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NTG Clarity Networks Announces First Quarter 2017 Financial Results
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Toronto, ON / TheNewswire / May 30, 2017 / NTG Clarity Networks Inc. (TSX.V:NCI), announces its first quarter results for the period ended March 31, 2017 (all figures in Canadian Dollars).
NTG Clarity’s financial performance continued to be challenged during the first quarter of 2017, as a result of lower oil prices, which affected customer projects in the Middle East, as well as from the devaluation of the Egyptian pound and related challenges for working in that country. However, the Company achieved improvement in revenues, significantly lower costs, and recorded a much lower net loss compared to the same period last year. Management is continuing the aggressive cost reduction strategy initiated in Q3 2016, to bring the Corporation back to profitability. The beginning of the effects of these measures are apparent in Q1 2017, however there are still significant cash flow constraints which are limiting the Company’s ability to expand revenues.
Consolidated revenue for the three months ended March 31, 2017 increased to $3,007,929 compared to $2,433,333 for the same period in 2016. Revenues were comprised of product-related revenue, professional services and a small amount for hardware/office supplies.
Gross margin for Q1 2017 was $584,070 compared to $696,001, or 19% compared to 29% for the same period in 2016. We continue to work toward reducing the cost of sales in order to optimize our revenue growth.
NTG Clarity’s operating expenses were reduced by 33% in Q1 2017 to $1,327,924 compared to $1,985,235 in the same period last year as we continue staff, salary, and selling and travel reductions to bring expenses more in line with revenue.
G&A expenses for the three months ended March 31, 2017 were $735,076 compared to $1,465,251 in Q1 2016, a decrease of 50%. This significant reduction was due primarily to a reduction of salaries and consulting costs, lower occupancy costs as we continue to work on reducing rental costs, and the discontinuation of research activities related to our new software product StageEM.
For the period ended March 31, 2017, the Corporation recognized a foreign currency exchange loss of $156,293, compared to a loss of $14,512, in the same period in 2016. The loss was primarily due to the weakening of currencies in relation to the Canadian and US dollar.
For Q1 2017, NTG Clarity recorded a net loss of $752,579 as compared to a net loss of $1,986,457 in Q1 2016. This is a substantial improvement as management has worked diligently to reduce selling and G&A costs, and optimize cost of sales to be more in line with the Company’s current revenue.
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March 31, 2017 |
December 31, 2016 |
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Current Assets |
$ 6,171,411 |
$ 6,086,530 |
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Current Liabilities |
$ 11,448,604 |
$ 11,205,545 |
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Long-Term Debt |
$ nil |
$ nil |
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Shareholder’s Equity |
$ (3,152,353) |
$ (2,820,821) |
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NTG Clarity is actively pursuing new opportunities with existing and potential new customers. We have expanded our existing professional services contract with more resources. In Q1 2017, we finalized a Purchase Order for a Smart Building Systems project valued at approximately $753,000. We also received a Purchase Order for a CRM and Billing Data Migration expansion project. We have been short listed for a PPM & Strategy and Requirements Management opportunity and have started proof of concept. We continue to work on a list of opportunities for services and products in the telecom, smart building and government sectors.
Looking towards the future, we are committed to bring NTG back to profitability in 2017. We will also focus on capitalizing on the goodwill we have with our existing customers to expand our business and increase our margins. We will concentrate on marketing our products NTS, StageEM and Voice Over WiFi, which are currently in demand and have higher margins.
About NTG Clarity Networks Inc.
NTG Clarity Networks’ vision is to be a global leader in providing networking solutions. As a Canadian company established in 1992, NTG Clarity has delivered networking, IT and network enabled application software solutions to network service providers and large enterprises. More than 350 network professionals provide design, engineering, implementation, software development and security expertise to the industry’s leading network service providers and enterprises.
Forward Looking Information
Certain statements in this release, other than statements of historical fact, are forward looking information that involves various risks and uncertainties. Such statements relating to, among other things, the prospects for the company to enhance operating results, are necessarily subject to risks and uncertainties, some of which are significant in scope and nature.
These uncertainties may cause actual results to differ from information contained herein. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward looking statements are based on the estimates and opinions of the management on the dates they are made and expressly qualified in their entirety by this notice. The Company assumes no obligation to update forward looking statements should circumstances or management's estimates or opinions change.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
For Further Information:
Doren Quinton, President QIS Capital
Ph:250-377-1182
Fax:250-377-1183
Email:info@smallcaps.ca
Kristine Lewis, President, NTG Clarity Networks Inc.
Ph: 905-305-1325
Fax: 905-752-0469
Email:klewis@ntgclarity.com