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Press release from Marketwire

Cyberplex Reports First Quarter 2012 Results and Normal Course Issuer Bid

Friday, May 11, 2012

Cyberplex Reports First Quarter 2012 Results and Normal Course Issuer Bid16:01 EDT Friday, May 11, 2012TORONTO, ONTARIO--(Marketwire - May 11, 2012) - Cyberplex Inc. (TSX:CX) a leader in performance-based online marketing and technology solutions today announced its financial results for the first quarter ended March 31, 2012. Total revenue for the quarter was $16.3 million, an increase from the $14.6 million recorded in the same quarter of 2011, and adjusted EBITDA loss for the quarter was approximately $341,000 as compared to income of $150,000 in the same period of 2011. The net loss for the quarter was $3.4 million as compared to a net loss of $3.6 million in the same year ago period.Results for the First Quarter ended March 31, 2012The Company generated revenue of $16.3 million, a 65% increase from the $9.9 million recorded in the previous quarter; Adjusted EBITDA loss for the quarter was $ 341,000, as compared to an Adjusted EBITDA loss of $1.8 million in the previous quarter; Excluding the operations of Tsavo Media, revenue for the quarter was $3.5 million and adjusted EBITDA was a loss of $622,000; Net loss for the quarter was $3.4 million compared to a net loss of $4.6 million in the previous quarter; and Cash flow from operations used $3.2 million in cash for the three months ended March 31, 2012, as compared to cash generated of $2.8 million for the same period in 2011. On April 24, 2012, the Company announced the sale of Tsavo Media as part of a series of transactions valued at approximately $33 million (the "Transaction") in which the Company received cash proceeds of approximately $7.3 million and reduced its debt obligations from approximately $25.6 million to approximately $150,000. As a result of the Transaction, the Company's financial position has been improved significantly."The sale of Tsavo has resulted in much more stable and focused organization" said Geoffrey Rotstein, Chief Executive Officer of Cyberplex. "From both a financial and a strategic perspective, Cyberplex is now able to deliver quality digital marketing solutions to our clients without further distractions and has the financial resources required to fund sustainable growth in this exciting digital environment."Non-IFRS Financial MeasuresThis press release includes a discussion of "Adjusted EBITDA," which is a non-IFRS financial measure. The Company defines Adjusted EBITDA as net loss from operations before; (a) depreciation of property and equipment and amortization of intangible assets; (b) stock-based compensation expense, (c) restructuring and acquisition costs, (d) Impairments of goodwill and intangible assets and other items net. Management uses Adjusted EBITDA as a measure of the Company's operating performance because it provides information related to the Company's ability to provide operating cash flows for acquisitions, capital expenditures and working capital requirements. The Company also believes that analysts and investors use Adjusted EBITDA as a supplemental measure to evaluate the overall operating performance of companies in its industry.The non-IFRS financial measure is used in addition to and in conjunction with results presented in accordance with the Company's consolidated financial statements prepared in accordance with IFRS and should not be relied upon to the exclusion of IFRS financial measures. Management strongly encourages investors to review the Company's consolidated financial statements in their entirety and to not rely on any single financial measure. Because non-IFRS financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-IFRS financial measures having the same or similar names. In addition, the Company expects to continue to incur expenses similar to the non-IFRS adjustments described above, and exclusion of these items from the Company's non-IFRS measures should not be construed as an inference that these costs are unusual, infrequent or non-recurring.The table below reconciles net loss from operations and Adjusted EBITDA for the periods presented:Three months ended March 31,(In thousands of Canadian dollars)20122011Net loss from operations$(2,875)$(2,851)Add:Depreciation of property and equipment301381Amortization of intangible assets2,0082,210Restructuring and acquisition expenses221263Stock based compensation4147Adjusted EBITDA$(341)$150Normal Course Issuer BidThe Company also today announced that the Toronto Stock Exchange (the "TSX") has accepted a notice filed by the Company of its previously announced intention to make a normal course issuer bid, commencing May 14, 2012 and expiring May 13, 2013. Under the bid, the board of directors has authorized the purchase of up to 11,913,232 of its common shares, representing approximately 10% of the "public float" of common shares. Daily purchases will be limited to 40,721 common shares, other than block purchase exceptions. Purchases will be made on the open market by Cyberplex through the facilities of the TSX in accordance with TSX requirements. The prices that Cyberplex will pay for any purchased common shares will be the market price of such shares on the TSX at the time of acquisition.Cyberplex has 127,525,349 common shares issued and outstanding as of May 10, 2012, with