Vigil Health Solutions Inc.
TSX VENTURE : VGL

Vigil Health Solutions Inc.

February 13, 2012 15:07 ET

Vigil Health Solutions Reports Q3 Results

Sales Bookings Up 12%

VICTORIA, BRITISH COLUMBIA--(Marketwire - Feb. 13, 2012) - Vigil Health Solutions Inc. ("Vigil") (TSX VENTURE:VGL) announces the results of operations for the quarter ending December 31, 2011.

Business Highlights

  • Bookings for the quarter were $1.02 million up 12% compared to $913 thousand in the three-month period ended December 31, 2010.
  • Revenue was $787 thousand, down 31% from $1.13 million in the three-months ended December 31, 2010.
  • Gross margin percentage was 47% compared to 46% for the quarter ended December 31, 2010.
  • Revenue from service and maintenance agreements and one-offs grew by 19% to $361 thousand from the same quarter ended December 31, 2010.

"The improvement in bookings is encouraging and in line with the slow recovery being seen in seniors' housing. The continued growth in follow on service and product sales is also a positive sign although unfortunately not enough to build the revenue numbers which continue to be affected by the poor bookings seen in earlier quarters," stated Troy Griffiths, President and CEO of Vigil Health Solutions Inc.

Financial Results

Unless otherwise indicated, all financial information presented in this press release has been prepared in accordance with International Financial Reporting Standards ("IFRS"). The conversion to IFRS from

Canadian generally accepted accounting principles became effective on or after January 1, 2011. Please refer to the Company's most recently issued financial statements for further discussion.

Bookings for the quarter were $1.02 million up 12% compared to $913 thousand in the three-month period ended December 31, 2010.

At December 31, 2011 Vigil had a backlog of approximately $2.08 million (including $611 thousand in deposits and progress billings, recorded as deferred revenue on the balance sheet) compared to approximately $2.36 million (including $1.20 million in deposits and progress billings, recorded as deferred revenue on the balance sheet) at December 31, 2010. Vigil's backlog includes all signed contracts at varying stages of installation and progress billing. At December 31, 2011 there were 23 projects with an average value of $91 thousand compared to 28 with an average value of $84 thousand at December 31, 2010.

Revenue for the three-months ended December 31, 2011 was $787 thousand compared to $1.13 million in the three-month period ended December 31, 2010, a decrease of 31%. The decrease in revenue is due to low bookings in earlier quarters reflecting the US economic downturn. Project revenue made up 54% of total revenue; the remaining revenue came from follow on sales to existing customers.

The gross margin percentage for the three months ended December 31, 2011 was 47% compared to 46% for the three months ended December 31, 2010. The gross margin during the period was within management's expectations of margins of between 42% and 47%.

Expenditures for the three months ended December 31, 2011 were $452 thousand, down 3% from $468 thousand for the period ended December 31, 2010.

Net loss for the three month period ended December 31, 2011 was $68 thousand, or $0.005 per share compared to a profit of $24 thousand, or $0.005 per share for the previous year. The increase in losses is attributable to the 31% decrease in revenues reflecting the lower number of projects completed during the period. Management believes this is the result of lower bookings in prior quarters, which was due to the low construction activity and lack of financing available to senior housing.

Detailed financial statements along with Management Discussion and Analysis have been filed with SEDAR and may be viewed at (www.sedar.com).

Financial information will be mailed to entitled security holders on February 16, 2012. Or, upon notice to the Company, entitled security holders may request a copy of financials in advance.

