IDC Revenues Improve
Ottawa, Canada, Dec. 10, 2014- International Datacasting Corporation (IDC) (TSX:IDC), announced its financial results today for the nine months and third quarter ended October 31, 2014. Revenues totaled CDN $3.0 million for the third quarter of Fiscal 2015, 19% higher than the prior year's third quarter. The increase was primarily due to a 79% improvement in product revenues, partially offset by a reduction in services revenues due to the non-renewal of the Canadian Forces Radio and Television service.
The increase in product revenues was driven by video and data products, including large orders for digital cinema and data receivers as well as increasing shipments of the new TITAN 3 encoder. When comparing IDC's third quarter product sales with the second quarter of Fiscal 2015, revenues increased sequentially by 20%, continuing a trend that has been in place for several quarters.
The total gross margin for the quarter improved to 40% from 33% for the comparable prior period, primarily due to an increased revenue base to cover fixed expenses.
Total operating expenses decreased by 27% compared to the third quarter of Fiscal 2014, and by 10% compared to the first nine months of Fiscal 2014. Fiscal 2015's operating expenses include $0.4 million of restructuring costs. IDC incurred a net loss of $1.1 million in the third quarter of Fiscal 2015, compared to a loss of CDN $2.3 million in Fiscal 2014.
At October 31, 2014, IDC's working capital was CDN $4.1 million, including CDN $0.3 million in cash. In addition, IDC's accounts receivable factoring facility remains mostly undrawn, with CDN $0.9 million of additional capacity available.
During the first nine months of Fiscal 2015, IDC made progress in executing its turnaround plan. Key accomplishments during this period included the reduction ofthe company's cost structure, resulting in a significantly lower breakeven point. These changes included a reduction of approximately 40% in its global workforce, as well as the consolidation of manufacturing and supply chain activity in its Ottawa location.
Doug Lowther, IDC's President and CEO, stated, "While IDC has made significant progress over the last three quarters, we have not yet returned the company to profitability. This remains our top priority and we are focused on achieving sustainable revenue growth to return the company to profitability in the near term."
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