Waterloo Tech Digest - May 5, 2009
Compiled and written by
Gary Will
gary@garywill.com
In this issue:
A D V E R T I S E M E N T S
EVERYBODY WANTS TO BE HEARD - and we want to listen.
Hagon Design is #1 at creating marketing communications that get heard. Our technology industry experience includes everything from start-ups to global brands. Let¹s get together for a coffee and chat. You tell us where you want to go, we listen, and we¹ll help pave the way to successful marketing. Give creative director, Ben Hagon a call at 519.500.7985 or email ben@hagondesign.com
BERESKIN & PARR LLP - INTELLECTUAL PROPERTY LAW
Bereskin & Parr is a leading Canadian intellectual property law firm on your doorstep. Our Waterloo region office brings a wealth of experience to serve the growing high technology and manufacturing communities in Canada's Technology Triangle and surrounding areas. Bereskin & Parr's practice encompasses all areas of intellectual property from patents to trade marks and related litigation. Please contact Tim Sinnott (tsinnott@bereskinparr.com) or Jason Hynes (jhynes@bereskinparr.com), at (519) 783-3210 for more information.
AERO CORPORATE BENEFITS - Your Employee Benefits Solutions Provider
Located in Waterloo, we've served the KW technology community for over 20 years, providing employee benefits solutions to companies large and small. Our mission is simple. Help our clients succeed by doing what we do best:
* Design and monitor programs that attract & retain the most qualified employees
* Contain costs of employee benefits, retirement plans, and HR support
* Provide employee-level support & advice to help you manage risk & compliance
Please contact Herb Goedecke at 519.489.2376 x11 or herbg@aero-corp.com for details.
GO BEYOND STAFFING
For over 30 years, Procom has been matching people with companies, for jobs that are a perfect fit - contract, full-time, or part-time. We partner with large and small companies across North America, including some of the world's best-known enterprises, to provide a range of services, training tools, and the ideal candidates to help them flourish. We've been named one of Canada's 50 Best Managed Companies and go beyond staffing to look strategically at the processes and people that will truly help a company succeed. Phone: 519.885.4331.
RISK FREE LEAD GENERATION
From sales opportunity development to increasing attendance for events, Virtual Causeway accelerates your sales process! With a focus on selling and marketing complex services and technology, we guarantee a consistent and reliable flow of quality leads - assuring that your pipeline is constantly full. Contact us today to learn how we can help connect you with your next customer. Call 519-886-1600 ext. 405 or email marketing@v-causeway.com for details.
////////////////////////////////////////////////////////////
[1]---------------------------------------------------------------
Sandvine shows it doesn't need Comcast for strong top line
April 9, 2009
Sandvine proved it could have an impressive top line even without significant revenue from Comcast in the quarter ended February 28 (Q1 09). It reported sales of $18.6 million in the period -- the same as the previous quarter and up 124% from a rough period last year when Comcast sales went south and nothing else stepped in to make up the difference.
Net loss was $4.8 million, which included a $2.4 million non-cash goodwill impairment charge. Excluding that charge, the operating loss of $2.6 million was just slightly more than the $2.5 million reported in the previous quarter.
The biggest difference between the two quarters was that Sandvine wasn't dependent on just a couple of customers for the bulk of its revenue, as had been the case in Q4 and in many of the company's previous periods. In this quarter, the largest three customers provided 45% of revenue, compared to Q4 when two customers -- including Comcast -- accounted for about three-quarters of sales. Q1 revenue from Comcast was down to $1.2 million, or 6.5% of sales.
There were other significant differences between this quarter and Q4, despite the similar top and not-quite-bottom lines. This time, DSL customers accounted for just 24% of sales ($4.4 million), down sharply from 41% ($7.7 million) in Q4. Direct sales were back up to nearly two-thirds of all revenue, after dropping to 54% in Q4.
Sandvine had $92.6 million in cash at the end of the quarter, essentially unchanged over the period. Operations provided $2.8 million in cash.
