Counsel Corporation Announces 2004 First Quarter Results.Business Editors TORONTO--(BUSINESS WIRE)--May 14, 2004 Counsel Corporation (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :CXS CXS Coherent X-Ray Scattering ) (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CXSN) today reported its financial results for the three months ended March 31, 2004. All amounts are stated in US dollars. Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: revenues from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the for the first three months of 2004 increased 11% to $35.8 million from $32.2 million in the first three months of 2003 primarily due to the inclusion of $4.7 million in non-recurring revenue in its communications business, Acceris Communications Inc. The Company incurred a loss from continuing operations of $2.5 million, or $0.05 per share, basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. , in the first three months of 2004, compared with a loss of $14.3 million, or $0.70 per share, in the first three months of 2003. Including discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , the Company incurred a net loss of $2.5 million or $0.05 per share, basic and diluted, for the three months ended March 31, 2004, compared with a loss of $15.3 million, or $0.75 per share, for the three months ended March 31, 2003. Highlights of the first quarter of 2004: - Recorded 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 of $0.7 million in the first quarter of 2004 (1) - Acceris expanded local dial tone service in the states of New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of and New Jersey. - Acceris completed the consolidation of its network operations centres in San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. and Pittsburgh Pittsburgh (pĭts`bərg), city (1990 pop. 369,879), seat of Allegheny co., SW Pa., at the confluence of the Allegheny and the Monongahela rivers, which there form the Ohio River; inc. 1816. . "As a result of the bold decisions and actions taken in 2003, Counsel Corporation is experiencing positive momentum. We are pleased with our progress," said Allan Allan can refer to:
(1)"EBITDA," which is calculated as Earning Before deductions for Interest, Taxes, Depreciation and Amortization, is not a measure of financial performance under GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). . EBITDA is provided for the use of the reader in understanding the Company's operating results and is not prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with, nor does it serve as an alternative to, GAAP measures and may be materially different from similar measures used by other companies. While not a substitute for information prepared in accordance with GAAP, the Company believes that this information is helpful for investors to more easily understand the Company's operating financial performance, especially in light of the significant restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). activities the Company has recently undertaken. The Company also feels that this measure may better enable an investor to form views of the Company's potential financial performance in the future. These measures have limitations as analytical analytical, analytic pertaining to or emanating from analysis. analytical control control of confounding by analysis of the results of a trial or test. tools, and investors should not consider them in isolation or as substitutes for analysis of the Company's results prepared in accordance with GAAP. A reconciliation of EBITDA to the nearest GAAP measure, net income, as it appears on our income statement is below:
Three Months Ended
March 31, 2004
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EBITDA $703
Less: depreciation and amortization (2,481)
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Operating loss (1,778)
Total other income(expense) (242)
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Loss from continuing operations before undernoted (2,020)
Provision for income taxes (426)
Non-controlling interest (10)
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Loss from continuing operations (2,456)
Loss from discontinued operations (49)
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Net loss ($2,505)
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About Counsel Corporation Counsel Corporation (TSX: CXS)(NASDAQ:CXSN) is a diversified company diversified company A company engaged in varied business operations not directly related to one another. A diversified company is less likely to suffer either a collapse or a spectacular gain in earnings compared with a firm concentrating its operations in a focused on acquiring and building businesses using its financial and operational expertise in two specific sectors: communications and real estate. Counsel's communications platform is focused on building upon its existing communications investment, Acceris Communications Inc. (OTCBB OTCBB See OTC Bulletin Board (OTCBB). : ACRS ACRS See: Accelerated cost recovery system ACRS See Accelerated Cost Recovery System (ACRS). ), through organic growth and by acquiring additional customer revenues. Counsel's real estate platform has a focused strategy of investing in and developing income producing commercial properties, primarily retail shopping centers shopping center, a concentration of retail, service, and entertainment enterprises designed to serve the surrounding region. The modern shopping center differs from its antecedents—bazaars and marketplaces—in that the shops are usually amalgamated into . For further information, visit Counsel's website at www.counselcorp.com. 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. The statements made in this release that are not historical facts contain forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. information that involves risks and uncertainties. All statements, other than statements of historical facts, which address Counsel Corporation's expectations, should be considered as forward-looking statements. Such statements are based on knowledge of the environment in which they currently operate, but because of the factors herein listed, as well as other factors beyond their control, actual results may differ materially from the expectations expressed in the forward-looking statements. Important factors that may cause actual results to differ from anticipated results include, but are not limited to, obtaining necessary approvals and other risks detailed from time to time in the Company's securities and other regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. filings.
