Manaris Corporation
OTC Bulletin Board : MANS
FRANKFURT : WKN:255471

Manaris Corporation

November 20, 2006 18:05 ET

Manaris Corporation Reports Solid First Quarter Revenue Growth

- Revenues increase 89% and operating losses decrease by 61% as compared to the same period last year - Avensys subsidiary fuels growth in revenues and turns a profit - Cash burn decreases

MONTREAL, CANADA--(CCNMatthews - Nov. 20, 2006) - Manaris Corporation (OTCBB:MANS) (FRANKFURT WKN:A0F5LD) has announced its financial results for the Company's first fiscal quarter ending September 30, 2006.

Revenues for the quarter increased by 89% to $3.76M as compared to the same period last year. This growth is attributable to revenues generated by Avensys, one of Manaris' two operating subsidiaries. For the quarter ended September 30, 2006, we reduced our loss from operations by 61% to $0.59M as compared to a loss from operations of $1.5M for the same period in fiscal 2006.

Net cash used in operating activities was $1.66M for the three month period ending September 30, 2006, as compared to $0.61M for the same period last year. Of the $1.66M, $1.26M was used to reduce accounts payable. In addition, only $0.11M was used for operating activities, as compared to $0.73M for the same period a year earlier.

Net loss applicable to shareholders was $0.22M for the quarter ended September 30, 2006 as compared to $3.31M for the same period in 2005. This amount, however, was affected by the addition of derivative financial instruments to our balance sheet resulting from two activities: our acquisition of the assets of ITF Optical in 2006 and the August 2006 convertible note financing. With these transactions, we incurred liabilities that are treated as derivative financial instruments ("derivative liabilities"). These derivative liabilities are measured using the Black-Scholes option pricing model, and are therefore sensitive to share price fluctuations. At September 30, 2006, our share price had decreased to $0.23 per share. This change in share price significantly affected the fair values of the derivative liabilities on our balance sheet and reduced our net loss by $0.76M. If we were to exclude the gain from changes in fair values of these derivative liabilities, our net loss would have been $0.99M for the quarter ending September 30, 2006.

Avensys Technologies, a division of our Avensys subsidiary, which produces optical components and modules for the telecom and optical sensor markets, continues to experience strong profitable growth. Avensys' acquisition of ITF Optical provided this division with the platform for operational synergies and competitive advantages.

Avensys Solutions, the other division of Avensys, which provides environmental solutions and instrumentation, was a strong contributor to improved margins. Avensys Solutions has developed the "Intelligent Bubbler System" for the automated measurement of surface and ground water levels. This system was developed in conjunction with Hydro Quebec, one of Canada's leading providers of hydroelectricity. Avensys Solutions intends to be active in consolidation activities in the sector while growing its distribution channels and product offerings through merger and acquisition activities. In addition, it expects to further integrate capabilities and services to its core products.

Manaris' other subsidiary, C-Chip Technologies (North America), spent considerable efforts during the quarter on the development of a resellers network for the distribution of its GSM-based Credit Chip 200 to the "buy here, pay here" market. C-Chip currently has 17 resellers in the United States.

CONTINUED GROWTH AND FOCUS

In announcing the results, John G. Fraser, President and Chief Executive Officer said, "We have realized significant improvements during this first quarter of 2007 and expect this trend to continue as some cost reduction measures will not take effect until subsequent quarters. We are pleased that our Avensys subsidiary turned a profit and experienced a 92% increase in revenues to $3.67M from $1.91M for the same period last year."

He continued: "During the quarter, our CFO resigned effective September 30, 2006 and has been replaced by the Company's Controller, Tony Giuliano. We also appointed Marie-Annick Riel as President of C-Chip Technologies (North America) on October 1, 2006, following the resignation of Claude Arbour. Ms. Riel also leads the Avensys Solutions division of Avensys."

CONFERENCE CALL

Manaris Corporation will hold a conference call to discuss these results on Wednesday, November 22 at 11 A.M. Eastern Standard Time. Interested parties can join the call by dialing 514.807.8791 or 800.733.7560. Overseas callers must dial 001.514.807.8791. If you are unable to call in at this time, you may access a copy of the call by visiting the Company's website www.manariscorp.com.

ABOUT MANARIS CORPORATION

Manaris Corporation operates two wholly-owned subsidiaries. Our Avensys subsidiary, through its Avensys Technology division, is a recognized world leader in providing high quality fiber optic components & sensors to businesses in Asia, Europe and North America with. Its other division, Avensys Solutions, provides environmental monitoring solutions and services, including the monitoring of air, water and soil, to industrial and public sector organizations across Canada. Our other subsidiary, C-Chip Technologies (North America), offers products and services to the credit management market for new and used cars. Its technology allows credit providers to remotely locate and disable the operation of any vehicle in the event of a delinquent payment.

FORWARD-LOOKING-STATEMENT: Except for factual statements made herein, the information contained in this press release consists of forward-looking statements that involve risks uncertainties, including the effect of changing economic conditions, competition within the credit and security industry, customer acceptance of products and other risks and uncertainties. Such forward looking statements are not guarantees of performance, and Manaris Corporation results could differ materially from those contained in such statements. These forward-looking statements speak only as of the date of this release and Manaris Corporation undertakes no obligation to publicly update any forward-looking statements to reflect new information, events or circumstances after the date of this release.

Contact Information

  • Manaris Corporation
    Mr. John Fraser
    President and CEO
    514-337-2447
    or
    Zenergy Communications
    Linda Farha
    514-273-4034
    linda@zenergycom.com