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Offshore Systems International reports Fiscal Third-Quarter and Nine Month Revenues and Net Income
Vancouver, Canada — Offshore Systems International Ltd. (OSI) (TSX: OSI, OTCBB: OFSYF) today announced its financial results for the third quarter and nine months ended August 31, 2004.
"OSI's businesses continued to demonstrate strong fundamentals in the third quarter", said John Jacobson, President and CEO Offshore Systems International. "We reported a loss from operations in the quarter, as the pace of new bookings and product shipments slowed through the summer season in the northern hemisphere. We believe we had a solid quarter of achievement, highlighted by the announcement of the Portuguese Navy's selection of ECPINS®, COP-IDS™'s strong showing at Joint Warrior Interoperability Demonstration, and significant contract option exercises from the Royal Australian Navy and Royal New Zealand Navy."
Fiscal Third Quarter 2004 Results
For the third quarter of fiscal 2004, revenues increased 30% to $3.0 million compared with $2.3 million in the same quarter last year. Net loss for the third quarter was $483,869, or $0.02 per diluted share, compared to a net loss of $338,797, or $0.01 a diluted share, in the same quarter last year.
At August 31, 2004, the company had current assets of $11.6 million versus current liabilities of $3.0 million, which resulted in working capital increasing $0.5 million to $8.6 million from $8.1 million at November 30, 2003. Cash and cash equivalents were $1.8 million at August 31, 2004 versus $3.8 million at November 30, 2003.
The Company's total order backlog* at the end of the third quarter was approximately $21.8 million including option backlog* of $12.8 million versus $3.3 million at November 30, 2003 including option backlog of $2.4 million.
Year-to-Date 2004 Results
For the first nine months of fiscal 2004, revenues increased 11% to $9.8 million compared with $8.8 million in the first nine months last year. Net income for the first nine months was $366,592, or $0.01 per diluted share, compared to net income of $61,613, or $0.00 a diluted share, in the first nine months last year.
Operational Highlights
- June 2004: OSI Geomatics was awarded a prime contract for land mapping by the City of Brampton, Ontario, in the amount of $271,000.
- July 2004: OSI Navigation Systems announced that the Portuguese Navy had informed SICOM, OSI's in-country partner in Portugal and the prime contractor for the installation, that ECPINS® had been selected by the Portuguese Navy to transform approximately thirty of their ships from paper-chart based navigation to ECDIS electronic chart-based navigation.
- August 2004: OSI announced that it had completed its participation in the Joint Warrior Interoperability Demonstration ("JWID") event hosted by the U.S. Chairman of the Joint Chiefs of Staff. JWID is an annual event where a coalition of U.S and international military participants evaluate new technologies to significantly improve interoperability. This year's event also included civilian agencies in support of homeland security. During the simulations COP-IDS™ provided a web-based map server which obtained simulation data from a variety of sources and combined it with current land and marine mapping data, improving operation planning and execution effectiveness.
- August 2004: OSI announced that the Royal New Zealand Navy had exercised contract options to deploy the latest version of ECPINS® across its entire naval fleet. The value of the options exercised is $947,000.
- August 2004: OSI announced that it had agreed with Nautronix Ltd., the Australian prime contractor to the Royal Australian Navy (RAN), for the supply of additional ECPINS-M systems to the RAN. Twelve ECPINS-M systems have been purchased for installation on the RAN's ARMIDALE Class of new patrol boats to be constructed by Austal Ships, of Henderson in Western Australia. The value of the contract is in excess of $1.2 million.
Conference Call
As previously announced, the Company will host a live conference call on Friday, October 1, 2004 at 11:00 a.m. Eastern Daylight Time (8:00am Pacific Daylight Time). The dial-in number for the call is 416-405-9328 in Toronto or 1-800-387-6216. Please call in prior to the scheduled start to secure a line; you will then be put on hold until the call begins. A taped replay of the conference call will be available until October 8, 2004 at 11:59 p.m. Eastern Daylight Time by calling 416-695-5800 in Toronto or 1-800-408-3053, passcode 3096400.
