VANCOUVER, B.C., Aug. 15, 2003 (PRIMEZONE) -- Stockgroup Information Systems Inc. (OTCBB:SWEB) (TSX Venture Exchange:SWB), a financial media and technology company, today announced its financial results for the second quarter ended June 30, 2003. An investor conference call will be held today and web cast at 4:05 pm EST to discuss these results.
Operational Highlights
-- Revenue increased 69% in Q2, 2003 over Q2, 2002
-- Revenue increased 15% in Q2, 2003 over Q1, 2003
-- Financial Content and Software revenue increased 86% year over
year and 43% over Q1, 2003
-- Margin increased to 74% in Q2, 2003 from 58% in Q2, 2002
-- Gross Profit increased 115%
-- Eliminated all long-term debt and convertible note
-- First Associates was retained as Investment Banker and raised
US$1.0MM
"What we have created is a platform for success. That platform is comprised of three elements," stated Marcus New, CEO. "The first is financial. We have eliminated all long-term debt in our company and have just injected US$1.0 million dollars to help accelerate our growth. The second is sales. We are winning new business, new accounts, new clients in all the market segments in which we choose to participate. This is reflected by the revenue growth and financial performance we are demonstrating. The third is our product package and our product development. We believe it is totally in tune with industry requirements."
Business Highlights
-- Associated Press (AP) Launches Stockgroup's AP branded Financial
Applications for its customers at Nexpo in Las Vegas
-- US Global Funds (Nasdaq:GROW) acquired a 9% interest in
Stockgroup
-- Stockgroup and AP Digital sign Road Runner, Time Warner Cable's
subsidiary and Netster.com one of the fastest growing search
engines on the Internet
Mr. New continued, "We are signing up some of the biggest names in the world for the Stockgroup solution. After almost a year of due diligence, the Associated Press (AP) chose our company to work with them to provide a co-branded solution to their thousands of publishing and corporate clients worldwide. Sun Life selected Stockgroup to manage the Investor Relations portion of their corporate web site with our IntegratIR product line. Search engine Google selected Stockhouse to provide advertising for its clients. Revenue from these newly signed clients will be recognized in future quarters. As the industry continues to grow and change we are well positioned to make the adjustments required to win new business."
Quarter Comparison 2003 to 2002
Stockgroup reported revenue of US$0.69 million for the quarter ended June 30, 2003, compared to US$0.41 million in the same quarter 2002, an increase of 69%. The increase in revenue was primarily the result of increased recurring revenue from sales made in previous quarters along with improved advertising revenue. Gross Profit increased 115% to US$0.51 million from US$0.24 million. In the quarter, Gross Margin increased to 74% from 58% in 2002. Losses from operations for the quarter ended June 30, 2003 were US$0.23 million compared to US$0.33 million in 2002 an improvement of 30%.
Six-Month Comparison 2003 to 2002
Stockgroup reported revenue of US$1.3 million for the six-month period ended June 30, 2003, compared to US$0.85 million in the same period in 2002, an increase of 52%. Gross Profit increased 85% to US$0.96 million in 2003 from US$0.52 million in 2002. Losses from operations for the six-month period ended June 30, 2003 were US$0.48 million compared to US$0.53 million.
Financial Software and Content Systems
Financial Software and Content Systems revenue increased 86% for Q2 2003 over the same quarter in 2002. Stockgroup has continued to sign licensing agreements with large enterprise customers to give the customer the ability to provide financial content, data and tools to their customers on a private label basis for a fraction of the cost of doing it themselves. Stockgroup has established relationships with major sales channels, media networks, and financial companies, and has already seen significant results. Stockgroup's Financial Software and Content Systems are made up of a suite of over 30 proprietary financial and software tools and 100 different data sources that disseminate data from all North American Exchanges and from a database of over 21,000 publicly traded companies. Some of Stockgroup's more than 30 different financial tools include quotes, charts, portfolio, technical analysis, wireless applications, watch lists and others. In addition to financial services firms, Stockgroup also provides specialized tools for the publishing industry, public companies (CFO/IRO) and corporate employee intranet markets.
