Toronto, ON / TNW-Accesswire / August 18, 2021 / NTG Clarity Networks Inc. (TSX.V:NCI), announces its second quarter results for the period ended June 30, 2021 (all figures in Canadian Dollars).

 

We have continued our road back to profitability with the fourth straight quarter of positive results. This quarter’s net income was $459,813, making the total for the four consecutive positive quarters of $1,229,374. Our gross margin for this quarter was 40% and the income from operations was $689,818.

The COVID-19 pandemic continues to present a significant source of economic uncertainty however despite restrictions on travel, market/trade shows and client/potential client visits, our collections have remained current and we have no bad debt recorded in Q2 2021. Our outsourced resources and project-focused staff are continuing to work remotely as much as possible. Office staff in Egypt is rotating between working from the office and working remotely.

In April, we announced the receipt of a Contract Purchase Agreement with a major financial institution in the Middle East to provide onshore and offshore professional resources. The estimated annual revenue would reach $3.6 million. This is an extension of existing work/resources and will add extra resources.

 

In May, we announced the receipt of multiple purchase orders for a total estimated amount of $900K in contract value to provide IT, telecom and professional resources.

 

In June, we introduced our NTGapps Digital Toolbox, which is built on the NTG Smart2Go platform. This cloud-based suite of digital tools helps Telecom Operators perform their jobs in a simple, efficient manner. The orders received as of this date are valued at approximately $1.1 Million. For more information, please visit www.ntgapps.com.

 

Consolidated revenue for the three and six months ended June 30, 2020 was $2,621,252 and $4,919,559 compared to $1,651,209 and $4,125,975 for the same periods in 2020 and is made up of product-related revenue and professional services.

 

Gross margin for Q2 2021 was $1,038,059 compared to $627,252 for Q2 2020. Percentages were (40% compared to 38% for Q2 2020). For the six months ended June 30, 2020 the gross margin was $2,124,773 or 43%, compared to $1,514,660 or 37% for the same period in 2020.

 

Selling and marketing expenses for the three and six months ended June 30, 2021 were $136,343 and $354,463 respectively compared to $193,961 and $467,250 in the previous year. This 30% decrease in the selling and marketing in the quarter (24% year to date) was the direct result of restrictions on travel, trade shows and customer visits required by COVID-19.

 

G&A expenses for the three and six months ended June 30, 2021 were $293,464 and $713,545 respectively compared to $1,191,283 and $1,788,003 in the previous year. G&A costs have decreased significantly in this period due to:

• one time End of Service (severance) accruals added in Q2 2020 ($512,626) was not present in Q2 2021. Only adjustments were added in Q2 2021.
• qualified resources previously on the bench due to COVID-19 are now billable.
• lower insurance costs in KSA due to a change in insurance carrier.

Working capital as at June 30, 2021 was a deficit of $5,751,702 compared to a deficit of $6,336,678 at December 31, 2020.

Income statement highlights for the three and six months ended June 30, 2021 and 2020

 

	3 Months Ended				6 Months Ended
	June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020
REVENUE	$	2,621,252	$	1,651,209	$	4,919,559	$	4,125,975
COST OF SALES		1,583,194		1,023,957		2,794,786		2,611,315
GROSS PROFIT	$	1,038,059	$	627,252	$	2,124,773	$	1,514,660
Expenses		674,520		1,747,782		1,426,666		2,688,882
Foreign exchange loss (gain)		(81,566)		(121,668)		(77,942)		223,162
Net Income before taxes		445,104		(998,862)		776,049		(1,397,384)
Other - Exchange (loss) gain on translation		14,709		(20,853)		(66,510)		(221,068)
Net Income after taxes	$	459,813	$	(1,019,715)	$	709,539	$	(1,618,452)
Per Share	$	0.004	$	(0.01)	$	0.01	$	(0.02)

 

 

Balance Sheet Highlights for the six months ended June 30, 2021 and December 31, 2020

 

	June 30, 2021			December 31, 2020
Current Assets	$	2,724,949		$	2,154,910
Current Liabilities	$	8,476,651		$	8,491,588
Long-Term Debt	$	7,316,794		$	7,217,784
Shareholder’s Equity	$	(11,383,802)		$	(12,536,069)

 

Outlook

In 2021, we continue our road back to profitability with the fourth straight quarter of positive results. Though we anticipate the COVID-19 pandemic will continue to have an impact on our customers and operating activities, we are working to adjust to changing circumstances.

 

Providing the offshoring and outsourcing of our technical, IT and professional services resources has proven to be a successful strategy as working remotely has become increasing popular. This has helped us grow and expand our business into new verticals that include government and financial sectors. We are looking forward to more contracts such as those announced in Q1 and Q2 2021.

 

The NTG roadmap for the foreseeable future is to introduce 4 new tools every month to the NTGapps Digital Toolbox. This new concept will allow the Telecom Operators to have immediate access to the digital tools that meet their needs. NTGapps are easily integrated into the operators’ existing systems with very little effort. For more information, visit www.ntgapps.com.

 

 

In an unrelated matter, the Company announced that share options will be issued for each independent member of the Board of Directors for the Company; Saleem Siddiqi will receive 250,000 share options; and Zeeshan Hasnain will receive 250,000 share options. Each option will be exercisable at a price of $0.05 per share and will vest immediately.

 

 

About NTG Clarity Networks Inc.

NTG Clarity Networks’ vision is to be a global leader in providing networking solutions. As a Canadian company established in 1992, NTG Clarity has delivered networking, IT and network enabled application software solutions to network service providers and large enterprises. More than 275 network professionals provide design, engineering, implementation, software development and security expertise to the industry’s leading network service providers and enterprises.

 

Forward Looking Information

Certain statements in this release, other than statements of historical fact, are forward looking information that involves various risks and uncertainties. Such statements relating to, among other things, the prospects for the company to enhance operating results, are necessarily subject to risks and uncertainties, some of which are significant in scope and nature.

 

These uncertainties may cause actual results to differ from information contained herein. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward looking statements are based on the estimates and opinions of the management on the dates they are made and expressly qualified in their entirety by this notice. The Company assumes no obligation to update forward looking statements should circumstances or management's estimates or opinions change.

 

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

 

For Further Information:

Kristine Lewis, President, NTG Clarity Networks Inc.

Ph: 905-305-1325

Fax: 905-752-0469

Email:klewis@ntgclarity.com