LAVAL, QUEBEC -- (Marketwired) -- 04/24/14 -- Warnex Inc. (TSX VENTURE: WNX.H) ("Warnex" or the "Company") announced today financial results for the year ended December 31, 2013.
Warnex sold its Bioanalytical Services division on December 10, 2012, which represented its last operating business unit. On December 2, 2013, the Company terminated its long-term operating lease for its Laval, Quebec facilities and sold one of its subsidiaries. "These transactions have allowed Warnex to eliminate all significant future financial commitments and to aggressively manage its operating expenses," remarked Michael Singer, Chairman of Warnex. "They have also provided the Company with the flexibility required in order to explore more optimally its strategic alternatives. In this regard, discussions with external parties continue to advance and the Company expects to announce the outcome of this process in the near term."
Financial results
Consolidated revenue for the twelve-month period ended December 31, 2013, amounted to $nil compared to $9.0 million in 2012. The Company did not generate any sales, nor related cost of goods sold, in the year ended December 31, 2013, as a result of the sale of all of its operating divisions in 2012.
Net loss for twelve-month period amounted to $2.0 million or $0.07 per share compared to net earnings of $1.0 million or $0.04 per share for the same period in 2012.
Selling expenses amounted to $nil for the twelve-month period ended December 31, 2013, compared to $0.3 million for the twelve-month period ended December 31, 2012.
General and administrative expenses amounted to $1.1 million for the twelve-month period ended December 31, 2013 compared to $4.0 million for the same period in 2012.
Research and development tax credits amounted to $81,267 for the twelve-month period ended December 31, 2013 as a result of the reversal of prior period provisions following assessments by the taxation authorities ($139,998 in the year ended December 31, 2012).
Financial revenues amounted to $3,832 in the twelve-month period ended December 31, 2013 compared to financial expenses of $651,493 in the twelve-month period ended December 31, 2012. This decrease is due to the repayment in full of the Company's debts in 2012.
The Company ended fiscal 2013 with cash, cash equivalents and short-term investments of $2.1 million and working capital of $2.7 million, compared to $2.7 million in cash and a working capital of $4.1 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 annual 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.
Consolidated Statements of Financial Position
December 31 December 31
2013 2012
$ $
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Assets
Current assets
Cash and cash equivalents 218,299 2,742,114
Short-term investments 1,900,000 -
Trade and other receivables 782,073 1,804,421
Prepaid expenses 55,483 70,779
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2,955,855 4,617,314
Non-current assets
Amount receivable held in trust - 600,000
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2,955,855 5,217,314
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Liabilities
Current liabilities
Trade and other payables 169,731 457,317
Provisions 80,000 90,930
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249,731 548,247
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Shareholders' equity
Capital stock 41,706,049 41,706,049
Other reserves 2,803,559 2,803,559
Deficit (41,803,484) (39,840,541)
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2,706,124 4,669,067
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2,955,855 5,217,314
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Consolidated Statements of Changes in Shareholders' Equity
Other reserves
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Equity
Capital components 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,
December 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 earnings
and
comprehensive
income - - - - -
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Balance,
December 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 (1,962,943) (1,962,943)
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Balance,
December 31,
2013 (41,803,484) 2,706,124
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Balance,
December 31,
2011 (40,863,719) 2,920,889
Issuance of
common shares - 725,000
Net earnings
and
comprehensive
income 1,023,178 1,023,178
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Balance,
December 31,
2012 (39,840,541) 4,669,067
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Consolidated Statements of Operations and Comprehensive Income
2013 2012
For the years ended December 31 $ $
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Revenue - 8,964,219
Cost of goods sold - 7,049,073
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Gross margin - 1,915,146
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Operating expenses
Selling - 266,567
General and administrative 1,123,042 3,986,584
Finance (3,832) 651,493
Research and development tax credits (81,267) (139,998)
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1,037,943 4,764,646
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Loss before under noted items and income
taxes (1,037,943) (2,849,500)
Gain on disposal of assets 50,001 4,261,178
Lease termination (975,001) -
Impairment of assets - (388,500)
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Earnings (loss) before income taxes (1,962,943) 1,023,178
Deferred income taxes - -
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Net earnings (loss) and comprehensive income (1,962,943) 1,023,178
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Basic earnings (loss) per share ($0.07) $0.04
Diluted earnings (loss) per share ($0.07) $0.04
Weighted average number of shares
outstanding 28,323,884 25,958,190
Weighted average number of diluted shares
outstanding 28,323,884 27,891,802
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Consolidated Statements of Cash Flow
2013 2012
For the years ended December 31 $ $
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Operations
Net earnings (loss) (1,962,943) 1,023,178
Items not affecting cash:
Depreciation of property, plant and
equipment - 707,352
Amortization of intangibles - 32,117
Impairment of assets - 388,500
Gain on disposal of assets - (4,261,178)
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(1,962,943) (2,110,031)
Net change in non-cash working capital items 1,339,128 (773,352)
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Net cash used in operations (623,815) (2,883,383)
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Investing activities
Acquisition of property, plant and equipment - (85,181)
Proceeds of disposal of property, plant and
equipment - 6,060,205
Proceeds of disposal of intangibles - 58,477
Acquisition of short-term investments (3,000,000) -
Maturity and disposal of short-term
investments 1,100,000 -
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Net cash provided by (used in) investing
activities (1,900,000) 6,033,501
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Financing activities
Decrease in bank loan - (740,000)
Repayment of long term debt - (42,840)
Repayment of debentures - (910,400)
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Net cash used in financing activities - (1,693,240)
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Increase (decrease) in cash and cash
equivalents (2,523,815) 1,456,878
Cash and cash equivalents, beginning of year 2,742,114 1,285,236
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Cash and cash equivalents, end of year 218,299 2,742,114
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Contacts:
Michael Singer
Chairman of the Board of Directors
Warnex Inc.
(514) 940-3600
info@warnex.ca
