Wireless Matrix Corporation

Wireless Matrix Corporation

December 14, 2006 09:02 ET

Wireless Matrix Reports Second Quarter Fiscal 2007 Results

Grows Subscriber Base to over 46,300

RESTON, VIRGINIA--(CCNMatthews - Dec. 14, 2006) - Wireless Matrix Corporation (TSX:WRX) ("Wireless Matrix" or the "Corporation"), is pleased to provide the results for the second quarter ended October 31, 2006 ("Second quarter fiscal 2007"). All currency is expressed in U.S. dollars.

Wireless Matrix has successfully transformed itself into a software application provider offering end-to-end wireless data solutions for enterprises on a hosted, recurring revenue basis. The acquisition of substantially all the assets of MobileAria, Inc. ("MobileAria") on August 1, 2006 and its logistics applications platform, FleetOutlook, has made Wireless Matrix the only provider that can service an entire fleet with divergent connectivity needs through an integrated platform of applications, devices, and wireless networks. The Corporation's products and services suite helps organizations with vehicle fleets improve asset and human productivity through the convergence of technology: broadband wireless data connectivity, vehicle management and GPS technology.

"The acquisition of MobileAria has filled out our wireless broadband portfolio and given us the application platform we need to pursue a larger addressable market. The integration is ahead of schedule and helped us deliver operational and financial results that are better than we anticipated." said J. Richard Carlson, Wireless Matrix's Chief Executive Officer and President. "This has accelerated Wireless Matrix as an emerging leader within the growing mobile resource management industry."

Highlights for the second quarter of fiscal 2007, include:

- Acquired substantially all the assets of MobileAria, Inc. ("MobileAria") effective August 1, 2006 and completed the first phase of its integration. This includes the incorporation of MobileAria's enterprise level logistics application platform with Wireless Matrix's single and multi-mode wireless data communication modems providing customers an integrated solution to optimize their fleet and achieve measurable productivity gains.

- Achieved quarter-over-quarter service revenue growth of over 18% with application revenues becoming 14% of total revenues and achieved service gross margins of over 70%.

- Generated $1,055,000 of cash from operations and obtained positive income before other charges of $28,000 despite incurring integration costs.

- Announced a three year contract for multimode wireless data communication modems and services with a potential value of approximately $9,000,000 with CSX, one of the leaders in the rail industry.

- Grew its subscriber base to over 46,300 recurring revenue subscribers, including 10,977 subscribers acquired from MobileAria.

- Launched the terrestrial mobile base station 2, a device that integrates GPRS/EDGE broadband wireless, 802.11, and GPS technologies, providing customers a mobile internet communications platform, fleet management capabilities, and an embedded automatic vehicle location application.

- Reduced its customer concentration and completed the quarter with a diversified Fortune 500 client base with five clients representing less than 61% of total revenue;

Financial Highlights:

Three months ended, Six months ended,
October 31 October 31
2006 2005 2006 2005
Service revenue $ 4,759,000 $ 4,025,000 $ 8,631,000 $ 7,827,000
Hardware revenue 1,988,000 2,418,000 3,799,000 5,026,000
Total revenue 6,747,000 6,443,000 12,430,000 12,853,000
Gross margins(1) 3,369,000 3,002,000 6,309,000 5,792,000
Income before other
charges(1) 28,000 412,000 441,000 590,000
Net income (loss) $ (638,000) $ 199,000 $ (415,000) $ 71,000

Basic and diluted income
(loss) per share: $ (0.0095) $ 0.0030 $ (0.0062) $ 0.0011

Cash balance $ 5,464,000 $13,676,000 $ 5,464,000 $13,676,000
Total subscribers 46,399 28,642 46,399 28,642
Average Revenue Per
Unit (ARPU)(1) $ 32.94 $ 45.09 $ 33.97 $ 45.51
Total units shipped 1,951 1,942 2,780 2,942

(1) This press release should be read in conjunction with the Management
Discussion and Analysis included in Wireless Matrix's April 30, 2006
Annual Report and Financial Statements and Notes thereto. Non-GAAP
measures presented in this press release are further discussed and
defined under the heading "Supplemental Non-GAAP Measures" within
Management Discussion and Analysis included in Wireless Matrix's
April 30, 2006 Annual Report.

Forward Looking Statements

General information regarding the Corporation set forth in this document, including management's assessment of the Corporation's future plans and operations contains forward looking statements that involve substantial known and unknown risks and uncertainties. These forward looking statements are subject to numerous risks and uncertainties, some of which are beyond the Corporation's and management's control, including but not limited to, the impact of general economic conditions, industry conditions, fluctuation of commodity prices, fluctuation of foreign exchange rates, imperfection of estimates, industry competition, availability of qualified personnel and management, stock market volatility, timely and cost effective access to sufficient capital from internal and external sources. The Corporation's actual results, performance or achievement could differ materially from those expressed in or implied by, these forward looking statements and accordingly, no assurance can be given that any of the events anticipated to occur or transpire from the forward looking statements will provide what, if any benefits to the Corporation. All data presented herein should be read in conjunction with the Corporation's regulatory filings, with the appropriate Securities Commission and SEDAR. These filings, including the Corporation's Annual Information Form ("AIF"), are located at www.sedar.com.

About Wireless Matrix:

Wireless Matrix provides enterprise-class wireless data solutions for business-critical mobile and remote asset operations. The Corporation delivers real-time data services across cellular, satellite and WiFi networks; a variety of modems and hardware platforms; and transportation applications that increase productivity and reduce operating expenses with service fleet operations. Wireless Matrix is headquartered in Reston, Virginia, and has offices in Burnaby, British Columbia and Mountain View, CA. For more information visit www.wrx-us.com.

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

Contact Information

  • Investor Relations:
    Maria C. Izurieta, Chief Financial Officer
    Wireless Matrix Corporation
    (703) 262-4020
    Website: www.wirelessmatrixcorp.com