CounterPath Reports First Quarter Fiscal 2018 Financial Results
September 14 2017 - 8:15AM
CounterPath Corporation (“CounterPath” or the “Company”)
(NASDAQ:CPAH) (TSX:PATH), a global provider of award-winning
over-the-top (OTT) Unified Communications solutions for enterprises
and carriers, today announced the financial and operating results
for the first quarter ended July 31, 2017 of fiscal year 2018.
First Quarter Financial Highlights
(unaudited)
- Revenue of $3.1 million compared to $3.0 million for the first
quarter of fiscal 2017 and $2.4 million for the fourth quarter of
fiscal 2017.
- Gross margin of 88% compared to 84% for the first quarter of
fiscal 2017.
- Non-GAAP loss from operations of $0.2 million compared to
non-GAAP loss from operations of $0.3 million for the first quarter
of fiscal 2017.
- Non-GAAP net loss of $0.2 million, or $0.05 per share, compared
to $0.3 million, or $0.06 per share, for the first quarter of
fiscal 2017.
- Net loss of $1.2 million, or $0.23 per share, compared to net
loss of $0.4 million, or $0.08 per share, for the first quarter of
fiscal 2017.
- Cash of $2.5 million as of July 31, 2017 compared to cash of
$2.1 million as of April 30, 2017.
Management Commentary
“I am pleased with the growth in new customers using our
products and the contributions of our team members” said Donovan
Jones, President and Chief Executive Officer. “We expect to
see revenue growth in fiscal 2018 as we build on our achievements
from the first quarter. We maintained our focus on transitioning to
SaaS as we recently began selling retail Bria Mobile for iOS and
Android exclusively through subscription and anticipate launching
cloud based software and services in the coming months that will
enable enterprises to collaborate with their colleagues and
externally with their customers. This evolution of Bria
integrates voice, instant messaging, screen sharing and
conferencing all under one application enabling users to do away
with multiple communication services and reduce costs,” continued
Jones.
Recent Business Highlights
- Released the Bria 5 softphone for desktop which includes 1080p
high-definition video for much clearer image quality.
- Recognized as one of CIOReview’s “20 Most Promising Contact
Center Technology Solution Providers”.
- Announced the release of the subscription-based version of Bria
Mobile, which now includes push services for enhanced battery
savings.
- Closed a non-brokered private placement of 539,240 shares of
common stock of the Company at a price of $2.20 for gross proceeds
of $1,186,328.
Financial Overview
(All amounts are in U.S. dollars and in accordance with
accounting principles generally accepted in the United States
(“GAAP”) unless otherwise specified - unaudited.)
Revenue was $3.1 million for the quarter ended July 31, 2017
compared to $3.0 million for the same quarter last fiscal year.
Software revenue was $1.7 million compared to $1.7 million for the
same quarter last fiscal year. Subscription, support and
maintenance revenue was $1.0 million compared to $1.0 million for
the same quarter last fiscal year. Professional services and other
revenue was $0.4 million compared to $0.4 million for the same
quarter last fiscal year.
Operating expenses for the quarter ended July 31, 2017 were $3.6
million compared to $3.6 million for the same quarter last fiscal
year. Operating expenses for the quarter ended July 31, 2017
included a non-cash stock-based compensation expense of $0.3
million (2016 - $0.3 million). Sales and marketing expenses
were $1.0 million for the quarter ended July 31, 2017 compared to
$1.0 million for the same quarter last fiscal year. For the quarter
ended July 31, 2017, research and development expenses were $1.4
million and general and administrative expenses were $0.9 million
compared to $1.2 million and $1.0 million, respectively, for same
quarter last fiscal year.
Foreign exchange loss for the quarter ended July 31, 2017 was
$0.6 million compared to foreign exchange gain of $0.2 million for
the same quarter last fiscal year. The foreign exchange gain
(loss) represents the gain (loss) on account of translation of the
intercompany accounts of CounterPath’s subsidiary which are
maintained in Canadian dollars and transactional gains and losses
resulting from transactions denominated in currencies other than
U.S. dollars.
The net loss for the quarter ended July 31, 2017 was $1.2
million, or $0.23 per share, compared to a net loss of $0.4
million, or $0.08 per share, for the same quarter last fiscal
year. As of July 31, 2017, the Company had $2.5 million in
cash, compared to $2.1 million at April 30, 2017.
Forward-Looking Statements
This news release contains "forward-looking statements".
