Miranda Sales Rise, Profit Drops

MONTREAL, QUEBEC: Miranda Technologies reported lower earnings on higher revenues today for its first quarter compared to last year. The company posted sales of $33.2 million Canadian, up 30 percent from C$25.5 million last year, with net income at C$1.1 million, down 69 percent from last year’s C$3.5 million. Miranda’s (TSX: MT) $40 million U.S. acquisition of NVision closed in December.

“First quarter revenues increased by 30 percent, fueled by the acquisition of Nvision,” said Strath Goodship. “Interest in our products remains robust, although the global recession caused lower sales volumes.”

Higher administrative and special charges also contributed to the decrease in net income, which came out to 5 Canadian cents a share, or 8 cents excluding special charges.

“We continue to have a strong balance sheet that should support us through the economic downturn and allow us to continue to invest in our business,” Goodship said. “However, as markets remain uncertain, we have accelerated the rationalization of our cost structure to preserve cash flows and the benefits of these initiatives will be seen in the next few quarters.”

These programs are expected to generate annualized savings in the order of $4 million, according to the company.

“With the on-going global recession, it remains difficult to predict how broadcaster spending will continue to be impacted,” Goodship said. “Although interest in our products remains high, order intake remains affected by weak economic conditions, which leads us to be cautious about growth expectations in the coming quarters. As such, we will continue to work on cost containment and preserving cash. At the same time, we will concentrate our sales efforts on more buoyant markets and continue to innovate and deliver value added products and services to our customers.”

Sales in the United States increased 91 percent and fell in Canada by about 60 percent compared to the same quarter last year. U.S. sales comprised 56 percent of the total; Canadian sales, 4 percent. The remainder were from other countries.

Miranda finished the quarter with cash and equivalents of C$71.2 million, current portion of long-term debt (due within a year) at $24.5 million, and long-term debt of C$172,000. – Deborah D. McAdams