CAPE Systems Announces Fiscal 2007, 2008, and 2009 Third Quarter Unaudited Results
Tuesday 09/22/2009 3:25 PM ET - Pr Newswire
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Symbol Last %Chg
CYSG 0.0059 490.00%
As of 3:59 PM ET 9/23/09
CAPE Systems Group, Inc., (Pink Sheets: CYSG) a leading provider of software technology for packaging design, pallet optimization, RFID Asset Tracking, inventory and warehouse management, supply chain execution and order fulfillment, today announced preliminary unaudited financial results for the fiscal years ending September 30, 2007 and 2008, and the three months and nine months ended June 30, 2009.
Cape Systems Group, Inc. reported revenues of $0.5 million and $1.6 million for the three and nine month periods ended June 30, 2009, respectively. The Company also reported a $15.3 million non-cash profit (unaudited) for its third quarter ending June 30, 2009 based on anticipated settlements within the next 60 days of $8 million in liabilities related to the closing of its European operations back in 2003 and $8.4 million in liabilities related to the closing of three domestic operations in 2004. Existing operations during the same quarter had a $1.1 million loss after a $0.7 million beneficial conversion charge for the conversion of accrued interest into notes to its bondholders. The same period for the prior year had a $0.8 million loss after a $0.5 million beneficial conversion charge also for the conversion of accrued interest into notes to its bondholders. Excluding the beneficial conversion charges each year, the net operating loss for the third quarter was $0.4 million vs. $0.3 million in 2008 caused by a $0.3 million decrease in gross profit that was offset by $0.2 million in reduced S, G & A expenses based on a cost savings strategy initiated in FY2009.
Based on the third quarter's $16.4 million gain in settlement the profit for the nine months ending June 30, 2009 was $14.5 million after absorbing an operating loss of $1.9 million that included $1.2 million in beneficial conversion charges. This compares to a $1.4 million loss for the nine months ending June 30, 2008 that included $0.5 million in beneficial conversion charges. Excluding the beneficial conversion charges each year 2009's net operating loss for the nine months ending June 30 was $0.7 million vs. a $0.9 million loss in 2008. This $0.2 million improvement is the result of $0.6 million in reduced S, G & A expenses offset by a $.4 million decrease in gross profit.
For the fiscal year ended September 30, 2008, the Company reported preliminary unaudited revenues of $3.5 million. The unaudited net loss for the last fiscal year ending September 30, 2008 was $1.7 million that included $0.7 million in beneficial conversion charges vs. the prior year's unaudited net loss that ended September 30, 2007 of $3.0 million (including $1.3 million in beneficial conversion charges). Excluding the beneficial conversion charges each year 2008's net operating loss for the twelve months ending September 30, 2008 was $1.0 million vs. a $1.7 million loss in 2007. This $0.7 million improvement is the result of $1.0 million in reduced S, G & A expenses (mainly intangible amortization that finished in 2007) plus a $0.3 million increase in gross profit, which was offset by a $0.6 million decrease in gains on settlement that were realized in 2007.
About CAPE Systems
CAPE Systems is an international provider of supply chain management technologies. CAPE Systems offers a comprehensive range of software systems and tools, from packaging and pallet optimization software, RFID asset tracking, to integrated warehouse and inventory management solutions, pick-to-light systems, and transportation management systems for enterprise wide and collaborative supply chain optimization. For more information about CAPE visit: www.capesystems.com.
Safe Harbor
Statements about the company's future expectations, including future revenue and earnings and all other statements in this press release, other than historical facts, are "forward-looking" statements and are made pursuant to safe harbor provisions of the Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties and are subject to change at any time. The company's actual results could differ materially from expected results. In reflecting subsequent events or circumstances, the company undertakes no obligation to update forward-looking statements.
Cape Systems Group, Inc.
