Epic Data Announces Year End Results

Epic Data Announces Year End Results 
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 01/28/13 -- Epic Data
International Inc. (TSX VENTURE:EKD), a provider of manufacturing
execution systems (MES), a provider of manufacturing operations
management and real-time data collection solutions, today announced
the results of operations for the three months and year ended
September 30, 2012. 
Highlights for the year: 


 
--  Increased product development spending in 2012 compared to 2011 by
    nearly 150% to $1.6 million; 
--  Released IntegraMES 6.4, our newly architected, web-enabled MES
    platform; 
--  Developed UniView, our new rugged shop floor terminal that supports
    browser-based web applications and high security; 
--  Set up a majority-owned equity joint venture with Huazhong University of
    Science & Technology, one of China's most prominent engineering
    universities and grew the operations to 115 staff in Wuhan; and 
--  Completed a $2.4 million equity and debenture financing.
 
Results of Operations                                                       
                             Three months ended                  Year ended 
                                  September 30,               September 30, 
                             2012          2011          2012          2011 
                     ------------- ------------- ------------- -------------
                                                                            
Revenue              $    956,508  $    935,869  $  4,213,752  $  4,202,974 
                                                                            
Cost of sales             717,025       458,325     2,441,982     2,082,498 
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Gross margin              239,483       477,544     1,771,770     2,120,476 
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Expenses                                                                    
  General and                                                               
   administration         638,641       500,444     2,435,705     1,814,415 
  Sales and marketing     527,396       284,708     1,852,273       987,761 
  Product development     365,706       182,475     1,570,417       632,137 
  Net finance charges      77,280        52,742       473,213       153,382 
  Deferred income tax                                                       
   (recovery)            (117,768)            -      (117,768)     (167,608)
  Foreign exchange        (38,576)        7,640         8,421        84,833 
----------------------------------------------------------------------------
                                                                            
                        1,452,679     1,028,009     6,222,261     3,504,920 
----------------------------------------------------------------------------
                                                                            
