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UrtheCast Reports 2014 Second Quarter Financial Results(Canada Newswire Via Acquire Media NewsEdge) VANCOUVER, Aug. 12, 2014 /CNW/ - UrtheCast Corp. (TSX:UR) ("UrtheCast" or the "Company"), a technology company that is developing the world's first Ultra HD video feed of Earth from space, today announces financial results for the three and six months ended June 30, 2014. The Company reported a comprehensive loss of $4.1 million in the quarter as compared to $10.5 million in the comparative quarter in 2013 and $3.9 million in the previous quarter. Our year-to-date comprehensive loss was $8.0 million as compared to $11.8 million in the comparable period of the previous year. Recent highlights Include: New Sensors on the US Side of the ISS The Company's plans to install second-generation, state-of-the-art Earth Observation ("EO") sensors on the NASA segment of the International Space Station (ISS). NanoRacks, UrtheCast's partner in this endeavor, will work with the U.S. National Lab manager, CASIS, to facilitate the launch, installation and onboard integration of the sensors and hardware in line with its Space Act Agreement with NASA. UrtheCast will supply the sensors, electronics and other related hardware. These sensors and their components are scheduled to launch to the International Space Station in 2016, and the Company anticipates that the data will be available in 2017. Major Contract Update The Company recently concluded negotiations with a confidential customer and anticipates final approval of budgetary allocation and signature on a five-year contract valued at US $65 million for value-added services and earth imagery data. The contract stipulates that a substantial portion is to be allocated for non-data related value-added services to be provided by UrtheCast over the first three years of the contract. The terms of the contract provide for the payment of a cash advance in the amount of 20% of the total contract value and a letter of credit for the balance of payments. MRC IOC Achieved Initial Operational Capability ("IOC") was achieved by the medium-resolution still camera ("MRC"), which means that the camera system is capable of large capacity data collections, the data is meeting all specifications and the Company's cloud-based processing system is capable of generating imagery products autonomously. The engineering team continues to refine the operational and processing systems required to meet increased order volumes and produce value-added consumer products and services. Technical and Corporate Update On July 16, we announced that our engineering team is continuing to commission and calibrate the Bi-axial Pointing Platform ("BPP"), which is required before test imagery can be acquired by the high-resolution video camera ("HRC"). The BPP enables the HRC to point in the direction of its targets and keeps its field of view stable while the ISS is moving at 25,000 kilometers per hour. During on-orbit testing the BPP experienced difficulties in achieving the pointing control precision needed for the HRC to meet image quality specifications. UrtheCast's engineering team has developed a solution that has been successfully tested on the ground. Due to the cables having to be manufactured and delivered to the ISS, the on-orbit implementation of this solution will cause a delay of several months in the commissioning of the HRC. We have notified our insurers regarding the potential of a claim against our insurance policy resulting from the delay. The determination of whether we are in a position to file a claim will be made after we receive the results from the BPP and HRC testing procedures. "This has been a significant quarter of achievement for our Company. We are bullish about our growth prospects, despite having to report a delay to our HRC commissioning," explained Scott Larson, UrtheCast's Chief Executive Officer. "Being able to make the transition into operations and the revenue stage is a huge milestone, one that we've been looking forward to. Of course, like all start-ups, we continue to monitor our costs closely. With the final negotiations on a significant contract that will help us finance the second-generation camera development, and with initial reaction to the release of our first MRC products, we look forward to providing unique, market-leading products and services not currently available." Results of Operations Operating expenditures increased significantly in 2014 compared with the same period in the prior year, as additional personnel were added to support the infrastructure development necessary for the launch of the MRC and HRC in late 2013, and the anticipated start of commercial revenues. RESULTS OF OPERATIONS Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 General and administrative expenses $ 2,975,374 $ 1,493,565 $ 5,529,759 $ 2,122,564 Research expenditures 484,070 506,291 975,619 831,674 Share-based payments 644,048 1,033,364 1,490,471 1,351,232 Operating loss 4,103,492 3,033,220 7,995,849 4,305,470 Net finance (income)/costs, foreign exchange (gains)/losses and changes in fair value of derivatives (34,088) 1,693 (57,485) 64,305 Loss on settlement of convertible debenture - 230,345 - 230,345 Non-cash loss on completion of Transaction - 7,205,501 - 7,205,501 Net loss 4,069,404 10,470,759 7,938,364 11,805,621 Other comprehensive loss 12,515 202 15,960 3,987 Comprehensive loss $ 4,081,919 $ 10,470,961 $ 7,954,324 $ 11,809,608 Net loss per share $ 0.06 $ 