Zedi Inc.

Zedi Inc.

November 13, 2007 19:11 ET

Zedi Announces Third Quarter 2007 Financial Results

CALGARY, ALBERTA--(Marketwire - Nov. 13, 2007) - Zedi Inc. (the "Company" or "Zedi") (TSX VENTURE:ZED) today releases results for the third quarter, 2007. "I am pleased with the results our team has produced for Q3, not withstanding continued uncertainty in the industry and sector as a whole. While our business model continues to deliver value and a number of our initiatives designed to insulate us from reduced drilling activity have gained traction in Q3, we are cognizant of the challenges facing our industry and continue to manage the business conservatively," said Matthew Heffernan, President and CEO of Zedi, who added: "nonetheless we are committed to an ongoing program to identify growth opportunities in other markets, including U.S., Russia and China." Q3 2007 audited financial statements and MD & A are filed on Sedar and can be accessed at www.sedar.com or on the Company's website at www.zedi.ca.

Revenues for the third quarter of 2007 were $7,197,000, compared to $6,793,000 in the third quarter of 2006. Free cash flow in the third quarter was $698,000, compared to $463,000 in Q3 2006. The quarter ended with cash on hand of $11,899,000 and working capital of $20,228,000. None of the Company's cash is invested in asset-backed commercial paper.

Net income before tax for the third quarter 2007 was $719,000 or $0.01 per common share compared to net loss before tax of $829,000 or $0.01 per common share for the same quarter in 2006. A stock-based compensation expense of $286,000 was recognized in Q3 2007. Although these are non-cash expenses, with no actual impact on the Company's operations, generally accepted accounting principles require that they be recognized in the calculation of net income. Earnings before interest, taxes, depreciation, amortization and stock option expense ("EBITDAS") for the quarter was $1,621,000 compared to $1,095,000 for the same quarter in 2006, a significant increase of 48%. While EBITDAS is a non GAAP measure it is a common measure used by industry to normalize non-operating factors that are included in the net income results.

The Company tracks recurring revenue as a percentage of operating expenses. Recurring revenue for the quarter increased to 111% of operating expenses, up from 93% in the third quarter of 2006. Zedi has begun to report on recurring revenue as a percentage of the Company's total cash expenditures, which in addition to operating expenses includes deferred development and capital asset purchases, and reports 76% for Q3 2007 up from 68% in Q3 2006. The Company believes that these two measures are significant indicators of performance.

The Company also announces that it has granted 1,380,917 options to employees, officers and directors of the corporation. The exercise price of the options is $0.53, which is the closing price at the time the options were granted by the Board of Directors on November 13, 2007. All of the options vest equally in thirds over a three year period and expire in equal amounts on the second, third and fourth anniversaries from the date of grant. The Company also granted 517,844 Restricted Stock Units to employees, officers and directors of the corporation vesting two years from the date of grant.

Zedi Inc. (TSX VENTURE:ZED) specializes in production operations management, delivering systems and services that help oil and gas producers to efficiently manage people, assets and information. We enable our customers to increase earnings from production, decrease operating costs, effectively utilize human, physical and fiscal assets and mitigate compliance risk.

Established in 1987, Zedi has enhanced the operational performance of more than 200 upstream, midstream and oilfield service customers. Please visit www.zedi.ca, for more information.

The TSX Venture Exchange has neither approved nor disapproved the contents of this news release.

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