[2]---------------------------------------------------------------
Dalsa starts 2009 with slow sales and weak profits
April 30, 2009
Even without digital cinema to drag down its earnings, Dalsa had a disappointing quarter in the period ended March 31 (Q1 09). The company reported earnings of $1.3 million on sales of $37.9 million, but nearly all of the profits came from a gain on a sale of land. Operating income was just $698,000, down from $5.5 million in the previous quarter and $8.7 million a year ago.
Sales were down 18% from Q4 and 30% from last year. Weaker margins pushed the sequential decline in gross profit to 24%. The digital imaging and semiconductor businesses both reported significant year-over-year and quarter-over-quarter sales declines. One bright spot in the quarter was the $12.9 million increase in the order backlog for the semiconductor business.
Operations used $7.7 million in cash -- after contributing $6.5 million in Q4 and $6.7 million a year ago. Dalsa spent $301,000 in cash to repurchase shares in the company and distributed $921,000 in dividends. It ended the quarter with $11.5 million in cash. Dalsa added $8.5 million in long-term debt in the quarter.
[3]---------------------------------------------------------------
Open Text acquires Toronto's Vizible
April 8, 2009
Open Text has acquired Toronto's Vizible Corp., a developer of interactive, 3-D web interface technology. Financial details were not announced, but all indications are that the price tag was very low. Vizible had been working with AT&T on a Mozilla-based 3-D browser called Pogo, but the project never moved beyond a private beta stage and the company had a round of layoffs and cutbacks in the fall.
Vizible was founded by Anthony Gallo -- a UW architecture grad -- who is now VP of digital media experiences at Open Text. About 15 Vizible employees -- including some that had been laid off -- will join Open Text and work out of the company's Richmond Hill office. Vizible was privately held, but reported revenue of US$10 million in fiscal 2007.
The announcement from Open Text emphasized Vizible's strengths in rich-media widgets, multi-platform syndication, 3-D navigation, and user-customizable presentation of Web content. The company said it was unveiling a "breakthrough 3D interface" at the annual conference of the National Association of Broadcasters' NAB Show in Las Vegas.
[4]---------------------------------------------------------------
Arise hopes for solar rebound later in the year; delays CEO search
April 29, 2009
Arise has put off the search for a new CEO at least until later in the year, and will continue under hitherto-interim CEO Vern Heinrichs.
With the solar industry going through hard times, it was another rough quarter for Arise in the period ended March 31 (Q1 09). The company lost $14.8 million on sales of $7.2 million. Sales were down 62% from the previous quarter, which was itself a disappointment at the time.
The loss included a $2.9 million writedown of its inventory and a $6.0 million writedown of silicon wafer prepayments. Those were on top of the $9.0 million in writedowns in the previous quarter. Even without those charges, gross margins would still have been -19%, which was a step in the wrong direction from the -15% margins (also excluding the writedowns) in Q4. Arise's PV cell business, which accounted for 95% of sales in the quarter, recorded a $14.2 million operational loss, while the pre-revenue PV silicon business lost $1.5 million and the solar systems business lost $116,000.
Accumulated deficit now stands at $80.3 million.
Arise says the feedback it's receiving from customers is that demand for PV cells will pick up in the current quarter and even more so through the rest of the year.
The company ended the quarter with a working capital deficiency, but it believes it has enough cash on hand to fund operations until late this year. It says it is "in discussions on several options" to raise funds. It ended the period with $7.2 million in cash, down $15.4 million over the quarter. At April 28, it had $6.3 million in cash.
[5]---------------------------------------------------------------
RDM reduces losses on weaker sales
May 1, 2009
RDM lost $865,000 on sales of $5.8 million in the quarter ended March 31 (Q2 09). Sales were down 15% from a year ago and 18% from the previous quarter, although stronger margins reduced the sequential decline in gross profit to 13%. The net loss was an improvement from Q1, thanks to a smaller foreign exchange loss.
Average transaction volumes on RDM's ITMS system were up 9% from the previous quarter to 3.6 million items a week. End user locations for ITMS grew to 17,000 from 15,900 at the end of Q1. Overall, revenue from RDM's payment processing business declined 16% from Q1.
