Epic Data International Inc.
TSX : EKD

Epic Data International Inc.

August 14, 2006 17:00 ET

Epic Data Announces Third Quarter Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 14, 2006) - Epic Data International Inc. (TSX:EKD), today reported financial results for the quarter ended June 30, 2006. Third quarter revenue of CDN $3.0 million (2005 equals CDN $2.9 million) yielded a net loss of CDN $800 thousand versus a net loss in the third quarter of 2005 of CDN $920 thousand. Sequentially versus the second quarter of 2006, revenue improved by CDN $429 thousand, or approximately 17% over the previous quarter's achievement.

For the nine month period to date, revenue was CDN $9.6 million (2005 equals CDN $12.2 million) and the net loss was CDN $2.3 million (2005 equals CDN $797 thousand net loss). The company's contracted sales backlog at the end of the period stands at CDN $4.8 million.

The company reported that anticipated substantial new orders had been delayed, resulting in the lower third quarter revenue. Gross margin in the third quarter was 45% down from 47% in the third quarter of 2005 and up 1% percent sequentially from the second quarter of 2006.

The company's unencumbered cash position at June 30, 2006 was CDN $466 thousand, down from CDN $1.7 million at the beginning of the fiscal year.

Separately, the company announced that during the quarter it had concluded terms with a company owned by a member of its board of directors for a CDN $500 thousand revolving credit facility. As of June 30, 2006, the company had not utilized this credit facility.

A comprehensive analysis of Epic Data's third quarter financial statements is available at sedar.com and a conference call to discuss these results will be held at 2:30 pm today. Information regarding participation in the call is available on the Investors page of our website at www.epicdata.com.

About Epic Data International Inc.

For over 30 years Epic Data has been a leader in automatic identification and data collection solutions for the world's most progressive organizations.

In aerospace & defense, automotive, high technology and industrial equipment & machinery manufacturers, our systems enable real-time visibility and synchronization of processes across the manufacturing value streams in order to increase production velocity, while identifying the continuous improvement initiatives vital to winning in today's competitive manufacturing environments.

In parking enforcement and route management, our systems are used to increase productivity while improving customer service and worker safety by connecting mobile personnel to central offices in real time.

People and technology make Epic Data a global leader in automated data collection and manufacturing execution solutions for the extended enterprise.

Information about Epic Data is available at www.epicdata.com.



EPIC DATA INTERNATIONAL INC.
Consolidated Balance Sheet
(Stated in thousands of Canadian dollars)
As at
June 30 September 30
2006 2005
(unaudited) (audited)
---------------------------
Assets:
Current Assets
Cash and cash equivalents $ 466 $ 1,675
Accounts receivable 2,089 3,686
Inventory 239 451
Prepaid Expenses 430 558
------------- ------------
Total current assets 3,224 6,370

Cash equivalents pledged as security 1,600 2,000

Property and equipment 839 1,067
------------- ------------
$ 5,663 $ 9,437
------------- ------------
------------- ------------

Liabilities and Shareholders' Equity:

Current Liabilities
Non-revolving credit facility $ - $ 733
Related party loan, net of
equity portion of $ 81 919
Accounts payable and accrued
liabilities 2,393 2,649
Deferred revenue 1,742 2,140
------------- ------------
------------- ------------
5,054 5,522
------------- ------------
------------- ------------
Long term Liabilities

Related party loan, net of equity
portion (September 30, 2005 - $111) - 889
Provision for unused leased facilities 501 650
------------- ------------
501 1,539
------------- ------------

Shareholders' Equity
Share Capital 58,867 58,788
Deficit (58,759) (56,412)
------------- ------------
108 2,376
------------- ------------

$ 5,663 $ 9,437
------------- ------------
------------- ------------

Certain comparative figures have been reclassified to conform with
the financial statement presentation adopted for Fiscal 2006.


