Comtex Reports 2nd Quarter Fiscal 2006 Financial Results.ALEXANDRIA, Va. -- Comtex News Network, Inc. (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). BB:CMTX CMTX Charcot-Marie-Tooth Disease, X-Linked ), a leading provider of economically useful electronic real-time news, content and market alerts, today announced financial results for the quarter and six months ended December 31, 2005. Comtex reported approximately $1.9 million in revenue for the second quarter of fiscal 2006 compared to $2.1 million in revenue for second quarter fiscal 2005. For the six months ended December 31, 2005, Comtex reported revenue of $3.9 million compared to $4.1 million for the comparative period of the previous year. The decreases in revenue are primarily the result of business consolidations among clients. For the three and six month periods ended December 31, 2005, Comtex reported operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of ($162,000) and ($58,000), respectively, versus operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $159,000 and $291,000 for the three and six months ended December 31, 2004. Comtex reported a net loss of ($184,000), or ($0.01) per share, for second quarter fiscal 2006, versus net income of $119,000, or $0.01 per share, for second quarter fiscal 2005. For the six months ended December 31, 2005 and 2004, respectively, Comtex reported a net loss of ($121,000), or ($0.01) per share, and net income of $216,000, or $0.01 per share. The operating and net losses reported by Comtex for the three and six month periods ended December 31, 2005 primarily result from the effects of reporting stock-based compensation in accordance with Statement of Financial Accounting Standard No. 123R of a charge of approximately $321,000 and $438,000 respectively, which requires the issuance of stock options be accounted for using specific new regulations. Comtex adopted this standard on its effective date, July 1, 2005. In addition to the impact of SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System No. 123R, Comtex has also experienced decreases in gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. . For the six month periods ended December 31, 2005 and 2004, EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (as defined and explained in the accompanying note to the table below) decreased to $561,000 from $648,000. This change is reflective of increased stock-based compensation charges, decreased gross profit margins, and decreased depreciation and amortization, as described above. "Comtex continues to work to optimize our financial results while providing superior, targeted news and financial data products to our clients," said Chip Brian, Comtex's President and COO. "Besides our focus on new product development, we're quite pleased that our 2005 statistical analysis of Comtex's technical performance showed a near-perfect score of 99.8% reliability and a per-story throughput speed of less than one second. These high performance metrics Performance metrics are measures of an organizations activities and performance. Performance metrics should support a range of stakeholder needs from customers, shareholders to employees [1]. substantiate To establish the existence or truth of a particular fact through the use of competent evidence; to verify. For example, an Eyewitness might be called by a party to a lawsuit to substantiate that party's testimony. our dedication to exceeding our customers' requirements and expectations." About Comtex Comtex (www.comtex.com) provides real-time news, SmarTrend(SM) Alerts and economically useful information to businesses whose customers need more than just facts. Comtex customers receive select content from key sources which is further enhanced with stock tickers Stock ticker A letter designation assigned to securities and mutual funds that trade on US financial exchanges. and an extended lexicon of relevant terms. With a specialization A career option pursued by some attorneys that entails the acquisition of detailed knowledge of, and proficiency in, a particular area of law. As the law in the United States becomes increasingly complex and covers a greater number of subjects, more and more attorneys are in the financial news and content marketplace, Comtex receives, enhances, combines and filters news and content received from national and international news bureaus, agencies and publications, and distributes more than one million total stories per day. Comtex's state-of-the-art technology delivers this relevant content and reliable service in real-time. Comtex (OTC BB:CMTX) has offices in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. and Alexandria, Virginia Alexandria is an independent city in the Commonwealth of Virginia. As of the 2000 census, the city had a total population of 128,284. Located along the Western bank of the Potomac River, Alexandria is approximately 6 miles (9.6 kilometers) south of downtown Washington, DC. . SmarTrend(SM) and CSTA (Computer Supported Telephony Application) An international standard interface between a network server and a telephone switch (PBX) established by the European Computer Manufacturers Association (ECMA). (SM) are service marks of Comtex News Network, Inc. Please Note: Except for the historical information contained herein, this press release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended, that involve a number of risks and uncertainties. These forward-looking statements may be identified by reference to a future period by use of forward-looking terminology such as "anticipate," "expect," "could," "intend," "may" and other words of a similar nature. These statements involve risks and uncertainties that could cause actual results to differ materially from those contemplated herein, including the occurrence of unanticipated events or circumstances relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the fact that Comtex is in a highly competitive industry subject to rapid technological, product and price changes. Other factors include the possibility that demand for the Company's products may not occur or continue at sufficient levels, changing global economic and competitive conditions, technological risks and other risks and uncertainties, including those detailed in the Company's filings with the Securities and Exchange Commission. Comtex undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
FINANCIAL TABLE FOLLOWS
Comtex News Network, Inc.
Selected Financial Data
(unaudited)
(amounts in thousands, except per share amounts)
Three Months Ended Six Months Ended
December 31 December 31
--------------------- ---------------------
2005 2004 2005 2004
---------- ---------- ---------- ----------
Revenues $ 1,933 $ 2,086 $ 3,929 $ 4,072
Operating (Loss) / Income (162) 159 (58) 291
Net Income (Loss) $ (184) $ 119 $ (121) $ 216
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Net Earnings (Loss) Per
Share
Basic $ (0.01) $ 0.01 $ (0.01) $ 0.02
-------------------------------------------
Diluted $ (0.01) $ 0.01 $ (0.01) $ 0.01
-------------------------------------------
Weighted Avg. # Shares:
Basic 13,700 13,600 13,650 13,600
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Diluted 13,700 14,645 13,650 14,645
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Reconciliation to EBITDA:
Net Income (Loss) $ (184) $ 119 $ (121) $ 216
Stock-based
compensation 321 - 438 -
Depreciation &
Amortization 75 178 181 357
Interest/Other Expense 22 40 47 75
Income Taxes - - 16 -
-------------------------------------------
EBITDA $ 234 $ 337 $ 561 $ 648
Please Note: EBITDA consists of earnings before interest and other expense, interest and other income, income taxes, stock-based compensation, depreciation and amortization and impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges. EBITDA is not a term defined by generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting , and as a result, our measure of EBITDA might not be comparable to similarly titled measures used by other companies. However, we believe that EBITDA is relevant and useful information, which is often reported and widely used by analysts, investors and other interested parties in our industry. Accordingly, we are disclosing this information to permit a more comprehensive analysis of our operating performance. |
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