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QIS Update #11 - 2016 - Fairmont Resources private placement and Q1 results from Lingo Media and NTG Clarity Networks 2016 - May 31st 2016



Included in this update:

  • Fairmont Resources announces non-brokered private placement
  • Lingo Media reports first quarter 2016 results
  • NTG Clarity reports Q1 2016 financial results

 


 

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.



 

Fairmont Resources Inc. (FMR:TSX-V)
Website: www.fairmontresources.ca
Current Price: $0.075 (coverage commenced February 18/16 - $0.025)

 

Fairmont Resources Inc. has arranged a private placement of eight million units. Each unit consists of one common share and one-half of one share purchase warrant at a price of six cents per unit. Each full warrant will entitle the holder to purchase one share for a period of 12 months at an exercise price of 10 cents per share.


Fairmont may accelerate the warrant term for the outstanding but unexercised warrants such that the warrant term shall expire at 5 p.m. Pacific Time on the day that is 30 calendar days after the date that Fairmont first issues the acceleration notice. In order to exercise the acceleration rights, (i) the average closing price must have been equal to or greater than 20 cents (subject to adjustment for forward or reverse stock splits, recapitalizations, stock dividends, or other changes to Fairmont's corporate or capital structure) for 15 consecutive trading days prior to the date that Fairmont exercises the acceleration rights, and (ii) Fairmont must issue a news release announcing its intention to exercise the acceleration rights within 10 business days after the end of the particular 15-day period relied upon by Fairmont in (i).


A finder's fee will be payable on the private placement, subject to the policies of the TSX Venture Exchange.

Proceeds of the private placement financing will be used for exploration work on Fairmont's mineral properties, acquisitions and general working capital purposes.


QIS Capital: This financing is expected to close very quickly due to the discounted price and market demand. Anyone interested in participating should contact us as soon as possible at 250-377-1182 or by email at info@smallcaps.ca The financing is available to accredited investors.




 

Lingo Media Corporation (LM:TSX-V)
Website: www.lingomedia.com
Current Price: $0.70 (coverage commenced March 22/16 - $0.76)

 

Lingo Media Corporation, an EdTech company that is ‘Changing the way the world learns English’ through innovative online and print-based technologies and solutions, announces its financial results for the first quarter ended March 31, 2016.


“We are pleased to report our financial results for Q1 2016. Our revenue growth was in excess of 16% over Q1 2015, reflecting growth in both our digital learning market in Latin America and our publishing royalty business in China. While profitability was down from last year, it was due to a net foreign exchange loss of $125,586, resulting in total comprehensive income of $111,787 for the quarter vs. $146,598 last year. We look forward to providing shareholders with further updates as we continue to build the business with strategic distribution partnerships with Telefonica and Cengage Gale and execute on new market expansion opportunities in North America and beyond”, said Michael Kraft, President & CEO of Lingo Media.


Q1 2016 Operational Highlights


Online English Language Learning:


  • completed the development of ELL Studio, a speech recognition and practice pronunciation mobile app that enables learners to practice their spoken English skills anywhere, any time
  • expanded Latin America sales channel with the strategic hire of Luis Ortiz, who comes to the Company with more than 20 years of experience where he has been instrumental in delivering significant sales growth in Latin America
  • entered into a distribution partnership with Telefonica Educación Digital S.L.U, which has been granted the rights to market, sell and distribute ELL Technologies’ full product suite of English language training products in Peru
  •  

    Print-Based English Language Learning:


  • expanded the market for PEP Primary English and Starting Line textbook programs by launching into new Chinese provinces
  •  

    Corporate Highlight


  • subsequent to this quarter, loans payable of $580,000 were repaid in full and retired
  •  

     

    LATEST FINANCIAL RESULTS
      3 Months Ended Mar. 31
      2016 2015
    Revenues $756,858 $651,627
    Operating Expenses 262,922 319,463
    Foreign Exchange (gain) loss 186,544 (159,743)
    Total Expenses 706,028 426,198
    Net Income 111,788 146,598
          per share $0.00 $0.01

     

     

  • Revenue for the period ended March 31, 2016 totalled $756,858 as compared to $651,627 in 2015, a 16% increase.
  • Operating expenses for the period ended March 31, 2016 totalled $262,922 compared to $319,463 in 2015.
  • Net profit for the period ended March 31, 2016 was $50,830 or $0.00 per share (basic) based on 29.7 million shares as compared to 225,429 for 2015 or $0.01 per share (basic) on 22.1 million shares.
  • Income before amortization, share-based payments, depreciation, finance charges and taxes was $493,936 compared to $332,164 in 2015.

  •  

    The Company’s management team will host a conference call for investors on Tues May 31, 2016, at 11:30 a.m. Eastern Time, to provide a corporate update and to discuss its financial results.