CONDENSED COMBINED BALANCE SHEET
Nine Months
F/Y Ending F/Y Ending Ending June
Sept 30 2007 Sept 30 2008 30 2009
ASSETS
Cash $174,112 $217,741 $173,505
Accounts receivable, net 376,381 375,872 290,305
Allowance for Bad Debt (2,147) (2,704) (1,793)
Inventories, net 174,410 937 21,792
Prepaid expenses 49,218 35,596 38,646
Total Current Assets 771,974 627,441 522,455
Equip Gross 778,535 737,072 695,919
Accum Depr/Amort (756,423) (728,230) (683,775)
Equipment and fixtures, net 22,112 8,842 12,144
Deferred Financing Costs, net 86,146 27,621 8,934
Goodwill - Cape 341,685 285,173 285,173
Other Intangibles - Cape 1,545,785 1,666,025 1,666,025
Amortization (1,497,478) (1,666,025) (1,666,025)
Other Assets 132,075 133,951 262,745
Total Assets $1,402,299 $1,083,028 $1,091,451
LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)
CURRENT LIABILITIES
Mandatorily redeemable
preferred stock $504,713 $504,713 $504,713
Notes payable 1,227,500 1,227,500 1,227,500
Accounts payable 3,097,363 2,957,780 184,113
Net liabilities -
subsidiaries in Liquidation 8,407,512 8,207,583 250,000
Payroll and related benefits
accrual 1,146,032 1,154,612 742,462
Accrued litigation 2,655,322 2,655,322 25,000
Other accrued expenses and
liabilities 3,802,122 4,196,918 1,819,604
Customer Deposits 357,460 112,100 19,821
Deferred revenue 612,759 533,688 557,909
Total current liabilities 21,810,783 21,550,216 5,331,122
Convertible notes payable 6,360,053 7,036,336 7,915,623
Total liabilities 28,170,836 28,586,552 13,246,745
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock 4,973,741 4,991,831 4,991,831
Preferred stock 13,657 13,657 13,657
Subscriptions receivable (66,000) (66,000) (66,000)
Additional paid-in capital 169,211,898 169,887,060 170,778,800
Accumulated equity
(deficit) (195,002,427) (197,954,211) (199,634,644)
Accum. other comprehensive
inc/( loss) (2,816,653) (2,628,187) (2,683,347)
Treasury stock (67,240) (67,240) (67,240)
YTD net income/(loss) (3,015,513) (1,680,433) 14,511,650
Total Stockholders' deficit (26,768,537) (27,503,524) (12,155,293)
Total liabilities and
stockholders' equity $1,402,299 $1,083,029 $1,091,452
Cape Systems, Inc.
CONDENSED COMBINED STATEMENT OF OPERATIONS
For the For the
For the Twelve Three Nine Months
Months Ending Months Ending Ending
Sept 30 Sept 30 June 30 June 30
2007 2008 2009 2009
REVENUE $3,224,333 $3,504,895 $548,604 $1,697,146
COST OF SALES 1,416,908 1,356,433 223,228 755,487
GROSS PROFIT 1,807,424 2,148,461 325,376 941,659
GM 56% 61% 59% 55%
OPERATING EXPENSES
Selling and administrative 3,411,878 2,898,228 558,754 1,782,197
Depreciation and
amortization 692,960 229,784 1,528 3,848
Total operating expenses 4,104,838 3,128,012 560,282 1,786,045
Operating income/(loss) (2,297,413) (979,551) (234,906) (844,386)
OTHER INCOME (EXPENSE)
Interest income 2,613 3,263 0 0
Interest expense (726,424) (936,481) (210,275) (490,166)
Beneficial Conversion Costs(1,330,967) (676,283) (696,125) (1,196,834)
Gain on settlement of
Liabilities 830,368 190,242 16,454,134 16,454,134
Other (4,388) 0 3,846 3,846
Net other income(expense)(1,228,798) (1,419,259) 15,551,580 14,770,980
INCOME/(LOSS) BEFORE
PROVISION FOR INCOME
TAXES (3,526,211) (2,398,810) 15,316,674 13,926,594
Provision for income taxes 0 2,500 1,842 1,842
Credit for sale of state tax
Benefits (510,698) (720,877) 0 (586,898)
Net income tax credit (510,698) (718,377) 1,842 (585,056)
NET INCOME (LOSS) ($3,015,513)($1,680,433)$15,314,832 $14,511,650
SOURCE CAPE Systems Group, Inc.
http://www.capesystems.com
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