10/24/2003 - Mindready Solutions Inc. (TSX: MNY), a subsidiary of Quebecor Media Inc., announced its financial results for the third quarter ended September 30, 2003.
Quarterly revenues totalled $5.0 million, compared with $6.3 million in the same quarter of 2002. The decrease was mainly due to lingering uncertainty in the telecommunications market combined with the generally unfavourable business environment in the US and Europe.
Mindready pursued its drive to diversify its customer base and penetrate new vertical markets. Non-telecommunications sales made up 53% of revenues in the third quarter of 2003, compared with 47% in the same quarter last year.
Mindready continued to register growth in sectors such as the aerospace, medical and automotive industries, which accounted for 39%, 11% and 3% of revenues respectively during the quarter.
Broken down by business unit, 55% of third quarter 2003 revenues were generated by the test systems segment and 45% by the embedded systems segment. The geographic distribution of revenues was as follows: 40% from Canada, 39% from the US, 21% from Europe.
The Company generated earnings before income taxes of $61,000 in the third quarter of 2003, compared with a loss of $1.7 million in the third quarter of 2002. The significant improvement was mainly caused by an increase in the gross margin from 32% in the third quarter of 2002 to 38% in the third quarter of 2003, the recording of tax credits receivable from previous years, and a decrease in the order of 37% in the selling and administrative expenses. The Company currently has 195 employees.
As of September 30, 2003, Mindready's balance sheet showed $15.2 million, or $1.27 per share, in cash, cash equivalents and short-term investments, and $15.1 million of working capital, compared with $16.3 million and $16.1 million respectively as of December 31, 2002. The changes in cash, cash equivalents and short-term investments over the nine-month period ended September 30, 2003 were due primarily to the operating loss and the net change in operating assets and liabilities, which required capital of $565,000, the repayment of long-term debt in the amount of $123,000, investments in capital assets and in development cost totalling $328,000, and the cash impact of exchange rate fluctuations, which amounted to $135,000.
"Despite still-challenging business conditions, Mindready posted an operating profit in the third quarter of 2003 for the first time since the first quarter of 2001 and the collapse of the telecom market," commented Marc Doré, President and Chief Executive Officer of Mindready.
"Notwithstanding our improved results, it is imperative that we continue to exercise tight cost management and step up our diversification and sales efforts, given the market that is still difficult." Mr. Doré stated.
The statements regarding Mindready's future operating results, performance and business prospects contained in this press release, and any other statements not constituting historical information, are forward-looking statements. These forward-looking statements reflect Mindready's current opinions and assumptions with respect to future business decisions and results, and are based on the information currently available to Mindready. Accordingly, these statements are subject to risks, uncertainties and contingencies which could cause Mindready's future operating results, performance or business prospects to differ from those expressed in, or implied by, these statements.
About Mindready Solutions
Mindready Solutions Inc. (TSX: MNY) is a leading supplier of automation systems, embedded systems and test systems for the aerospace/defense, automotive, industrial, medical and telecommunication markets. Recognized as the world leader in industrial-grade IEEE-1394 / FireWire®-based products, systems and engineering services, Mindready offers complete innovative solutions based on this technology. Mindready's clients include Alcatel, Boeing, Hewlett-Packard, Nortel Networks, Rockwell Collins, Sanmina-SCI, Visteon and Wind River. More information about Mindready and its products, systems and services can be found at www.mindready.com.
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