    To listen to the live conference call, parties in Canada and the United States should dial 877-858-5743, access code 641103. International parties should call 858-609-8959 using access code 641103. The call will be recorded and available for review at www.lingomedia.com.


    Lingo Media will be hosting and moderating a Q&A period on the call. Participants will be able to enter a moderated queue to ask a question live on the call, or to submit a question via email. To submit one or more questions to the executive management team, please email your question to investors@lingomedia.com with the words "Investor Question for Conference Call" in the subject line. The Company’s management will endeavour to address as many questions as possible in the hour allocated to the call.


    View the company’s complete financial statements online at www.sedar.com.


    QIS Capital: Lingo Media management will be hosting a conference call very shortly at 11:30am EST. Investors are encouraged to participate where possible. Q1 is typically a much slower quarter due to a lack of educational budgets being allocated during the period. Q2/Q3 are typically much stronger as it corresponds with the school year and new budget allocations.




     

    NTG Clarity Networks Inc. (NCI:TSX-V)
    Website: www.ntgclarity.com
    Current Price: $0.105 (coverage commenced Feb. 4/10 - $0.045)

     

    NTG Clarity Networks Inc. is releasing its first quarter results for the period ended March 31, 2016.


    During the first quarter of 2016, NTG Clarity continued the trend of customer and geographical diversification. Along with this trend comes higher cost of sales, and selling and G&A (general and administrative) expenses, as the company incurred expenses for its new offices in Oman and Kuwait, as well as higher wages and salaries for key personnel, which are required for anticipated new revenues to be achieved over the remainder of 2016.


    During the first quarter of 2016, NTG Clarity generated revenues of $2,433,333, as compared with $5,002,161 in the same period last year (which was an exceptional, record quarter). Traditionally, first quarter revenue is weaker due to the timing of new budgets and projects. The first quarter of 2016 is in line with first quarters in previous years (first quarter of 2014, $2,933,749; first quarter of 2013, $1,486,872). The decrease in revenues was due to:


  • Foreign currency exchange, including the weakening of the Egyptian pound in relation to the Canadian dollar, and fluctuations in currencies in the period;
  • Longer lead time to close new projects as the uncertainty in the Middle East due to lower oil prices has delayed the awarding of new projects.

    However, with the recent stability in oil prices, the company expects the start of new projects in the next quarter. The increase in operating expenses was due to:

  • The costs of the company's new offices in Egypt, Kuwait and Oman;
  • The retention of highly skilled employees after the completion of projects, pending the start of new projects. It is important to note that these personnel are the company's main assets.


  • Revenue comprised 79 per cent professional services, 12 per cent product-related sales, 7 per cent for office equipment and services, and 2 per cent for field service work. As professional services carry a lower gross margin than product related sales, margins were lower in the first quarter, compared with the prior year, but showed improvement over fourth quarter 2015 margins. In the first quarter of 2016, the company's gross margin was 29 per cent, compared with 35 per cent in the first quarter of 2015. The higher cost of skilled personnel continues to affect the company's margins. The company is working to balance between growth and expenses to help generate increased margins.


     

    LATEST FINANCIAL RESULTS
      3 Months Ended Mar. 31
      2016 2015
    Revenues $2,433,333 $5,002,161
    Cost of Sales 1,737,332 3,247,342
    Gross Profit 696,001 1,754,820
    Operating Expenses 1,985,235 631,098
    Forex Loss 320,098 -
    Net Income (1,986,457) 722,489
          per share ($0.05) $0.02



    BALANCE SHEET
    (as at March 31, 2016)
    Current Assets $ 10,536,023
    Total Assets 15,913,025
    Current Liabilities 8,257,259
    Long-Term Debt nil
    Shareholders' Equity 7,655,766

     

     

    NTG Clarity continues to diversify its customer base and is starting to see revenue from these new customers. Growth from new customers is expected to show a dramatic improvement over the remainder of 2016, and should lead to continued revenue growth despite the slower start to this year. This is the base of the company's strategy going forward to achieve its targets by year-end.


    In an unrelated matter, 100,000 share options will be issued for Zafar Farooqui, a member of the board of directors for the company. Each option will be exercisable at a price of 10 cents per share and will be to replace expired options.


    View the company’s complete financial statements online at www.sedar.com.


    QIS Capital: It was another challenging quarter for NTG Clarity financially as costs continued to be elevated due to the opening of new offices and the increase to key personnel in anticipation of expanding revenues. New contracts are expected to be announced over the next few months with the bulk of new revenues to be recognized in the second half of 2016. Working capital was also impacted during Q1 and now stands at $2.3 million or $0.06 per share. NTG Clarity remained free of long-term debt.



     

    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 nil shares of Fairmont Resources Inc., 5,500 shares of Lingo Media Corporation, and 1,093,000 shares of NTG Clarity Networks 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 - 2016 QIS Capital Corporation.

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