Mr. Bruce Murray reports

WANTED TECHNOLOGIES REPORTS 39% INCREASE IN REVENUE TO $10.1 MILLION AND RECORD NET INCOME OF $2.6 MILLION ($0.109 PER SHARE) FOR THE YEAR ENDED JUNE 30TH, 2014

Wanted Technologies Corp. has released its financial results for the fiscal year ended June 30, 2014.

Highlights

• Revenues of $10,056,648, an increase of 39 per cent, or $2,825,429, compared with revenues of $7,231,219 for fiscal 2013. Excluding a significant non-recurring revenue of $976,988 derived from one agreement, revenues grew 26 per cent over the prior year;
• Record net income of $2,634,753 (10.9 cents per share) for fiscal 2014 compared with a net income of $1,362,555 (5.7 cents per share) for fiscal 2013, an increase of $1,272,198;
• Earnings before interest, taxes, depreciation and amortization of $3,659,329, or 36 per cent of revenues, compared with EBITDA of $1,816,907 in the prior year, an increase of $1,842,422;
• Growth of 24 per cent in the company's recurring revenue base in U.S. dollars to reach $7.7-million (U.S.) as of June 30, 2014, an increase of $1.5-million (U.S.) over the recurring revenue base of $6.2-million (U.S.) as at June 30, 2013 (excluding $1.0-million (U.S.) reported in prior year as recurring revenue from a reseller partnership terminated in June, 2014);
• Wanted announced during fiscal 2014 that it will be expanding its sales organization to focus on direct sales efforts in the market for big data analytics in the human capital management sector;
• The company, which sells its products through its direct sales force and through resellers, announced the termination of one of its reseller agreements, effective June 22, 2014. The reseller agreement represented revenues of $1,341,098 for fiscal 2014 and $419,812 for the most recent quarter;
• In October, 2014, the company deployed an international version of its product platform which includes data and analytics describing the talent marketplace in 20 additional countries. With the addition of these 20 countries, and including the current coverage of the United States and Canada, the company now offers human capital analytics for the 22 largest economies in the world.

Wanted Technologies had a 39-per-cent year-over-year increase in revenues and record net income of $2,634,753, or 10.9 cents per share, for fiscal 2014. The company's annualized recurring revenue base increased 24 per cent during fiscal 2014, reaching $7.7-million (U.S.) as of June 30, 2014. This compares with $6.2-million one year ago excluding $1.0-million (U.S.) reported as recurring revenue in prior year from a reseller partnership terminated in June, 2014.

For the fiscal year ended June 30, 2014, Wanted posted revenues of $10,056,648 compared with $7,231,219 for the fiscal year ended June 30, 2013, an increase of $2,825,429, or 39 per cent. The gain over the prior year mostly results from the company's product diversification and partnership strategy supported by the continued growth and improvement in economic conditions and from deriving during fiscal 2014 a significant non-recurring fee of $976,988 from licensing a component of its historical big data warehouse of more than one billion records. Revenue during fiscal 2014 also included an amount of $1,341,098, or 13 per cent of revenues, derived from a reseller agreement that was terminated on June 22, 2014.

"Our results from fiscal 2014 were the best in the history of the organization," said Bruce Murray, Wanted's president and chief executive officer. "Our strategy of diversifying our business and developing products for high-growth markets is responsible for these results."

During fiscal 2014, one significant big data licence agreement was responsible for non-recurring revenues of $976,988. This significant contract, which was signed during the second quarter, demonstrated how the company's proprietary analytical processes can convert a sizable data warehouse of information into compelling products. In this instance, the company licensed a portion of its database of more than one billion records to enable a financial services client to make more informed analytical decisions about small and medium-sized businesses.

Wanted has been collecting and storing this category of data since 2005. The company mines the historical data for trends and provides current data for real-time analysis.

"We have demonstrated the value of one or our key assets, which is an extremely large database of current and historical data on the employment marketplace," said Mr. Murray. "We build products based on this big data warehouse, which give our clients insights and actionable intelligence to operate their businesses more efficiently."

Excluding both the one-time non-recurring revenue of $976,988 from a specific contract associated with the financial sector and any revenue from the partnership that ended in June, 2014, total revenue grew 20 per cent during fiscal 2014 over the prior year.

Note also that after removing any revenue from the partnership that ended in June, 2014, revenues for fiscal 2014 derived from the combined corporate and staffing sectors increased 65 per cent during fiscal 2014 and represented 26 per cent of total revenues. These two sectors represented 21 per cent of total revenues in the prior year.

"Different clients use our data in diverse ways," Mr. Murray said. "We offer a flexible user interface and multiple delivery options, which give our users many alternatives for applying our data to their business requirements."

In addition to the gains in top-line revenues, the company continued to record strong gains in recurring revenues, EBITDA and net income.

As of June 30, 2014, contracts in hand represented approximately $7.7-million (U.S.) in annualized recurring revenues. This compares with contracts in hand totalling approximately $6.2-million (U.S.) as of June 30, 2013, when the company excludes revenues associated with the reseller partner terminated in June, 2014, representing an increase of 24 per cent. The annualized recurring revenue base represented $8.3-million, a 30-per-cent increase over prior year. At the end of fiscal 2014, 68 per cent of that recurring revenue base was supported by contracts from the staffing, corporate and government sectors. This compares with 63 per cent at the end of the previous fiscal year.