Statements in this news release which are not purely historical are
forward-looking statements and include any statements regarding
beliefs, plans, outlook, expectations or intentions regarding the
future including: (1) the Company’s expectation of revenue growth
in fiscal 2018 as it builds on its achievements from the first
quarter; and (2) the Company’s anticipation of launching cloud
based software and services in the coming months that will enable
enterprises to collaborate with their colleagues and externally
with their customers. It is important to note that actual outcomes
and the Company’s actual results could differ materially from those
in such forward-looking statements. Actual results could differ
from those projected in any forward-looking statements due to
numerous factors. Such factors include, among others: (1) the
variability in CounterPath’s sales from reporting period to
reporting period due to extended sales cycles as a result of
selling CounterPath’s products through channel partners or the
length of time of deployment of CounterPath’s products by its
customers; (2) the Company’s ability to manage its operating
expenses, which may adversely affect its financial condition; (3)
the Company’s ability to remain competitive as other better
financed competitors develop and release competitive products; (4)
a decline in the Company’s stock price or insufficient investor
interest in the Company’s securities which may impact the Company’s
ability to raise additional financing as required or may cause the
Company to be delisted from a stock exchange on which its common
stock trades; (5) the impact of intellectual property litigation
that could materially and adversely affect CounterPath’s business;
(6) the success by the Company of the sales of its current and new
products; (7) the impact of technology changes on the Company’s
products and industry; (8) the failure to develop new and
innovative products using the Company’s technologies; and (9) the
potential dilution to shareholders or overhang on the Company’s
share price of its outstanding stock options. Readers should
also refer to the risk disclosures outlined in the Company’s
quarterly reports on Form 10-Q, the Company’s annual reports on
Form 10-K, and the Company’s other disclosure documents filed from
time to time with the Securities and Exchange Commission at
http://www.sec.gov and the Company’s interim and annual
filings and other disclosure documents filed from time to time on
SEDAR at www.sedar.com.
About CounterPath
CounterPath Unified Communications solutions are changing the
face of telecommunications. An industry and user favorite, Bria
softphones for desktop, tablet and mobile devices, together with
Stretto Platform™ server solutions, enable operators, OEMs and
enterprises large and small around the globe to offer a seamless
and unified over-the-top (OTT) communications experience across
both fixed and mobile networks. The Bria and Stretto combination
enables an improved user experience as an overlay to the most
popular UC and IMS telephony and applications servers on the market
today. Standards-based, cost-effective and reliable, CounterPath’s
award-winning solutions power the voice and video calling,
messaging, and presence offerings of customers such as AT&T,
Avaya, BroadSoft, BT, Cisco Systems, GENBAND, Metaswitch Networks,
Mitel, NEC, Network Norway, Nokia, Rogers and Verizon. Visit
www.counterpath.com.
Contacts:
David KarpChief Financial Officer,
CounterPathdkarp@counterpath.com(604) 628-9364
(TABLES TO FOLLOW) COUNTERPATH
CORPORATIONCONDENSED CONSOLIDATED BALANCE
SHEETS (Stated in U.S. Dollars) |
|
|
July 31, |
|
|
April 30, |
|
|
|
2017 |
|
|
2016 |
|
Assets |
|
(Unaudited) |
|
|
|
|
Current
assets: |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
2,526,262 |
|
$ |
2,071,019 |
|
Accounts receivable (net of allowance for doubtful accounts of
$138,196 and $80,232, respectively) |
|
2,667,318 |
|
|
2,133,469 |
|
Prepaid expenses and deposits |
|
156,985 |
|
|
170,853 |
|
Total current assets |
|
5,350,565 |
|
|
4,375,341 |
|
|
|
|
|
|
|
|
Deposits |
|
99,497 |
|
|
91,400 |
|
Equipment |
|
139,584 |
|
|
125,813 |
|
Goodwill |
|
7,043,181 |
|
|
6,440,955 |
|
Other
assets |
|
206,022 |
|
|
199,637 |
|
Total Assets |
$ |
12,838,849 |
|
$ |
11,233,146 |
|
|
|
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
Accounts payable and accrued liabilities |
$ |
2,038,941 |
|
$ |
1,825,528 |
|
Accrued warranty |
|
54,920 |
|
|
54,365 |
|
Customer deposits |
|
11,793 |
|
|
6,211 |
|
Unearned revenue |
|
2,016,863 |
|
|
2,134,948 |
|
Total current liabilities |
|
4,122,517 |
|
|
4,021,052 |
|
|
|
|
|
|
|
|
Deferred lease
inducements |
|
22,570 |
|
|
23,022 |
|
Unrecognized tax
benefit |
|
9,763 |
|
|
9,763 |
|
Total
liabilities |
|
4,154,850 |
|
|
4,053,837 |
|
|
|
|
|
|
|
|
Stockholders’
equity: |
|
|
|
|
|
|
Preferred stock,
$0.001 par value |
|
|
|
|
|
|
Authorized: 100,000,000 |
|
|
|
|
|
|
Issued and outstanding: July 31, 2017 – nil; April 30, 2017 –
nil |
|
– |
|
|
– |
|
Common stock,
$0.001 par value |
|
|
|
|
|
|
Authorized: 10,000,000 |
|
|
|
|
|
|
Issued and outstanding: |
|
|
|
|
|
|
July 31, 2017 – 5,485,808; April 30, 2017 – 5,005,245 |
|
5,486 |
|
|
5,005 |
|
Treasury
stock |
|
(3 |
) |
|
(60 |
) |
Additional
paid-in capital |
|
73,140,707 |
|
|
71,680,575 |
|
Accumulated
deficit |
|
(61,633,548 |
) |
|
(60,481,015 |
) |
Accumulated
other comprehensive loss – currency translation adjustment |
|
(2,828,643 |
) |
|
(4,025,196 |
) |
Total stockholders’ equity |
|
8,683,999 |
|
|
7,179,309 |
|
Liabilities and
Stockholders’ Equity |
$ |
12,838,849 |
|
$ |
11,233,146 |
|
|
|
|
|
|
|
|
COUNTERPATH CORPORATIONCONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS(Stated in U.S.
