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QIS Update #11 2013 - May 31st 2013



Included in this update:

  • NTG Clarity Networks announces strong first quarter financial results and another significant contract
  • Pennant Energy files third quarter financial statements

 


 

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Please feel free to email us anytime at info@smallcaps.ca or call us at (250) 377-1182. We look forward to your comments, questions, and feedback.




 

NTG Clarity Networks Inc. (NCI:TSX-V)
Website: www.ntgclarity.com
Current Price: $0.095 (coverage commenced Feb. 4/10 - $0.045)

 

NTG Clarity Networks Inc. has announced that the company received a Letter of Intent from a leading mobile operator in the Gulf region to provide resources to enhance some of their current systems. The contract value is approximately $4.2 Million. The expected duration of this project is 12 months.

 

We are very pleased with the award of this project as it reflects our customer's increasing satisfaction and confidence with our extensive expertise in telecom systems and operator requirements, said Ashraf Zaghloul, NTG Clarity's Chairman & CEO.

 

________________________________________

 

 

NTG Clarity Networks Inc. has reported its first quarter 2013 revenues of $1,486,872 as compared to $1,060,471 in the same period last year. This increase in revenue was mainly due to demand for our professional services and product licenses.

 

The company reported a net income for the three months ended March 31, 2013 of $202,064, compared to a net loss of ($59,430), for the comparable period last year. This is mainly due to the increased sales of product licenses which are market oriented and highly profitable.

 

As at March 31, 2013, NTG Clarity had positive working capital of $1,041,971 and long-term debt of only $62,240.



LATEST FINANCIAL RESULTS
  3 Months Ended Mar. 31
  2013 2012
Revenues $1,486,872 $1,060,471
Cost of Sales 787,325 651,081
Gross Margin 699,547 409,390
Selling and G&A Exp. 388,750 311,723
Forex Loss (gain) (30,140) 38,647
Deprec. & Amort. 87,274 58,782
Interest Expense 38,955 45,524
Net Income 202,064 (59,430)
      per share $0.007 ($0.002)



BALANCE SHEET
(as at March 31, 2013)
Current Assets $ 3,274,027
Total Assets 6,246,099
Current Liabilities 2,232,056
Long-Term Debt 73,887
Shareholders' Equity 3,940,156

 

In an unrelated matter, the company announced the following members of the Board of Directors will have share options issued to replace expired options; M. Zafar Farooqui; 100,000 options, Kristine Lewis; 340,000 options and Ashraf Zaghloul; 300,000 options. Additionally, Mr. Sinclair Stevens will have 100,000 options issued, Each option will be exercisable at a price of $0.10 per share and will vest upon issuance.

 

QIS Capital:

 

NTG Clarity has now had 4 good quarters in a row and has posted net income of over $1.0 million ($0.035 per share) during the last 12 months. In addition, the company has positive working capital of approximately $0.035 per share and minimal long-term debt. This is the second contract announcement for NTG Clarity since the end of the first quarter and increases the company’s order backlog for 2013 to over $6 million with room for more announcements in the next few months. If all of the contracts are completed on schedule, this should be a record year for the company in both revenues and earnings. NTG Clarity has seen a sharp increase in liquidity and share price over the past week but is still trading at less than 3 times trailing earnings and at less than 2 times earnings net of working capital.




 

Pennant Energy Inc. (PEN:TSX-V)
Website: www.pennantenergy.com
Current Price: $0.015 (coverage commenced Dec 7/12 - $0.075)

 

Pennant Energy Inc. has announced its financial and operating results for the three and nine months ended March 31, 2013.

 

During the nine month period ended March 31, 2013, the company recognized a total of $660,668 (2012 - $431,102) in petroleum and natural gas revenues from its Bigstone, Badger, Ferrier and Watts properties. Production expenses of $381,236 (2012 - $197,550) and royalties of $50,285 (2012 - $55,323) are attributed to the producing wells. During the current period the company recovered $31,470 representing a portion of the 2008 to 2012 Badger, Ferrier and Watts property royalties paid to Alberta Energy.

 

To date, Pennant Energy has not yet realized significant profit from operations and has relied on debt and equity financings and trade credit to fund the operations.



BALANCE SHEET
(as at Mar. 31, 2013)
Current Assets $ 488,487
Total Assets 6,440,306
Current Liabilities 23,299
Long-Term Debt nil
Shareholders' Equity 6,253,881



LATEST FINANCIAL RESULTS (in 000s)
  3 Mos. Ended Mar. 31 9 Mos. Ended Mar. 31
  2013 2012 2013 2012
Revenues $122 $136 $660 $431
Expenses 257 473 1,088 1,521
Gain on Prop. Sale - - 357 -
Cash Flow (80) (216) 178 (566)
      per share ($0.001) ($0.004) $0.003 ($0.011)
Net Loss (112) (875) (108) (2,121)
      per share ($0.002) ($0.018) ($0.002) ($0.043)

 

QIS Capital:

 

The period ended March 31, 2013 marked the first complete quarter of operating results under the new management team that took control of Pennant in late November 2012. One of the primary goals for the new management team was to control costs and make necessary cost cuts to ensure a future for the company. During Q3 this year, consulting fees were reduced to $700, down from almost $55,000 last year. Office and miscellaneous expenses dropped dramatically from $21,000 down to $2,000. Management fees decreased from $63,000 to $15,000 on a year over year basis. Rent was cut to $900 for the quarter from $3,500 in 2012 and travel was down to $700 from $20,500.

 

The new management team has been actively seeking new drilling or joint venture opportunities to get the company active again while avoiding dilutive financing during a period of tremendous challenges for small resource companies. Management remains committed to the ultimate success of the company and we expect to see some announcements in this regard this summer.

 


 

Disclaimer: This article is for informational purposes only. The information contained within this article should not be construed as offering investment advice. Those seeking direct investment advice should consult a qualified, registered, investment professional. BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. The company profiled assumes no liability for the information presented. This is not a direct or implied solicitation to buy or sell securities. Readers are advised to conduct their own due diligence prior to considering buying or selling any stock. The author(s) owns directly or indirectly 764,000 shares of NTG Clarity Networks Inc. and 215,000 shares of Pennant Energy Inc. QIS Capital may have a financial relationship with these companies and may trade in the stocks mentioned. No stock exchange has approved or disapproved of the information contained herein. Copyright © 2003 - 2013 QIS Capital Corporation.

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