Public Company Disclosure and Awareness Products
The Company's IntegrateIR software system continues to be a strong source of revenue. Public Company Disclosure and Awareness Products revenue was up 57% for Q2 2003 over the same quarter in 2002. The increase has come about despite the fact that many of our Public Company Disclosure and Awareness Products customers have historically come from the poorly performing technology industry. Even as public companies in general have reduced spending on investor marketing, our products continue to sell well because we have adapted them to the needs of the market. We also continue to sign new agreements for our disclosure products with major corporations. We feel that this area of the business will rebound fully when the financial markets begin to recover from their current slowdown. The IntegrateIR software system for CFO/IRO's includes 12 basic components ranging from company overview, stock quotes and charts to automated SEC filings. The IntegrateIR gives the CFO/IRO the ability to add or change up to 40 additional components that can be displayed on the Investor Relations section of their web site. These include automated press releases, embedded news systems, company fundamentals, and interactive financial reports.
For full details please view our 10QSB filed today on EDGAR.
Investor Conference Call
Chairman and CEO, Marcus New, and CFO, David Gillard, will host an investor conference call, which will be simultaneous Webcast at 4:05 p.m. EST today. To participate, please dial 1-866-743-0443 Participant Pass-code: 874044#. To listen to the live Webcast, please connect to www.stockgroup.com. Select 'Investors' at the top of the page, and then select 'Conference Call' in the navigation bar. This earnings call will be accessible using Windows Media Player for a period of one year.
ABOUT STOCKGROUP
Stockgroup Information Systems Inc. is a financial media and technology company. It is a leading provider of private labeled Financial Software and Content Systems to media, corporate and financial services companies. Stockgroup employs proprietary technologies which enable its clients to provide financial data streams and news combined with cutting edge fundamental, technical, productivity and disclosure tools to their customers, shareholders and employees at a fraction of the cost of traditional internal methods. Stockgroup is also a provider of Public Company Disclosure and Awareness Products for publicly traded companies. Its financial Web sites including www.stockhouse.com, www.stockhouse.ca and www.smallcapcenter.com are state-of-the-art online research centers for the investment community. To find out more about Stockgroup (OTCBB:SWEB) (TSX Venture Exchange:SWB), visit our website at www.stockgroup.com
Signed: Contact: John Bevilaqua /s/ Marcus New David Gillard, CFO Investor Relations Marcus New, CEO (800) 650-1211 800-650-1211x180
The TSX Venture Exchange has neither approved nor disapproved this news release.
This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, goals, assumptions or future events or performance are not statements of historical fact and may be "forward-looking statements." Forward-looking statements are based on expectations, estimates and projections at the time the statements are made that involve a number of risks and uncertainties which could cause actual results or events to differ materially from those presently anticipated. Forward-looking statements in this action may be identified through the use of words such as "expects", "will," "anticipates," "estimates," "believes," or statements indicating certain actions "may," "could," or "might" occur.
Stockgroup Information Systems Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED -- Expressed in U.S. Dollars)
Three Months Three Months Six Months Six Months
Ended June Ended June Ended June Ended June
30, 2003 30, 2002 30, 2003 30, 2002
----------- ----------- ----------- ------------
REVENUE
Revenues $ 688,529 $ 407,703 $ 1,290,241 $ 849,944
Cost of
revenues 176,332 169,258 333,686 333,506
----------- ----------- ----------- -----------
Gross profit $ 512,197 $ 238,445 $ 956,555 $ 516,438
EXPENSES
Sales and
marketing $ 166,041 $ 137,451 $ 324,815 $ 229,511
General
and
administrative 574,050 432,188 1,111,789 814,226
----------- ----------- ----------- -----------
$ 740,091 $ 569,639 $ 1,436,604 $ 1,043,737
----------- ----------- ----------- -----------
LOSS FROM
OPERATIONS $ (227,894) $ (331,194) $ (480,049) $ (527,299)
Interest income -- 22 -- 168
Interest expense
ordinary (11,789) (4,095) (24,647) (9,881)
Non recurring
interest on
conversion of
8% convertible
notes (note 2) (656,707) (33,966) (860,351) (52,330)
Interest on
conversion of
3% convertible
debentures -- -- -- (160,209)
Loss on
warrants
liability -- -- -- (55,000)
Gain on
restructuring
of convertible
notes -- -- -- 1,088,586
Other
income 2,653 (1,671) 3,125 2,279
----------- ----------- ----------- -----------
NET INCOME
(LOSS) $ (893,737) $ (370,904) $(1,361,922) $ 286,314
=========== =========== =========== ===========
BASIC AND
DILUTED
EARNINGS
(LOSS) PER
SHARE:
Net income
(loss) $ (0.04) $ (0.03) $ (0.06) $ 0.02
=========== =========== =========== ===========
Weighted
average
shares
outstanding
for the
period 24,199,767 13,841,482 22,371,013 12,313,576
=========== =========== =========== ===========