Vecima Networks Inc.
TSX : VCM

Vecima Networks Inc.

November 14, 2005 17:00 ET

VCom Announces First Quarter Results

VICTORIA, BRITISH COLUMBIA--(CCNMatthews - Nov. 14, 2005) - VCom Inc. (TSX:VCM) announces that the Company's 2006 fiscal year first quarter interim financial and operating results for the three months ended September 30, 2005 have been filed on the SEDAR system. The highlights provided in this press release should be read in conjunction with the Company's final prospectus dated November 3, 2005, in relation to our initial public offering of shares, and our unaudited interim financial statements and management's discussion and analysis for the first quarter, which are available on SEDAR at www.sedar.com.

All dollar amounts are in Canadian dollars.

This is our first quarterly report as a public company. As quarterly reports were not prepared historically, it is impracticable to present prior-period information on a basis consistent with the results for the three months ended September 30, 2005.

Financial Highlights

- Total revenue for the first quarter was $17.3 million, representing a 10% increase over the average quarterly total revenue for the fiscal year ended June 30, 2005.

- Gross margin was 37%, within our model of 35-39%.

- Net income for the first quarter was $2.4 million or $0.13 per share. As stated in our final prospectus, net income for the year ended June 30, 2005 benefited from recognition of unearned revenue on the termination of an OEM supply contract. Excluding the effect of that non-recurring event, our net income of $2.4 million for this quarter represents an increase of 19% over the average quarterly net income for the fiscal year ended June 30, 2005.

- Shareholders' equity increased to $40.9 million at September 30, 2005 from $38.5 million at June 30, 2005.

Operational Highlights

- We are making progress in introducing new products into the standards-based wireless and digital video markets.

- VCom Inc. announced today that it has successfully completed its initial public offering of 3,335,000 common shares at a purchase price of $7.50 per share for gross proceeds of $25,012,500. VCom and its principal shareholders have granted the underwriters an over-allotment option to purchase an additional 500,250 common shares (of which up to 225,250 will be issued by VCom and up to 275,000 will be sold by its principal shareholders) at $7.50 per share within 30 days after closing. The Company's common shares began trading today on the Toronto Stock Exchange under the symbol "VCM".

- Operating expenses in the first quarter were 19% of total revenue, unchanged from the year ended June 30, 2005.

- During the quarter, preparations continued toward the introduction of the new WiMax product line that will utilize our licensed 3.5 GHz spectrum resources across Canada.

About VCom

We design, manufacture and sell products that enable broadband access to cable, wireless and telephony networks. Our hardware products incorporate embedded software developed by us to meet the complex requirements of next-generation, high-speed digital networks. Service providers use our solutions to deliver services to a converging worldwide broadband market, including what are commonly known as "triple play" (voice, video and data) and "quadruple play" (voice, video, data and wireless) services. Our solutions allow service providers to rapidly and cost-effectively bridge the final network segment that connects a system directly to end-users, commonly referred to as "the last mile", by overcoming the bottleneck resulting from insufficient carrying capacity in legacy last-mile infrastructures. Visit VCom at www.vcom.com.

Beginning next quarter, management will hold quarterly conference calls to discuss financial and operating results.


Contact Information

  • VCom Inc.
    Mike Barry
    Chief Financial Officer
    (250) 881-1982
    www.vcom.com