Grey Island Systems International Inc.
TSX VENTURE : GIS

Grey Island Systems International Inc.

May 27, 2009 07:00 ET

Grey Island Announces 2nd Quarter 2009 Financial Results Posts Record Revenue of $6.35M and Net Income of $282K

TORONTO, ONTARIO--(Marketwire - May 27, 2009) - Grey Island Systems International Inc. (TSX VENTURE:GIS), reports record revenue of $6.35-million in the second quarter of fiscal 2009 represented an increase of 43 percent as compared with revenue of $4.44-million in the second quarter of fiscal 2008 and represented an increase of 32 percent quarter over quarter with the first quarter of fiscal 2009 revenue of $4.80-million. Concurrently, the company posted net income of $0.282-million during the second quarter fiscal 2009, an increase of 485 percent as compared with a net income of $0.058-million for the second quarter of 2008 and a marked improvement over the first quarter of 2009 in which the company incurred a net loss of $0.264-million. In addition, the company improved its cash and short-term investments by $1.15-million during the quarter bringing total cash and short-term investments to $12.53-million. The company's stated future goal is to maintain only moderate increases in operating expenses on a quarter-by-quarter basis when compared with expected revenue increases.

As described in more detail below, key financial highlights for Grey Island in fiscal 2009 second quarter included:

- Record Revenues of $6.35-million, up $1.91-million or 43 per cent from second quarter of fiscal 2008 and up 32 percent from the previous quarter;

- Income of $0.282-million, up from a net income of $0.058-million in second quarter of fiscal 2008 and compared with a net loss of $0.264-million in the previous quarter;

- Recurring revenues increased by 51 percent to $2.67-million for the second quarter 2009 compared to the second quarter of 2008 recurring revenues of $1.77-million;

- US revenue increased by 75 percent to $4.20-million for the second quarter 2009 from $2.40-million for the second quarter of 2008;

- Cash and short-term investments improved to $12.53-million during the quarter.

"Our results this quarter are indicative of a company which can quickly adapt to economic uncertainty and re-focus efforts on business units which are insulated to a recessionary impact, as a result, the company illustrated significant organic growth, both year over year and quarter over quarter, through new client acquisition while limiting operating expense expansion" said Owen Moore, President at Grey Island "Further, we have a solid balance sheet with a healthy cash position that will allow us to continue to capitalize on future opportunities".

"Factors such as increasing fuel prices, increased funding for public transit, a need for improved mobile work force accountability in government fleets will continue to drive demand for our products and services," said Andrew Moore, CEO at Grey Island.



Consolidated statements of operations and comprehensive income

Three months ended
March 31
2009 2008
Revenue $ 6,349,469 $ 4,436,339
Cost of revenue 3,362,803 2,015,802
----------------------------
Gross profit 2,986,666 2,420,537

Expenses
General and administrative 1,222,194 1,041,994
Sales and marketing 541,284 352,094
Engineering, development and research 976,155 772,392
Datacentre operations 130,169 94,313
Stock-based compensation 9,078 31,351
----------------------------
2,878,880 2,292,144
----------------------------

Income (Loss) before the following 107,786 128,393

Other income and expenses
Other (income) expenses -80,143 -117,610
Amortization of intangible assets 14,718 229,034
Amortization of tangible assets 93,819 51,818
Foreign exchange gain -170,854 -126,550
----------------------------
-142,460 36,692
----------------------------
Net income before income taxes 250,246 91,701
Taxation expense
Current
Future -32,000 33,000
----------------------------
-32,000 33,000
----------------------------

Net income and comprehensive income 282,246 58,701


The company's consolidated financial statements, accompanying notes and management's discussion and analysis will be available on SEDAR.

About Grey Island

Grey Island Systems International Inc. (TSX VENTURE:GIS), together with its subsidiaries NextBus Inc. in Alameda, California, InterFleet, Inc. in New York, New York is a leading provider of custom real-time GPS/AVL, security and Telematics solutions as well as real-time passenger information systems to government and related fleets. To find out more about our products and services, visit our websites at www.interfleet.com or www.nextbus.com.

Forward Looking Statements

This news release contains forward-looking information based on management's best estimates and the current operating environment. These forward-looking statements are related to, but not limited to, Grey Island's operations, anticipated financial performance, business prospects and strategies. Such forward-looking statements are subject to a number of known and unknown risks, uncertainties and other factors which could cause actual results or events to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, business risks, changes in market and competition, technological and competitive developments and potential downturns in economic conditions generally. Therefore, there can be no assurance that the expectations of the management of Grey Island will prove to be correct.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information