VANCOUVER, Sept. 14 /PRNewswire-FirstCall/ -- CounterPath
Solutions, Inc. (OTCBB: CTPS), a leading provider of VoIP (Voice
over IP) and Video over IP SIP softphones, today announced the
financial and operating results for its first quarter ended July
31, 2006. "We are pleased to report another quarter of continued
growth and record revenue," commented Mark Bruk, chairman and chief
executive officer. "Moreover, the quality of our customers
continues to be outstanding as evidenced by tier one customers
selecting our product for their softphone rollouts, and supporting
our continued investment in new SIP technologies." First quarter
highlights: - Record quarterly revenues for the quarter ended July
31, 2006 of $1,760,881, an increase of 113% over the $827,296
recorded for the quarter ended July 31, 2005, and a 20% increase
over the $1,467,850 in revenues recorded for the quarter ended
April 30, 2006. - Announcement of a per-subscriber softphone
licensing deal with BT Retail (a division of leading UK-based
British Telecommunications plc), which allows BT Retail's consumer
broadband customers to experience the benefits of a CounterPath
softphone with BT's new, enhanced VoIP service, including secure
Internet voice calling and video messaging. BT is one of the
world's leading providers of communications solutions and services
operating in 170 countries. For more information visit
http://www.bt.com/broadbandtalk. - Announcement of a collaborative
effort with Intel Corporation integrating CounterPath's eyeBeam(TM)
1.5 Video over IP SIP softphone with the Intel(R) 600SM PCI Phone
Adapter. The "phone-ready" PC's (personal computers) will enable
users to make calls utilizing standard phones, corded or cordless
with their VoIP service. For more information visit
http://www.intel.com/products/desktop/adapters/600sm/index.htm. -
Launching of X-Lite(TM) 3.0, our newest free SIP softphone building
on the success achieved by the previous version of X-Lite which was
launched in April 2003, and has since seen nearly two million
downloads and is used by the majority of companies looking to test,
build and deploy SIP-based solutions. X-Lite is also a favorite
among end users of Asterisk(R) (http://www.asterisk.org/),
recognized as the world's leading open-source IP-PBX. For more
information visit http://www.counterpath.com/xlite. Financial
Results - Unaudited (All amounts in U.S. dollars and in accordance
with U.S. GAAP unless otherwise specified) For the three months
ended July 31, 2006, we generated $1,760,881 in revenue compared to
$827,296 for the three months ended July 31, 2005. This represents
an increase of $933,585 or 113% from the same period last year. We
generated $1,409,719 in software revenue for the three months ended
July 31, 2006 compared to $710,678 for the three months ended July
31, 2005, representing an increase of $699,041 or 98% over the same
period last year. The increase in software revenue was attributable
to an increase in both the number of customers we sell to and the
revenue per customer. For the three months ended July 31, 2006, we
generated $351,162 in service revenue compared to $116,618 for the
three months ended July 31, 2005 representing an increase of
$234,544 or 201% over the same period last year. The significant
increase in service revenue reflects the increase in services we
provide primarily to our larger customers to enable them to deploy
our software. Our total number of customers that have deployed our
software increased by 22 over the quarter to 213 as at July 31,
2006. Total expenses for the three months ended July 31, 2006 were
$2,239,023 compared to $1,137,100 for the previous three months
ended July 31, 2005, representing and increase of 97% or
$1,101,923. Expenses for wages, commissions and benefits during the
quarter were $1,156,218 compared to $695,253 for the three months
ended July 31, 2005 reflecting the addition of engineering staff
required for research and development and the addition of sales and
marketing staff. Other expenses include a $266,429 non-cash expense
for stock-based compensation compared to $72,586 recorded in the
same quarter last year. During the quarter, we began expensing the
fair value of our employee stock options. The net loss for the
three months ended July 31, 2006 was $478,142 ($0.01 per share)
compared to $309,804 ($0.01 per share) recorded for the three
months ended July 31, 2005. As of July 31, 2006, we had $1,133,361
in cash and cash equivalents compared to $2,369,021 at April 30,
2006. Our working capital was $1,671,169 at July 31, 2006 compared
to $1,975,881 at April 30, 2006, representing a decrease of
$304,712 from the previous quarter. COUNTERPATH SOLUTIONS, INC.
