Governance, Risk & Compliance

Governance, Risk & Compliance

May 17, 2011

Ezenia! Inc. Reports 2011 Financial Results for First Quarter

Ezenia! Inc., a provider of real-time situation awareness, command and control solutions for corporate and government networks, has reported the financial results for its first quarter ended March 31, 2011.

The Company during the first quarter of 2011, reported revenue generation of close to $676,000, which is a 4% decline from $703,000 for the first quarter of 2010. The Gross margin saw a dip of close to 64.6% this quarter from the estimated 65.1% last year. The company’s estimated loss from operations was placed at $792,000 per share, as opposed to loss of $751,000 in quarterly losses from operations the previous year. Loss from operations, not including stock option expenses and depreciation, was estimated to be close to $702,000 compared to $587,000 in quarterly losses from operations in the last financial year

Estimated net quarterly loss came close to $784,000 compared to a net loss of $743,000 for the same period last year.

No major differences were reported in operating expenses, estimated to be close to $1.2 million, for the three months ended March 31, 2011 and the same period in 2010. Operating expenses, minus stock option expenses and depreciation, saw a raise of $1.14 million from the reported figure of $1.05 million for the same period in 2010.

At March 31, 2011, the Company’s cash and cash equivalents of close to $1.0 million as compared to cash and cash equivalents of around $1.8 million on December 31, 2010. Amid liquidity concerns and the current financial condition Ezenia! Inc., has implemented cost-cutting exercise such as reduction of the Company's workforce from 25 to 13 in March 2011. Other initiatives include reduction in general and administrative expenses. The Company will have to look for renewal of orders and the generation of new sales orders, as well as cash on hand, for funding operations for the next several months.

During the first quarter of 2011, existing customers renewed their licenses at an estimated 80% renewal rate. Deferred revenue has seen a steady increase to the current figure of $2.2 million as of March 31, 2011, compared to $500,000 from December 31, 2010 and $400,000 from March 31, 2010. The Company will continue to build upon its solution and support to the Air Force and the intelligence community, which presents a committed backlog pipeline of close to $430,000
Calvin Azuri is a contributing editor for TMCnet. To read more of Calvin’s articles, please visit his columnist page.

Edited by Chris DiMarco

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