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Bridgewater Systems Reports Financial Results for Fiscal 2009(Canada Newswire Via Acquire Media NewsEdge) << - Revenue of $66.7 million for fiscal 2009, an increase of 51% over prior year - Net earnings of $11.2 million, or $0.44 per share fully diluted, compared with net earnings of $2.8 million, or $0.11 per share fully diluted, in 2008 - Cash and cash equivalents, and short-term investments increased to $67.3 million - Company issues guidance for continued growth in 2010 >> OTTAWA, Feb. 26 /CNW/ - Bridgewater Systems (TSX: BWC), the mobile personalization company, today announced financial results for the three and twelve months ended December 31, 2009. This news release contains forward-looking statements. Reference should be made to "Forward-Looking Statements" at the end of this news release. All amounts are stated in Canadian dollars except where otherwise noted. "Bridgewater delivered solid financial performance in 2009," said Ed Ogonek, CEO of Bridgewater Systems. "This reflects continued robust demand for our technology to support mobile broadband growth, combined with successful operational execution across the company, highlighted by significant new customer wins and key product launches." "Global mobile data traffic grew significantly in 2009, and this is fuelling demand for our solutions as operators implement network and bandwidth management strategies to reduce costs, while also introducing flexible and dynamic pricing models to better align data revenues with network costs," added Mr. Ogonek. "We are well positioned to capitalize on these trends, and in 2010 are focused on growing our core business, increasing revenue from new products and solutions for 3G and 4G networks, and increasing sales outside North America." << Financial Highlights -------------------- - Revenue of $66.7 million for fiscal 2009 increased 51%, compared with $44.2 million for fiscal 2008. The year-over-year increase mainly reflects contribution from new products such as the Home Subscriber Server and Policy Controller, license revenue from existing customers, as well as revenue from the delivery of integrated solutions. - Q4 2009 revenue was $20.7 million, 53% higher than revenue in the same period last year. - 2009 gross margin was $45.7 million (69% of revenue) versus $34.0 million (77% of revenue) in 2008, reflecting increases in direct product costs associated with the deployment of integrated systems and planned investments in operations support infrastructure, as well as internal and subcontracting costs incurred to support the increase in professional services engagements. - Total operating expenses in 2009 were $33.2 million, net of $2 million of investment tax credit (50% of revenue), compared with $33.6 million (76% of revenue) in the same period last year. - Net earnings for 2009 were $11.2 million, or $0.44 per share fully diluted, versus $2.8 million, or $0.11 per share fully diluted, in the prior year. - Net earnings for Q4 2009 increased to $2.5 million, or $0.10 per share fully diluted, compared with $1.7 million, or $0.07 per share fully diluted, for the same period in 2008. - Cash and cash equivalents, and short-term investments of $67.3 million at December 31, 2009, compared with $50.4 million at December 31, 2008. Business Highlights ------------------- - In 2009, Bridgewater continued to successfully penetrate the 3G and 4G markets globally. In Q4, the Company announced that MetroPCS selected Bridgewater for its 4G LTE network. The multi-million dollar order includes the Bridgewater(R) Home Subscriber Server and Policy Controller. This competitive selection is a strong market validation of Bridgewater's unique approach to LTE and deep expertise and leadership in control plane transformations. Bell Canada also selected the Bridgewater(R) Service Controller for its new national 3G HSPA network in the quarter. During 2009, the Company expanded 3G deployments with several existing customers and expanded customer engagements including new engagements with Cox and Mobily. - Bridgewater continued to increase its international customer base in 2009, adding new customers in Taiwan, the Middle East, Europe, and China. - Bridgewater's continued investment in research and development resulted in the launch of several new 3G and 4G solutions in 2009 with a focus on Policy Control and LTE. New policy products and solutions included: - PCRF standards compliant Policy Control systems that continue to expand the Company's policy market leadership - Bridgewater's award-winning myPolicy(TM) solution for smartphones that gives subscribers greater control over their mobile data usage - LTE product suite including the Bridgewater(R) Home Subscriber Server and Policy Controller. Bridgewater(R) EPC 