                            FINANCIAL HIGHLIGHTS
                                                     2014             2013

Revenues                                      $10,056,648      $ 7,231,219
Cost of sales                                    (573,057)        (492,262)
Gross margin                                    9,483,591        6,738,957
(Expenses)
Research and development                       (2,197,733)      (2,324,265)
Marketing and selling                          (2,310,490)      (1,952,469)
Administrative                                 (1,731,621)      (1,126,251)
Other financial (expenses)                        (23,775)         (18,345)
Other                                                (239)
                                               (6,263,858)      (5,421,330)
Operating income                                3,219,733        1,317,627
Finance income                                     33,466           96,046
Finance costs                                     (25,435)          (8,172)
Income before tax                               3,227,764        1,405,501
Current tax (expense)                            (349,495)        (121,222)
Deferred tax income                              (243,516)          78,276
Tax (expense)                                    (593,011)         (42,946)
Net income and comprehensive income             2,634,753        1,362,555
Net income per share
Basic                                               0.109            0.057
Diluted                                             0.106            0.057

Overall operating costs increased by $842,528, or 16 per cent, during fiscal 2014. Research and development costs, before recognition in the second quarter of fiscal 2014 of a non-recurring tax credit of $482,640, totalled $2,680,373, compared with $2,324,265 in the previous fiscal year, a net increase of $356,108, or 15 per cent, mostly resulting from increased staffing levels and computer infrastructure related to the company's product expansion to include data to be able to serve international markets. Marketing and selling expenses totalled $2,310,490, compared with $1,952,469 in the previous year, an increase of $358,021, or 18 per cent, due to variable compensation resulting from higher sales and consulting services related to targeted marketing initiatives. Administrative expenses showed an increase of $605,370, or 54 per cent, going from $1,126,251 in fiscal 2013 to $1,731,621 in fiscal 2014. This increase is mainly due to variable compensation following the solid financial performance of the company, to foreign exchange variations, as well as an increase in professional legal and fiscal fees.

EBITDA for the fiscal year ended June 30, 2014, represented $3,659,329, an increase of $1,842,422 over the EBITDA of $1,816,907 recorded in the prior fiscal year. As noted above, EBITDA was positively affected by a non-recurring tax credits amounting to $482,640 recorded in the second quarter of fiscal 2014 and non-recurring revenues totalling $976,988 derived from one specific contract executed with a client from the financial sector.

Net income for fiscal 2014 was $2,634,753, or 10.9 cents per share, an improvement of $1,272,198 over the net income of $1,362,555 recorded in fiscal 2013, or 5.7 cents per share. This improvement mostly results from an increase of 41 per cent, or $2,744,634, in gross margin partially offset by an increase of $842,528, or 16 per cent, in operating costs. Net income was also affected negatively by an increase of $550,065 in tax expense resulting from both an increased profitability and the fact that the company used during fiscal 2014 the remaining balance of the eligible research and development costs and tax losses available to reduce its income taxes in future years.

Summary of financial results for the fourth quarter of 2014

During the fourth quarter of fiscal 2014, Wanted's total revenue amounted to $2,708,721, an increase of 27 per cent over the $2,125,294 recorded for the corresponding quarter of the previous fiscal year. Note that revenues for the last quarter of fiscal 2014 included an amount of $419,812 from a reseller agreement that was terminated on June 22, 2014. Revenues from this reseller represented $235,724 for the corresponding quarter of prior year.

Net income for the fourth quarter of fiscal 2014 amounted to $383,140 (or 1.6 cents per share), compared with a net income of $541,333 (or 2.2 cents per share) for the corresponding quarter in 2013, a negative variation of $158,193 mostly resulting from investments in the company's direct sales force, an increase in cost of sales as well as an increase in variable compensation resulting from the solid performance of the company.

EBITDA for the fourth quarter of fiscal 2014 was $584,847, representing 22 per cent of revenues. EBITDA for the fourth quarter of fiscal 2013 was $635,558, representing 30 per cent of revenues.

Financial position

As at June 30, 2014, Wanted had $6,724,870 in cash and monetary investments, including $2,037,852 in redeemable term deposits. This compares with $3,101,798 in cash and monetary investments at the end of fiscal 2013, an increase of $3,623,072. This increase is the result of the strong profitability of the company during fiscal 2014, which, combined with favourable variations in working capital items, caused cash flows from operating activities to generate $3,835,496 in additional liquidities during fiscal 2014. This positive contribution was, however, partially offset by cash used for investing and financing activities of $165,253 and $47,171, respectively.

As at June 30, 2014, total assets amounted to $11,955,516 compared with $7,658,548 as at June 30, 2013, an increase of $4,296,968 mostly resulting from the increase in cash and monetary investments of $3,623,072. The increase in total assets also resulted from an increase of $514,848 in current and non-current tax credits receivable mostly due to the recognition in the second quarter of fiscal 2014 of a non-recurring tax credit of $482,640. Increases of $140,957 in trade and other receivables driven by higher sales, $147,357 in property, plant and equipment, and $33,814 in prepaid expenses also contributed to the increase in total assets. These increases were, however, partially offset by a decrease of $163,080 in intangible assets resulting from amortization.

Those interested will be able to access the information on the June 30, 2014, audited consolidated financial statements, the notes thereto, and the management's discussion and analysis via SEDAR and at the company's website as of Thursday, Oct. 23, 2014.