EPIC DATA INTERNATIONAL INC.
Consolidated Statement of Operations
For the periods ended June 30

(Stated in thousands of dollars-unaudited)

3 months ended 9 months ended
-------------------- ---------------------
2006 2005 2006 2005
--------- --------- --------- ---------
Revenue $ 2,964 $ 2,916 $ 9,641 $ 12,185

Cost of sales 1,626 1,533 5,316 5,821
--------- --------- --------- ---------
Gross margin 1,338 1,383 4,325 6,364

Gross margin percentage 45% 47% 45% 52%

Operating expenses:
Selling, marketing and
administrative 1,615 1,830 5,083 5,748
Product development 446 435 1,326 1,276
--------- --------- --------- ---------
2,061 2,265 6,409 7,024
--------- --------- --------- ---------

Income(Loss) before
undernoted items (723) (882) (2,084) (660)

Other expenses (earnings):
Amortization of property
and equipment 99 90 308 321
Unused leased facilities (50) (50) (150) (150)
Net finance charges 28 (2) 105 (34)
--------- --------- --------- ---------
77 38 263 137
--------- --------- --------- ---------

Income(Loss) before
income taxes (800) (920) (2,347) (797)

Income taxes (Recovery) - - - -

--------- --------- --------- ---------
Income(Loss) for the
period (800) (920) (2,347) (797)

Deficit, beginning
of period (57,959) (54,567) (56,412) (54,690)

--------- --------- --------- ---------
Deficit, end of period $ (58,759) $ (55,487) $ (58,759) $ (55,487)
--------- --------- --------- ---------
--------- --------- --------- ---------

Weighted average of
outstanding common
shares (thousands) 12,547 12,777 12,547 12,584
Fully Diluted Weighted
average of outstanding
common shares (thousands) 14,421 14,373 14,498 14,319

Income (loss) per common
share: basic & diluted $ (0.06) $ (0.07) $ (0.19) $ (0.06)

Certain comparative figures have been reclassified to conform with
the financial statement presentation adopted for Fiscal 2006.


EPIC DATA INTERNATIONAL INC.
Consolidated Statement of Cashflows
For the periods ended June 30

(Stated in thousands of dollars - unaudited)

3 months ended 9 months ended
-------------------- ---------------------
2006 2005 2006 2005
--------- --------- --------- ---------

Cash provided by (used in):

Operating:
Net income (loss) $ (800) $ (920) $ (2,347) $ (797)

Items not involving cash:
Amortization of capital
assets 99 90 308 321
Provision for unused
lease facilities (50) (50) (150) (150)
Stock-based compensation
expense 16 16 58 65
--------- --------- --------- ---------
Total of items not
involving cash 65 56 216 236

Change in non-cash
operating working
capital
Accounts receivable 192 149 1,597 910
Inventory 139 (133) 212 17
Prepaid expenses 94 55 128 42
Non-revolving credit
facility - - (733) -
Related party loan,
net of equity portion 919 - 919 -
Accounts payable &
accrued liabilities 362 (425) (256) (827)
Deferred revenue (720) (344) (398) (187)
--------- --------- --------- ---------
Total of non-cash
operating working
capital 986 (698) 1,469 (45)
--------- --------- --------- ---------
251 (1,562) (662) (606)

Investing:
Net acquisition of
capital assets (7) (33) (79) (193)
Cash equivalents pledged
as security - - 400 400
--------- --------- --------- ---------
(7) (33) 321 207

Financing:
Related party loan, net
of equity portion (921) 872 (889) 872
Related party loan,
equity portion 21 128 21 128
Proceeds on exercise of
employee options - 21 - 21
--------- --------- --------- ---------
(900) 1,021 (868) 1,021
--------- --------- --------- ---------
Increase (decrease) in
cash & cash equivalents (656) (574) (1,209) 622

Cash and cash equivalents,
beginning of period 1,122 2,302 1,675 1,106

--------- --------- --------- ---------
Cash and cash
equivalents, end of
period $ 466 $ 1,728 $ 466 $ 1,728
--------- --------- --------- ---------
--------- --------- --------- ---------

The Company's cash
position consists of:
Cash and cash
equivalents $ 466 $ 1,728 $ 466 $ 1,728
Cash and cash
equivalents pledged
as security 1,600 2,000 1,600 2,000
--------- --------- --------- ---------
Cash position $ 2,066 $ 3,728 $ 2,066 $ 3,728
--------- --------- --------- ---------
--------- --------- --------- ---------

Certain comparative figures have been reclassified to conform with
the financial statement presentation adopted for Fiscal 2006.



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