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS (Stated in U.S.
dollars) (Unaudited) July 31, April 30, 2006 2006 ------------
------------ ASSETS Current Cash and cash equivalents $ 1,133,361 $
2,369,021 Accounts receivable 1,664,858 477,814 Prepaid expenses
and deposits 121,839 104,927 ------------ ------------ 2,920,058
2,951,762 Deposits 73,187 - Equipment 345,005 300,077 Other assets
9,351 8,165 ------------ ------------ $ 3,347,601 $ 3,260,004
------------ ------------ ------------ ------------ LIABILITIES
Current Accounts payable and accrued liabilities $ 984,777 $
754,589 Due to related parties 21,711 34,929 Unearned revenue
105,425 115,214 Customer deposits 51,995 138 Warranty payable
84,981 71,011 ------------ ------------ 1,248,889 975,881
Convertible debenture 1,904,684 1,887,582 ------------ ------------
3,153,573 2,863,463 ------------ ------------ STOCKHOLDERS' EQUITY
Common stock, $0.001 par value Authorized: 415,384,500 shares
Issued: 37,940,983 shares (April 30, 2006: 37,915,462) 37,941
37,915 Additional paid-in capital 3,026,851 2,750,494 Deficit
(2,795,731) (2,317,589) Accumulated other comprehensive loss
(75,033) (74,279) ------------ ------------ 194,028 396,541
------------ ------------ $ 3,347,601 $ 3,260,004 ------------
------------ ------------ ------------ CounterPath Solutions, Inc.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS (Stated in
U.S. dollars) (Unaudited) Three months ended July 31, July 31, 2006
2005 ------------ ------------ Revenues Software $ 1,409,719 $
710,678 Service 351,162 116,618 ------------ ------------ 1,760,881
827,296 ------------ ------------ Expenses Amortization 75,005
50,807 Bad debts 24,466 20,152 Computer expenses 23,636 1,259
Consulting fees 220,470 104,136 Foreign exchange loss 22,297 1,900
Interest on convertible debenture 42,102 - Licenses and permits
94,514 (30,000) Office and miscellaneous 31,921 20,935 Professional
fees 69,720 58,673 Public relations 44,576 17,529 Rent 61,333
40,557 Stock-based compensation 266,429 72,586 Telephone and
internet 23,897 16,716 Travel and promotion 68,469 59,885 Wages,
commissions and benefits 1,156,218 695,253 Warranty expense 13,970
6,118 Write-off of trademark - 594 ------------ ------------
2,239,023 1,137,100 ------------ ------------ Net loss for the
period (478,142) (309,804) Other comprehensive loss Foreign
currency translation adjustments (754) (1,735) ------------
------------ Comprehensive loss $ (478,896) $ (311,539)
------------ ------------ ------------ ------------ Basic and
diluted loss per share $ (0.01) $ (0.01) ------------ ------------
------------ ------------ Weighted average number of shares
outstanding 37,926,439 37,915,462 ------------ ------------
------------ ------------ The Company's Quarterly Report on Form
10-QSB for the quarter ended July 31, 2006 is available for viewing
at http://www.sec.gov/. About CounterPath CounterPath Solutions,
Inc., formerly Xten Networks, Inc., is a developer of
award-winning, carrier-grade VoIP and Video over IP SIP softphones
for telecom and Internet telephony service providers, cable
operators, IP-PBX manufacturers and infrastructure manufacturers.
CounterPath's SIP softphones and softphone SDKs (Software
Development Kits), which provide VoIP, Video over IP, IM (Instant
Messaging) and Presence functionality and can be preconfigured to
our customer's VoIP service, are predominantly licensed on a
per-seat or per-subscriber basis either co-branded or private
labeled. CounterPath's technology is deployed by over 210 customers
in more than 49 countries. Additional information about CounterPath
and CounterPath's products and services is available at
http://www.counterpath.com/. CONTACT: Leila Neale, +1-604-320-3344
x114, DATASOURCE: CounterPath Solutions, Inc. CONTACT: Leila Neale,
(604) 320-3344 x114,
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