Chalk Media Corp. announces first quarter 2006 financial results28 May 2006
Chalk Media Corp. ("Chalk") today announced its unaudited interim consolidated financial results for the three month period ended March 31, 2006.
First Quarter 2006 Highlights:
- Completed private placement for 18,105,000 units at US$0.20 per
unit for gross proceeds of $4,202,479
- Entered into strategic alliance with Intelligent Decisions Inc., a
leading provider of information technology solutions to the US
federal government, whereby Chalk will be the exclusive supplier
of eLearning content management system software and related
services to Intelligent Decisions' customers
- Entered into strategic alliance with Digital Media Broadcasting
Corporation ("DMBC"), a Virginia-based provider of niche digital
broadcasts over a dedicated 'Virtual Private Network', whereby
Chalk will become the exclusive provider of eLearning software,
services and content to DMBC's clients
- Signed new deals with 1-800-GOT-JUNK?, Avokia, Canadian Welding
Bureau, Fuji Photo Film Canada, Future Shop, Microsoft, Research
in Motion, Samsung of Canada, Shoppers Drug Mart, The Health
Initiative and Transit Television Network
- Achieved Certified Partner status in the Microsoft Partner
Program, with a recognized competency as an Independent Software
Vendor for chalkboard(TM) LCMS
Chalk earned revenues of $561,141 for the three months ended March 31, 2006, compared to $1,061,209 for the same period in 2005. The main reason for the decrease was that the first quarter of 2005 revenues included revenues from the second season of the Spy Academy TV program and the second season of the Dave Chalk Connected TV program.
Chalk has made the decision to move away from actively pursuing television program production to focus on its core eLearning business. While Chalk has made significant progress with its eLearning solutions to large governmental agencies and blue-chip companies in the US and it continues to sign new contracts with blue-chip companies in Canada, it is still in the transition stage and will take several quarters for these activities to be converted into revenue.
The net loss for the three month period ended March 31, 2006 was $1,680,709, or $0.04 per share, compared to a net loss of $546,842, or $0.02 per share, for the same period in 2005. In addition to the reduced revenues mentioned above, higher research and development costs for continued development of chalkboard(TM) LCMS, higher selling and marketing expenses due to greater sales activities and the costs associated with our US office all contributed to the higher net loss. Net loss figures include a non-cash stock- based compensation charge of $58,269 for the three months ended March 31, 2006, compared to $56,372 for the same period in 2005. Net of the stock-based compensation charge, the net loss for the three months ended March 31, 2006 was $1,622,440 compared to $490,470 for the same period in 2005.
"The selection of chalkboard(TM) Learning Content Management System by 1-800-GOT-JUNK? and Avokia were significant wins for us this quarter", said Stewart Walchli, President & CEO, Chalk, "These license deals for our eLearning software, in addition to contracts we continue to sign for our custom online training and rich media content, validate the quality and scalability of our eLearning solutions. We see a tremendous window of opportunity in the marketplace for our solutions and we are devoting great efforts to further developing our software, generating greater sales in Canada and the US, and creating an infrastructure to support rapid growth."
"Our financial results in the first quarter are in large part due to increased research and development costs to enhance our chalkboard(TM) LCMS, the costs of expansion and infrastructure for our new office in Virginia and costs associated with building our sales team and sales pipeline in Canada and the United States. While in the short term these do not improve our bottom line, these activities are necessary to position us for revenue growth and improvements to our profitability in future quarters."
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Selected Financial Data (in $'000's, except per share numbers):
Three Months ended
------------------
March 31,
---------
2006 2005
---- ----
Revenue $561 $1,061
Gross margin $30 $212
Operating income / (loss) ($1,631) ($534)
Net income / (loss) ($1,681) (547)
Earnings / (loss) per share ($0.04) ($0.02)
Chalk's unaudited consolidated financial statements for the three month period ended March 31, 2006, as well as its management discussion and analysis, can be read at www.sedar.com.
Disclaimer:
While the information contained herein is believed to be accurate and reliable, Chalk and its subsidiaries and / or affiliates, and their respective directors, officers, employees and shareholders make no representations or warranties, expressed or implied, as to the accuracy or completeness of such information, and Chalk expressly disclaims any and all liability that may be based on such information, or errors or omissions thereof.
The forward-looking statements contained herein (such as statements relating to the future anticipated direction of the media and high technology industries, plans for future expansion, revenue targets, various business development activities, planned capital expenditures, future funding sources, anticipated sales growth and potential contracts) involve important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may vary materially from those expressed in any forward-looking statements made by or on behalf of Chalk.
There can be no assurance that Chalk will achieve the results projected or implied by the forward-looking statements included herein. These risks and uncertainties include, but are not limited to, those relating to Chalk's ability to raise sufficient financing to fund its business plan, development and expansion activities, dependence on existing management, financial activities, domestic and global economic conditions, changes in federal or provincial income tax laws, and market competition factors.
The TSX Venture Exchange has not reviewed the contents of this release
and is not responsible for its accuracy.
About Chalk Media Corp.
Chalk (TSX-V: CKM) is a leading provider of interactive learning solutions and tools that help organizations communicate more effectively with their employees, business partners and consumers. The company's core focus is customized, results-driven eLearning solutions.
By combining in-house expertise in instructional design, content strategy, web development, quality assurance, Flash animation and video production, Chalk produces customized rich media content that focuses on the user experience. Chalk uses its proprietary software platform, chalkboard(TM) LCMS, to measure the effectiveness of their learning solutions and track ROI for their clients.
With a US office in Vienna, Virginia, and Canadian offices in Toronto, Ontario, Vancouver, British Columbia and Fredericton, New Brunswick, Chalk works with global blue-chip organizations such as AstraZeneca, Best Buy, Business Objects, Future Shop, Fujifilm, HSBC, Intrawest, Microsoft, RBC Financial, Research in Motion, Samsung, Scotiabank, Sony, TELUS Mobility, Terasen Gas and Verizon. For more information, please visit www.chalk.com.
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For further information: Chalk Media Corp., Kris Sutherland, Executive Vice President, Tel: (604) 453-4424, ksutherland@chalk.com
Source: newswire
All trademarks and copyrighted information contained herein are the property of their respective owners.
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