Scanner sales were weak in the quarter, with 4,200 units shipped -- down from 10,300 a year ago and 7,700 in the previous quarter. RDM's legacy quality assurance business was down to just $229,000 in sales in Q2, accounting for only 4% of revenue.
RDM had $16.9 million in cash at the end of the quarter. Operations provided $252,000 in cash and the company spent $173,000 repurchasing 254,000 RDM shares and an additional $458,000 on furniture and equipment.
[6]---------------------------------------------------------------
STOCK REPORT: Sandvine bounces back; great month for RIM stock
April 2009
Although Sandvine's quarterly results were nearly identical to what the company reported three months ago, there was a night-and-day difference in the reaction from investors. Where the results in April were met with indifference on the stock market, this time Sandvine shares had their best month ever, climbing 75% to their highest month-end price since June.
And RIM shares had their biggest month in eight years, adding more than $15 billion to the company's market value, while Com Dev shares finished April at their highest month-end price since October 2007.
For the month of April:
Sandvine [TSX: SVC] +75%
RIM [TSX: RIM] +51%
TurboSonic [OTCBB: TSTA] +46%
RDM [TSX: RC] +34%
Com Dev [TSX: CDV] +21%
ATS [TSX: ATA] +14%
Arise [TSX: APV] +14%
Dalsa [TSX: DSA] +9%
Descartes [TSX: DSG] +8%
--S&P TSX COMPOSITE INDEX +7%
--S&P TSX VENTURE INDEX +5%
MKS [TSX: MKX] +4%
Biorem [TSXV: BRM] 0%
===============================
Open Text [TSX: OTC] -10%
The gains in RDM shares all happened before the quarterly results were announced on May 1, and the stock hit $1 during the month for the first time since October. The company's market value has now climbed back above its cash holdings -- about $3 million above.
Dalsa shares gave back all their April gains in the first day of trading in May, after the company's quarterly results were announced.
Companies with core operations outside the area:
ON Semiconductor [Nasdaq: ONNN] +39%
Agfa-Gevaert [Brussels: AGFA] +35%
NCR [NYSE: NCR] +28%
Google [Nasdaq: GOOG] +14%
Sybase [NYSE: SY] +12%
McAfee [NYSE: MFE] +12%
Blue Coat [Nasdaq: BCSI] +10%
Ansys [Nasdaq: ANSS] +10%
Oracle [Nasdaq: ORCL] +7%
===================================
Acorn Energy [Nasdaq: ACFN] -2%
[7]---------------------------------------------------------------
Miscellaneous Tidbits
Gary Will
gary@garywill.com
In this issue:
- Sandvine shows it doesn't need Comcast for strong top line
- Dalsa starts 2009 with slow sales and weak profits
- Open Text acquires Toronto's Vizible
- Arise hopes for rebound later in the year; delays CEO search
- RDM reduces losses on weaker sales
- STOCK REPORT: Sandvine bounces back; great month for RIM stock
- Miscellaneous tidbits from LoyaltyMatch, Aeryon Labs, AideRSS, Tungle, ParkVu, RIM, Com Dev, Virtek, TurboSonic, Desire2Learn, Maplesoft
A D V E R T I S E M E N T S
EVERYBODY WANTS TO BE HEARD - and we want to listen.
Hagon Design is #1 at creating marketing communications that get heard. Our technology industry experience includes everything from start-ups to global brands. Let¹s get together for a coffee and chat. You tell us where you want to go, we listen, and we¹ll help pave the way to successful marketing. Give creative director, Ben Hagon a call at 519.500.7985 or email ben@hagondesign.com
BERESKIN & PARR LLP - INTELLECTUAL PROPERTY LAW
Bereskin & Parr is a leading Canadian intellectual property law firm on your doorstep. Our Waterloo region office brings a wealth of experience to serve the growing high technology and manufacturing communities in Canada's Technology Triangle and surrounding areas. Bereskin & Parr's practice encompasses all areas of intellectual property from patents to trade marks and related litigation. Please contact Tim Sinnott (tsinnott@bereskinparr.com) or Jason Hynes (jhynes@bereskinparr.com), at (519) 783-3210 for more information.
