SOURCE: Chalk Media Corp.

August 27, 2007 18:40 ET

Chalk Media Corp. Announces Second Quarter 2007 Financial Results

VANCOUVER, BC--(Marketwire - August 27, 2007) - Chalk Media Corp. (TSX-V: CKM) ("Chalk") today announced its unaudited interim consolidated financial results for the three- and six-month periods ended June 30, 2007.

Second Quarter 2007 Corporate Significant Events:

* Completed private placement of 29,721,600 common shares at $0.25 per share for gross proceeds of $7,430,400.

* Released Mobile chalkboard™, a Mobile Content Deployment System (MCDS), designed to work on BlackBerry® handheld devices from Research in Motion (RIM).

* Entered BlackBerry® Independent Software Vendor Alliance Program to align the Company's development of Mobile chalkboard™ with Research in Motion's BlackBerry® as Mobile chalkboard™ evolves.

* Convertible debenture holders converted US$525,000 face value of the convertible debentures to 3,500,000 common shares of the Company, reducing our long-term debt.

* Earned revenues of $680,726 for the three months ended June 30, 2007 compared to $818,610 for the same period in 2006.

* Incurred loss of $2,559,301 or $0.04 per share for the three months ended June 30, 2007 compared to loss of $1,978,438 or $0.03 per share for the same period in 2006.

* Earned revenues from interactive media of $590,046 for the three months ended June 30, 2007 compared to $633,826 for the same period in 2006.

Chalk earned revenues of $680,726 for the three months ended June 30, 2007, compared to $818,610 for the same period in 2006. Chalk earned revenues of $590,046 for interactive media and $57,670 for television and airline segment production for the three months ended June 30, 2007 and $633,826 and $155,111 respectively for the same period in 2006. The decrease in interactive media revenues was due to the decrease in the volume and dollar value of contracts signed in previous quarters as it takes a number of quarters for projects to be completed and revenue to be recognized. The drop in revenues for television and airline segment production in 2007 was due to lower sponsorship levels for airline segment production.

The net loss for the three months ended June 30, 2007 was $2,559,301, or $0.04 per share, compared to a net loss of $1,978,438, or $0.03 per share, for the same period in 2006. The increase in the net loss was due to the decreased revenues, higher cost of sales from increased production personnel, increased sales and marketing expenses with the introduction of the new Mobile chalkboard™ product, increased legal and other professional fees, travel expenses associated with our issuance of common shares in the quarter, and the accretion expense associated with the convertible debentures.

"We see excellent opportunity for Mobile chalkboard™, which works on BlackBerry® handheld devices," said Stewart Walchli, President & CEO. "In order to position ourselves financially and enable us to focus on this opportunity from a personnel perspective, we have decided to reduce our personnel levels by approximately 24 people. The reduction will be primarily in the area of content production and is planned for the third and fourth quarters of 2007. In the long term these changes will give us more flexibility and allow us to focus our finances and energies on the Mobile chalkboard™ opportunity."

Selected Financial Data (in $'000's, except per share numbers):

                             Three Months ended          Nine Months ended
                                   June 30,                   June 30,
                                2007      2006             2007      2006
Revenue                         $681      $819           $1,384    $1,380
Gross margin                     $12      $287             $161      $437
Operating loss               ($2,389)  ($1,827)         ($4,433)  ($3,458)
Net income / (loss)          ($2,559)  ($1,978)         ($4,738)  ($3,659)
Earnings / (loss) per share   ($0.04)   ($0.03)          ($0.07)   ($0.07)

This press release should be read in conjunction with Chalk's unaudited consolidated financial statements for the six months ended June 30, 2007, as well as its management discussion and analysis available at


While the information contained herein is believed to be accurate and reliable, Chalk and its subsidiaries and / or affiliates, and their respective directors, officers, employees and shareholders make no representations or warranties, expressed or implied, as to the accuracy or completeness of such information, and Chalk expressly disclaims any and all liability that may be based on such information, or errors or omissions thereof.

The forward-looking statements contained herein (such as statements relating to the future anticipated direction of the media and high technology industries, plans for future expansion, revenue targets, various business development activities, planned capital expenditures, future funding sources, anticipated sales growth and potential contracts) involve important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may vary materially from those expressed in any forward-looking statements made by or on behalf of Chalk.

There can be no assurance that Chalk will achieve the results projected or implied by the forward-looking statements included herein. These risks and uncertainties include, but are not limited to, those relating to Chalk's ability to raise sufficient financing to fund its business plan, development and expansion activities, dependence on existing management, financial activities, domestic and global economic conditions, changes in federal or provincial income tax laws, and market competition factors.

About Chalk Media Corp.

Chalk is a leading provider of enterprise solutions that help organizations communicate more effectively with their employees, business partners and consumers. Chalk's new Mobile Content Deployment System allows rich media content to be pushed securely to BlackBerry® smartphones and tracked. For more information, please visit

The TSX Venture Exchange has not reviewed the contents of this release and is not responsible for its accuracy.

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Contact Information

  • For more information, please contact:

    Chalk Media Corp.
    Kris Sutherland
    Executive Vice President
    Tel: (604) 453-4424
    Email Contact