Brainhunter Inc.
TSX : BH

Brainhunter Inc.

April 03, 2009 22:14 ET

Brainhunter Issues Financial Statements for First Quarter Fiscal 2009

TORONTO, ONTARIO--(Marketwire - April 3, 2009) -

THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION TO CANADIAN INVESTORS ONLY.

Brainhunter Inc. ("Brainhunter" or the "Company") (TSX:BH) today released its financial statements for the three month period ended December 31, 2008.

The release of the financial statements was delayed until the release of the financial statements for the year ended September 30, 2008. The release of the 2008 statements had been delayed pending resolution of the amount of an adjustment for impairment of Goodwill.

The Company announced earlier that it is reviewing its strategic alternatives with a view to enhancing value to shareholders and to build on its current critical mass of business. The Company has engaged a corporate finance advisory firm, Ernst & Young Orenda Corporate Finance Inc., to advise in the process.

Business Overview

Brainhunter is an ISO9001:2000 Certified "Staffing Services and Solutions" Company. Brainhunter's business is focused on using a leading technology platform to provide end to end recruiting and staffing services and solutions in information technology, engineering and other selected market sectors. These services are provided to clients throughout Canada, United States, and globally under the Brand "Brainhunter".

Brainhunter's technology platform and best practices strive to deliver the most cost effective and flexible recruiting and staffing services and solutions in the marketplace today. The solutions are modular in nature and customizable to suit both small and large scale business processes. Brainhunter has over 350 active client relationships including a number of North America's leading corporations and over 30 federal and provincial government groups. Brainhunter's Jobseeker database currently holds in excess of 1.2 million professionals and is one of the largest active databases for professional staffing in North America.

Brainhunter is a publicly traded company with a senior listing on the Toronto Stock Exchange. Brainhunter deploys over 1600 consultants and has an internal staff of over 200 personnel. The Company has delivery capability across Canada and in the United States including Toronto, Ottawa, Maritimes, Montreal, Calgary, Edmonton, Vancouver, activities in Dalian China, and an office in Hyderabad India, and the UK.

Following are statements extracted from the unaudited financial statements of Brainhunter for the period ending December 31, 2008. The following statements should be read in conjunction with the notes to the financial statements attached to the unaudited financial statements as filed on SEDAR. Amounts are in $,000 except earnings per share.



As at December 31, September 30,
2008 2008
$ $
----------------------------
ASSETS
Current
Accounts receivable 36,253 35,876
Prepaid expenses 1,035 332
----------------------------
Total current assets 37,288 36,208
----------------------------
Property, plant and equipment, net 2,934 3,032
Deposits 379 366
Other assets 464 471
Intangible assets, net 6,679 7,718
Goodwill 6,571 6,571
Due from related parties 1,059 853
----------------------------
55,374 55,219
----------------------------
----------------------------

LIABILITIES AND SHAREHOLDERS' (DEFICIENCY)
EQUITY
Current
Accounts payable and accrued liabilities 18,996 21,737
Current portion of deferred lease inducement 103 103
Current portion of provision for lease
restructuring 48 91
Current portion of long-term debt 16,328 16,144
Term bank credit facility 19,430 15,409
Deferred revenue 285 337
----------------------------
Total current liabilities 55,190 53,821
----------------------------
Deferred lease inducement 608 637
Long-term debt 262 339
Long-term future income tax liabilities 74 74
----------------------------
Total liabilities 56,134 54,871
----------------------------
Commitments and contingencies

Shareholders' deficiency
Capital stock 19,387 19,472
Warrants 1,531 1,531
Contributed surplus 1,622 1,567
Equity component of convertible note obligation 1,951 1,951
Deficit (25,251) (24,173)
----------------------------
Total shareholders' deficiency (760) 348
----------------------------
55,374 55,219
----------------------------



Three months ended December 31, 2008 2007
$ $
--------------------------

Revenue 54,220 58,393
Cost of revenue 46,475 49,732
--------------------------
Gross profit 7,745 8,661
--------------------------

Expenses
Other staffing costs 5,092 5,087
Selling, general and administrative 1,587 2,314
--------------------------
6,679 7,401
--------------------------
Income before the following 1,066 1,260
--------------------------
Interest expense 740 876
Interest expense - accreted 317 335
Amortization
Property, plant and equipment 174 178
Intangible assets 1,038 1,121
--------------------------
2,269 2,510
--------------------------
Loss before income taxes (1,203) (1,250)
Recovery of future income taxes - (216)
--------------------------
Net loss from continuing operations (1,203) (1,034)
--------------------------

Discontinued Operations
Income from discontinued operations - 41
Gain from disposal of discontinued operations 125 -
--------------------------
Net profit from discontinued operations 125 41
--------------------------
Net loss for the period (1,078) (993)
--------------------------

Deficit, beginning of period (24,173) (11,838)
--------------------------
Deficit, end of period (25,251) (12,831)
--------------------------
--------------------------

(Loss) per share
Continuing Operations - Basic and diluted (0.03) (0.02)
Discontinued Operations - Basic and diluted - -
--------------------------



Three months ended December 31 2008 2007
$ $
----------------
OPERATING ACTIVITIES
Net loss for the period (1,203) (1,034)
Add (deduct) items not involving cash
Future income taxes - (216)
Loss on disposal of fixed assets - 6
Accretion of interest 317 336
Amortization of deferred lease inducement and provisions (28) (20)
Amortization of provision for lease restructuring (43) (62)
Stock-based compensation expense 7 45
Amortization of property, plant and equipment 174 178
Amortization of intangible assets 1,038 1,121
----------------
262 354
Net change in non-cash working capital balances
related to operations (3,886) (3,016)
----------------
Cash used in operating activities (3,624) (2,662)
----------------

FINANCING ACTIVITIES
Exercise of common share options - 36
Loans to related parties (note 3) (206) -
Purchase of common shares (37) -
Proceeds from (repayment of) term bank credit facility 4,021 4,406
Repayment of long-term debt (note 7) (210) (1,416)
----------------
Cash provided by financing activities 3,568 3,026
----------------

INVESTING ACTIVITIES
Additions to property, plant and equipment (76) (377)
Increase in other assets 7 (28)
----------------
Cash used in investing activities (69) (405)
----------------
Net cash flows used for continuing operations (125) (41)
----------------

Cash provided from discontinued operations
Cash provided by (used in) operating activities of
discontinued operations - 41
Cash provided from the disposal of discontinued operations 125 -
----------------
Net cash flows provided from discontinued operations 125 41
----------------

Net increase in cash during the period - -
Cash, beginning of period - -
----------------
Cash, end of period - -
----------------
----------------

Supplemental cash flow information
Interest paid 672 649
Additions to capital assets - non-cash - -
----------------


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

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