500 which combines both these products into an innovative LTE trial-ready system - The Bridgewater(R) ServiceMAX 500, an entry-level WiMAX system for small to mid-sized service providers, was also introduced. Bridgewater expanded business with Verizon Wireless for its WideSpan(R) integrated system, including subscriber data management and service control. Outlook ------- >> With today's release, Bridgewater presented its guidance for 2010. For 2010, the Company is expecting: << - Revenues of $82 to $92 million - Net earnings of $13 to $16 million >> Factors supporting Bridgewater's annual outlook include: high revenue visibility due to significant contracts with Tier 1 customers; a large installed customer base in existing and emerging markets; the long-term industry trends of growth in mobile data services and applications; and continued evolution of our business model for delivering products and services to address higher transaction capacity needs. The complete financial statements and management's discussion and analysis for the three and twelve months ended December 31, 2009 can be found at www.bridgewatersystems.com or at www.sedar.com. Forward-Looking Statements Certain statements in this release, including the estimates of future revenues and net earnings provided above, constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws. These statements are subject to certain assumptions, risks and uncertainties. Material factors and assumptions used to develop such estimates include: << - Bridgewater's ability to maintain its relationships and contracts with Tier 1 customers; - Bridgewater's visibility into the deployment plans of its major customers; - Bridgewater's ability to maintain and grow its installed customer base in existing and emerging markets; and - Bridgewater's expectations regarding long-term industry trends in growth in mobile data services and applications. >> Readers are cautioned not to place undue reliance on such statements. These statements are provided to enable external stakeholders to understand Bridgewater's expectations as of the date of this release and may not be appropriate for other purposes. Actual results, performance, achievements or developments of Bridgewater may differ materially from the results, performance, achievements or developments expressed or implied by such statements. Risk factors that may cause the actual results, performance, achievements or developments of Bridgewater to differ materially from the results, performance, achievements or developments expressed or implied by such statements can be found in the public documents filed by Bridgewater with Canadian securities regulatory authorities, including, but not limited to Bridgewater's Annual Information Form dated March 31, 2009 and Management's Discussion & Analysis of Financial Condition and Results of Operation dated February 26, 2010, which are available at www.sedar.com, and include the following: << - Bridgewater operates in highly competitive and continually evolving markets, and if it is not able to compete effectively, it may not be able to continue to expand its business as expected; - Bridgewater relies on a limited number of customers for a large percentage of its revenue, and the loss of, or significant shortfall in business from, a key customer could significantly reduce its revenue; - Bridgewater must continue to evolve its business models and platforms for delivery of products and services to respond to transaction capacity needs of its customers; - Bridgewater's engagements with its customers involve complex arrangements and the size, timing and contractual terms of orders for Bridgewater's products may affect when revenue is recognized; - Bridgewater has a lengthy and variable sales cycle; and - Bridgewater may engage in future acquisitions that could disrupt its business and affect its financial condition and operating results. >> Bridgewater assumes no obligation to update or revise any forward-looking statements or forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by law. Conference Call and Webcast A conference call and webcast will be held today, Friday, February 26, 2010 at 8:30 a.m. ET to discuss this announcement. The telephone numbers to access the call are 647-427-7450 or 1-888-231-8191. To access the live webcast, please visit www.bridgewatersystems.com or www.newswire.ca. Participants will require Windows Media Player(TM) to listen to the webcast. About Bridgewater Systems Bridgewater Systems, the mobile personalization company, enables service providers to efficiently manage and profit from mobile data services, content and commerce. The company's market leading mobile personalization portfolio provides a real-time, unified view of subscribers including entitlements, devices, networks, billing