The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Globe Investor

News Sources

Take control of your investments with the latest investing news and analysis

Press release from Marketwire

GuestLogix Generates Continued Sequential Revenue Growth in Fiscal 2012 Second Quarter

Company successfully executes on strategy, renewing contracts, expanding footprint, leveraging footprint and penetrating new markets

Monday, July 16, 2012

GuestLogix Generates Continued Sequential Revenue Growth in Fiscal 2012 Second Quarter16:00 EDT Monday, July 16, 2012TORONTO, ONTARIO--(Marketwire - July 16, 2012) - GuestLogix Inc. (TSX:GXI), the leading global provider of onboard retail and payment technology to airlines and the passenger travel industry, today announced its financial and operational results for the three- and six-month periods ended May 31, 2012. All financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS") and reported in U.S. dollars. This is the Company's second quarter reporting in U.S dollars and under IFRS."We delivered on all aspects of our fiscal 2012 strategy, which will also translate into our financial results in the coming quarters," said Mr. Tom Douramakos, President and CEO, GuestLogix. "We signed renewals with three major airlines, won a contract in the Asia-Pacific region, deployed a new technology offering with an existing customer and added a rail client. Establishing new in-flight ancillary revenue streams is a key focus for airlines worldwide. Going forward, we expect our operating expenses to stabilize at current levels, as the strategic investments we have made to-date position us very well to further expand our presence in the onboard retail marketplace and drive revenue growth." Q2 F2012 Financial Summary Revenue of $6.0 million, compared to $5.6 million in Q1 F2012 EBITDA(1) of ($0.4) million, compared to $0.09 million in Q1 F2012 Net income of ($0.5) million, compared to net income of $0.06 million in Q1 F2012 Cash and cash equivalents including restricted cash of $3.2 million as at May 31, 2012 Q2 F2012 Operational Highlights Expand FootprintAmericas: signed contract renewal with a leading global airline and announced contract renewal with Southwest Airlines, including expansion to AirTran Airways EMEA: signed contract renewal with KLM Royal Dutch Airlines Asia-Pacific: won contract with major Indian airline, Jet Airways, opened Asia-Pacific headquarters in Hong Kong and launched Chinese, Korean and Japanese language versions of the Company's onboard retail technology software platform to better meet the needs of Asia-based airlines Leverage FootprintNew Technology Offerings: went live with Global Payment Services onboard existing customer (a large European airline) Enter New MarketsRail: Signed agreement with U.K. rail operator, First TransPennine Express through local channel partner, Skytrac Group Technology InnovationLaunched solution that enables airlines to convert consumer mobile devices (smartphones and tablets running on iOS, Android and BlackBerry operating systems) into secure point-of-sale terminals Unveiled second-generation onboard retail software platform, OBR PlusReleased next-generation onboard point-of-sale device, XPDA-SP Key Operating Metrics Q2 F2012Q1 F2012Q2 F2011H1 F2012H1 F2011GTV processed in the period$149M$143M$155M$292M$295MTotal revenue as a percentage of GTV4.0%3.9%4.1%4.0%4.0% Financial Summary GuestLogix' Q2 F2012 results are the Company's second set of consolidated financial statements prepared in U.S. dollars and under IFRS. For more detailed information regarding the Company's transition to IFRS, including a reconciliation of the Company's Q2 fiscal 2011 results and fiscal 2011 annual results as originally reported in Canadian Generally Accepted Accounting Principles ("CGAAP") to IFRS, please refer to the Company's financial statements and MD&A filings on SEDAR at www.sedar.com. Note, the Company has not provided CGAAP to IFRS reconciliations for its quarterly or annual results prior to fiscal 2011. Therefore, historical numbers reported under CGAAP should not be directly compared to the Company's fiscal 2011 or fiscal 2012 quarterly or annual results as reported under IFRS.Q2 F2012Q1 F2012Q2 F2011H1 F2012H1 F2011Revenue$6.0M$5.6M$6.3M$11.7M$11.8MOperating Expenses(2)$6.6M$5.6M$5.8M$12.2M$10.3MEBITDA($0.4)M$0.09M$0.6M($0.3)M$1.6MNet Income (Loss)($0.5)M$0.06M$0.06M($0.5)M$0.9MNet Income (Loss) Per Share($0.01)$0.00$0.00($0.01)$0.01 Transition to IFRS Effective December 1, 2010, the Company changed its functional and presentation currency from the Canadian dollar to the U.S. dollar as a result of the adoption of IFRS and the significant role of the U.S. dollar in the business operations of the Company. In addition, as required under IFRS, the Company must now recognize revenue attributed to the hardware components contained in a multiple-element agreement as if it were an upfront sale at the inception of the arrangement. The effect of applying this change at December 1, 2010 was the elimination of deferred cost of equipment sales and capital assets deployed accounts, as well as a significant reduction in deferred revenue to reflect the upfront sale, while the Company restated net finance receivable to reflect the fair value of the delivered elements of the arrangement. Accordingly, revenue under IFRS, including what the Company has reported for Q2 2012 and Q2 2011, is reduced by an amount equal to the fair value of the hardware components of the arrangement recognized in past periods. While the changes to the Company's accounting policies under IFRS are significant, the underlying business model and cash inflows remain the same as they were under CGAAP. Q2 F2012 Conference Call Details GuestLogix will host a conference call on Monday, July 16, 2012 at 4:30 p.m. Eastern Time to discuss its fiscal 2012 second quarter financial and operational results as well as the Company's outlook for the remainder of the fiscal year. To access the conference call, please dial 647-427-7450, or 1-888-231-8191. A replay of the call will be available at http://www.guestlogix.com/events.html.A complete set of financial statements and Management's Discussion and Analysis for the three- and six-month month periods ended May 31, 2012 will be available at http://www.sedar.com/ and http://www.guestlogix.com/.(1) Defined as Earnings Before, Interest, Taxes, Depreciation and Amortization(2)Includes depreciation and stock based compensation, but excludes interest and F/X gains or lossesAbout GuestLogixGuestLogix Inc. (TSX:GXI), the leading global provider of onboard store technology and merchandising solutions, helps airlines and other travel operators create, manage, and control onboard retail environments tailored to their needs and their passengers. GuestLogix brings a decade of expertise as a trusted onboard transaction processing partner to airlines around the world. The Company's global headquarters and centre for product innovation is located in Toronto, Canada with regional head offices located in Dallas, Texas (serving Americas) London, UK (serving EMEA), and Hong Kong (serving Asia Pacific). A sales and support office is located in Singapore. Logistics centres are situated in Toronto, Dallas, London and Seoul with a software development centre located in India. More information is available at www.guestlogix.com.© 2012 GuestLogix. All Rights Reserved. ®OnTouch is a trademark of GuestLogix Inc. and is registered in the United States and may be pending or registered in other countries. All other trademarks and trade names are the property of their respective owners.Forward-Looking StatementsThis news release includes certain forward-looking statements that are based upon current expectations, which involve risks and uncertainties associated with GuestLogix' business and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions "anticipate", "believe", "plan", "estimate", "expect", "intend", and similar expressions to the extent they relate to the Company or its management. The forward-looking statements are not historical facts, but reflect GuestLogix' current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under "Risks and Uncertainties" in the Filing Statement filed on July 16, 2012 with the regulatory authorities. GuestLogix assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.FOR FURTHER INFORMATION PLEASE CONTACT: Brian ReddyGuestLogixChief Financial Officer416-987-7053breddy@guestlogix.comwww.guestlogix.comORKristen DicksonTMX/Equicom416-815-0700 ext. 273kdickson@equicomgroup.com