AERO CORPORATE BENEFITS - Your Employee Benefits Solutions Provider
Located in Waterloo, we've served the KW technology community for over 20 years, providing employee benefits solutions to companies large and small. Our mission is simple. Help our clients succeed by doing what we do best:
* Design and monitor programs that attract & retain the most qualified employees
* Contain costs of employee benefits, retirement plans, and HR support
* Provide employee-level support & advice to help you manage risk & compliance
Please contact Herb Goedecke at 519.489.2376 x11 or herbg@aero-corp.com for details.
GO BEYOND STAFFING
For over 30 years, Procom has been matching people with companies, for jobs that are a perfect fit - contract, full-time, or part-time. We partner with large and small companies across North America, including some of the world's best-known enterprises, to provide a range of services, training tools, and the ideal candidates to help them flourish. We've been named one of Canada's 50 Best Managed Companies and go beyond staffing to look strategically at the processes and people that will truly help a company succeed. Phone: 519.885.4331.
RISK FREE LEAD GENERATION
From sales opportunity development to increasing attendance for events, Virtual Causeway accelerates your sales process! With a focus on selling and marketing complex services and technology, we guarantee a consistent and reliable flow of quality leads - assuring that your pipeline is constantly full. Contact us today to learn how we can help connect you with your next customer. Call 519-886-1600 ext. 405 or email marketing@v-causeway.com for details.
////////////////////////////////////////////////////////////
[1]---------------------------------------------------------------
Sandvine shows it doesn't need Comcast for strong top line
April 9, 2009
Sandvine proved it could have an impressive top line even without significant revenue from Comcast in the quarter ended February 28 (Q1 09). It reported sales of $18.6 million in the period -- the same as the previous quarter and up 124% from a rough period last year when Comcast sales went south and nothing else stepped in to make up the difference.
Net loss was $4.8 million, which included a $2.4 million non-cash goodwill impairment charge. Excluding that charge, the operating loss of $2.6 million was just slightly more than the $2.5 million reported in the previous quarter.
The biggest difference between the two quarters was that Sandvine wasn't dependent on just a couple of customers for the bulk of its revenue, as had been the case in Q4 and in many of the company's previous periods. In this quarter, the largest three customers provided 45% of revenue, compared to Q4 when two customers -- including Comcast -- accounted for about three-quarters of sales. Q1 revenue from Comcast was down to $1.2 million, or 6.5% of sales.
There were other significant differences between this quarter and Q4, despite the similar top and not-quite-bottom lines. This time, DSL customers accounted for just 24% of sales ($4.4 million), down sharply from 41% ($7.7 million) in Q4. Direct sales were back up to nearly two-thirds of all revenue, after dropping to 54% in Q4.
Sandvine had $92.6 million in cash at the end of the quarter, essentially unchanged over the period. Operations provided $2.8 million in cash.
[2]---------------------------------------------------------------
Dalsa starts 2009 with slow sales and weak profits
April 30, 2009
Even without digital cinema to drag down its earnings, Dalsa had a disappointing quarter in the period ended March 31 (Q1 09). The company reported earnings of $1.3 million on sales of $37.9 million, but nearly all of the profits came from a gain on a sale of land. Operating income was just $698,000, down from $5.5 million in the previous quarter and $8.7 million a year ago.
Sales were down 18% from Q4 and 30% from last year. Weaker margins pushed the sequential decline in gross profit to 24%. The digital imaging and semiconductor businesses both reported significant year-over-year and quarter-over-quarter sales declines. One bright spot in the quarter was the $12.9 million increase in the order backlog for the semiconductor business.
Operations used $7.7 million in cash -- after contributing $6.5 million in Q4 and $6.7 million a year ago. Dalsa spent $301,000 in cash to repurchase shares in the company and distributed $921,000 in dividends. It ended the quarter with $11.5 million in cash. Dalsa added $8.5 million in long-term debt in the quarter.
