Welcome!

News Feed Item

Inscape Announces Fourth Quarter and Annual Results

HOLLAND LANDING, ONTARIO -- (Marketwired) -- 06/26/14 -- Inscape (TSX: INQ) today announced its fourth quarter and fiscal year 2014 annual financial results ended April 30, 2014.

Fiscal year 2014 was a challenging year for the Company. The fourth quarter of fiscal year 2014 had a net loss of $1.5 million or 10 cents per share. The same quarter of last year had a net loss of $1.4 million or 10 cents per share. On an annual basis, the fiscal year ended with a net loss of $7.1 million or 49 cents per share, compared to a net loss of $1.3 million or 9 cents per share in fiscal year 2013. The current year's loss included $2.8 million decrease in the fair value of outstanding hedge contracts as the U.S. spot exchange rate at the end of the year was higher than the average strike price of the hedges. Fiscal year 2014's operating loss before taxes was $6.1 million, compared with an operating loss of $1.6 million a year ago due to an 11.7% decline in sales.

The sales decline from fiscal 2013 to fiscal 2014 was the key driver of the Company's losses and is attributable to several factors: disruption to distribution channels partially caused by the bankruptcy of a major dealer; stagnation in US Government budget approvals; delayed key product launches, as well as significant concentration of resources on the launch of new products for fiscal 2015.

Although resolving these issues will take some time, management is cautiously optimistic about the plans in place to address them. A reinvigorated sales force focusing on key markets across North America, improved brand messaging and training programs, and a back-to-basics approach to communicating our brand to dealers demonstrate management's focus on distribution channels. The US Government has approved budgets for office spaces this year. A focus on sales efforts has begun paying off with an increase in opportunities, and the new product introductions which received five Best of NeoCon Awards (4 Gold and 1 Silver) in the June 2014 trade show. Inscape won the most awards of any manufacturers at NeoCon this year.

"We have a strong financial position and our foundation remains strong," said Jim Stelter, CEO. "Our outlook continues to improve as we actively engage our markets, intensify our marketing efforts, and make more people aware of how we can provide great solutions for them."

Sales in the fourth quarter of fiscal year 2014 at $15.2 million were 5.4% lower than the $16 million for same quarter of the previous year. The annual sales of $66.2 million fell 11.7% from last year's sales of $74.9 million. The drop in the year-over-year sales was mainly caused by a decline in the volume of the office furniture projects by 13.1%, while the moveable wall segment had a 3.9% decrease from last year.

The fourth quarter's gross profit as a percentage of sales was 21.1%, a decrease of 1.4 percentage points from the 22.5% of the same quarter a year ago. The decrease in gross profit percentage was mainly caused by lower realized selling prices, partially offset by lower overheads and better margin on services. The annual gross profit as a percentage of sales decreased 4.2 percentage points from last year's 26.5% to the current year's 22.3%. The reduced gross margin percentage was attributable to lower realized selling prices and decrease in volume, partially offset by lower overheads and variable production costs.

Selling, general and administrative expenses ("SG&A") in the fourth quarter were 35.7% of sales, compared to 33.6% in the same quarter of last year. In terms of dollar amounts, SG&A expense during the current quarter was comparable to the same quarter of last year. SG&A for the year was 31.6% of sales versus 28.6% of last year. The dollar spent was $0.5 million lower than last year. The lower SG&A was attributable to $0.2 million variable selling expenses due to reduced sales volume, $0.3 million lower provision for doubtful accounts accrued in last year relating to the bankruptcy of a dealer, $0.4 million overheads. The lower SG&A was partially offset by a $0.3 write off of a product licence fee during the year.

During the fourth quarter, the Company booked a valuation allowance relating to deferred tax assets accrued during the first three quarters of fiscal 2014. Due to the continued losses in the fourth quarter and the effects of lower accounting income in the previous two years, management deemed it appropriate to charge a valuation allowance for these assets. This adjustment is a non-cash charge to the results and the Company has 20 years in which the assets can be realized against future income, at which point the valuation allowance can be reversed.

At the end of the fiscal year 2014, the company was debt-free with cash and cash equivalents totaling $18.9 million.