0.29 $ 0.12 $ 0.37 Given our current cash position of $11.4 million and the potential proceeds from any successful insurance claims and from the long-term contract, if finalized, along with the initial expected revenues from the MRC, our funds are expected to be sufficient to get us through to the start of revenue generation by the HRC. Balance Sheet As at June 30, 2014 December 31, 2013 Assets Current assets Cash and cash equivalents $ 11,413,218 $ 21,787,577 Restricted term deposits 440,000 440,000 Sales tax and other receivables 102,501 469,699 Prepaid expenses and deposits 1,319,007 2,461,539 Total current assets 13,274,726 25,158,815 Non-current assets Property and equipment 58,173,654 49,843,532 Intangible assets 10,343,011 5,421,099 Total assets $ 81,791,391 $ 80,423,446 Liabilities and shareholders' equity Current liabilities Trade and other payables $ 2,247,732 $ 2,417,229 Total current liabilities 2,247,732 2,417,229 Deferred revenue 35,160,000 28,900,000 Total liabilities 37,407,732 31,317,229 Shareholders' equity Share capital 71,909,292 69,892,954 Warrant reserve 2,398,501 2,459,718 Contributed surplus 6,889,600 5,612,955 Accumulated other comprehensive loss (17,949) (1,989) Accumulated deficit (36,795,785) (28,857,421) Total shareholders' equity 44,383,659 49,106,217 Total liabilities and shareholders' equity $ 81,791,391 $ 80,423,446 The full financial statements and accompanying Management's Discussion & Analysis are available on UrtheCast's profile on the System for Electronic Document Analysis and Retrieval ("SEDAR") at its website www.sedar.com, and on UrtheCast's website at www.urthecast.com. The Company will host a conference call regarding its first half-year corporate earnings for 2014 at 2:00 p.m. PT (5:00 p.m. ET) on Tuesday, August 12, 2014. The live conference call will be available by calling toll-free at 888-789-9572, or by toll call at 416-695-7806. The participant pass code is 5271784. An archived version of the conference call will be made available on the Company's investor webcast page following the live conference call. About UrtheCast Corp. UrtheCast Corp. is a Vancouver-based technology company that is developing the world's first Ultra HD video feed of Earth, streamed from space in full color. Working with renowned aerospace partners from across the globe, UrtheCast has built, launched, installed, and will soon operate two cameras on the ISS. Video and still image data captured by the cameras will be downlinked to ground stations across the planet and displayed on the UrtheCast web platform, or distributed directly to exclusive partners and customers. UrtheCast's cameras will provide Ultra HD video and still imagery of Earth that will allow for monitoring of the environment, humanitarian relief, social events, agricultural land, etc. Common shares of UrtheCast trade on the Toronto Stock Exchange as ticker 'UR'. For more information visit our website at www.urthecast.com. This release contains certain information which, as presented, constitutes "forward-looking information" within the meaning of applicable Canadian securities laws. Forward-looking information involves statements that relate to future events and often addresses expected future business and financial performance, containing words such as "anticipate", "believe", "plan", "estimate", "expect", and "intend", statements that an action or event "may", "might", "could", "should", or "will" be taken or occur, or other similar expressions and includes, but is not limited to, statements about the commissioning of the cameras and the BPP, plans to operate camera components on, and stream video footage from, the ISS, proposed image and video product offerings, expectations regarding the commencement of commercial operations, expected partners and customers to distribute such products and expected costs and revenues. Forward-looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of UrtheCast to control or predict, and which may cause UrtheCast's actual results, performance or achievements to be materially different from those expressed or implied thereby, including, but not limited to, damage which may have occurred to the cameras during launch or installation, unexpected changes in Russian or Canadian government policies, technology changes, reliance on key personnel, the performance of third parties under contract, the potential for conflicts of interest among certain officers, directors or promoters with certain other projects, competition, risks related to the business activities of Longford Energy Inc. (now UrtheCast) prior to the reverse take-over transaction with Earth Video Camera Inc., as well as those factors discussed in the Company's annual information form dated March 26, 2014, (the "AIF") and the Company's short form base shelf prospectus dated April 7, 2014 (the "Prospectus") which are available under UrtheCast's SEDAR profile at www.sedar.com. Forward-looking information is developed based on assumptions about such risks, uncertainties and other factors set out herein, in the AIF and Prospectus, and as otherwise disclosed from time to time on UrtheCast's SEDAR profile. Forward-looking statements are made based on management's beliefs, estimates and opinions on the date that statements are made and UrtheCast undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as may be required by applicable Canadian securities laws. Readers are cautioned against attributing undue certainty to forward-looking statements. SOURCE UrtheCast Corp. |