a public float of 119,132,316 common shares. The Company has not purchased any of its common shares during the preceding 12 months pursuant to a normal course issuer bid.The Company believes that from time to time the common shares of the Company have been trading at prices that do not fully reflect the underlying value of the Company. As a result, Cyberplex believes that its common shares are a good investment at its current and recent prices.The Company may from time to time enter into a pre-defined plan with a registered investment dealer to allow for the repurchase of common shares at times when Cyberplex ordinarily would not be active in the market due to its own internal trading blackout periods, insider trading rules, or otherwise. This plan will be adopted in accordance with applicable TSX rules and Canadian securities laws.About CyberplexCyberplex Inc. (www.cyberplex.com) is a North American leader in online publishing and customer acquisition strategies. The Company, through its subsidiaries, connects advertisers to their most relevant online customers and prospects. Cyberplex delivers targeted, high quality results through online, mobile and social initiatives that improve advertiser ROI, monetize the value of online properties, and build loyal online audiences.Forward-Looking StatementsThis news release may contain forward-looking statements that are based on management's current expectations and are subject to known and unknown uncertainties and risks, which could cause actual results to differ materially from those contemplated or implied by such forward-looking statements. Cyberplex is under no obligation to update any forward-looking statements contained herein should material facts change due to new information, future events or otherwise.Cyberplex Inc.Unaudited Interim Condensed Consolidated Statements of Financial Position (In thousands of Canadian dollars)March 31, 2012December 31, 2011AssetsCurrent assets:Cash and cash equivalents$1,260$4,050Accounts receivable12,0998,769Income taxes recoverable-31Other current assets7,0466,90720,40519,757Non-current assets:Restricted cash2,3172,357Property and equipment1,8281,998Intangible assets19,67322,069Goodwill35836524,17626,789Total assets$44,581$46,546Liabilities and Shareholders' EquityCurrent liabilities:Accounts payable and accrued liabilities$15,202$13,707Current portion of loans and borrowings24,6804,697Current portion of deferred lease inducements7171Deferred revenue537498Income taxes payable34834840,83819,321Non-current liabilities:Loans and borrowings93620,836Deferred lease inducements85114Deferred tax liabilities5486031,56921,553Shareholders' Equity2,1745,672Total liabilities and Shareholders' equity$44,581$46,546Cyberplex Inc.Unaudited Interim Condensed Consolidated Statements of Comprehensive Income (Loss) (In thousands of Canadian dollars, except per share amounts)Three months ended March 31, 2012 and 201120122011Revenue$16,325$14,603Expenses:Publishing and advertising costs11,4938,916Employee compensation and benefits3,1753,904Other operating expenses2,0021,780Depreciation of property and equipment301381Amortization of intangible assets2,0082,210Restructuring costs22126319,20017,454Loss from operations(2,875)(2,851)Finance income(14)(19)Finance cost595892Loss before income taxes(3,456)(3,724)Income tax recovery:Deferred5513055130Loss for the period(3,401)(3,594)Other comprehensive income (loss):Net change in fair value of available-for-sale financial assets-8Foreign currency translation adjustments to equity(101)(299)Other comprehensive income (loss) for the period, net of tax(101)(291)Total comprehensive loss for the period$(3,502)$(3,885)Loss per share:Basic$(0.03)$(0.03)Diluted$(0.03)$(0.03)Cyberplex Inc.Unaudited Interim Condensed Consolidated Statements of Cash Flows(In thousands of Canadian dollars)Three months ended March 31, 2012 and 201120122011Cash flows from operating activities:Loss for the period$(3,401)$(3,594)Adjustments to reconcile net loss to net cash flows from operating activities:Depreciation of property and equipment301381Amortization of intangible assets2,0082,210Amortization of deferred lease inducements(29)(29)Share-based payments4147Foreign exchange loss (gain)(3)130Finance (income) cost, net526873Deferred income tax recovery(55)(130)Restructuring cost221263Change in non-cash operating working capital(2,811)2,523Cash generated from operating activities(3,239)2,774Income taxes received310Net cash from (used in) operating activities(3,208)2,774Cash flows from financing activities:Proceeds from bank operating facility625-Repayment of term loans-(2,176)Repayment of finance lease(16)-Interest paid(72)(814)Net cash from (used in) financing activities537(2,990)Cash flows from investing activities:Sale of short-term investments-1,294Interest income received319Decrease in restricted cash and short-term investments40115Additions to property and equipment(165)(97)Additions to intangible assets-(11)Net cash from (used in) investing activities(122)1,320Foreign exchange gain (loss) on cash held in foreign currency3(130)Increase (decrease) in cash and cash equivalents(2,790)974Cash and cash equivalents, beginning of period4,0505,192Cash and cash equivalents, end of period$1,260$6,166FOR FURTHER INFORMATION PLEASE CONTACT: David KatzCyberplex Inc.EVP Corporate Development416.597.8889416.597.2345 (FAX)press@cyberplex.comwww.cyberplex.com