SENSIO Technologies Inc.
TSX VENTURE : SIO

SENSIO Technologies Inc.

October 28, 2015 16:00 ET

SENSIO Releases its First Quarter Results for Fiscal 2015-2016

A Transitional Quarter for SENSIO and 3DGO!™

MONTREAL, CANADA--(Marketwired - Oct. 28, 2015) - SENSIO Technologies Inc. ("SENSIO" / "the Company") (TSX VENTURE:SIO) today released its results for the first quarter of its 2015-2016 fiscal year. In the first quarter, the Company's revenues amounted to $80,589 compared to $86,898 in the previous quarter, a decrease of 7.3%. For their part, revenues coming from 3DGO!™ activities amounted to $31,814 compared to $31,043 in the fourth quarter, a slight increase of 2.5%. 3DGO!™ revenues however progressed by 78.9% compared to the first quarter of the previous fiscal year when they amounted to $17,784. It must be reminded that 3DGO!™'s activities being seasonal, results fluctuate from one quarter to the next.

In the first quarter, operating expenses before impairments related to advances on royalties amounted to $629,781 compared to $845,680 in the previous quarter, a decrease of 25.5%. This decrease can mainly be explained by lower R&D expenses and administrative expenses during the quarter. There were no impairments related to advances on royalties in the first quarter and consequently, the Company's net loss amounted to $608,949 compared to $1,435,135 in the fourth quarter of fiscal 2015 representing a decrease of 57.6%.

"The first quarter was a transitional one for SENSIO which is reflected in the results that are being presented," noted Nicholas Routhier, President and CEO. "The lower revenues from our patent and technology licensing activities were in line with our expectation in view of the slower sales of 3DTVs and pending the signing of new agreements by Wi-LAN. On the other hand, 3DGO!™ activities have progressed in the first quarter compared to the comparable quarters of the two previous fiscal years. Although revenues from 3DGO!™ remained modest, they were consistent with our expectations and more importantly, they marked a turning point in the acceleration of rental activities by our active users.

In recent quarters, we've achieved many milestones that unlocked a market potential which has yet to be tapped. Whether by the expansion of our addressable market thanks to the launch on the millions of Samsung 3DTVs in the second quarter of the current year, or by the increase in potential rentals thanks to the addition of new studio titles, these achievements will allow us to move forward on the path to growth both in terms of new users and rentals. In fact, with one more month to go, our 3DGO! ™ revenues are already over the full second quarter of 2014 and 2015 which both included the impact of the US Thanksgiving in November, a strong period of the year. Our job from now on consists on extracting the full potential of these achievements and as video-on-demand movie rentals high-season approaches, we are optimistic that we will see revenue growth in the coming quarters."

Highlights

  • Agreement signed with Twentieth Century Fox Studios, adding titles of a fourth MPAA member studio (Motion Picture Association of America) to 3DGO!™;

  • 3DGO!™ service added to Gracenote's "On® Entertainment" movie database, enabling search engines using this product, namely LG's, to display movies available on 3DGO!™;

  • Launch of 3DGO!™ on Samsung's 3DTVs in September 2015;

  • Increase of 3DGO! ™ revenues by 78.9% compared to the corresponding quarter of the previous fiscal year.

Consumer electronics market - An expected slowdown

In the first quarter, revenues from technology and patent licensing activities amounted to $48,775 compared to $55,854 in the previous quarter and $302,684 in the first quarter of fiscal 2015. The decrease is attributable to the expected slowdown of 3DTV sales in the marketplace by SENSIO's clients and the absence of new patent licensing agreements by Wi-LAN during the quarter. The Company expects that the first patent licensing agreements stemming from the most recent deal struck with Wi-LAN in November 2014 will only be reached 18 to 24 months after that date given the normal patent licensing sales cycle.

"The results in this market are consistent with what we had anticipated and they reflect the transition in the nature of the Company's primary activities," commented Mr. Routhier. "With the discontinuance of our technology development efforts and the outsourcing of patent licensing activities to Wi-LAN, our efforts are henceforth resolutely focused on 3DGO!™. Although we will continue to generate revenues from the consumer electronics market in the coming years, notably upon Wi-LAN's signature of new patent licensing agreements, strong revenue growth will come from 3DGO!™ from now on."

3DGO! - Notable improvement of performance on a comparable basis

In the first quarter, revenues from 3DGO!™ amounted to $31,814 compared to $17,784 in the first quarter of 2015, a year over year increase of 78.9%. This is the second consecutive quarter that has performed better than its comparative quarter of the preceding year, following two quarters of lower comparable performance. The first quarter increase can be explained primarily by the continued progression with LG and by the addition of numerous titles to the 3DGO!™ movie catalogue pursuant to the renewal with Paramount and the deal signed with Twentieth Century Fox.

For their part, the number of registered 3DGO!™ users continued to progress in the first quarter, growing from 28,112 to 31,414. This is an increase of 3,302 users compared to an increase of 2,189 users in the first quarter of the previous fiscal year. This improvement is attributable to the numerous marketing initiatives the Company has put in place to stimulate the recruitment of new users.

"The first-quarter growth in revenues and in the number of users marks a turning point for 3DGO!™," observed Mr. Routhier. "This performance, achieved in a historically weaker quarter in view of the seasonality, is especially encouraging since it was achieved without Samsung's contribution as their 3DTVs were only added in the second quarter of this fiscal year. The higher rental revenues are also evidence of the improved quality of the users that have been recruited and of the appeal of our 3D film library, which continues to get better. What we are observing is the continued improvement of our performance which started in the last quarter and we are positive about the current quarter's results."

For further information, please refer to financials statements and management and discussion analysis for the most recently completed period fiscal year on SENSIO's web site: www.sensio.tv

About SENSIO Technologies Inc. (SENSIO):

Founded in 1999, SENSIO Technologies Inc. (www.sensio.tv) is a pioneer in the field of stereoscopic 3D imaging and of 3D content distribution at home. For over 15 years, SENSIO has been developing, patenting and marketing advanced 3D image processing technology providing superior image quality as well as a simple user friendly experience. Its award-winning technology, SENSIO ® Hi-Fi 3D, can be found in millions of products for the cinema, distribution and consumer electronics markets worldwide.

Today, SENSIO uses its technologies and 3D expertise to deliver its video-on-demand service, 3DGO!, the first 3D-dedicated service offering Hollywood blockbuster movies directly to consumers. SENSIO works with some of the biggest brands in the consumer electronics industry and the film industry to become the destination of choice for 3D movie fans. 3DGO! aims to become the largest distributor of 3D content for the consumer market in the world.

SENSIO is listed on the Toronto TSX Venture Exchange (SIO).

Caution Concerning Forward-Looking Statements

Certain statements made in this press release that are not historical facts are forward-looking statements and are subject to important risks, uncertainties and assumptions, both general and specific, which give rise to the possibility that actual results or events could differ materially from our expectations expressed in or implied by such forward-looking statements. As a result, we cannot guarantee that any forward-looking statement will materialize and readers are cautioned not to place undue reliance on these forward looking statements. For more exhaustive information on these risks and uncertainties, the reader should refer to the risk factors described in the management's discussion and analysis of SENSIO for the period ended August 31, 2015. The forward-looking statements contained in this press release represent our expectations as of the date hereof. We disclaim any intention and assume no obligation to update or revise any forward-looking statements. Forward-looking statements are presented for the purpose of providing information about management's current expectations and plans and allowing investors and others to obtain a better understanding of our anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes.

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.

SENSIO® is a registered trademark of SENSIO Technologies Inc

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