AZCAR Technologies Incorporated
TSX : AZZ

AZCAR Technologies Incorporated

October 27, 2005 18:04 ET

AZCAR Announces $13.5 Million In Revenue And $490,000 In Net Income In Q3 2005

TORONTO, ONTARIO--(CCNMatthews - Oct. 27, 2005) - Stephen F. Pumple, President & CEO of AZCAR (TSX:AZZ) today announced AZCAR's third quarter revenues of $13.5 million, resulting in YTD revenue of $46.5 million, an increase of 32% over the first nine months of 2004. Net income earned in Q3 was $490,000 or 3.2 cents per share, reflecting the Company's improved operating margins in the North American market. Overall net income YTD is $992,000 or 6.4 cents per share.



AZCAR Technologies Incorporated
Consolidated Statements of Operations

2005 2004 2005 2004
Periods ending Three Nine
September 30 months ended Variance months ended Variance
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Can$000's Unaudited Unaudited Unaudited Unaudited

Revenues 13,541 13,259 282 46,505 35,238 11,267
Cost of goods
sold 10,548 11,724 1,176 38,956 29,804 (9,152)
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Gross margin 2,993 1,535 1,458 7,549 5,434 2,115
Gross margin % 22.1% 11.6% 10.5% 16.2% 15.4% 0.8%
Operating
expenses 2,023 1,971 (52) 5,712 4,809 (903)
Stock-based
compensation 16 10 (6) 38 29 (9)
Amortization 75 60 (15) 203 178 (25)
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2,114 2,041 (73) 5,953 5,016 (937)
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Income (loss)
before taxes 879 (506) 1,385 1,596 418 1,178
Income tax
expense
(recovery) 420 (62) (482) 701 74 (627)
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interest 459 (444) 903 895 344 551
Minority interest 31 (17) 48 97 (119) 216
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Net income
(loss) 490 (461) 951 992 225 767
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Earnings
per share
- Basic (cents) 3.2 (3.0) 6.1 6.4 1.5 5.0
- Fully diluted
(cents) 2.9 (2.8) 5.7 6.0 1.4 4.6
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The continuing focus to improve the business practices and expand sales opportunities is reflected in the higher margins in Q3. New business from the acquisition of Pro-Com Systems in May contributed appreciably to Q3 revenue. The investment in additional sales and professional staff in four more USA cities announced in early October broadens the Company's ability to generate new revenues in the future.

The business climate for AZCAR's services into 2006 remains very positive and will not be affected by the recent hurricanes in the USA. The US congress is moving ever closer to mandating the switchover to HDTV in 2009, a decision that is viewed very positively by AZCAR. The company continues to refine its business processes and improve its sales channel both of which will ultimately translate into better margins and a healthier bottom line.

New business opportunities are opening to AZCAR in areas of video to cell phones and video over internet protocol (IP) services. Recently awarded contracts with clients, including Crown Castle, utilize these technologies.

AZCAR is an independent technology integration company providing value-driven solutions, consulting, engineering, systems design, integration, project management, maintenance and the supply of related products to organizations in the broadcasting, communications and training industries. The stock trades on the Toronto Stock Exchange under the symbol: AZZ.

This review contains Management's discussion of AZCAR's operational results and financial condition, and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2004, the unaudited consolidated financial statements for the period ended September 30, 2005, and each of the related "Management's Discussion and Analysis" (MD&A) documents.

The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.

Contact Information

  • AZCAR Technologies Incorporated
    Jim O'Neill
    Chief Financial Officer
    (905) 470-2545, ext. 244
    (905) 470-2943 (FAX)
    jim.oneill@azcar.com