VENDTEK SYSTEMS INC. VANCOUVER, BC - June 29, 2015 - VendTek Systems Inc. (VSI - TSX Venture) (the "Company"), a developer and licensor of software for the global prepaid telecom and financial services markets, today reported its financial results for its first quarter of fiscal 2015 ended April 30, 2015 ("Q2 2015").
Selected Financial Information- Revenue for the quarter ended April 30, 2015 decreased $287,727 to $264,934, or 52.1% from $552,661 in the prior fiscal quarter of Q2 2014;
- Operating expenses were $773,807 compared to $1,017,270 in the prior fiscal quarter.
- Adjusted EBITDA1 loss was $486,314 for Q2 2015 compared to a loss of $341,689 for the prior year;
- Net loss from continuing operations was $527,737 compared to $530,898 in the prior fiscal quarter;
- Cash used in operations was $563,244 for Q2 2015, compared to $1,995,823 cash used in operations in the prior fiscal year;
- Cash and cash equivalents was $117,923 at April 30, 2015 compared to $291,366 at October 31, 2014.
"Since the beginning of the current quarter, our Company has refocused its business to solely operate as a software provider, having eFreshTM as its core product. While this decision was inevitable due to the company's inability to raise sufficient funds in order to support the growth in its distribution network, it was also supported by our strong belief that our eFreshTM technology can, with the adequate sales team and structure, generate significant value to our shareholders" says Felipe Ayres, VendTek's Chief Executive Officer.
These consolidated financial statements have been prepared on the going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. For the quarter ended April 30, 2015 the Company has incurred a net loss from continuing operations of $527,737 and negative cash flows of $563,244 from operating activities. The Company also has a working capital deficiency of $3,389,252 and a shareholders' deficiency of $4,157,730 as at April 30, 2015. These conditions raise significant doubt about the ability of the Company to continue as a going concern without additional financing or renegotiate the terms of existing financing. In addition to the funds raised subsequent to quarter end, Management is pursuing several sources of additional financing (both debt and equity) and is of the opinion that sufficient working capital will be obtained from: external financing, renegotiation of existing financing; and improved operations to meet the Company's liabilities and commitments as they become due, although there is significant risk that this may not happen on a timely basis or on terms acceptable to the Company. These consolidated financial statements do not give effect to any adjustments which would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the accompanying consolidated financial statements. Subsequent to quarter end, on June 5, 2015, the Company closed its previously announced non- brokered private placement of 9,478,568 units of the Company (each a "Unit") at a price of $0.07 per Unit for gross proceeds of $663,499.76 (the "Offering"). Each Unit was comprised of one common share in the capital of the Company (each a "Common Share") and one warrant (each a "Warrant"). Each Warrant is exercisable to purchase one Common Share at a price of $0.25 (subject to adjustment) for a period of three years from the date of issuance. The net proceeds from the Offering will be used for general corporate purposes, including working capital. The Offering may be considered a related party transaction pursuant to applicable securities laws due to the fact that certain insiders of the Company will be participating in the Offering. VendTek's MD&A and complete financial statements and notes are available at www.sedar.com and the Company's website www.vendteksystems.com. For more information or to receive the complete statements please contact Samantha White at 604- 805-4653 or 1-800-806-4958 or investment@vendteksystems.com. For unaudited condensed consolidated statement of financial position click here. About VendTek VendTek develops and licenses automated transaction system software and supporting technologies. VendTek's customers and its subsidiaries use e-Fresh™ software to build electronic, prepaid services networks that enable consumers to purchase prepaid products and services via POS and self-serve terminals connected to a central server. This system creates significant value through improved efficiencies compared to a traditional distribution model. e-Fresh™ reduces shrinkage and inventory requirements for vendors while improving consumer access to prepaid products and services by completely eliminating physical cards and vouchers. VendTek has deployed its software around the world including Canada, United States, Asia, the Middle East and Africa. For further information please visit the Company's website www.vendteksystems.com Forward-looking Statements This press release contains statements which are not current statements or historical facts and are "forward-looking information" within the meaning of applicable Canadian securities laws. All statements, other than statements of historical fact, contained in this press release constitute forward-looking information. Examples of forward-looking information in this news release include, but are not limited to, statements with respect to the TSXV's approval of the Consolidation and the anticipated timing of the effective time of the Consolidation. Although the forward-looking information in this press release reflects the Company's current beliefs on the date of this press release based upon information currently available to management and based upon what management believes to be reasonable assumptions, the Company cannot be certain that actual results, performance, achievements, prospects and opportunities, either expressed or implied, will be consistent with such forward-looking information. By its very nature, forward-looking information necessarily involves significant known and unknown risks, assumptions, uncertainties and contingencies that may cause the Company's actual results, assumptions, performance, achievements, prospects and opportunities in future periods to differ materially from those expressed or implied by such forward-looking information. There may be other factors that cause results, assumptions, performance, achievements, prospects or opportunities in future periods not to be as anticipated, estimated or intended. Accordingly, all such factors should be considered carefully when making decisions with respect to the Company, and prospective investors should not place undue reliance on forward-looking information. The Company assumes no obligation to update or revise forward-looking information to reflect changes in assumptions, changes in circumstances or any other events affecting such forward-looking information, except as required by applicable law. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. For more information or to receive the complete statements please contact Samantha White at 604-805-4653 or 1-800-806-4958 or investment@vendteksystems.com.
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