CALGARY, ALBERTA — (Marketwired) — 06/26/13 — Cortex Business Solutions Inc. (TSX VENTURE: CBX) (“Cortex” or the “Company”) is pleased to announce the Company-s Q3 F2013 Financial and Operational Highlights. Complete financials and MD&A are available on SEDAR ().
Revenue was $1.6M in the third quarter of the Fiscal Year 2013, compared to $1.4M in the same quarter Fiscal Year 2012, reflecting a 20% growth in total revenue. Q3 F2013 total revenue grew 9% over Q2 F2013. Included in the total revenue is access and usage fee revenue of $1.4M Q3 F2013 compared to $1.1M in Q3 F2012 and $1.3M in Q2 F2013 representing a 30% and 9% respective, increase in recurring revenue growth.
The Company reduced its net cash used in operating activities to $1,093,929 in Q3 F2013 from $2,103,861 in Q3 F2012; an improvement of 48%. There was a 39% reduction in net cash used in operating activities Q3 F2013 compared to Q2 F2013 of $1,807,182.
At the end of the quarter ended April 30, 2013 (“Q3 F2013”), Cortex had signed agreements with 69 Hubs, 5 more than at the end of January 31, 2013 (“Q2 F2013”). Of those, 51 have progressed through the pilot phase and were available to receive invoices from their suppliers electronically. Hubs are the main driving force for the growth in the Company as each new hub brings a list of additional customers to the Network and provides an additional destination for existing network users to send invoices to. During the quarter, Cortex added 367 new customers.
Cortex had a net loss of $1,809,062 or $(0.01) per basic and diluted share in Q3 F2013, compared to net loss of $2,374,772 or $(0.01) per basic and diluted share in Q3 F2012. This reduction in net loss of 24% is the result of increased revenue in conjunction with a reduction of expenditures of 8% compared to Q3 2012.
“Cortex continues to grow our Network of companies, transactions and revenue during a time period when drilling activity in the oil and gas industry is down considerably from last year. This is a direct result of our investments in market expansion, productivity improvements and technology over the past year,” said Art Smith, President & CEO of Cortex. “We expect 2013 to close with strong growth for the Company in terms of both revenue and productivity improvements, as we expand our Network in Canada and the United States.”
Outlook
Cortex is seeing increasing demand for our new 100% e-Billing service with the signing of a large initiative in February 2013. This initiative will expand the Cortex network into 5 new industries including Mining, Construction, Power Systems, Agriculture and Forestry and has the potential to add thousands of new Hubs to the Cortex network. We have seen additional demand for this service and expect more projects to be signed over the next 6 months.
Cortex expects to launch its new Portal product in the summer of 2013, which will include a collaboration environment enabling customers to create profiles, perform searches, send messages and connect with each other through the Cortex Network. The Roadmap project was the foundation required to proceed with the development of the Portal product.
Cortex will continue to expand the Network by adding Hubs and their supplier groups through current and new partnerships. Cortex will explore new revenue, industry and partnership opportunities in Canada and the U.S.
Cortex is three quarters through fiscal 2013 with 69 Hubs signed to the Network, 51 Hubs active on the Network and 9,147 contracted suppliers. F2013 continues the momentum with a focus on strong relationships with clients and partners which are expected to provide continued month over month revenue growth through increasing transaction volumes between our Hub customers and their suppliers.
Organic network growth, both in the number of customers connected and the number of transactions they do, has provided a solid revenue foundation for the Company. Management expects to see continued Hub signings in 2013 and is projecting to exit fiscal year ended July 31, 2013 with over 80 Hub customers.
Strategic partnerships with Full Circle, Powervision, Pandell, Basware, Verian Technologies, IT Canada and Concerta are providing numerous opportunities to add Hubs in both Canada and the U.S.
Cortex continues to expand partnerships adding Microsoft, Etelligent, Coupa Software and Perfect Commerce this year.
Over the next year, management expects to complete more partnerships, launch new features to the Network and continue increasing recurring revenue.
The TSX Venture Exchange approved the previously disclosed applied for issuance of 200,000 common shares at a deemed price of $0.19. These shares were issued on April 23, 2013.
Quarterly Results Conference Call
On June 26th, 2013 at 2:00 pm MST, please join the live conference:
Toll-Free Dial-In Number: (866) 223-7781
Local Dial-In #: (416) 340-8018
Time: 2:00 pm MST
A replay of the conference call will be available two hours after the call-s completion and will expire by 11:59 pm EST on July 3rd, 2013. You may listen to the recording by calling toll-free (800) 408-3053 or (905) 694-9451. The password for the replay is 4507076.
About Cortex Business Solutions
Cortex Business Solutions Inc. is a leading eCommerce service company that improves efficiencies, reduces costs and streamlines procurement and supply chain processes for its customers. Accessing the Cortex Network enhances the exchange of business critical documents, such as purchase orders, receipts and invoices resulting in improved cash flow management and business controls, while reducing day-s outstanding and administrative costs. Cortex is a low cost, low risk solution that can be implemented quickly by leveraging its customers- existing business environment – evolving business. For more information please visit our website at .
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release.
Forward-Looking Statements
Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed under the heading “Risk Factors” and elsewhere in the Company-s periodic filings with Canadian securities regulators. Such information contained herein represents management-s best judgment as of the date hereof based on information currently available. The Company does not assume the obligation to update any forward-looking statement.
Contacts:
Brisco Capital Partners
Scott Koyich
(403) 215-5979
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