Dollars)(Unaudited) |
|
|
|
|
|
Three Months Ended |
|
|
|
|
|
|
July 31, |
|
|
|
|
|
|
|
|
|
2017 |
|
|
2016 |
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
Software |
|
|
|
|
|
|
$ |
1,698,893 |
|
$ |
1,656,003 |
|
Subscription, support and maintenance |
|
|
|
|
|
|
|
967,062 |
|
|
955,296 |
|
Professional services and other |
|
|
|
|
|
|
|
446,851 |
|
|
414,695 |
|
Total revenue |
|
|
|
|
|
|
|
3,112,806 |
|
|
3,025,994 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales (includes depreciation of $1,584 (2016 – $1,806)) |
|
|
|
|
|
|
|
388,243 |
|
|
497,116 |
|
Sales and
marketing |
|
|
|
|
|
|
|
1,004,284 |
|
|
961,869 |
|
Research
and development |
|
|
|
|
|
|
|
1,361,473 |
|
|
1,158,661 |
|
General
and administrative |
|
|
|
|
|
|
|
892,587 |
|
|
981,471 |
|
Total operating expenses |
|
|
|
|
|
|
|
3,646,587 |
|
|
3,599,117 |
|
Loss from
operations |
|
|
|
|
|
|
|
(533,781 |
) |
|
(573,123 |
) |
Interest and other
income (expense), net: |
|
|
|
|
|
|
|
|
|
|
|
|
Interest
and other income |
|
|
|
|
|
|
|
– |
|
|
13 |
|
Interest
expense |
|
|
|
|
|
|
|
(53 |
) |
|
– |
|
Foreign exchange
gain (loss) |
|
|
|
|
|
|
|
(618,699 |
) |
|
209,199 |
|
Net loss for the
period |
|
|
|
|
|
|
$ |
(1,152,533 |
) |
$ |
(363,911 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted |
|
|
|
|
|
|
$ |
(0.23 |
) |
$ |
(0.08 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares outstanding: Basic and diluted |
|
|
|
|
|
|
|
5,036,954 |
|
|
4,550,516 |
|
Non-GAAP Financial MeasuresThis news release
contains “non-GAAP financial measures”. The non-GAAP financial
measures in this news release consist of non-GAAP income (loss)
from operations which excludes non-cash stock-based compensation
relative to gross profit and income (loss) from operations
calculated in accordance with GAAP. The non-GAAP financial
measures also include non-GAAP net income (loss) which excludes
non-cash stock-based compensation and foreign exchange gain (loss)
relative to income (loss) calculated in accordance with GAAP.
Non-GAAP financial measures should not be considered as a
substitute for, or superior to, measures of financial performance
prepared in accordance with GAAP. CounterPath utilizes both
GAAP and non-GAAP financial measures to assess what it believes to
be its core operating performance and to evaluate and manage its
internal business and assist in making financial operating
decisions. CounterPath believes that the inclusion of
non-GAAP financial measures, together with GAAP measures, provides
investors with an alternative presentation useful to investors'
understanding of CounterPath’s core operating results and
trends.
Reconciliation to
GAAP(Unaudited)
|
|
|
|
Three Months Ended |
|
|
|
|
July 31, |
|
|
|
|
|
|
|
|
|
2017 |
|
|
2016 |
|
Non-GAAP income
(loss) from operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP income
(loss) from operations |
|
|
|
|
|
|
$ |
(533,781 |
) |
$ |
(573,123 |
) |
Plus: |
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation |
|
|
|
|
|
|
|
296,332 |
|
|
314,223 |
|
Non-GAAP income
(loss) from operations |
|
|
|
|
|
|
$ |
(237,449 |
) |
$ |
(258,900 |
) |
|
|
|
|
Three Months Ended |
|
|
|
|
July 31, |
|
|
|
|
|
|
|
|
|
2017 |
|
|
2016 |
|
Non-GAAP net
income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss) |
|
|
|
|
|
|
$ |
(1,152,533 |
) |
$ |
(363,911 |
) |
Plus: |
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation |
|
|
|
|
|
|
|
296,332 |
|
|
314,223 |
|
Foreign exchange
gain (loss) |
|
|
|
|
|
|
|
618,699 |
|
|
(209,199 |
) |
Non-GAAP net
income (loss) |
|
|
|
|
|
|
$ |
(237,502 |
) |
$ |
(258,887 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted |
|
|
|
|
|
|
$ |
(0.23 |
) |
$ |
(0.08 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
net income (loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted |
|
|
|
|
|
|
$ |
(0.05 |
) |
$ |
(0.06 |
) |
CounterPath (NASDAQ:CPAH)
Historical Stock Chart
From Aug 2024 to Sep 2024
CounterPath (NASDAQ:CPAH)
Historical Stock Chart
From Sep 2023 to Sep 2024