WizCom Technologies Releases Q1 2009 Results

Corporate news announcement processed and transmitted by Hugin AS. The issuer is solely responsible for the content of this announcement. ---------------------------------------------------------------------- -------------- Rosh Ha'ayin, July 6th, 2009 - WizCom Technologies Ltd. ("WizCom") (Prime Standard: WZM, IL 0010830706), a leading global provider of handheld scanning and translation tools, announces its delayed results for the first quarter of 2009. Figures in this press release are according to US-GAAP and in US$ thousands. Financial Highlights Revenues for Q1 of 2009 dropped by 23% compared to Q1 2008, from US$2,226 to US$1,705. However, compared to Q4 of 2008, revenues increased by 26%. Gross profit margin for the first quarter came in at 38%, compared to 41% for the previous year. An operating loss of US$146 was posted as compared to a US$256 operating loss for Q1 2008. A net loss was posted of US$112, compared with last year's Q1 net loss of US$264. Basic and diluted net loss per common share was US$0.01, compared to US$0.02 for Q1 2008. As of 31 March 2009, the Company had cash and cash equivalents of US$240, as compared to US$194 thousand for 31 December 2008, representing a positive total cash-flow of US$46, while net cash used in operating activities was still negative with US$10. Operations Mr Shimon Amouyal, CEO for WizCom, stated, "First of all, we would like to apologize for the delay in posting our results, for which there were two main reasons. To begin with, in May there was a major change in Management with the appointment of both a new CEO and CFO. Secondly, new auditors were appointed. The people involved in producing the accounts obviously required time to get to grips with the ins and outs of the Company, which led to a delay in producing the figures." "As to our results, I can state that we are confident we will be able to build upon what the Company has achieved so far. The cost cutting plan, engaged upon under the reign of Mr Elad as CEO, has shown very clear results, with our bottom line improving significantly. We also posted a substantial revenue increase over the fourth quarter of 2008, which we believe is a sign of the validity of our strategy to develop new online distribution channels. We think that with these results, especially in these troubled times, we have shown our ability to implement a turn around. We are not there yet, but the first positive results are in." During Q1 2009 the Company managed to reduce operating costs by 42% compared to the previous year's period. The main reason for this development was the reduction in wages from US$1,344 in Q1 2008 to US$ 971 for the first three months of 2009. WizCom has continued its cost cutting plan into Q2 2009, with further decreases in expenses coming from items such as the change of the company's headquarters, with reduced space and lease costs. In addition, WizCom benefited from a stronger US-Dollar vs. NIS, which resulted in a positive effect on the net income by US$109. Outlook Although it is too early to come with quantitative statements as to the outlook for the coming financial year, Management believes that the results achieved in today's market place allow the Company to feel confident about its ability to further improve the bottom line. Ms Kochava Shmaryahu, CFO for WizCom, stated: "We have high hopes of becoming cash flow positive this coming year and approach breakeven or even achieve profitability. The organization is now in a much better place than it was 18 months ago and we look forward to capitalize on the opportunities that WizCom's technology and its position in the market for translation tools are offering. However, Management is continuously evaluating further options to improve the Company's costs structures." In Q1 2009 the Company has taken measures to develop new channels for the sales of its products, such as selling products via the Company's own website. The initial success has encouraged Management further to develop the e-commerce strategy and tools. Moreover, WizCom is undertaking efforts to build up a world wide sales team. So far, new sales managers for Turkey, Latin America and Israel have been recruited. Last but not least, a loyalty program will be launched aimed at resellers in order to incentivize distribution partners. On the cost side, a further efficiency improvement in the production process is on top of the agenda. The above mentioned activities have started to sort effect, which has resulted in an increase in liquidity. 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. WizCom Technologies Inc, Boston, US-based entity, responsible for WizCom Group operations in the Americas. 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 Phone +972-3-9103330 shimona@wizcomtech.com http://www.wizcomtech.com SCHWARZ Financial Communication Frank Schwarz Investor Relations Germany Phone +49-611-1745-398-11 Schwarz@schwarzfinancial.com --- 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 Berlin, Freiverkehr in Börse Düsseldorf, Freiverkehr in Hanseatische Wertpapierbörse zu Hamburg, Freiverkehr in Niedersächsische Börse zu Hannover, Freiverkehr in Bayerische Börse München, Freiverkehr in Börse Stuttgart, Prime Standard in Frankfurter Wertpapierbörse, Regulierter Markt in Frankfurter Wertpapierbörse;