Bluemetric Environmental, Inc. (TSXV:SET)
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OTTAWA, May 10 /CNW/ --
OTTAWA, May 10 /CNW/ - Seprotech Systems Incorporated (TSXV: SET);
("Seprotech" or the "Company") announces the following unaudited
results for the fourth quarter of 2010 and audited results for the
fiscal year ended August 31, 2010.
Three Months Ended Year Ended
August 31 August 31
2010 2009 2010 2009
$000 $000 $000 $000
Revenue 1,440 1,849 5,190 7,399
Gross Margin 396 587 2,056 2,220
Net Loss (552) (2,473) (625) (3,110)
Loss per share (0.01) (0.07) (0.01) (0.07)
The fiscal year ended August 31, 2010 was again a very challenging year
for the Company, with the revenue contribution from the Company's core
wastewater treatment business unit remaining depressed. The decision to
sell back to the vendor the Envirosearch Operations Inc. business
further added to the challenges faced by management. Despite these
setbacks, operations benefited from the stability offered by the repair
contract for Department of National Defence reverse osmosis water
purification units, the contract continuing beyond fiscal year end and
ultimately being extended until April 2011.
As a result of the downturn in activities in both the mining sector
(remote operations) and the housing and municipal development sectors,
revenues for the year from sales of rotating biological contactors
("RBCs") fell from $7,399 in fiscal 2009 to $5,190, a 30% decline. In
response to the reduction in revenues, management imposed further cuts
to operating expenses and the resulting net loss for the year was
reduced from $3,110 for the year ended August 31, 2009 (which included
a one-time write-down of goodwill by $2,003) to $625 for the same
period in 2010. Comparative data has been changed to reflect
discontinued operations in 2009.
The delay in completing the fiscal 2010 audit resulted from management's
detection, subsequent to year-end, of an overstatement of revenue by a
material amount with respect to its financial statements for the
quarters ended November 30, 2009, February 28, 2010 and May 31, 2010.
The overstatement resulted from over-billing a customer over a period
of approximately 12 months from July 2009. The Company immediately
brought the billing discrepancy to the attention of its customer, and
subsequently determined that the over-billing amounted to $315,584
spread over the fiscal year ended August 31, 2010. As a consequence of
the over-billing, interim unaudited financial statements for the
periods ended November 30, 2009, February 28, 2010 and May 31, 2010
have been amended and restated, and filed on March 25, 2011. The impact
of the over-billing is fully reflected in the August 31, 2010 financial
statements, and did not impact any subsequent fiscal periods. The
amount of the over-billing has been repaid in full.
The delay in completing the fiscal 2010 audit, and consequent delay in
completing both its annual and first and second quarters' 2011 required
regulatory filings has led to the imposition on the Company of cease
trade orders from the Ontario, British Columbia and Manitoba securities
commissions (respectively, the "OSC", the "BCSC" and the "MSC"). The
BCSC's cease trade order will be automatically revoked upon completion
of the required regulatory filings, but the OSC and MSC cease trade
orders will only be revoked upon application by the Company. Seprotech
is targeting to complete its required regulatory filings (including
quarterly interim financial statements and related MD&A and officer
certifications for the first and second quarters of 2011) on or before
May 16, 2011, and at that time intends to make application to the OSC
for a full revocation of the cease trade order.
The Company has also been notified by the TSX Venture Exchange (the
"TSXV") that if it does not complete its reinstatement to trading on or
before May 25, 2011, the Company's securities will be transferred to
NEX at that time. The Company intends to make application to the TSXV
for reinstatement as soon as it is compliant with respect to its
required filings, as described above. The Company believes that, other
than the delayed filings described above, it otherwise meets the
continuous listing requirements of the TSXV.
Seprotech is a provider of pre-engineered water and wastewater treatment
solutions to the municipal/land development, resource sector and
military market place, including Reverse Osmosis water purification
systems, ROTORDISK® biological sewage treatment package plants and
CrystalBlue™ membrane-based water recycling systems.
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.
The TSX Venture Exchange has neither approved nor disapproved of the
information contained herein. Some of the statements in this press
release, including those relating to the Company's strategies and other
statements that are predictive in nature, that depend upon or refer to
future events or conditions, or that include words such as "expects",
"anticipates", "intends", "plans", "believes", "estimates" or similar
expressions, are forward-looking statements within the meaning of
securities laws. Forward-looking statements include, without
limitation, the information concerning possible or assumed future
results of operations of the Company. These statements are not
historical facts but instead represent only the Company's expectations,
estimates and projections regarding future events. The Company does not
undertake any obligation to update or release any revisions to these
forward-looking statements to reflect events or circumstances after the
date of this presentation or to reflect the occurrence of unanticipated
events, except as required by law.
To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/May2011/10/c3270.html
p Mr. Matthew Anderson, Investor Relationsbr/ Tel: (613) 523-1641br/ Fax: (613) 731-0851 /p