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Bluedrop Performance Learning Inc
Symbol BPL
Shares Issued 98,986,609
Close 2015-01-27 C$ 0.07
Market Cap C$ 6,929,063
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Bluedrop loses $3.91-million in fiscal 2014

2015-01-28 21:02 ET - News Release

Mr. Emad Rizkalla reports

BLUEDROP RELEASES YEAR-END FINANCIAL RESULTS

Bluedrop Performance Learning Inc. has released its audited consolidated financial results for the year ended Sept. 30, 2014 (including nine months of revenues of Atlantis Systems Corp. and associated acquisition related costs).

Revenues for the year ended Sept. 30, 2014, were $15,393,315, up from $11,527,765, an increase of 34 per cent. Gross profit for the year was $6,075,972, up from $5,391,955, an increase of 13 per cent. Pretax loss for the year was $4,406,985, including transaction and restructuring costs of $2,112,203, versus a pretax loss in the prior year of $2,300,416, an increase of $2,106,569. After-tax loss for the period was $3,919,982 as compared with a loss of $1,723,610 in the prior period. For further details, please see the financial statements and management's discussion and analysis for the year ended Sept. 30, 2014, which are available on the company's website or on SEDAR.

For the postacquisition nine-month period ended Sept. 30, 2014, consolidated revenues were $13,356,117, an increase of 48 per cent. Consolidated gross profit was $5,291,823 for the same period, an increase of 23 per cent.

The company acquired Atlantis on Dec. 31, 2013, by way of a plan of arrangement for cash consideration of $1-million and the assumption of $2.5-million in term debt. The company financed the cash component of the purchase price from the proceeds of a $3-million unsecured convertible debenture. The company also entered into a royalty agreement, raising an additional $1-million during the period to help finance working capital. The company paid down $1-million of the term debt from the Atlantis acquisition during the year, and subsequent to year-end, the company made an early payment, at a discount of $470,422, to pay out the remaining $1.5-million of debt and accrued interest.

The acquisition-related costs during the period totalled $2,112,203, including: legal fees, advisory services, restructuring costs and employee termination benefits associated with the acquisition. The company relocated the Atlantis and Bluedrop (defence and aerospace) staff to one location in Halifax, N.S., and closed its Brampton, Ottawa, Dartmouth and Fredericton offices. The company announced that the target cost reductions of $3.0-million annually expected from the integration of Atlantis were exceeded by year-end.

The company also announced the realignment of its two operating business units on Oct. 1, 2014, to focus on two areas: (i) the development and delivery of training programs, and simulation technologies for the defence and aerospace industry (including the acquisition and the related Bluedrop defence and aerospace business) and (ii) the development and delivery of its SaaS Bluedrop learning networks platform and programs for extended enterprise solutions that target work force development and channel/supplier training for corporate users (formerly called CoursePark). The new corporate entities are Bluedrop Training & Simulation Inc. and Bluedrop Learning Networks Inc., both wholly owned subsidiaries of Bluedrop. The restructuring has been undertaken for operating efficiencies and tax planning, as well as future corporate initiatives, and will not have any impact on the overall consolidated operations of Bluedrop or the rights or interests of shareholders.

Commenting on the overall results and progress for the year, founder and chief executive officer, Emad Rizkalla, said: "This was clearly a transformative year for Bluedrop and a challenging year for the whole management team. While many difficult business decisions had to be made and staffing levels had to be aligned with the combined businesses, we are very pleased with the end result. We maintained every major customer related to the Atlantis acquisition, exceeded our cost reduction targets and increased our business with many of the customers. At the same time, we made great strides in transforming the learning networks business to a recurring software as a service model. We expect that the financial results going forward will demonstrate these cost savings and synergies resulting from the Atlantis acquisition."

We seek Safe Harbor.

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