Wizcom Technologies Releases 2009 Annual Results

WizCom Technologies Ltd. / Wizcom Technologies Releases 2009 Annual Results processed and transmitted by Hugin AS. The issuer is solely responsible for the content of this announcement. Rosh Ha'ayin, March 31, 2010 - Wizcom Technologies Ltd. ("Wizcom") (Prime Standard: WZM, IL 0010830706) today announces the financial results for the fiscal year 2009 according to US-GAAP. Key Financials * Revenues for the full year 2009 went down by 21.7% to US$ 5.60 million (2008: 7.15 million), in Q4 2009, revenue fell down by 17.6% to 1.12 million (1.36 million). * Gross margin for the full year 2009 was 28% compared to 38% in the previous year. * An operating loss was recorded for 2009 US$ 2.421 million versus an operating loss of 1.808 million for 2008.  For Q4, the operating loss was US$ 1.926 million versus a loss of US$ 1.004 for Q4 2008. * In 2009, the company wrote off inventory in the amount of US$ 292,000 basically consisting of raw materials. In addition, the Company has completed an impairment analysis related to the fully owned subsidiaries Ligature and Galil. As a result, the carried goodwill of US$ 733,000 for Ligature was completely written off. Another US$ 174,000 of goodwill was written off for Galil, totaling to a US$ 1.199 million of non-cash expenses. * Net loss for 2009 came in at US$ 2.505 million (2008: US$ -1.759 million), and a loss of US$ 1.988 for Q4 (-955 thousand). * Net loss per share for 2009 was US$ 0.21 (2008: 0.148), and US$ 0.167 in Q4 (2008 Q4: 0.081). * Cash and cash equivalents as of 31st December 2009 stood at US$ 677 thousand, compared to US$ 194 thousand for 31st December 2008. Summary of important events 2009 Mr Shimon Amouyal, CEO for Wizcom, stated, "Financial year 2009 saw a number of big challenges for the Company.  The appointment of a completely new management team, with myself as the new CEO, required a transition period before big decisions needed could be taken and implemented.  My number one responsibility was to stop the bleeding of Wizcom and put the Company on the road to recovery. The first step was a reassessment of the strategy that had been implemented by previous management. We found that the state of the Company required a thorough shakeup of strategy and policies, operational processes, business relationships, sales channels and sales model.  This process took time and had an impact on our results. Furthermore, we felt we had to make comprehensive changes in management that were finalized with the appointment of Mr Yaron Herz as the new CFO in February 2010. Mr. Herz was Controller at Eltek, an international publicly traded company. He has a CPA license and his experience includes working at Deloitte & Touche and Ernst & Young up to the position of Senior Control Coordinator. One of the major challenges we faced this year was a supply problem that could have caused serious liquidity issues. We managed to raise US$1.2 million through issuing convertible loan notes, which prevented these problems from occurring. At the same time, however, we realized we had to change supply arrangements in order to hedge against the risks of dependence on a single supplier. The supply problems we witnessed had a strong limiting effect on our ability to generate revenues, as can be seen from the fall in Q2 revenues when compared to Q1, as well as Q4 revenues when compared to Q3.  Part of our supply problems continued into the new year, but we believe these have now been solved through the appointment of the CAM Group as a new, non-exclusive supplier, as per Wizcom's strategy to reduce dependency on a single supplier As we recently announced, we are now in the process of ascertaining if we have cause to pursue legal action against our former supplier, Teliran, in relation to over-payments over the past five years.  As the total amount potentially is significant, we have decided to appoint external auditors to assist us in the process. On the strategic and operational side, we had a busy year with a number of positive developments. By focusing our resources on the three most important regions for us, Europe, the US and Asia, we are better able to support and drive sales in these areas. R&D concentrated on enhancing the genericity of the product family by reducing the variety of different platforms from 30 down to 4, which will result in a cut of COGS in the very near future. In the US subsidiary, Wizcom Inc, the entire sales model has been changed, which should lead to a breakthrough for this division. . An increased focus on our web presence, as well as a distributor model that welcomes rather than excludes competition, have resulted in an increase in order inflow. As explained, we have had problems converting orders into revenues due to supply issues, but going forward the positive results of our new strategy have put us on the way to recovery and profitability.  It is too early to make definitive statements on our expectations for the full year, but we do believe that we are on the right way and the signs are there, even though we have had to overcome serious challenges. Our balance sheet has been cleaned up, our cost base has been rationalized, we have cash in the bank and our order intake is improving all the time.  If the improvement in the general economy continues, we anticipate our performance to strengthen, both at the top and bottom line." The audited financial statements for fiscal year 2009 will be published at www. wizcomtech.com on April 1, 2010. About Wizcom Group: WizCom Technologies Ltd. is the world's leading producer of personal, portable scanning pens that help people read and process text. These pocket-sized, user-friendly devices enable people to understand and use printed material, anytime and anywhere, without disrupting their reading process. Our pens help students of English as a first or second language, as well as people working in multilingual environments, enhancing their fluency and expediting reading comprehension. Ligature Ltd. is a world leader developer of Optical Character Recognition (OCR) technologies and applications. The company offers innovative approach to OCR based solutions for specialized markets partnering with OEMs, VARs and system integrators incorporating CharacterEyes into software applications and hardware products. Galil Microwaves Israel (2003) Ltd. is a third party manufacturer and assembler of electronic modules for microelectronic and microwave components. For further information, please contact: WizCom Technologies Ltd. Shimon Amouyal, CEO 13 Hamelacha St. Rosh Ha'ayin, 48091, Israel Telefon +972-3-9103330 shimona@wizcomtech.com http://www.wizcomtech.com SCHWARZ Financial Communication Frank Schwarz Investor Relations Telefon +49-611-1745-398-11 Schwarz@schwarzfinancial.com [HUG#1400015] --- End of Message --- WizCom Technologies Ltd. 8B Hamarpe St. Jerusalem Israel WKN: 915856;ISIN: IL0010830706;Index:Prime All Share,TECH All Share; Listed: Freiverkehr in Börse Stuttgart, Freiverkehr in Börse Berlin, Freiverkehr in Börse Düsseldorf, Freiverkehr in Bayerische Börse München, Prime Standard in Frankfurter Wertpapierbörse, Regulierter Markt in Frankfurter Wertpapierbörse; Press Release as PDF: http://hugin.info/130210/R/1400015/355423.pdf