loss from discontinued operations (12,178) (21,605) (4,124)
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Net earnings/(loss) $14,109 $(25,778) $(7,049)
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Earnings/(loss) per share - basic and
diluted
From continuing operations $0.54 $(0.10) $(0.07)
From discontinued operations (0.25) (0.51) (0.10)
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Net earnings/(loss) per share $0.29 $(0.61) $(0.17)
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During 2006, Wi-LAN transformed itself into a pure-play wireless and wireline IP licensing company by divesting its products and engineering services businesses.

Revenues from Wi-LAN's licensing activities reached $2,108 for the fiscal year ending October 31, 2006. There were no license revenues generated in the prior two years. The Company generated $9,561 of earnings from its continuing licensing business before taxes in fiscal 2006, following two years of losses.

The 2006 results reflected $5,721 of operating expenses for the Company's staff, external legal costs, facilities, administration and other expenses plus $676 of depreciation and amortization expenses relating mainly to its patent portfolio. Pre-tax 2006 earnings also included several non-recurring gains: a $9,635 net settlement with Cisco Systems Inc. ("Cisco") that included the sale of patents and paid-up royalties on certain patents; a $2,919 gain on its settlement with Industry Canada; and the $1,145 gain on the sale of its Calgary head office. The Company also reported a $16,726 non-cash future income tax recovery based mainly on the income from license agreement signed with Nokia in December 2006 following the fiscal year end.

Losses from the discontinued products and engineering services businesses amounted to $(12,178), $9,427 less than the prior year due to lower R&D, sales and marketing and other expenses. The Company exited these businesses in the fiscal second quarter ending April 30, 2006.



FINANCIAL POSITION
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As at October 31 2006 2005 2004
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Cash and cash equivalents $16,680 $3,690 $13,768
Future tax asset 16,726 - -
Patents and trademarks 9,787 10,059 10,512
Shareholders' equity 43,274 10,916 35,830
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Wi-LAN's cash position improved by $12,990 in 2006 mainly due to the $14,738 of net cash raised by the issuance and sales of common shares in June and August 2006.

SUBSEQUENT EVENTS

Two significant subsequent events were achieved in December 2006, after the end of the fiscal year.

- Wi-LAN licensed its patent portfolio to Nokia for total consideration of $49,200, including approximately $15,200 of cash and ADSL patents valued at $34,000; and

- The Company completed a bought deal financing to issue 6,666,700 common shares for net cash proceeds of approximately $28,250 (gross proceeds of $30,000).

MANAGEMENT COMMENTS

"This has been a watershed year for Wi-LAN, including our dramatic turnaround to profitability in 2006," said Jim Skippen, President & CEO. "We started with a very strong wireless patent portfolio and put in place a dedicated and experienced management team. Our patent deal with Nokia, announced on December 4, 2006, is highly significant. Not only did it produce high-margin revenue, it provided instant validation that the things we've been saying about our patents were right. It also gave us access to some of the world's most important patents in ADSL - the technology that provides access for an estimated two thirds of the world's Internet users."

"Our financial position has not been this strong in many years," said Steve Bower, CFO. "Taking into account the $28 million net cash raised in December, we are now in an excellent position to fund growth in our operations, carry the costs of litigation, and continue to grow our valuable patent portfolio."

CONFERENCE CALL INFORMATION -- JANUARY 11, 2007 - 10:00 EASTERN TIME

Wi-LAN will conduct a conference call to discuss its fiscal year results today at 10:00A.M. eastern time (8:00 A.M. mountain time).

Participants calling from Canada or the Unites States should call toll-free: 1 (866) 585-6398 Callers from other international locations may access the call at: 1 (416) 849-9626 For those who prefer to join by webcast, the URL is:

http://www.vcall.com/IC/CEPage.asp?ID=112809

Participants are requested to call in 10 minutes before the start of the call. The call will be webcast from Wi-LAN's website at www.wi-lan.com and will be archived there.

Wi-LAN representatives will be: Jim Skippen - President & CEO, and Steve Bower - CFO

A replay of the call will be available until 11:59 P.M. Eastern time on January 18, 2007 by calling 1 (866) 245-6755 or 1 (416) 915-1035. The replay pin number is: 44 86 63. The Conference Call will also be available by webcast at the same URL noted above.

About Wi-LAN Inc.

Wi-LAN, which was founded in 1992, licenses intellectual property that drives a full range of products providing access in wireless and wireline telecommunications markets. Some of the fundamental technologies covered by Wi-LAN's patents include: CDMA, Wi-Fi, WiMAX and ADSL. Wi-LAN has already licensed its intellectual property to a number of major companies, including Cisco, Fujitsu and Nokia.

Detailed information on Wi-LAN can be found at www.wi-lan.com.

