Mr. Emad Rizkalla reports

BLUEDROP RELEASES Q3 2016 FINANCIAL RESULTS

Bluedrop Performance Learning Inc. has released its financial results for the three months ended June 30, 2016.

Revenue for the three months ended June 30, 2016, was $5.9-million, up from $5.4-million, an increase of 10 per cent on the same period in the previous year. Gross profit for the period was $2.6-million, an increase of $400,000 over the three-month period ended June 30, 2015. Pretax income was $400,000 for the three-month period compared with a loss of $400,000 in the same period in the previous year. After-tax income for the period was $200,000 compared with after-tax loss of $400,000 for the same period in the previous year.

Revenues increased in both business units versus last year, with the largest percentage increase in the learning networks business unit at a year-over-year increase of 22 per cent and an 8-per-cent increase in year-over-year revenues for the training and simulation business. Consolidated gross margins remained strong in the quarter at $2.6-million or 45 per cent, up slightly from the previous year. Consolidated expenses for the quarter were down $500,000 from that of the same quarter in the previous year, notwithstanding that investment in research and development increased in the quarter this year. Net investment in research and development in the quarter this year was reduced as a result of strong offset financing recognized from various government and other financing programs.

Bluedrop continued its investment trend in its research and development efforts with over $1.0-million of investment in the quarter. The training and simulation business unit invested $700,000 in the quarter. This investment was expensed in the quarter but was offset by an equal amount from the company's fully financed deferred development Boeing contract and therefore had no effect on pretax income. The learning networks business unit invested $400,000 in the quarter for costs mostly associated with enhancements to the in-service Bluedrop 360 platform. This investment, net of related government assistance, was expensed in the quarter.

For further details, please see the financial statements, and management's discussion and analysis for the quarter ended June 30, 2016, which are available on the company's website or on SEDAR.

Commenting on the results and year-to-date progress of Bluedrop, founder and chief executive officer Emad Rizkalla said: "It was another strong quarter for Bluedrop financially and operationally. I was especially pleased to see the year-over-year revenue growth in the learning networks business unit. That unit is very busy with some large deliverables. While we had hoped to meet a few more revenue milestones in the quarter, I feel confident they will be achieved before year-end. The training and simulation group achieved a major milestone for the Boeing rear crew mission trainer in the quarter, and we remain excited about that program's potential. The demonstration unit is on schedule to be delivered to Boeing by end of calendar year. We saw some large contracts announced in the quarter, including a $13-million (U.S.) contract renewal with Sikorsky and excellent pipeline opportunities for both groups. We continued to pay down debt while still aggressively investing in our R&D. Over all we are very pleased with the quarter and the year-to-date results, and excited about our progress on our new product strategy. I am enormously proud of the Bluedrop team. Their passion and commitment to making a difference is the source of our success."

About Bluedrop

Bluedrop Performance Learning is transforming the workplace globally by designing, developing and delivering practical, actionable and affordable training content and delivery platforms that improve individual and overall performance of organizations.

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