MARKHAM, ONTARIO–(Marketwire – Feb. 9, 2012) – Sangoma Technologies Corporation (TSX VENTURE:STC), a leading provider of hardware and software components that enable or enhance IP Communications Systems for both voice and data, today announced highlights of its unaudited consolidated interim financial statements under IFRS for the second quarter of fiscal 2012 ended December 31, 2011.
Sales for the second quarter of fiscal 2012 ended December 31, 2011 were $3.43 million, a record for quarterly revenue at Sangoma, and around 15% higher than both the quarter ended December 31, 2010 and the first fiscal quarter of 2012.
“Delivering a quarter with 15% growth over the same quarter in the previous year is another very positive sign that our new strategy at Sangoma is working” said Bill Wignall, President and CEO of Sangoma. “Our focus on R&D to drive innovation and new product launches, as well as on marketing and sales to increase awareness and expand our geographic presence, is continuing to deliver solid revenue growth. It is especially gratifying to see significant revenue from new products such as our SS7 and Vega gateways, including sales through channels we obtained as part of the VegaStream acquisition, further evidence of both product and sales synergies from that transaction.”
The following chart shows the key metrics tracked by the Company using the IFRS accounting standards.
| Q2 FY2012 | Q2 FY2011 | Change | Q1 FY2012 | Change | ||||||||
| Sales | $ | 3.43 m | $ | 2.98 m | 15 | % | $ | 3.01 m | 14 | % | ||
| Gross profit | $ | 2.51 m | $ | 2.30 m | 9 | % | $ | 2.19 m | 15 | % | ||
| Operating Expense | $ | 2.32 m | $ | 1.89 m | 23 | % | $ | 1.38 m | 68 | % | ||
| Operating Income1 | $ | 0.19 m | $ | 0.41 m | (54 | %) | $ | 0.81 m | (77 | %) | ||
| Net income | $ | 0.17 m | $ | 0.31 m | (45 | %) | $ | 0.47 m | (64 | %) | ||
| Net earnings per share (fully diluted) | $ | 0.006 | $ | 0.010 | $ | 0.015 | ||||||
| EBITDA1 | $ | 0.33 m | $ | 0.55 m | (40 | %) | $ | 0.93 m | (65 | %) | ||
Following the transition to IFRS, all fiscal 2011 numbers have been updated to reflect the IFRS accounting conventions and will not match 2011 numbers previously reported under Canadian GAAP, as explained in the interim financial statements and MD&A. 1 Operating Income and EBITDA are metrics used by the company to monitor its performance and the definitions may be found in the accompanying MD&A published today at www.sedar.com.
Gross margin for the quarter was $2.51 million, an increase of 9% from the same period in fiscal 2011, and 14% above the immediately preceding quarter. As a percentage of revenue, gross margin was approximately 73%. This is 4% lower than that of the quarter ended December 31, 2010 which reflects the new product mix having a slightly lower gross margin.
Operating expenses for the quarter ended December 31, 2011 were $2.3 million, 23% higher than those of the quarter ended December 31, 2010. Sangoma continues to invest in new marketing, sales and product development initiatives, and this quarter is also the first full quarter of operating expenses deriving from the VegaStream acquisition. That business has been fully integrated during the second quarter, the Vega gateway products have been manufactured in volume, and that entire product portfolio is now fully stocked and selling. Second quarter operating expenses appear higher than the first quarter by 68%, but this is primarily because the difference is heavily dominated by a large swing in foreign exchange expense, from a gain of $0.6 million in the first fiscal quarter to a loss of $0.1 million this quarter. This swing represents $0.7 million of the $0.9 million difference in operating expenses between first and second quarters of fiscal 2012.
Operating Income (revenue less expenses before financing and one-time costs) was $0.19 million for the fiscal second quarter, versus $0.41 million in the same quarter last year.
Net Income for the fiscal second quarter of 2012 was $0.17 million ($0.006 per share fully diluted) compared to Net Income of $0.31 million ($0.010 per share fully diluted) for the fiscal second quarter of 2011.
Earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the quarter ended December 31, 2011 was $0.33 million, versus the $0.55 million in the same quarter one year ago.
President and CEO, Bill Wignall, and CFO, David Moore will host a conference call on Monday February 13, 2012 at 4pm Eastern Standard Time to discuss the quarterly results. The dial-in number for the call is 1-800-319-4610 (International 1-604-638-5340). Investors are requested to dial in 5 to 10 minutes before the scheduled start time and ask to join the Sangoma call.