Forward-looking Information

Certain statements in this release, other than statements of historical fact, may include forward-looking information that involves various risks and uncertainties. These may include, without limitation, statements based on current expectations involving a number of risks and uncertainties related to all aspects of the wireless and wireline communications industry and the global economy. These risks and uncertainties include, but are not restricted to: the almost exclusive reliance of the Company on licensing its patent portfolio to generate revenues and cash flows; that the Company may be required to establish the enforceability of its patents in court to obtain material licensing revenues; that the Company will need to acquire or develop new patents to continue to grow its business; that the Company requires investment to translate its intellectual property position into sustainable profit in the market; that the Company is dependent on the performance of its key officers and employees; that changes in patent legislation or in the interpretation or application of patent litigation could materially adversely affect the Company; and that the Company has and may make acquisitions of products, technologies or businesses which could materially adversely affect the Company. These risks and uncertainties may cause actual results to differ from information contained herein, when estimates and assumptions have been used to measure and report results. There can be no assurance that such forward-looking statements will prove to be accurate. Actual result and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. The Company assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.

All trademarks and brands mentioned in this release are the property of their respective owners.



Wi-LAN Inc.

Consolidated Statements of Operations and Deficit

(In thousands of Canadian dollars, except per share amounts)

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Years ended October 31 2006 2005
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Revenues $2,108 $-

Income/(expenses) from the following:
Operating expenses (5,721) (3,872)
Depreciation and amortization (676) (563)
Settlement 9,635 -
Gain on debt settlement 2,919 -
Gain on sale of property 1,145 88
Gain on disposal of long-term investments - 142
Inpairment of investments - (70)
Other income 29 297
Interest:
Interest income 219 176
Interest expense on long-term debt (97) (286)
Other interest expense - (85)
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Earnings/(loss) from continuing operations
before income taxes 9,561 (4,173)
Provision for future income tax recovery 16,726 -
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Earnings/(loss) from continuing operations 26,287 (4,173)
Loss from discontinued operations (12,178) (21,605)
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Net earnings/(loss) 14,109 (25,778)
Deficit, beginning of year (179,701) (153,923)
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Deficit, end of year $(165,592) $(179,701)
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Earnings/(loss) per share - basic and
diluted
From continuing operations $0.54 $(0.10)
From discontinued operations (0.25) (0.51)
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Net earnings/(loss) per share $0.29 $ (0.61)
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Wi-LAN Inc.

Consolidated Balance Sheets
(In thousands of Canadian dollars)
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As at October 31 2006 2005
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Assets

Current assets:
Cash and cash equivalents $16,680 $3,690
Accounts receivable 400 -
Future tax asset 16,726 -
Prepaid expenses and deposits 387 453
Assets of discontinued businesses 621 11,290
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Current assets 34,814 15,433

Furniture and equipment 174 86
Patents and trademarks 9,787 10,059
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$44,775 $25,578
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Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued liabilities $814 $1,706
Debt - 4,508
Current portion of deferred gain
on sale of property - 176
Liabilities of discontinued businesses 687 7,303
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Current liabilities 1,501 13,693

Deferred gain on sale of property - 969
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Total liabilities 1,501 14,662
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Shareholders' equity
Common shares 202,396 184,921
Contributed surplus 6,470 5,696
Deficit (165,592) (179,701)
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Shareholders' equity 43,274 10,916
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$44,775 $25,578
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Wi-LAN Inc.

Consolidated Statements of Cash Flows
(In thousands of Canadian dollars)
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Years ended October 31 2006 2005
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Cash provided by/(used in)
Operations
Earnings from continuing operations $26,287 $(4,173)
Non-cash items:
Stock-based compensation 447 379
Depreciation and amortization 676 563
Settlement (9,635) -
Debt settlement (4,508) 843
Gain on sale of property (1,145) (88)
Deferred stock units 105 -
Gain on disposal of long-term investments - (142)
Inpairment of investments - 70
Gain on sale of patents (429) -
Future tax recovery (16,726) -
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(4,928) (2,548)
Change in non-cash working capital balances:
Accounts receivable (400) -
Prepaid expenses 66 (261)
Accounts payable and accrued liabilities (892) 250
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Cash (used in) continuing operations (6,154) (2,559)
Cash (used in) discontinued operations (7,800) (12,188)
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Cash (used in) operations (13,954) (14,747)
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Financing
Proceeds on sale of common shares, net 14,738 -
Share capital issued for cash on
the exercise of options 479 56
Share capital issued for cash on
the exercise of warrants 233 -
Cash received from loan payable 2,000 -
Repayment of loan payable (2,000) -
Repayment of long-term debt - (7,842)
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Cash generated from/(used in) continuing
operations 15,450 (7,786)
Cash (used in) discontinued operations (61) (48)
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Cash generated from/(used in) financing 15,389 (7,834)
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Investing
Purchase of furniture and equipment (107) (4)
Purchase of patents and trademarks (6) (102)
Restricted cash - 775
Proceeds from settlement, net 9,635 -
Proceeds from sale of patents 1,510 -
Proceeds on sale of property, net - 11,787
Proceeds on sale of long-term investments, net - 303
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Cash generated from continuing operations 11,032 12,759
Cash generated from/(used in)
discontinued operations 523 (256)
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Cash generated from investing 11,555 12,503
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Net cash and cash equivalents generated/
(used) in the year 12,990 (10,078)
Cash and cash equivalents at beginning of year 3,690 13,768
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Cash and cash equivalents at end of year $16,680 $3,690
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