profiles, preferences and context. Anchored by Bridgewater's Subscriber Data Broker(TM), the portfolio of carrier-grade and standards-based products includes the Bridgewater(R) Service Controller (AAA), the Bridgewater(R) Policy Controller (PCRF) and the Bridgewater(R) Home Subscriber Server (HSS). More than 140 leading service providers including America Movil, Bell Canada, Clearwire, Cox, Hutchison Telecom, Iusacell, Scartel, SmarTone-Vodafone, Sprint, Tata Teleservices, Tatung, Telmex, Telstra, and Verizon Wireless use Bridgewater's solutions to rapidly deliver innovative mobile services to over 150 million subscribers. For more information, visit us at www.bridgewatersystems.com. Bridgewater, Bridgewater Systems, the Bridgewater Systems logo, WideSpan, Smart Caps, myPolicy, and Subscriber Data Broker are trademarks or registered trademarks of Bridgewater Systems Corporation. All other company, product names and any registered and unregistered trademarks mentioned are used for identification purposes only and remain the exclusive property of their respective owners. << BRIDGEWATER SYSTEMS CORPORATION Consolidated Statements of Earnings and Comprehensive Earnings years ended December 31, 2009 and 2008 (expressed in Canadian dollars) ------------------------------------------------------------------------- 2009 2008 -------------- -------------- Revenue Product $ 49,372,413 $ 28,586,917 Service and support 17,303,896 15,591,272 ------------------------------------------------------------------------- 66,676,309 44,178,189 Cost of sales 20,951,811 10,226,717 ------------------------------------------------------------------------- Gross margin 45,724,498 33,951,472 ------------------------------------------------------------------------- Expenses Sales and marketing 13,880,517 13,372,256 Research and development 15,718,157 14,934,992 General and administration 5,428,610 3,919,694 Investment tax credit carryforwards recognized (2,000,000) - Bad debt (recovery) expense (158,278) 1,183,077 Stock-based compensation 370,817 234,827 ------------------------------------------------------------------------- 33,239,823 33,644,846 ------------------------------------------------------------------------- Earnings before undernoted items 12,484,675 306,626 Foreign exchange (loss) gain (189,619) 1,495,851 Interest and other income 543,585 1,260,670 Loss on disposal of property, equipment and intangible assets (130,820) (118,159) ------------------------------------------------------------------------- Earnings before income taxes 12,707,821 2,944,988 Current income tax expense 2,000,000 - Future income tax (recovery) expense (496,000) 180,000 ------------------------------------------------------------------------- NET EARNINGS AND COMPREHENSIVE EARNINGS $ 11,203,821 $ 2,764,988 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Net earnings per share - basic $ 0.46 $ 0.12 Net earnings per share - diluted $ 0.44 $ 0.11 Weighted average number of shares outstanding - basic 24,179,224 22,653,503 Weighted average number of shares outstanding - diluted 25,248,147 24,183,094 BRIDGEWATER SYSTEMS CORPORATION Consolidated Balance Sheets as at December 31, 2009 and 2008 (expressed in Canadian dollars) ------------------------------------------------------------------------- 2009 2008 -------------- -------------- CURRENT ASSETS Cash and cash equivalents $ 53,828,859 $ 50,363,771 Short-term investments 13,459,190 - Accounts receivable 24,879,197 13,423,994 Unbilled receivables 1,360,741 968,363 Deferred cost of sales 12,324,813 3,518,085 Prepaid expenses and other assets 3,229,227 1,735,267 Future income tax asset 5,113,000 2,557,000 ------------------------------------------------------------------------- 114,195,027 72,566,480 DEFERRED COST OF SALES - 5,525,354 FUTURE INCOME TAX ASSET 3,703,000 5,763,000 PROPERTY, EQUIPMENT AND INTANGIBLE ASSETS 3,604,811 3,351,911 ------------------------------------------------------------------------- $ 121,502,838 $ 87,206,745 ------------------------------------------------------------------------- ------------------------------------------------------------------------- CURRENT LIABILITIES Accounts payable and accrued liabilities $ 9,617,441 $ 7,305,923 Deferred revenue 44,288,403 24,013,113 ------------------------------------------------------------------------- 53,905,844 31,319,036 ------------------------------------------------------------------------- SHAREHOLDERS' EQUITY Share capital 69,872,842 68,444,332 Contributed surplus 908,194 834,041 Deficit (3,184,042) (13,390,664) ------------------------------------------------------------------------- 67,596,994 55,887,709 ------------------------------------------------------------------------- $ 121,502,838 $ 87,206,745 ------------------------------------------------------------------------- ------------------------------------------------------------------------- BRIDGEWATER SYSTEMS CORPORATION Consolidated Statements of Cash Flows years ended December 31, 2009 and 2008 (expressed in Canadian dollars) ------------------------------------------------------------------------- 2009 2008 -------------- -------------- NET INFLOW (OUTFLOW) OF CASH RELATED TO THE FOLLOWING ACTIVITIES: OPERATING Net earnings $ 11,203,821 $ 2,764,988 Items not affecting cash Bad debt expense 332,461 1,183,077 Stock-based compensation 370,817 234,827 Foreign exchange loss (gain) on cash held in foreign currency 3,658,289 (1,826,193) Loss on disposal of assets 130,820 118,159 Future income tax (recovery) expense (496,000) 180,000 Amortization of property, equipment and intangible assets 1,494,768 1,400,482 ------------------------------------------------------------------------- 16,694,976 4,055,340 Changes in non-cash operating working capital items 5,531,388 11,619,949 ------------------------------------------------------------------------- 22,226,364 15,675,289 ------------------------------------------------------------------------- INVESTING Purchase of short-term investments (13,459,190) - Purchases of property, equipment and intangible assets (1,778,444) (1,053,072) Deferred cost of sales - (5,525,354) Repayment of note receivable - 10,000,000 ------------------------------------------------------------------------- (15,237,634) 3,421,574 ------------------------------------------------------------------------- FINANCING Proceeds from issuance of common shares 2,621,796 936,034 Repurchase of shares under normal course issuer bid (2,487,149) - Share issuance costs - (66,558) ------------------------------------------------------------------------- 134,647 869,476 ------------------------------------------------------------------------- Foreign exchange (loss) gain on cash held in foreign currency (3,658,289) 1,826,193 ------------------------------------------------------------------------- NET CASH INFLOW 3,465,088 21,792,532 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 50,363,771 28,571,239 ------------------------------------------------------------------------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 53,828,859 $ 50,363,771 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Supplementary information: Cash on hand and bank balances $ 17,485,505 $ 19,661,902 Cash equivalents 36,343,354 30,701,869 ------------------------------------------------------------------------- Total cash and cash equivalents $ 53,828,859 $ 50,363,771 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Interest received $ 485,749 $ 1,258,824 BRIDGEWATER SYSTEMS CORPORATION Consolidated Statements of Shareholders' Equity years ended December 31, 2009 and 2008 (expressed in Canadian dollars) ------------------------------------------------------------------------- Common Shares Contributed Number Amount Surplus ------ ------ ------- ------------------------------------------------------------------------- Balance at December 31, 2007 22,202,882 $ 67,477,616 $ 696,454 Stock-based compensation - - 234,827 Exercise of stock options 766,819 1,033,274 (97,240) Share issuance costs - (66,558) - Net earnings - - - ------------------------------------------------------------------------- Balance at December 31, 2008 22,969,701 $ 68,444,332 $ 834,041 Stock-based compensation - - 370,817 Repurchase of shares under normal course issuer bid (528,485) (1,489,950) - Exercise of stock options 1,991,252 2,918,460 (296,664) Net earnings - - - ------------------------------------------------------------------------- Balance at December 31, 2009 24,432,468 $ 69,872,842 $ 908,194 ------------------------------------------------------------------------- ------------------------------------------------------------------------- ---------------------------------------------------------- Shareholders' Deficit Equity ------- ------ ---------------------------------------------------------- Balance at December 31, 2007 $ (16,155,652) $ 52,018,418 Stock-based compensation - 234,827 Exercise of stock options - 936,034 Share issuance costs - (66,558) Net earnings 2,764,988 2,764,988 ---------------------------------------------------------- Balance at December 31, 2008 $ (13,390,664) $ 55,887,709 Stock-based compensation - 370,817 Repurchase of shares under normal course issuer bid (997,199) (2,487,149) Exercise of stock options - 2,621,796 Net earnings 11,203,821 11,203,821 ---------------------------------------------------------- Balance at December 31, 2009 $ (3,184,042) $ 67,596,994 ---------------------------------------------------------- ---------------------------------------------------------- >> |