[3]---------------------------------------------------------------
Open Text acquires Toronto's Vizible
April 8, 2009
Open Text has acquired Toronto's Vizible Corp., a developer of interactive, 3-D web interface technology. Financial details were not announced, but all indications are that the price tag was very low. Vizible had been working with AT&T on a Mozilla-based 3-D browser called Pogo, but the project never moved beyond a private beta stage and the company had a round of layoffs and cutbacks in the fall.
Vizible was founded by Anthony Gallo -- a UW architecture grad -- who is now VP of digital media experiences at Open Text. About 15 Vizible employees -- including some that had been laid off -- will join Open Text and work out of the company's Richmond Hill office. Vizible was privately held, but reported revenue of US$10 million in fiscal 2007.
The announcement from Open Text emphasized Vizible's strengths in rich-media widgets, multi-platform syndication, 3-D navigation, and user-customizable presentation of Web content. The company said it was unveiling a "breakthrough 3D interface" at the annual conference of the National Association of Broadcasters' NAB Show in Las Vegas.
[4]---------------------------------------------------------------
Arise hopes for solar rebound later in the year; delays CEO search
April 29, 2009
Arise has put off the search for a new CEO at least until later in the year, and will continue under hitherto-interim CEO Vern Heinrichs.
With the solar industry going through hard times, it was another rough quarter for Arise in the period ended March 31 (Q1 09). The company lost $14.8 million on sales of $7.2 million. Sales were down 62% from the previous quarter, which was itself a disappointment at the time.
The loss included a $2.9 million writedown of its inventory and a $6.0 million writedown of silicon wafer prepayments. Those were on top of the $9.0 million in writedowns in the previous quarter. Even without those charges, gross margins would still have been -19%, which was a step in the wrong direction from the -15% margins (also excluding the writedowns) in Q4. Arise's PV cell business, which accounted for 95% of sales in the quarter, recorded a $14.2 million operational loss, while the pre-revenue PV silicon business lost $1.5 million and the solar systems business lost $116,000.
Accumulated deficit now stands at $80.3 million.
Arise says the feedback it's receiving from customers is that demand for PV cells will pick up in the current quarter and even more so through the rest of the year.
The company ended the quarter with a working capital deficiency, but it believes it has enough cash on hand to fund operations until late this year. It says it is "in discussions on several options" to raise funds. It ended the period with $7.2 million in cash, down $15.4 million over the quarter. At April 28, it had $6.3 million in cash.
[5]---------------------------------------------------------------
RDM reduces losses on weaker sales
May 1, 2009
RDM lost $865,000 on sales of $5.8 million in the quarter ended March 31 (Q2 09). Sales were down 15% from a year ago and 18% from the previous quarter, although stronger margins reduced the sequential decline in gross profit to 13%. The net loss was an improvement from Q1, thanks to a smaller foreign exchange loss.
Average transaction volumes on RDM's ITMS system were up 9% from the previous quarter to 3.6 million items a week. End user locations for ITMS grew to 17,000 from 15,900 at the end of Q1. Overall, revenue from RDM's payment processing business declined 16% from Q1.
Scanner sales were weak in the quarter, with 4,200 units shipped -- down from 10,300 a year ago and 7,700 in the previous quarter. RDM's legacy quality assurance business was down to just $229,000 in sales in Q2, accounting for only 4% of revenue.
RDM had $16.9 million in cash at the end of the quarter. Operations provided $252,000 in cash and the company spent $173,000 repurchasing 254,000 RDM shares and an additional $458,000 on furniture and equipment.
[6]---------------------------------------------------------------
STOCK REPORT: Sandvine bounces back; great month for RIM stock
April 2009
Although Sandvine's quarterly results were nearly identical to what the company reported three months ago, there was a night-and-day difference in the reaction from investors. Where the results in April were met with indifference on the stock market, this time Sandvine shares had their best month ever, climbing 75% to their highest month-end price since June.
And RIM shares had their biggest month in eight years, adding more than $15 billion to the company's market value, while Com Dev shares finished April at their highest month-end price since October 2007.