                           Inscape Corporation
                Summary of Consolidated Financial Results
         (Unaudited) (in thousands of Canadian dollars except EPS)

                                                   Three Months
                                                  Ended April 30,
                                                     2014      2013   Change
------------------------------------------------------------------- --------

Sales                                           $ 15,171  $ 16,038     -5.4%
-------------------------------------------------------------------
Gross profit                                       3,203     3,614    -11.4%
Selling, general & administrative expenses         5,423     5,390      0.6%
Unrealized loss (gain) on foreign exchange           151       (93)
(Increase) Decrease in fair value of
 derivatives                                      (1,777)      499
Investment income                                    (88)     (100)
-------------------------------------------------------------------
Loss before taxes                                   (506)   (2,082)
Income taxes                                         945      (642)
-------------------------------------------------------------------
Net loss                                        $ (1,451) $ (1,440)
-------------------------------------------------------------------
-------------------------------------------------------------------

Basic earnings per share                        $  (0.10) $  (0.10)

Weighted average number of shares (in
 thousands)
for basic EPS calculation                         14,373    14,373
for diluted EPS calculation                       14,380    14,383

                                                   Twelve Months
                                                 Ended April 30,
                                                    2014      2013    Change
------------------------------------------------------------------- --------

Sales                                           $ 66,155  $ 74,900    -11.7%
-------------------------------------------------------------------
Gross profit                                      14,742    19,852    -25.7%
Selling, general & administrative expenses        20,890    21,413     -2.4%
Unrealized gain on foreign exchange                 (389)      (95)
Decrease in fair value of derivatives              2,825       989
Investment income                                   (374)     (394)
-------------------------------------------------------------------
Loss before taxes                                 (8,210)   (2,061)
Income taxes                                      (1,118)     (805)
-------------------------------------------------------------------
Net loss                                        $ (7,092) $ (1,256)
-------------------------------------------------------------------
-------------------------------------------------------------------

Basic and diluted earnings per share            $  (0.49) $  (0.09)

Weighted average number of shares (in
 thousands)
for basic EPS calculation                         14,373    14,375
for diluted EPS calculation                       14,380    14,452

Financial Statements

http://media3.marketwire.com/docs/F2014_Qt4.pdf

Fourth Quarter Call Details

Inscape will host a conference call at 8:30 a.m. on Friday, June 27, 2014 to discuss the company's quarterly and annual results. To participate, please call 1-800-381-7839. A replay of the conference call will also be available from June 27, 2014 after 10:30 a.m. until midnight on July 4, 2014. To access the rebroadcast, please dial 1-800-558-5253 (Reservation Number 21718745).

Forward-looking Statements

Certain of the above statements are forward-looking statements that involve risks and uncertainties. Actual results could differ materially as a result of many factors including, but not limited to, further changes in market conditions and changes or delays in anticipated product demand. In addition, future results may also differ materially as a result of many factors, including: fluctuations in the company's operating results due to product demand arising from competitive and general economic and business conditions in North America; length of sales cycles; significant fluctuations in international exchange rates, particularly the U.S. dollar exchange rate; restrictions in access to the U.S. market; changes in the company's markets, including technology changes and competitive new product introductions; pricing pressures; dependence on key personnel; and other factors set forth in the company's Ontario Securities Commission reports and filings.

ABOUT INSCAPE

Inscape makes smart workspaces. For over a century, we have collaborated with our clients to provide customized solutions based on their individual needs. Our meticulously engineered system, storage and wall products provide unparalleled flexibility to create unique applications at a lower cost of ownership. Easy reconfiguration and seamless integration with other products means our smart applications will work today and tomorrow. And they look fabulous.

For more information, visit www.inscapesolutions.com.

