March Networks Announces Financial Results for Third Quarter and First Nine Months and Revised Guidance for Fiscal 2008

OTTAWA, Feb. 27 /PRNewswire-FirstCall/ - Summary Operating Results: ------------------------------------------------------------------------- $Cdn millions Q1-Q3 Q1-Q3 except EPS data...


OTTAWA, Feb. 27 /PRNewswire-FirstCall/ - Summary Operating Results: ------------------------------------------------------------------------- $Cdn millions Q1-Q3 Q1-Q3 except EPS data Q3 '08 Q3 '07 '08(x) '07(x)(x) ------------------------------------------------------------------------- Revenue $21.1 $18.7 $73.4 $67.8 ------------------------------------------------------------------------- Earnings (loss) from continuing operations before income taxes (2.9) 1.9 (2.9) 9.4 ------------------------------------------------------------------------- Net earnings (loss) from continuing operations $ (3.1) $ 1.0 $ (3.4) $ 5.3 ------------------------------------------------------------------------- Diluted earnings (loss) per share from continuing operations $(0.18) $0.06 $(0.20) $0.29 ------------------------------------------------------------------------- (x) Earnings include the impact of a $2.4 million charge in Q2'08 for retrofit costs. (xx) Earnings include the impact of a $2.3 million charge in Q2'07 for patent litigation settlement.

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 third quarter and nine months of fiscal 2008 ended January 31, 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 third quarter of fiscal 2008 representing an increase of 13% as compared with revenue of $18.7 million in the third quarter of fiscal 2007 and a decline of 24% from the second quarter of fiscal 2008. Revenue of $73.4 million in the first nine months of fiscal 2008 represented an increase of 8% as compared to the first nine months of fiscal 2007.

The Company incurred a loss from continuing operations before income taxes in the third quarter of fiscal 2008 of $2.9 million as compared to earnings from continuing operations before income taxes of $1.9 million in the third quarter of fiscal 2007 and a loss of $872,000 in the second quarter of fiscal 2008. Loss from continuing operations before income taxes in the first nine months of fiscal 2008 was $2.9 million as compared to earnings of $9.4 million in the first nine months of fiscal 2007. Earnings from continuing operations before income taxes in the first nine months of fiscal 2008 reflected a one time $2.4 million charge related to a retrofit program which the Company initiated to proactively address design issues related to the Company's installed base of transit products. Earnings from continuing operations before income taxes in the first nine months of fiscal 2007 were negatively impacted by a $2.3 million lawsuit settlement.

The Company incurred a net loss from continuing operations in the third quarter of fiscal 2008 of $3.1 million or $0.18 per diluted share as compared to net earnings of $1.0 million or $0.06 per diluted share in the third quarter of fiscal 2007 and a net loss of $666,000 or $0.04 per share in the second quarter of fiscal 2008. The Company's net loss from continuing operations of $3.4 million or $0.20 per diluted share in the first nine months of fiscal 2008 compares to earnings of $5.3 million or $0.29 per share in the first nine months of fiscal 2007.

"I am pleased with the continued diversification of revenue outside our largest customer. We have aggressively invested in R&D and look forward to the release of our next generation IP products and growing our European business with the acquisition of Cieffe", said Peter Strom , President and CEO, March Networks.

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