Solium Capital Inc.
TSX VENTURE : SUM

Solium Capital Inc.

October 31, 2005 09:00 ET

Solium Capital Inc. Releases 2005 Third Quarter Results

CALGARY, ALBERTA--(CCNMatthews - Oct. 31, 2005) - Solium Capital Inc. (TSX VENTURE:SUM) ("Solium" or the "Company") today announced its financial results for the quarter ended September 30, 2005.

The Company had net earnings of $294,160 in the third quarter of 2005 compared to $35,273 in the third quarter of 2004. Net earnings for the nine months ended September 30, 2005 were $990,771 compared to a net loss of $215,132 for the comparable period in 2004.

Highlights for the quarter ended September 30, 2005:



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Three Months Ended September 30
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2005 2004 %
Change
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OPERATIONS
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Stock option participants 36,195 24,404 48
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Share purchase participants 119,868 101,290 18
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FINANCIAL
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Revenue $1,608,782 $763,137 111
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Expenses $1,314,622 $727,864 81
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EBITDA(1) $ 350,937 $111,118 216
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Net earnings $ 294,160 $ 35,273 734
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Net earnings per share
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Basic $ 0.010 $ 0.001 900
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Fully diluted(2) $ 0.010 $ 0.001 900
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Issued and outstanding
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Common shares 28,444,369 28,355,512 0.31
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Fully diluted 31,329,564 31,103,610 0.73
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Notes:

1. EBITDA is a non-GAAP financial measure which does not have any standardized meaning prescribed by GAAP (generally accepted accounting principles) and is therefore unlikely to be comparable to similar measures presented by other issuers. EBITDA provides useful information to users as it reflects the net earnings or loss prior to the effect of non-operating expenses such as interest, tax, depreciation and amortization. The Company currently does not have any income tax expense as a result of non-capital losses of approximately $7.2 million carried forward for tax purposes. The following is a reconciliation of EBITDA to net earnings (loss):



Three months ended September 30
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2005 2004
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EBITDA 350,937 111,118
Interest expense (6,301) (25,000)
Amortization expense (50,476) (50,845)
---------------------------------
Net earnings (loss) 294,160 35,273
---------------------------------
---------------------------------


2. Fully diluted earnings per share is calculated using the treasury stock method.

Financial results

- The positive net earnings in the third quarter of 2005 was the fifth consecutive quarter of positive earnings for the Company.

- Third quarter gross revenue in 2005 was $1,608,782, an increase of 111% over $763,137 in the third quarter of 2004. The overall increase was due mainly to increased access fee revenue from direct sales clients of $410,726 and associated transaction revenue of $175,193, and increased revenue from GRS Securities Inc. (a wholly-owned subsidiary of The Canada Life Assurance Company, which is a wholly-owned subsidiary of The Great-West Life Assurance Company) of $236,726.

- Total expenses in the third quarter of 2005 of $1,314,622 increased by 81% over $727,864 in the third quarter of 2004. The overall increase in 2005 was due to costs incurred to scale ongoing operations and to prepare for the additional clients being implemented through the end of the year and into the first quarter of 2006. In addition, expenses totaling approximately $94,000 were incurred in the ongoing development of the U.S. operations.

Operations

- Five direct sales clients were implemented onto Shareworks™ during the third quarter, adding approximately $150,000 in annualized access fee revenue.

- As at September 30, 2005, the Company had in progress, fourteen direct sales clients with approximately $1,000,000 in annualized access fee revenue being implemented onto Shareworks™ . Implementation of these clients is expected to be completed during the fourth quarter of 2005 and first quarter of 2006.

Other Corporate Matters

- On September 30, 2005, the Company made a final repayment of $250,000 on the demand debentures outstanding. As a result of the repayment, the holders' security interest in all of the Company's present and after-acquired property was discharged.

- The Company is continuing to develop its operations in the U.S. and has commenced direct sales activities.

About Solium Capital Inc.

Solium Capital Inc. (TSX Venture: SUM) specializes in the administration and execution of equity-based incentive and savings plans and is setting the industry standard for service excellence, industry knowledge and innovative technical leadership. Solium aligns companies and people through employee equity services.

During 2004, Solium began to set the new standard for equity plan management by leading the convergence of employee equity incentives and savings into a single integrated platform. The Solium brand has traditionally included two distinct products, Solium E-SOAP and Solium Share Purchase. Solium has recently completed a re-branding process and has launched a new single product, Solium Shareworks™.

Certain information set forth in this document contains forward-looking statements. By its nature, forward-looking statements are subject to numerous risks and uncertainties which could cause actual results to differ materially from those anticipated by Solium and described in the forward-looking statements contained herein. The risks, uncertainties and other factors, both known and unknown, that could influence actual results may be substantial, which may include, among others, general business and economic conditions, the overall stock market performance, actions from competitors, the corporate governance environment and regulatory reporting requirements for Solium's clients, product capability and acceptance, the Company's ability to generate sufficient cash flow from operations to meet its current and future obligations, and the Company's ability to access external sources of financing if required. Accordingly, no assurances can be given that any of the events anticipated by these forward-looking statements will transpire or occur, or if any of them do so, what benefits the Company will derive therefrom. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update or revise them to reflect new events or circumstances.

The Management's Discussion and Analysis and the unaudited consolidated financial statements for the quarter ended September 30, 2005 referred to herein are available on SEDAR at www.sedar.com under Solium Capital Inc., or at www.solium.com.


The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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