Contacts:
Inscape Corporation
Matthew Posno
Chief Financial Officer
905 836 7676
905 836 5037 (FAX)
www.inscapesolutions.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
DevOps at Cloud Expo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 21st Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to w...
While some vendors scramble to create and sell you a fancy solution for monitoring your spanking new Amazon Lambdas, hear how you can do it on the cheap using just built-in Java APIs yourself. By exploiting a little-known fact that Lambdas aren’t exactly single-threaded, you can effectively identify hot spots in your serverless code. In his session at @DevOpsSummit at 21st Cloud Expo, Dave Martin, Product owner at CA Technologies, will give a live demonstration and code walkthrough, showing how ...
Docker containers have brought great opportunities to shorten the deployment process through continuous integration and the delivery of applications and microservices. This applies equally to enterprise data centers as well as the cloud. In his session at 20th Cloud Expo, Jari Kolehmainen, founder and CTO of Kontena, discussed solutions and benefits of a deeply integrated deployment pipeline using technologies such as container management platforms, Docker containers, and the drone.io Cl tool. H...
SYS-CON Events announced today that DXWorldExpo has been named “Global Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Digital Transformation is the key issue driving the global enterprise IT business. Digital Transformation is most prominent among Global 2000 enterprises and government institutions.
21st International Cloud Expo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Me...
Any startup has to have a clear go –to-market strategy from the beginning. Similarly, any data science project has to have a go to production strategy from its first days, so it could go beyond proof-of-concept. Machine learning and artificial intelligence in production would result in hundreds of training pipelines and machine learning models that are continuously revised by teams of data scientists and seamlessly connected with web applications for tenants and users.
In his session at 20th Cloud Expo, Scott Davis, CTO of Embotics, discussed how automation can provide the dynamic management required to cost-effectively deliver microservices and container solutions at scale. He also discussed how flexible automation is the key to effectively bridging and seamlessly coordinating both IT and developer needs for component orchestration across disparate clouds – an increasingly important requirement at today’s multi-cloud enterprise.
Historically, some banking activities such as trading have been relying heavily on analytics and cutting edge algorithmic tools. The coming of age of powerful data analytics solutions combined with the development of intelligent algorithms have created new opportunities for financial institutions. In his session at 20th Cloud Expo, Sebastien Meunier, Head of Digital for North America at Chappuis Halder & Co., discussed how these tools can be leveraged to develop a lasting competitive advantage ...
IT organizations are moving to the cloud in hopes to approve efficiency, increase agility and save money. Migrating workloads might seem like a simple task, but what many businesses don’t realize is that application migration criteria differs across organizations, making it difficult for architects to arrive at an accurate TCO number. In his session at 21st Cloud Expo, Joe Kinsella, CTO of CloudHealth Technologies, will offer a systematic approach to understanding the TCO of a cloud application...
With Cloud Foundry you can easily deploy and use apps utilizing websocket technology, but not everybody realizes that scaling them out is not that trivial. In his session at 21st Cloud Expo, Roman Swoszowski, CTO and VP, Cloud Foundry Services, at Grape Up, will show you an example of how to deal with this issue. He will demonstrate a cloud-native Spring Boot app running in Cloud Foundry and communicating with clients over websocket protocol that can be easily scaled horizontally and coordinate...
In his session at 20th Cloud Expo, Chris Carter, CEO of Approyo, discussed the basic set up and solution for an SAP solution in the cloud and what it means to the viability of your company. Chris Carter is CEO of Approyo. He works with business around the globe, to assist them in their journey to the usage of Big Data in the forms of Hadoop (Cloudera and Hortonwork's) and SAP HANA. At Approyo, we support firms who are looking for knowledge to grow through current business process, where even 1%...
"With Digital Experience Monitoring what used to be a simple visit to a web page has exploded into app on phones, data from social media feeds, competitive benchmarking - these are all components that are only available because of some type of digital asset," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at DevOps Summit at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
SYS-CON Events announced today that Secure Channels, a cybersecurity firm, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Secure Channels, Inc. offers several products and solutions to its many clients, helping them protect critical data from being compromised and access to computer networks from the unauthorized. The company develops comprehensive data encryption security strategie...
In his session at @ThingsExpo, Sudarshan Krishnamurthi, a Senior Manager, Business Strategy, at Cisco Systems, discussed how IT and operational technology (OT) work together, as opposed to being in separate siloes as once was traditional. Attendees learned how to fully leverage the power of IoT in their organization by bringing the two sides together and bridging the communication gap. He also looked at what good leadership must entail in order to accomplish this, and how IT managers can be the ...
Most companies are adopting or evaluating container technology - Docker in particular - to speed up application deployment, drive down cost, ease management and make application delivery more flexible overall. As with most new architectures, this dream takes a lot of work to become a reality. Even when you do get your application componentized enough and packaged properly, there are still challenges for DevOps teams to making the shift to continuous delivery and achieving that reduction in cost ...