Vigil Health Solutions Inc.
TSX VENTURE : VGL

Vigil Health Solutions Inc.

February 08, 2010 13:13 ET

Vigil Health Solutions Reports Third Quarter Results

Year To Date Revenue up 9% over nine months ended December 31, 2008

VICTORIA, BRITISH COLUMBIA--(Marketwire - Feb. 8, 2010) - Vigil Health Solutions Inc. ("Vigil") (TSX VENTURE:VGL) announces the results of operations for the quarter ending December 31, 2009.

Business highlights

- Grew year to date revenue 9% to $3.25 million compared to the same period ended December 31, 2008

- Reduced Adjusted Operating Loss by 24% to $262 thousand (compared to $408 thousand for the nine months ended December 31, 2008)

- Recurring sales including service and maintenance billings and replacement products including wireless devices and communication equipment were up 30% to $213 thousand in Q3-FYE10 compared to $148 thousand over the three months ended December 31, 2008.

- Completed development of an advanced wireless testing device to further facilitate large, accelerated wireless solution deployments.

- Released additional integration capability with third party wireless telephone solutions to facilitate greater interoperability with current and future client's communication systems.

"While there have been some indications of improvements in the economy, the lending for new construction in seniors housing has remained stagnant" stated Troy Griffiths, President and CEO of Vigil Health Solutions Inc. "Despite this, with Vigil's versatile product line we have been successful in securing more retro-fit projects, and have seen solid growth in our recurring revenues."

Financial Results

Bookings for the quarter were $712 thousand, down 24% compared to $932 thousand in the three-month period ended December 31, 2008. The decrease in bookings relates to significant new construction business in the United States being put on hold due to the recession and credit crisis.

At December 31, 2009, Vigil had a backlog of approximately $3.16 million (including $1.4 million in deposits and progress billings, recorded as deferred revenue on the balance sheet) a 28% decrease compared to approximately $4.38 million (including $1.92 million in deposits and progress billings, recorded as deferred revenue on the balance sheet) at December 31, 2008. This is the result of more revenue being recorded than sales booked fiscal year to date. Further, with the current market conditions supporting retro-fit business over new construction there is a shorter installation cycle, which contributes to a lower backlog. Of the projects completed during the quarter, 76% of total project revenues were derived from retro-fit implementations.

Revenue for the three-months ended December 31, 2009 was $695 thousand compared to $1.25 million in the three-month period ended December 31, 2008, a decrease of 44%. The decrease in revenue reflects the impact to the senior living industry due to the economic downturn. Project revenue made up 65% of total revenue; the remaining revenue came from follow on sales to existing customers. These sales include service and maintenance billings and replacement products including wireless devices and communication equipment and were up 30% over the three months ended December 31, 2008.

The gross margin percentage for the three months ended December 31, 2009 was 42% compared to 48% for the three months ended December 31, 2008. The gross margin is in line with management's expectations of annual margins of between 42% and 47%.

Operating expenses for Q3FYE10 were $536 thousand, down 7% from $580 thousand in the same quarter of the prior year. The decrease relates to a decrease in insurance costs, lower payroll costs as a result of restructuring in certain departments and lower trade show expenses.

Losses for the three month period ended December 31, 2009 were $222 thousand, or $0.002 per share compared to income of $67 thousand, or $0.001 per share for the same period in the previous year.

Detailed financial statements along with Management Discussion and Analysis have been filed with SEDAR and may be viewed on the Company web site (http://www.vigil.com/investors/financial-statements/) or at (www.sedar.com).

Financial information will be mailed to entitled security holders on February 19, 2010. Or, upon notice to the Company, entitled security holders may request a copy of financials in advance.



Summary Financial Information

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Three months ended Nine months ended
December 31, December 31, December 31, December 31,
2009 2008 2009 2008
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Revenue $ 695,179 1,246,738 3,253,897 2,980,056
Cost of sales 401,137 647,591 1,774,112 1,609,687
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294,042 599,147 1,479,785 1,370,369

Expenses: 536,220 580,048 1,741,930 1,779,190

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Loss before the
following items (242,178) 19,099 (262,145) (408,821)

Other income
(expense) 19,771 47,778 (33,705) 43,467

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Loss for the period $ (222,407) 66,877 (295,850) (365,354)
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Non-GAAP Measure

For the nine-months ended December 31, 2009, we are disclosing Adjusted Operating Loss, a non-GAAP financial measure, as a supplementary indicator of operating performance. We define Adjusted Operating Income as net income before, interest, income taxes, amortization, and currency gains or losses including derivative foreign exchange differences. We are presenting the non-GAAP 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-GAAP measure, may not be comparable to other companies and it is not intended as a substitute for GAAP measures.



Adjusted Operating Loss reconciliation

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Nine months ended
December 31, 2009 December 31, 2008
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Loss for the period $ (295,850) (365,354)

Add / (deduct)
Foreign exchange gain (loss) 36,060 (81,571)
Derivative exchange gain (loss) (33,483) 2,056
Interest 619 (13,643)
Amortization 30,509 49,691
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33,705 (43,467)

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Adjusted Operating Loss $ (262,145) (408,821)


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. The Vigil Integrated Care Management System™ (Vigil® System) includes the award-winning Vigil Dementia System, a nurse call system, bed monitoring, resident check in, and the latest development the Vigil Wireless call system. The first to supply dementia specific care technology, Vigil facilitates the highest standard of care for cognitive residents while helping dementia residents enjoy a higher quality of life and greater dignity.

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 2008 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

  • Vigil Health Solutions Inc.
    Troy Griffiths
    President and CEO
    (250) 383-6900
    (250) 383-6999 (FAX)
    information@vigil.com
    or
    Vigil Health Solutions Inc.
    2102-4464 Markham Street
    Victoria, BC
    V8Z 7X8
    www.vigil.com