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NTG Clarity Networks Announces Third Quarter 2019 Financial Results

Tickers: XTSX:NCI, PINX:NYWKF
Tags: #Telecommunications



Toronto, ON - TheNewswire - November 28, 2019 - NTG Clarity Networks Inc. (TSXV:NCI), a leader in the telecommunications OSS/BSS market, today reported revenues for the third quarter of 2019 (All amounts in Canadian dollars).

This quarter, management's efforts were focused on working with the Bank and attending to the cash flow shortfall, which significantly affected operations. A continued effort was made to avoid a negative outcome with regards to the credit facilities, which are secured by a General Security Agreement over the assets of the Corporation.

Despite management's efforts to avert Bank action, we received a formal demand on September 16, 2019 to fully retire our Bank indebtedness within 10 days. This was announced by the Corporation on September 17, 2019. The Corporation is currently continuing discussions with the Bank to try to resolve this issue.

Income statement highlights for the three and nine months ended September 30, 2019 and 2018

3 Months Ended

9 Months Ended

September 30, 2019

September 30, 2018

September 30, 2019

September 30, 2018

REVENUE

$

575,594

$

3,501,906

$

6,227,237

$

10,158,805

COST OF SALES

1,393,617

1,766,218

4,486,129

5,643,653

GROSS PROFIT

$

(818,024)

$

1,735,689

$

1,741,107

$

4,515,152

Expenses

2,007,932

1,435,622

4,499,320

4,114,721

Foreign exchange loss (gain)

33,913

229,727

212,887

47,936

Exchange loss (gain) on translation

(28,516)

63,785

(155,296)

169,090

Provision for bad debt

2,379,114

--

2,379,114

--

Total Net Income (Loss)

$

(5,210,467)

$

6,555

$

(5,194,917)

$

183,406

Per Share

$

(0.09)

$

0.00

$

(0.09)

$

0.00

Balance Sheet Highlights as at September 30, 2019 and December 31, 2018

September 30, 2019

Dec. 31, 2018

Current Assets

$

3,676,070

$

6,369,085

Current Liabilities

$

13,022,980

$

11,230,740

Long-Term Debt

$

--

$

--

Shareholder's Equity

$

(8,123,769)

$

(3,330,273)

The major factors contributing to the negative quarter include:

- Management attention was focused on the bank issue

- Severe cash flow made it very difficult to fund projects and current activities

- Large provision for bad debt

- Ending/cancellation of some projects

There is significant uncertainty as to whether we can continue as a going concern if we cannot secure additional funding.

Subsequent to quarter end, the following occurred:

- on October 7, 2019, the Corporation announced the resignation of its two independent Board members

- on October 8, 2019, IIROC (Investment Industry Regulatory Organization of Canada) halted trading for the Corporation citing the reason as "Pending Corporation Contact".

- on October 9, 2019, the Bank obtained a court order placing the Corporation under interim receivership. Management has been in discussions with the Bank with a view to avoiding full receivership of the Corporation.

Subsequent to period end, as of November 1, 2019, the Corporation did not renew its insurance with Euler Hermes Canada due to cash flow and the current situation with the Bank.

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 250 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

Copyright (c) 2019 TheNewswire - All rights reserved.

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