Warnex Inc. (TSX VENTURE:WNX.H)(NEX:WNX) ("Warnex") announced today financial
results for the first quarter ended March 31, 2013.
Q1-2013 highlights
Subsequent to quarter-end, the Company announced that Mr. Marc Lebel, Mr. Louis
Lacasse and Mr. Patrice Hugo have agreed to resign as Directors of Warnex. In
addition, Mr. Jean Vezina, the Company's interim Chief Financial Officer has
also agreed to step down as of May 29, 2013. Furthermore, Mr. Sean Karamchandani
has been appointed as Director and will replace Mr. Lebel as the Company's
interim Chief Executive Officer and Mr. Vezina as the Company's interim Chief
Financial Officer until further notice.
"The Company's financial position at March 31, 2013 and as of today remains in
good health as the Board continues to evaluate a number of potential strategic
options. The significant cost containment measures recently completed during the
first quarter have fittingly positioned the Company's Board to carefully and
thoughtfully evaluate all identified opportunities in advance of making its
final recommendation to shareholders without placing excessive pressures on the
Company's existing working capital," remarked Michael Singer, Chairman of
Warnex. "We look forward in reaching a conclusion and eventual recommendation to
Warnex shareholders pursuant to the ongoing strategic review."
Financial results
Consolidated revenue for the three-month period ended March 31, 2012, amounted
to $nil compared to $5.7 million for the same period last year. The Company did
not generate any sales, nor related cost of goods sold in the first quarter of
2013, as a result of the sale of all of its operating divisions in 2012.
Net loss for the quarter amounted to $453,637, or $0.02 per share compared to
net loss of $863,945 or $0.01 per share for the same quarter in 2012.
General and administrative expenses amounted to $452,119 for the quarter
compared to $1,090,935 for the same quarter last year. General and
administrative expenses consisted primarily of corporate legal fees amounting to
approximately $200,000 for certain one-time mandates and for ongoing general
corporate matters; operating lease costs, net of sublease revenues, amounting to
approximately $120,000; professional and consulting fees of approximately
$40,000; board of director fees of approximately $80,000; and other
administrative costs of approximately $10,000.
Financial expenses for the quarter amounted to $1,518 compared to $298,959 for
the same quarter last year.
The Company ended the first quarter of 2013 with cash of $2.6 million and
working capital of $4.2 million, compared to $2.7 million in cash and a working
capital of $4.7 million as at December 31, 2012.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this news release are forward-looking and are
subject to numerous risks and uncertainties, known and unknown. For further
information identifying known risks and uncertainties, relating to financial
resources, liquidity risk, volatility of share price and other important factors
that could cause actual results to differ materially from those anticipated in
the forward-looking statements, please refer to the heading Risks and
Uncertainties in Warnex's most recent Management's Discussion and Analysis,
which can be found at www.sedar.com. Consequently, actual results may differ
materially from the anticipated results expressed in these forward-looking
statements.
Neither NEX nor its Regulation Services Provider (as that term is defined in
policies of the NEX) accepts responsibility for the adequacy or accuracy of this
release.
Financial statements to follow.
Interim Consolidated Statements of Financial Position
(Unaudited)
March 31 December 31
2013 2012
$ $
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Assets
Current assets
Cash and cash equivalents 2,573,745 2,742,114
Trade and other receivables 2,045,563 1,804,421
Prepaid expenses 111,004 70,779
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4,730,312 4,617,314
Non-current assets
Amount receivable held in trust - 600,000
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4,730,312 5,217,314
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Liabilities
Current liabilities
Trade and other payables 514,882 457,317
Provisions - 90,930
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514,882 548,247
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Shareholders' equity
Capital stock 41,706,049 41,706,049
Other reserves 2,803,559 2,803,559
Deficit (40,294,178) (39,840,541)
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4,215,430 4,669,067
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4,730,312 5,217,314
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Interim Consolidated Statements of Changes in Shareholders' Equity
(Unaudited)
Other reserves
--------------------------------------------
--------------------------------------------
Equity
components
Capital of Share-based Total other
stock debentures compensation Other reserves
$ $ $ $ $
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Balance, December
31, 2012 41,706,049 1,734,404 1,028,149 41,006 2,803,559
Net and
comprehensive loss - - - - -
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Balance,March 31,
2013 41,706,049 1,734,404 1,028,149 41,006 2,803,559
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Balance, December
31, 2011 40,981,049 1,734,404 1,028,149 41,006 2,803,559
Issuance of common
shares 725,000 - - - -
Net and
comprehensive loss - - - - -
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Balance, March 31,
2012 41,706,049 1,734,404 1,028,149 41,006 2,803,559
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Deficit Total
$ $
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------------------------------------------------------------
Balance, December
31, 2012 (39,840,541) 4,669,067
Net and
comprehensive loss (453,637) (457,637)
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Balance,March 31,
2013 (40,294,178) 4,215,430
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Balance, December
31, 2011 (40,863,719) 2,920,889
Issuance of common
shares - 725,000
Net and
comprehensive loss (863,945) (863,945)
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Balance, March 31,
2012 (41,727,664) 2,781,944
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Interim Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
For the three months ended March 31 2013 2012
$ $
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Revenue - 3,733,565
Cost of goods sold - 3,223,753
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Gross margin - 509,812
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Operating expenses
Selling - 58,863
General and administrative 452,119 1,090,935
Finance 1,518 298,959
Research and development tax credits - (75,000)
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453,637 1,373,757
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Net and comprehensive loss (453,637) (863,945)
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Basic loss per share ($0.02) ($0.05)
Diluted loss per share ($0.02) ($0.05)
Weighted average number of shares outstanding 28,323,884 18,809,115
Weighted average number of diluted shares
outstanding 28,323,884 18,809,115
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Interim Consolidated Statements of Cash Flow
(Unaudited)
2013 2012
For the three months ended March 31 $ $
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Operations
Net loss (453,637) (863,945)
Items not affecting cash:
Depreciation of property, plant and equipment - 248,163
Amortization of intangibles - 10,202
Capitalized fees and interest on debentures - 227,002
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(453,637) (378,578)
Net change in non-cash working capital items 285,268 69,198
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Net cash used in operations (168,369) (309,380)
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Investing activities
Acquisition of property, plant and equipment - (40,639)
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Net cash used by investing activities - (40,639)
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Financing activities
Increase in bank loan - 210,000
Repayment of long term debt - (40,628)
Repayment of debentures - (250,000)
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Net cash used in financing activities - (80,628)
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Decrease in cash and cash equivalents (168,369) (430,647)
Cash and cash equivalents, beginning of period 2,742,114 1,285,236
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Cash and cash equivalents, end of period 2,573,745 854,589
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FOR FURTHER INFORMATION PLEASE CONTACT:
Michael Singer
Chairman of the Board of Directors
Warnex Inc.
(450) 663-6724 (ext 311)
info@warnex.com
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