Medworxx Solutions Inc. Files First Quarter Financial Statements and Management Discussion and Analysis; Announces Record Quarter
TORONTO, ON – June 1, 2009 – Medworxx Solutions Inc (the "Company")(TSX VENTURE:MWX) announced today it has filed with the Canadian securities authorities its interim consolidated financial statements and management discussion & analysis report for the three month period ended March 31, 2009. These documents may be viewed under the Company's profile at www.sedar.com.
Medworxx posts quarterly results with record revenue, narrowing losses, and growth in recurring revenue. Highlights include:
Revenue for the quarter ended March 31, 2009 was $957,175 a 6% increase over revenue of $904,968 in the previous quarter and a 14% increase over revenue of $842,650 in the same quarter last year.
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Total expenses for the quarter ended March 31, 2009 before gain on foreign exchange, SR&ED expense, and interest on long-term debt were $1,198,585, representing an 8% decrease from expenses of $1,300,126 in the prior quarter and a 13% decrease from expenses of $1,382,089 in the same quarter last year. This decrease reflects the planned control in expenses as Medworxx drives to profitability.
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The Company incurred losses of $260,866 on revenue of $957,175 for the quarter ended March 31, 2009 vs. losses of $530,391 incurred for the same quarter in the prior year on revenue of $842,650, representing a 51% decrease in quarterly loss. In the prior quarter, the Company incurred losses of $356,720 on revenue of $904,968. This improvement in results of operations is due to the Company’s ability to grow revenue while maintaining expenses at a fairly consistent level. This is the lowest quarterly loss for the Company since becoming a publicly traded company May of 2007.
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Deferred revenue at March 31, 2009 was $1,784,114 as compared to $1,706,658 at December 31, 2008, representing a 5% increase. All annual renewable license software agreements are sold with a 12 month maintenance contract. The Company defers and amortizes the revenue over the next 12 months. Deferred revenue is defined as advance billings or payments received for customer contracts where the Company does not have vendor-specific objective evidence of fair market value of each contract element necessary to recognize the revenue; payments received in advance of delivery of services; or advance payments received for post contract support (maintenance) services.
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Contract value of recurring revenue at March 31, 2009 with existing customers was $2,756,000 as compared to $2,656,000 at December 31, 2008, representing a 4% increase over the prior quarter. The Company defines contract value of recurring revenue as the contract value or agreement amount for the annual renewable agreements which at the end of a reporting period management believes there to be a high probability of renewal. As the full value of such contracts is recognized as revenue over 12 months, the growth in this value is an important metric for the Company. This is a non-GAAP measure.
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Consulting services revenue for the quarter was $263,062, representing a 123% increase over revenue of $118,196 for the prior quarter and a 55% increase over revenue of $169,449 for the same quarter last year. This increase is attributable to growth in the customer base, and more of a focus on services work, best practices consulting, and custom development for hospitals as Medworxx delivers its software. The increase is also due to the fact that the Company is building relationships with customers which increases revenue in Consulting Services, as Medworxx customers engage the Company to do ongoing work and additional projects.
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The Company completed a $410,000 aggregate principal amount private placement of 14% convertible debentures maturing on February 20, 2011. The convertible debentures are convertible at the option of the holder into units at a conversion price of $0.10 per unit, each unit consisting of one common share of Medworxx and one-half of one warrant, each full warrant entitling the holder to purchase one common share at a price of $0.12 prior to the maturity date.
“Our recurring revenue continues to grow on a quarter over quarter basis. Medworxx continue to control costs, grow revenue, and drive towards profitability”, said Dan Matlow, President & CEO, Medworxx.
About Medworxx
Medworxx is a Toronto-based software company focused exclusively on solutions for the North American healthcare marketplace. Medworxx provides healthcare solutions for decision support, compliance and education. Its software comprises an integrated suite of solutions, including content management, learning management, policies and procedures, utilization management, bed optimization, single sign on, portal, and emergency readiness solutions.
Medworxx started business in May 2004 in Ontario with 3 employees and has since grown to over 35 employees. Medworxx' executive team consists of experienced sales, marketing, software development, healthcare, and finance personnel. Medworxx currently has a customer base of approximately 95 healthcare organizations representing more than 280 hospitals and 500,000 end users who are distributed approximately 70% in Canada and 30% in the United States. Medworxx' customers use its software platform to increase competency, reduce redundancy, reduce costs, and simplify distribution of knowledge to staff and patients, creating a net effect of increased efficiency and improved patient safety and care.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors, such as competition, technological changes, the changing needs of hospitals, the financial condition of the Company’s current and potential customers, foreign currency exchange rates, as well as general economic conditions, which may cause the actual results, performance or achievements of the Corporation and Medworxx to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this press release. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Contact:
Dan Matlow, President & Chief Executive Officer
Medworxx Inc.
416-642-1278
dmatlow@medworxx.com
Domenic Crudo, Chief Financial Officer
Medworxx Inc.
416-642-1278
dcrudo@medworxx.com