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TECSYS Signs Seven Customers, Generates Impressive Cash Flow

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TECSYS Inc., an industry-leading supply chain management software company, has announced its results for the fourth quarter and full fiscal year 2007, ended April 30th. Highlights for the fourth quarter include the following:
  • The Company signed seven new customers, including:
    • ROE Logistics, a Montreal-based global provider of logistics services.
    • Two major Caterpillar dealers in the U.S.
    • One import-to-retail distributor and a giftware manufacturer/distributor in Ontario.
    • Terrace Supply Company, a distributor of welding equipment and supplies in Illinois. telent plc, a leading provider of technology services in the U.K.
  • Revenue increased five percent or $396,000 to $7.8 million in fiscal 2007 compared to $7.4 million for the same quarter of the last fiscal year. Deferred license revenue increased to $1.725 million at the end of the fourth quarter from $1.221 million at the end of the third quarter; an increase of 41 percent.
  • Earnings from operations for the quarter were $46,000 compared to loss from operations of $1.3 million for the same quarter of last fiscal year.
  • EBITDA for Q4, 2007 improved to $126,000 compared to negative EBITDA of $1.154 million for Q4, 2006.
  • Gross margin percentage increased to 38 percent in Q4 of fiscal year 2007 compared to 32 percent in Q4 of last fiscal year. Gross margin improvement for the quarter includes a substantial increase in services' gross margin to 36 percent in 2007 from 13 percent in 2006.
  • Total operating expenses for the fourth quarter of fiscal year 2007 decreased by $698,000 or 19 percent to $2.9 million, compared to $3.6 million for the same quarter of last fiscal year.
  • Net loss for the quarter was $125,000 ($0.01 per share) compared to net loss of $1.4 million ($0.10 per share) for the fourth quarter of last fiscal year.
  • At the end of the quarter, backlog stood at $15.5 million, up from $14.9 million at the end of Q4 of the prior fiscal year.
  • The company's cash position increased by $2.6 million during the quarter.
"We believe that the positive returns in the second half of the year demonstrate clearly that our strategy is working," said Peter Brereton, president and CEO of TECSYS. "In the second half, after completing a major realignment in our business, both from a market focus and operational standpoint, we have generated operating earnings of $302,000 and $2.7 million in cash. We ended the year in good shape, with a clear focus on winning markets, a solid sales pipeline, a couple of quarters of solid earnings from operations and substantial cash generated." Financial highlights for the full fiscal year include:

  • Revenue for fiscal year 2007 was $31.0 million compared to $33.8 million for last fiscal year.

  • Deferred license revenue increased to $1.725 million at the end of fiscal year 2007 from $946,000 at the end of fiscal year 2006, an 82 percent increase.

  • For fiscal year 2007, EBITDA improved to $446,000 compared to negative EBITDA of $556,000 for last fiscal year.

  • Gross margin increased to 38 percent in 2007 compared to 37 percent in 2006. Gross margin improvement for the year includes a substantial increase in Services' gross margin to 33 percent in 2007 from 29 percent in 2006.

  • Total operating expenses decreased by 8 percent in fiscal year 2007 compared to last fiscal year.

  • Net loss for the year amounted to $554,000 or $0.04 per share, compared to a net loss of $1.6 million or $0.12 per share for last fiscal year.

  • Net loss for the first half of fiscal year 2007 was $865,000. Following strategic restructuring, the Company became profitable in the second half with net earnings of $311,000.

  • After re-payment of the final $425,000 of long term debt and capital lease obligations, cash amounted to $7.2 million at the end of fiscal 2007 compared to $6.9 million at the end of last fiscal year.

  • DSO (Days Sales Outstanding) was reduced to 76 days at the end of fiscal year 2007 compared to 87 days at the end of last fiscal year.

    Loss from operations for fiscal year 2007 was $598,000 and includes $234,000 in restructuring charges that took effect in the second quarter. Loss from operations for fiscal year 2006 was $1.2 million. After accounting for an exchange loss of $95,000, net interest income of $173,000 and a share of net loss of $34,000 from a company in which TECSYS has an equity interest, net loss for fiscal year 2007 was $554,000 or $0.04 per share compared to a net loss of $1.6 million or $0.12 per share for last fiscal year. Results for the full 2007 fiscal year are audited. All dollar amounts are expressed in U.S. currency and reported in accordance with Canadian Generally Accepted Accounting Principles (GAAP).

    About TECSYS

    TECSYS is a leading supply chain management software provider that delivers powerful enterprise distribution, warehouse and transportation logistics software solutions. The company's customers include about 800 mid-size and Fortune 1000 corporations in healthcare, giftware, office products, third-party logistics, and general wholesale high-volume distribution markets. TECSYS' shares are listed on the Toronto Stock Exchange under the ticker symbol TCS. For solutions and general info, contact: This email address is being protected from spambots. You need JavaScript enabled to view it.; for investor relations, This email address is being protected from spambots. You need JavaScript enabled to view it., media relations, This email address is being protected from spambots. You need JavaScript enabled to view it. or call TECSYS Inc. at (514) 866-0001 or (800) 922-8649.
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