A live audio webcast of the conference call will be available at here. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be needed to hear the webcast. Following the meeting, the webcast will be archived at www.osil.com for approximately 90 days.
About Offshore Systems International Ltd.
Offshore Systems International Ltd. (OSI) is a leader in electronic geography. The Company's core strengths lie in the ability to produce, manage and display many forms of geographic data. The Company provides display systems and data for several defense, government and commercial customers. OSI conducts its operations through three business units: OSI Geomatics (data production and distribution), OSI Navigation Systems, and OSI Applications (products and services for command and control systems). OSI's common shares are listed for trading on the Toronto Stock Exchange (TSX:OSI) and the OTC Bulletin Board (OTCBB: OFSYF). For more information please visit www.osil.com.
*Non-GAAP Definitions
Total backlog, firm backlog and option backlog are non-GAAP measures that do not have a standardized meaning and are likely not comparable to similar measures presented by other issuers. These measures, also do not have a comparable GAAP measure. Total backlog is the total of the firm and option backlogs. Firm backlog consists of firm, fixed, signed orders issued to the Company and executable by the Company subsequent to the balance sheet date. Option backlog consists of unexercised contract options at the balance sheet date and indefinite-quantity contracts executable by the Company subsequent to the balance sheet date. Should our customers elect to exercise contract options or place orders against indefinite-quantity contracts, the option backlog converts to firm backlog.
Forward-Looking Statements
This news release contains discussion of items that may constitute forward-looking statements within the meaning of securities laws including Section 27a of the Securities Act of 1933, as amended, and Section 21e of the Securities Exchange Act of 1934, as amended, with respect to achieving corporate objectives, developing additional project interests, OSI's analysis of opportunities in the acquisition and development of various project interests and other matters. These statements are made under the "safe harbour" provisions of the Private Securities Litigation Reform Act of 1995 and, as such, involve known and unknown risks and uncertainties and other factors that may cause the actual results to be materially different from the results implied herein. Although Offshore Systems International believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurances that its expectations will be achieved. Factors that could cause actual results to differ from expectations include the effects of general economic conditions, changing foreign exchange rates, actions by government authorities, uncertainties associated with contract negotiations, and industry supply.
ECPINS® and COP-IDS are trademarks of Offshore Systems Limited. All other trade names mentioned are trademarks and/or registered trademarks of their respective owners.
Offshore Systems International Ltd.
Selected Consolidated Financial Information (Unaudited)
(Canadian dollars - Canadian GAAP)
| Statement of Earnings Information |
Three months ended
August 31 2004
(unaudited)
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Nine months ended
August 31 2004
(unaudited)
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2004
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2003
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2004
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2003
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| Revenue |
2,951,571 |
2,275,153 |
9,755,166 |
8,796,354 |
| Earnings (loss) for the period |
(483,869) |
(338,797) |
366,592 |
61,613 |
| Basic earnings per share |
(0.02) |
(0.01) |
0.01 |
0.00 |
| Fully diluted earnings per share |
(0.02) |
(0.01) |
0.01 |
0.00 |
Balance Sheet
Information |
August 31 2004
(unaudited)
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November 30 2003
(unaudited)
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| Cash and cash equivalents |
1,842,274 |
3,837,555 |
| Working capital |
8,588,281 |
8,071,926 |
| Current assets |
11,567,289 |
10,377,836 |
| Total assets |
12,943,695 |
11,728,257 |
| Current liabilities |
2,979,008 |
2,305,910 |
| Long-term debt |
46,847 |
187,384 |
| Total liabilities |
3,025,855 |
2,493,294 |
| Shareholder's equity |
9,917,840 |
9,234,963 |
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For more information contact:
Jane Hayward
Investor Relations
+1 613 287 0462 or +1 888 880 9797
+1 613 287 0466 (FAX)
invest@osigeospatial.com
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