Lingo Media Corporation
TSX VENTURE : LM
OTC Bulletin Board : LMDCF

Lingo Media Corporation

May 02, 2011 10:00 ET

Lingo Media Reports 2010 Fourth Quarter and Year End Financial Results

TORONTO, ONTARIO--(Marketwire - May 2, 2011) -Lingo Media Corporation (TSX VENTURE:LM)(OTCBB:LMDCF) ("Lingo Media" or the "Company"), a leader in online and print-based English language learning solutions, announces its financial results for the fourth quarter and year ended December 31, 2010. All figures are reported in Canadian dollars, and are in accordance with Canadian GAAP unless otherwise noted.

"2010 was a pivotal year for Lingo Media as we successfully acquired the valuable asset, ELL Technologies, and successfully expanded our distribution network." said Michael Kraft, President & CEO of Lingo Media. "Our diversified business now consists of Lingo Learning, our legacy print–based publishing business, Speak2Me, a free-to-consumer ad-based service, Parlo, a fee-based online training and assessment service and ELL Technologies, a globally-established multi-media and online training company marketed under the Q Group brand. We continue to grow as an English language learning company with a diversified product base led by an experienced and operationally focused management team intent on maximizing the value of these assets."

Recent Operational Highlights

  • Lingo Learning:
    • co-published its 385 millionth unit with People's Education Press, China's State Ministry of Education's publishing arm
  • Speak2Me:
    • successfully extended its Conversational Advertising™ service with Mercedes-Benz (China) for a third contract for their smart car division utilizing Speak2Me's embedded advertising interface for a virtual tour of 18 cities around the world
    • completed the beta testing and integration of a Speak2Me App that will be deployed on leading social networking platforms in China
  • Parlo:
    • is now being cross-marketed thru ELL Technologies' distribution network
  • ELL Technologies:
    • under its South American expansion plan, secured a sales contract through its Colombian distributor with Escuela Superior de Administracion Publica ("ESAP"), a public administration college for an initial license for 7,800 seats
    • secured new distribution channels into 12 new markets

Michael Kraft added, "With demand for English language learning continuing to grow, we are confident that our wide array of service offerings, coupled with Lingo Media's strategic relationships, position us well for the future. Going forward, management is committed to increasing top line revenues, maintaining margins, and generating earnings in order to maximize shareholder value."

Financial Highlights for the Fourth Quarter Ended December 31, 2010

Fourth Quarter20102009
Sales$877,091$573,394
Gross margin849,445549,503
Loss - continuing operations(627,346)(873,922)
  • Revenue for the fourth quarter ended December 31, 2010 totalled $877,091 an increase of 53% compared to $573,394 for the same period in 2009. Revenue increased organically from the Company's print-based royalty revenues and through its online training business.
  • Gross margin for the fourth quarter of 2010 totalled $849,445, an increase of 57% compared to $549,503 for the same period in 2009. These results yielded a gross margin of 93% for the fourth quarter 2010 compared to 96% for the same period 2009.
  • Fourth quarter 2010 net loss totalled $627,346 or $0.04 per share based on 13.3 million shares outstanding compared to a net loss of $689,379 or $0.04 per share based on 12.5 million shares outstanding.

Financial Highlights for the Year Ended December 31, 2010

Year Ended December 31201020092008
Sales$1,985,153$1,466,696$969,128
Gross margin1,867,2121,321,702842,799
Gross margin %94%90%87%
Loss - continuing operations(3,679,127)(2,959,145)(2,311,474)
Cash used in operations(1,241,728)(808,104)(1,240,199)
  • Revenue for the year ended December 31, 2010 totalled $1.99 million, an increase of 35% compared to $1.47 million for the same period in 2009. Revenue increased organically from Lingo Learning's print-based royalty revenue business and through ELL Technologies' online training business.
  • Gross profit during 2010 totalled $1.87 million, an increase of 41% compared to $1.32 million for 2009. These results yielded an improved gross margin of 93% for 2010 compared to 90% for 2009.
  • Net loss for 2010 totalled $3.68 million or $0.28 per share based on 13.3 million shares outstanding compared to a net loss of $2.59 million or $0.24 per share based on 12.5 million shares outstanding. The increase in Net Loss was significantly impacted by increased amortization expense of software and web development costs totalling $2.44M compared to $1.40M for 2009.
  • Cash used in continuing operation activities for the year ended December 31, 2010 totalled $1.24 million compared to $0.81 million in 2009.

The audited financial statements for the year ended December 31, 2010 and Management Discussion & Analysis are available at www.sedar.com.

About Lingo Media (TSX VENTURE:LM)(OTCBB:LMDCF)

Lingo Media Corporation (www.lingomedia.com) is a diversified online and print-based education products and services company focused on English language learning ("ELL") on an international scale through its four distinct business units: ELL Technologies; Parlo; Speak2Me; and Lingo Learning. ELL Technologies is a globally-established ELL multi-media and online training company marketed under the Q Group brand (www.elltechnologies.com). Parlo is a fee-based online ELL training and assessment service (www.parlo.com). Speak2Me is a free-to-consumer advertising-based online ELL service in China (www.speak2me.cn). Lingo Learning is a print-based publisher of ELL programs in China. Lingo Media has formed successful relationships with key government and industry organizations, establishing a strong presence in China's education market of more than 300 million students. The Company continues to expand its ELL offerings in China and is extending its reach globally.

Portions of this press release may include "forward-looking statements" within the meaning of securities laws.Forward-looking statements contained in this press release are made pursuant to the safe harbour provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and involve certain risks and uncertainties. Actual results may vary materially from management's expectations and projections and thus readers should not place undue reliance on forward-looking statements. Certain factors that can affect the Company's ability to achieve projected results are described in the Company's filings with the Canadian and United States securities regulators available on www.sedar.com or www.sec.gov/edgar.shtml.

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