Counsel Corporation
Consolidated Statements of Operations
(Unaudited)
(in thousands of US Dollars, except per share amounts)
Three months ended
March 31
2004 2003
$ $
----------------------
Revenues
Telecommunication services 33,054 30,367
Communication technology licensing 450 -
Income producing properties 2,270 1,783
----------------------
35,774 32,150
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Operating costs and expenses
Telecommunication costs (exclusive of
depreciation and amortization shown below) 16,635 25,748
Income producing properties (exclusive of
depreciation and amortization shown below) 1,266 944
Selling, general and administrative 15,943 15,530
Provision for doubtful accounts 1,227 1,175
Depreciation and amortization 2,481 2,568
----------------------
37,552 45,965
----------------------
Operating loss before undernoted items (1,778) (13,815)
Gains and other income
Gain on sale of short-term investments 570 448
Other 767 -
Impairments and other losses
Write-down of short-term investments (70) (98)
Other (38) -
----------------------
Loss before the undernoted (549) (13,465)
Interest income 66 38
Interest expense (1,537) (871)
----------------------
Loss before income taxes, non-controlling
interest and discontinued operations (2,020) (14,298)
Provision for income taxes (426) -
Non-controlling interest (10) -
----------------------
Loss from continuing operations (2,456) (14,298)
Loss from discontinued operations (49) (987)
----------------------
Net loss (2,505) (15,285)
----------------------
----------------------
Basic and diluted net loss per share:
Continuing operations (0.05) (0.70)
Discontinued operations (0.00) (0.05)
----------------------
----------------------
Basic and diluted net loss per share (0.05) (0.75)
----------------------
----------------------
Weighted average number of common shares
outstanding (in thousands) - Basic and diluted 48,587 21,491
----------------------
Counsel Corporation
Consolidated Balance Sheets
(in thousands of US Dollars)
March 31, December 31,
2004 2003
$ $
----------------------
(Unaudited) (Audited)
Assets
Current assets
Cash and cash equivalents 5,643 16,996
Short-term investments 5,338 2,381
Accounts receivable (net of allowance for
doubtful accounts of $2,338; 2003 - $1,900) 15,983 18,719
Loans receivable 3,331 2,773
Prepaid expenses and deposits 2,344 2,863
Assets of discontinued operations 1,686 2,315
----------------------
34,325 46,047
Long-term assets
Income producing properties 46,460 42,225
Properties under development 5,409 7,600
Loans receivable 3,295 3,894
Portfolio investments 4,745 4,745
Property, plant and equipment, net 6,652 7,787
Intangible assets, net 7,634 8,546
Goodwill 947 947
Other assets 963 896
Assets of discontinued operations 20,886 20,902
----------------------
131,316 143,589
----------------------
----------------------
Liabilities
Current liabilities
Revolving credit facility 9,168 12,127
Accounts payable and accrued liabilities 31,171 33,404
Unearned revenue 1,085 4,011
Current portion of mortgages and loans
payable 4,367 4,377
Current portion of capital leases 2,769 2,715
Future income tax liabilities 1,164 1,110
Income tax payable 539 524
Liabilities of discontinued operations 8,922 9,712
----------------------
59,185 67,980
Long-term liabilities
Mortgages and loans payable 23,514 24,057
Capital leases 918 1,631
Convertible preferred shares 11,400 11,200
Future income tax liabilities 38,267 37,934
Liabilities of discontinued operations 13,617 13,871
----------------------
146,901 156,673
Non-controlling interest 1,063 1,066
Shareholders' equity (deficit) (16,648) (14,150)
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131,316 143,589
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