Net loss               (1,213,196)     (550,465)   (4,450,491)   (1,384,444)
----------------------------------------------------------------------------
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Loss per share -                                                            
 basic and diluted   $      (0.04) $      (0.02) $      (0.13) $      (0.05)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
Results of Operations for the year ended September 30, 2012 compared
with 2011 
Revenue 
Revenue for the year ended September 30, 2012 increased $10,778 or
0.3% to $4,213,752 compared with $4,202,974 in the prior year. The
increase in revenue was due to revenue from the start-up operations
in China.
Gross Margin 
The gross margin for the year ended September 30, 2012 decreased
$348,706 or 17% to $1,771,770 as compared with $2,120,476 in the
prior year. The decrease was due to the start-up operations in China
where a number of projects are in progress, however certain
conditions necessary to allow revenue recognition have not yet been
met. 
General and administration 
General and administration expenses for the year ended September 30,
2012 increased $621,290 or 34% to $2,435,705 compared with $1,814,415
in the prior year. The increase is principally due to the start up
operations in China, which were for $605,834. 
Sales and marketing 
Sales and marketing expenses for the year ended September 30, 2012
increased $864,512 or 87% to $1,852,273 compared with $987,761 in the
prior year. The increase is primarily due to the start-up operations
in China which accounted for $324,132 and compensation and sales
consulting related costs to new personnel, including the hiring of a
new vice president of sales, totaling for $461,388. 
Product development 
Product development expenses for the year ended September 30, 2012
increased $938,280 or 148% to $1,570,417 compared with $632,137 in
the prior year. We have development teams in Richmond, Canada and
Wuhan, China. The increase in spending was comprised of the new
development team in Wuhan, which accounted for $300,178 of the
increase and the balance of the increase of $638,102 was incurred in
Richmond. The increase is due to the development of the UniView, our
new rugged shop floor terminal that supports browser-based web
applications and high security and the release of IntegraMES 6.4, our
newly architected, web-enabled MES platform. 
Net finance charges 
Net finance charges for the year ended September 30, 2012 increased
$319,831 or 57% to $473,213 compared with $153,382 in the prior year.
The increase is due to the interest accretion of $292,534, which was
primarily related to the repayment of debt in the year, and to the
interest charged on the debt. 
Net loss 
Net loss for the year ended September 30, 2012 increased $3,066,047
or 221% to $4,450,491 compared with $1,384,444 in the prior year. The
significant components are the start-up operations in China, which
had a loss of 1,583,760 and the increased product development. 
Results of operations for the fourth quarter 
Revenue for the three months ended September 30, 2012 increased
$20,639 or 2% to $956,508 compared with $935,869 in the same period
of the prior year. The increase was due to project work in the fourth
quarter. Cost of sales however increased by $258,700 as a result of
the operations in China, which had a number of projects in progress,
however certain conditions necessary to allow revenue recognition
have not yet been met. 
Expenses for the three months ended September 30, 2012 increased
$424,670 or 55% to $1,452,679 compared with $1,028,009 in the same
period of the prior year. In general the expenses for the three
months ended September 30, 2012 are higher than last year due mainly
to the operations in China. 
Net loss for the three months ended September 30, 2012 increased
$662,731 to a loss of $1,213,196 compared with a loss of $550,465 in
the same period of the prior year. 
Loan Financing 
The Company announces that it has received a term loan of $555,000
from Hua Zhuo Lin, a minority shareholder of the Company. The
proceeds of the loan will be used to complete the Company's
registered capital obligation for its 51% investment in Epic-Hust
Technology (Wuhan) Co. Ltd ("Epic-Hust JV) in China. The principal
amount of the loan is due on January 31, 2016 and will bear interest
at the rate of 5% per annum payable semi-annually. In connection with
this loan, the Company has granted a security against the Company's
equity interest in Epic-Hust JV. 
About Epic Data 
Epic Data International Inc. has produced manufacturing execution and
warehouse management solutions for 36 years. Epic Data solutions
synchronize supply chain and production activities to achieve
real-time visibility of manufacturing metrics that reduces cycle
times and costs, optimizes production planning and control, and
boosts quality and efficiency. The solutions are easily implemented
either by module or as a completely integrated solution suite across
the global enterprise. Customers include Lockheed Martin, Bell
Helicopter, Komatsu, Hawker Beechcraft, Bombardier Learjet, CAE Inc.,
Kingfisher (B&Q) plc, Joy Mining Machinery, Cobham Defence
Communications Ltd., GE Aircraft Engine, Contour Premium Aircraft
Seating, McBride plc, Phoenix Contact, Rolls-Royce and Volvo. 
More information about Epic Data is available at www.epicdata.com. 
Caution Regarding Forward-looking Statements 
In this document and in other documents filed with Canadian
regulatory authorities or in other communications, the Company may
from time to time make written or oral forward-looking statements
within the meaning of applicable securities legislation, including
statements regarding the Company's business plans and financial
objectives. These statements typically use words such as prospects,
believe, estimate, forecast, project, expect, anticipate, plan, may,
should, could and would, or the negative of these terms, variations
thereof or similar terminology. By their very nature, forward-looking
statements are based on assumptions and involve inherent risks and
uncertainties, both general and specific in nature. It is therefore
possible that the forecasts, projections and other forward-looking
statements will not be achieved or will prove inaccurate. Although
the Company believes that the expectations reflected in these
forward-looking statements are reasonable, it provides no assurance
that these expectations will prove to have been correct. The Company
cautions readers against placing undue reliance on forward-looking
statements when making decisions, as the actual results could differ
considerably from the opinions, plans, objectives, expectations,
forecasts, estimates and intentions expressed in such forward-looking
statements due to various material factors. Among other things, these
factors include fiscal and economic policies, changes in interest and
foreign exchange rates, and general economic conditions, legislative
and regulatory developments, competition and access to capital. The
Company further cautions that the foregoing list of factors is not
exhaustive. For more information on the risks, uncertainties and
assumptions that would cause the Company's actual results to differ
from current expectations, please also refer to the Company's public
filings available at www.sedar.com. The Company does not undertake to
update any forward-looking statements, whether oral or written, made
by itself or on its behalf, except to the extent required by
securities regulations. 
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release. 
Contacts:
Epic Data International Inc.
Robert Nygren
President & CEO
604-273-9146
robert.nygren@epicdata.com
www.epicdata.com
 
 
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