Imagis Technologies Inc.

Imagis Technologies Inc.

March 30, 2005 19:17 ET

Imagis Announces Year-End Results


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: IMAGIS TECHNOLOGIES INC.

TSX VENTURE SYMBOL: WSI
OTC Bulletin Board SYMBOL: IMTIF

MARCH 30, 2005 - 19:17 ET

Imagis Announces Year-End Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 30, 2005) - Imagis
Technologies Inc. ("Imagis") (TSX VENTURE:WSI)(OTCBB:IMTIF)(DE:IGYA)
announced today that its fiscal year revenues at December 31, 2004 were
$1,032,970, a decrease of 24 percent over the previous fiscal year level
of $1,355,742. Software revenues decreased by 27% to $639,805 for the
year compared to the prior year level of $877,438. Support and services
revenues for the year declined 18% to $385,075 from the prior year level
of $469,575. As of March 15, 2005 Imagis has received orders totalling
$2,100,000 that are not recorded as at December 31, 2004. Consequently,
Imagis expects that revenues will increase in the first two quarters of
2005 when compared to the first two quarters of 2004 and will continue
to increase as the company's new products and solutions continue to gain
increasing customer acceptance.

Operating expenses totalled $6,490,907 for 2004, which is 20 percent
higher than the 2003 operating expenses of $5,414,599. The 2004 expenses
include stock-based compensation of $1,204,307 due to the restructuring
of Imagis' employee stock option plan and $1,524,525 in amortization,
which includes $1,290,852 in amortization costs of intellectual
property. Excluding these non-cash charges the 2004 operating expenses
total $3,762,075. The 2003 expenses include one-time charges of $266,950
and amortization of $359,241. Excluding these items, the operating
expenses for 2003 were $4,788,408. The difference of $1,026,333 between
2004 and 2003 represents a 21% reduction in operating expenses over the
prior year. The current cash operating expense level is approximately
$4,300,000 per year as a result of increased staffing levels required to
meet increased demand for Imagis' products and services.

Overall, the Company incurred a net loss for the year ended December 31,
2004 of $5,457,937 or $0.39 per share, which is 34 percent higher than
the net loss incurred during the year ended December 31, 2003 of
$4,058,857 or $0.74 per share. The loss per share figure for 2003 has
been adjusted to take into account the Company's share consolidation
that occurred in November of 2003. Adjusting the loss to take into
account the non-cash and one-time expenses described above, the losses
become $2,729,105 for 2004 and $3,432,666 for 2003, representing a 20%
reduction. The rate of loss at December 31, 2004 on an EBITDA basis was
$280,000 per month and management believes that the Company will be able
to achieve break even operations on an EBITDA basis during the first six
months of 2005. The Company received significant sales orders during the
final quarter of 2004 and the first quarter of 2005; however,
installation did not commence until 2005 and the revenue will not be
recognised until then. The timing of the revenue recognition will depend
on the schedule of completion of contracts.

The Company does not currently have sufficient cash flow from operations
to fund its operations. The company has cash sufficient to fund its
operations through April 30, 2005. The Company has also received orders
that if completed will generate cash sufficient to fund its operations
through September 30, 2005. If no further sales are received the
Company may need to raise additional funds through private placements of
its securities or seek other forms of financing. There can be no
assurance that such financing will be available to the Company on terms
acceptable to it, if at all. If the Company's operations are
substantially curtailed, it may have difficulty fulfilling its current
and future contract obligations.

Full details of Imagis financial results are available by reviewing the
Company's Form 10K-SB filed on both the SEDAR and EDGAR filing systems.

For the past few years, government legislation in the United States and
around the world has mandated two key improvements: security and
information sharing. The Company has found that the former cannot be
effectively accomplished without the latter. Nevertheless, there remain
a large number of information silos within and throughout government,
law enforcement and security agencies, as well as with information
systems in the health care and financial services sectors.

The merger with Briyante Software Corporation in November of 2003
brought a unique capability to Imagis and its customers. The Company can
rapidly and cost-effectively deliver data integration and unified query
solutions-incorporating these core capabilities with facial recognition
and image matching when necessary-to address legislated market needs and
priorities.

"The extended nature of our sales cycles takes time to bear fruit, but
new business opportunities and closings clearly show our re-vamped
business model and focus on information sharing is accelerating our
turnaround," says Roy Trivett, President and CEO, Imagis Technologies
Inc. "It is important to note that the company's core technologies and
solutions are still receiving enthusiastic validation from customers and
partners alike. The justice information sharing networks that utilized
our products over the past couple of years are now spreading into other
jurisdictions, and our partnerships in the United States and United
Kingdom have also been instrumental in developing new, exciting
opportunities. We continue to work on extending our industry-leading
integration solutions into the financial services, health care, public
services, telecommunications and other vertical market sectors."

About Imagis Technologies Inc.

Based in Vancouver, British Columbia, Imagis specializes in developing
and marketing software products that enable integrated access to
applications and databases. The company also develops solutions that
automate law enforcement procedures and evidence handling. These
solutions often incorporate Imagis' proprietary facial recognition
algorithms and tools. Using industry standard Web Services, Imagis
delivers a secure and economical approach to true, real-time application
interoperability. The corresponding product suite is referred to as the
Briyante Integration Environment (BIE).

Numerous production deployments of BIE have demonstrated remarkable
reductions in the time, complexity, and risk associated with defining,
implementing, and supporting integrated access to physically and
technologically disparate computers. The broad ranging applicability of
BIE into a variety of areas (e.g., health care, financial services,
government services, telecommunications, etc.) has been clearly
demonstrated by recent, highly-successful deployments in the United
States and Canada. Imagis booking and facial recognition systems are
deployed in Canada, the United Kingdom, United States, Mexico and the
Far East.

Imagis is a Microsoft Certified Partner.

For information about Imagis or the company's products and services,
please refer to www.imagistechnologies.com.

ON BEHALF OF THE BOARD OF DIRECTORS

"Roy Trivett"

President and CEO, Imagis Technologies Inc.

Forward Looking Statements: This press release may contain statements
that constitute "forward-looking statements" within the meaning of
Section 21E of the Securities Exchange Act of 1934, as amended. Such
forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our actual results,
performance or achievements, to differ materially from the anticipated
results, performance or achievements expressed or implied by such
forward-looking statements. Factors that could cause actual results to
differ materially from anticipated results include the risks and
uncertainties described in Imagis Technologies Inc.'s Form 10-KSB filed
with the United States Securities and Exchange Commission. We disclaim
any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Imagis Technologies Inc.
    Media and Investor Inquiries:
    Eric Westra - Manager, Marketing & Communications
    +1-604-684-2449 Ext. 226
    info@imagistechnologies.com
    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this news release.