Summary Financial Information

December 31, December 31,
2011 2010
(unaudited) (unaudited)
Revenue $ 786,737 $ 1,133,230
Cost of sales 420,835 611,470
365,902 521,760
Expenses 451,894 467,806
Income (loss) before the following items (85,992) 53,953
Other income (expense): 18,167 (29,557)
Loss for the period $ (67,825) $ 24,396

Non-IFRS Measure

For the three months ended December 31, 2011, we are disclosing Adjusted EBITDA, a non-IFRS financial measure, as a supplementary indicator of operating performance. We define Adjusted EBITDA as net income before, interest, income taxes, amortization, stock based compensation and currency gains or losses including derivative foreign exchange differences. We are presenting the non-IFRS financial measure in our filings because we use it internally to make strategic decisions, forecast future results and to evaluate our performance and because we believe that our current and potential investors and analysts use the measure to assess current and future operating results and to make investment decisions. It is a non-IFRS measure, may not be comparable to other companies and it is not intended as a substitute for IFRS measures.

Adjusted EBITDA Reconciliation

Three months ended
December 31, 2011 December 31, 2010
Income / (loss) for the period $ (67,825) $ 24,396
Add / (deduct)
Foreign exchange gain (loss) 14,168 13,667
Derivative exchange gain (34,337) -
Interest 2,002 15,890
Stock based compensation (924) 7,145
Amortization 5,274 7,263
(13,817) 43,965
Adjusted EBITDA $ (81,642) $ 68,361

About Vigil Health Solutions Inc.

Vigil offers a proprietary technology platform combining software and hardware to provide comprehensive solutions to the expanding seniors' housing market. Vigil has established a growing presence in North America and an international reputation for being on the leading edge of systems design and integration.

Vigil's objective is to offer solutions for the full continuum of care. Vigil's product range includes the innovative wireless VitalityCare System™ featuring discreet 'mini pendants', a nurse call system, mobile fall, incontinence monitoring, resident check and the award-winning Vigil Dementia System.

Certain statements contained in this news release that are not based on historical facts may constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). These forward-looking statements are not promises or guarantees of future performance but are only predictions that relate to future events, conditions or circumstances or our future results, performance, achievements or developments and are subject to substantial known and unknown risks, assumptions, uncertainties and other factors that could cause our actual results, performance, achievements or developments in our business or in our industry to differ materially from those expressed, anticipated or implied by such forward-looking statements.

Forward-looking statements include all financial guidance, disclosure regarding possible events, conditions, circumstances or results of operations that are based on assumptions about future economic conditions, courses of action and other future events. We caution you not to place undue reliance upon any such forward -looking statements, which speak only as of the date they are made. These forward-looking statements appear in a number of different places in this presentation and can be identified by words such as "may", "estimates", "projects", "expects", "intends", "believes", "plans", "anticipates", or their negatives or other comparable words. Forward-looking statements include statements regarding the outlook for our future operations, plans and timing for the introduction or enhancement of our services and products, statements concerning strategies or developments, statements about future market conditions, supply conditions, end customer demand conditions, channel inventory and sell through, revenue, gross margin, operating expenses, profits, forecasts of future costs and expenditures, the outcome of legal proceedings, and other expectations, intentions and plans that are not historical fact.

The risk factors and uncertainties that may affect our actual results, performance, achievements or developments are many and include, amongst others, our ability to develop our sales force and generate revenue, the length of the sales cycle, management of the Company's growth, ability to recruit and retain staff, fluctuations in demand for current and future products, our ability to develop, manufacture, supply and market existing and new products that meet the needs of customers, volatility in the exchange rate, ability to secure financing, ability to secure product liability insurance, the continuous commitment of our customers, increased competition, changes in regulation and reliance on third party suppliers. These risk factors and others are discussed in the Risks and Uncertainties section of our "Management Discussion and Analysis" segment of our fiscal 2009 Annual Report. Many of these factors and uncertainties are beyond the control of the Company. Consequently, all forward-looking statements in this news release are qualified by this cautionary statement and there can be no assurance that actual results, performance, achievements or developments anticipated by the Company will be realized.

Forward-looking statements are based on management's current plans, estimates, projections, beliefs and opinions and, except as required by law, the Company does not undertake any obligation to update forward-looking statements should the assumptions related to these plans, estimates, projections, beliefs and opinions change.

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

Contact Information