March Networks Announces Fourth Quarter and Fiscal Year 2008 Financial Results

OTTAWA , June 11 /PRNewswire-FirstCall/ - March Networks(TM) (TSX:MN; AIM:MNW), a leading provider of innovative video and data applications used for security surveillance, monitoring, analysis and business optimization, today announced financial...


OTTAWA , June 11 /PRNewswire-FirstCall/ - March Networks(TM) (TSX:MN; AIM:MNW), a leading provider of innovative video and data applications used for security surveillance, monitoring, analysis and business optimization, today announced financial results for the fourth quarter and fiscal year ended April 30, 2008 . All figures in Canadian dollars and in accordance with Canadian GAAP unless otherwise specified.

The Company recorded revenue of $21.1 million in the fourth quarter of fiscal 2008 representing an increase of 6% as compared to revenue of $19.8 million in the fourth quarter of fiscal 2007 and was even as compared to the third quarter of fiscal 2008. Revenue of $94.4 million in the fiscal year ended April 30, 2008 represented an increase of 8% as compared to fiscal 2007.

The Company incurred a loss from continuing operations before income taxes in the fourth quarter of fiscal 2008 of $4.2 million as compared to a loss from continuing operations before income taxes of $0.7 million in the fourth quarter of fiscal 2007 and a loss of $2.9 million in the third quarter of fiscal 2008. Loss from continuing operations before income taxes in the fiscal year ended April 30, 2008 was $7.1 million as compared to earnings of $8.8 million in fiscal 2007. Earnings from continuing operations before income taxes in the fourth quarter and fiscal year ended reflected charges of $750,000 and $3.2 million in the fourth quarter and fiscal year ended April 30, 2008 , respectively, related to a retrofit program which the Company initiated in the second quarter of fiscal 2008 to proactively address design issues related to the Company's installed base of transit products. Earnings from continuing operations before income taxes in fiscal 2007 were negatively impacted by a $2.3 million lawsuit settlement.

The Company incurred a net loss from continuing operations in the fourth quarter of fiscal 2008 of $3.1 million or $0.18 per diluted share as compared to a net loss of $444,000 or $0.03 per diluted share in the fourth quarter of fiscal 2007 and a net loss of $3.1 million or $0.18 per share in the third quarter of fiscal 2008. The Company's net loss from continuing operations of $6.5 million or $0.38 per diluted share in fiscal 2008 compares to earnings of $4.8 million or $0.27 per diluted share in fiscal 2007.

"Fiscal 2008 was a year of investment and diversification for the Company that featured excellent revenue growth outside of our largest customer, the establishment of a strong European presence through the acquisition of Cieffe and enhancement of the Company's product portfolio through this acquisition and the Company's internal development initiatives. We expect 2009 to be an exciting year for the Company with a return to operating profitability, an industry leading product line and strong international growth" said Peter Strom , President and Chief Executive Officer.

"The Company undertook some important initiatives in the fourth quarter of fiscal 2008 to put it on course for operating profitability and strong revenue growth in fiscal 2009 including trimming of the Company's cost structure and expansion of the Company's product line and market presence as a result of the acquisition of Cieffe." , said Ken Taylor , CFO of March Networks. "The Company's recently announced normal course issuer bid confirms that the Company's Management and Board of Directors believe in the prospects for the Company and that the market price for the Company's shares may be such that the purchase of common shares by the Company would be in the best interests of the Company and its shareholders."

Business Outlook

The Company's revenue expectations for the fiscal year ending April 30, 2009 are in the range of $100 million to $115 million.

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