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LeoNovus Inc
Symbol LTV
Shares Issued 285,446,639
Close 2019-11-08 C$ 0.025
Recent Sedar Documents

LeoNovus loses $1.03-million (U.S.) in Q3

2019-11-08 20:05 ET - News Release

Mr. Michael Gaffney reports

LEONOVUS INC. ANNOUNCES Q3 2019 FINANCIAL RESULTS AND BUSINESS UPDATE

LeoNovus Inc. has released its operating and financial results for the quarter ended Sept. 30, 2019. Amounts are in U.S. dollars unless otherwise stated.

The company incurred a net loss of $1,038,000 in the third quarter of 2019 and a net loss of $3,955,000 for the nine months ended Sept. 30, 2019, compared with a net loss of $1,363,000 in the comparable quarter of 2018 and a net loss of $3,539,000 for the first nine months of 2018. Total operating expenses decreased to $1.01-million for the third quarter of 2019 compared with $1,557,000 in third quarter 2018. For the nine months ended Sept. 30, 2019, operating expenses decreased from $3,815,000 in 2018 to $3,363,000 in 2019.

The company had cash and cash equivalents of $1,177,000 as of Sept. 30, 2019, as compared with $3,646,000 on Dec. 31, 2018. Revenues from Smart Filer are expected to start in fourth quarter 2019. The financing of the Galaxa project is currently under review with no financing raised to date. The company continued its investment in sales, marketing, product development, and general and administrative, however, at a reduced rate beginning in the second quarter of 2019.

On Nov. 5, 2019, the company announced the official launch of the Smart Filer cold data management solution, combined with Wasabi hot cloud storage. Smart Filer addresses the greater-than-50-per-cent compounded unstructured data growth problem (Gartner, 2018) facing many IT (information technology) departments by taking current file server infrastructure and automatically extending it to lower-cost secondary or cloud storage.

Smart Filer is an information life cycle management (ILM) solution that analyzes existing file storage and extends its capacity automatically and transparently. According to customer-defined policies, infrequently accessed files are automatically removed from high-cost, high performance primary storage and placed in secondary or cloud storage, without any changes to how users and applications access them. When LeoNovus Vault is deployed with Smart Filer, customers not only have lower data storage costs but enhanced data security and durability.

On Aug. 13, 2019, LeoNovus launched the free data discovery tool. Customers can visualize their file storage profile and create reports that include the number of files and the amount of storage they consume according to file type and the date they were last accessed. Since the launch date, 65 companies have downloaded the data discovery tool, which provides a qualified sales funnel for Smart Filer.

The partnership with Wasabi is the first product iteration of LeoCloud, which is the internal name used by LeoNovus to aggregate several cloud data storage providers under one brand. LeoCloud is a precursor, or very basic facsimile, of the Galaxa project. LeoCloud has the potential to evolve and expand into the company's original vision of the Galaxa project. At this time, the company's primary focus is the launch of Smart Filer, LeoCloud, and leveraging the company's historical investment in the Vault technology.

"Successful beta trials of Smart Filer with two customers provided the development team with excellent product feedback and the sales team with reference accounts for new sales. We continue to build out sales channels and attended two managed service provider (MSP) events in October and connected with over 60 MSPs. Currently, we are working with a national telecom company, three major cloud providers and several MSPs to train them to sell Smart Filer. Regarding the BCIP project, the statement of work and testing agreements with the respective government of Canada (GoC) departments are now complete. We will start final contract negotiation in the first quarter of 2020 and expect BCIP revenues to begin in second quarter 2020. In addition to the BCIP program, which is LeoNovus Vault technology, we have now engaged with several departments regarding Smart Filer, which supports the GoC strategic initiative to leverage cloud storage resources. We expect a major GoC department as one of the early 2019 Smart Filer customers," said Michael Gaffney, chair and chief executive officer.

In fourth quarter 2018, the company announced the expectation of revenues in 2019 from a major Canadian bank for work on three projects. In first quarter, the company announced the cancellation of the first project and the delay of the remaining two projects until later in 2019. Given the turnover in staff at the bank, and internal technology changes, the company has no information that the remaining two projects will proceed and hence no expectations of purchase orders from the bank in 2019. The company is now in discussions with the bank regarding how it can use Smart Filer to address its on-premise storage growth by moving its cold data into the cloud. Its legacy Vault technology could also be part of the solution if the bank decides that it needs a secure multicloud storage solution.

About LeoNovus Inc.

LeoNovus is a software provider that offers storage solutions that untether your data, allowing you to embrace cloud storage securely, simply and cost-effectively while giving you the flexibility to deal with the ever evolving cloud storage landscape.

LeoNovus Smart Filer is an information life cycle management (ILM) solution that analyzes existing file storage and extends its capacity automatically and transparently.

Designed with the IT manager in mind, LeoNovus Vault uses patented algorithms to analyze, classify, encrypt, shred and spread data across a network of on-premise, hybrid or multicloud storage nodes -- allowing for the most secure yet internally accessible form of object-based data storage across the entire solution. The advanced geo-distributed architecture minimizes latency, optimizes geo-availability, reduces remote backup costs and meets data sovereignty requirements.

We seek Safe Harbor.

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