For the month of April:
Sandvine [TSX: SVC] +75%
RIM [TSX: RIM] +51%
TurboSonic [OTCBB: TSTA] +46%
RDM [TSX: RC] +34%
Com Dev [TSX: CDV] +21%
ATS [TSX: ATA] +14%
Arise [TSX: APV] +14%
Dalsa [TSX: DSA] +9%
Descartes [TSX: DSG] +8%
--S&P TSX COMPOSITE INDEX +7%
--S&P TSX VENTURE INDEX +5%
MKS [TSX: MKX] +4%
Biorem [TSXV: BRM] 0%
===============================
Open Text [TSX: OTC] -10%
The gains in RDM shares all happened before the quarterly results were announced on May 1, and the stock hit $1 during the month for the first time since October. The company's market value has now climbed back above its cash holdings -- about $3 million above.
Dalsa shares gave back all their April gains in the first day of trading in May, after the company's quarterly results were announced.
Companies with core operations outside the area:
ON Semiconductor [Nasdaq: ONNN] +39%
Agfa-Gevaert [Brussels: AGFA] +35%
NCR [NYSE: NCR] +28%
Google [Nasdaq: GOOG] +14%
Sybase [NYSE: SY] +12%
McAfee [NYSE: MFE] +12%
Blue Coat [Nasdaq: BCSI] +10%
Ansys [Nasdaq: ANSS] +10%
Oracle [Nasdaq: ORCL] +7%
===================================
Acorn Energy [Nasdaq: ACFN] -2%
[7]---------------------------------------------------------------
Miscellaneous Tidbits
- LoyaltyMatch has launched its OnDemand software-as-a-service platform that lets users develop web-based customer loyalty programs. The news release included a quote from Sherry Colbourne, CEO of Ladybug Teknologies, sponsor of the not-for-profit SipSmart, which has a program that rewards designated drivers.
- Aeryon Labs -- developers of a flying vehicle that takes video and photographs for security and surveillance applications -- won the 2009 TiEQuest Business Venture Competition in Toronto on April 17. The prize money over the last couple of years has been $50,000 to the winner. KR Golf, which also has Waterloo connections, was another of the four finalists.
- AideRSS' PostRank statistics are now being used by AdAge as the largest component of its Power150 ranking of top marketing blogs. PostRank account for 50 points of the 150 that each blog can earn -- as much as Yahoo, Google, and Technorati combined.
- Tungle has formally launched what it calls the first calendar accelerator. The free software -- which has been in beta for several months -- makes it easy for users to share calendars and schedule meetings and works with a variety of calendar applications, including Outlook, Google Calendar, and iCal.
- ParkVu's i2b BlackBerry-iTunes software (see previous digest) has been accepted by RIM for the BlackBerry App World online store, and is now available there.
- RIM announced that its push API is out of beta and now available to developers of consumer apps who want to push content to BlackBerrys. Toronto's Polar Mobile (which has Waterloo ties) has been using the API in its software -- including apps it has written for The Hockey News and UW.
- Keith Ainsworth has stepped down as chairman of Com Dev, a position he held for six years. He will remain on the board. Terry Reidel, who's been on Com Dev's board for the last year and a half, has been named the company's new chairman.
- Virtek CFO Peter Monsberger is leaving the company this month. He's been with Virtek for the last seven years. Since its acquisition last year, Virtek continues to operate as a subsidiary of Gerber Technology. Hal Osthus -- a 25-year employee at Gerber -- is Virtek's president, while Waterloo-based Peter Richter oversees Virtek's imaging and templating business as VP. The company recently announced a five-year agreement to provide laser templating systems to Stork Fokker of The Netherlands and follow-on sales to Finland's Patria Aerostructures.
- TurboSonic received a US$2.3 million order from a European oil refinery, which will use TurboSonic technology to manage its particulate emissions.
- Desire2Learn was among the companies honored by the United States Distance Learning Association (USDLA) at that organization's annual conference in St. Louis.
- Maplesoft has released the newest version of Maple -- the mathematics software that led to the creation of the company in the 1980s. Along with Maple 13, the company also released a new version of its MapleSim modelling and simulation software.
posted by Gary Will at 1:12 AM
