PhotoChannel Releases Year End, Audited Financials
Record Revenues increase 177% from previous year.
VANCOUVER, BC – January 31, 2005 – PhotoChannel Networks Inc. (TSX-V:
PNI and OTCBB:
PHCHF) (“PhotoChannel” or the “Company”) the leading innovator of online digital media solutions for retailers, reports its financial results for the one year period ending September 30, 2005. The following discussion is qualified in its entirety by reference to the company’s audited financial statements and accompanying management discussion and analysis for the years ended September 30, 2005 and 2004, accessible on SEDAR at www.sedar.com or at www.photochannel.com.
During the year, the Company saw its large retail partners continue an aggressive marketing campaign of their online services. The Company believes this will continue during 2006 as they attempt to maintain and increase their market share. The Canadian marketplace, where PhotoChannel provides the dominant online solution for photofinishers, continues to accelerate rapidly as customers utilize all the services and capabilities PhotoChannel offers. The unique features of the new PNI Digital Media Platform, such as the up-sell to higher margin items, is providing retailers with opportunities to expand their service capabilities to their consumers.
In the last year PhotoChannel has increased the focus of its sales efforts in the US and International markets by aggressively targeting large retailers and introducing to the industry the value of the new PNI Digital Media Platform. We believe that this new strategy will prove successful in the upcoming months.
“PhotoChannel is pleased to report the strongest year in its history, as we continue to experience triple digit revenue growth year over year” states Peter Fitzgerald, Chairman and CEO of PhotoChannel. “During the year the Company invested heavily in both time and money in developing the new PNI Digital Media Platform, which allows us to deliver the best in class site experience for our retailers and their customers. With this new Platform we can compete with anyone in the world and it has already opened the door to several major US retailers. Adding just one of these retailers would drastically change the company’s dynamics.”
2005 Fiscal Highlights
- Record revenues for a fiscal year of $2.1 million, up 177% from $763,000 in fiscal 2004.
- Gross margins continue to improve, approaching 60%. Invested over $1.6 million in Research and Development.
- Completed the architecture, development and deployment of a new world class service, PNI Digital Media Platform. The scalability of this Platform enables the Company to process and deliver orders related to its anticipated growth and beyond in an efficient and cost effective manner.
The Company’s largest retailers are now connected for direct-to-store one-hour printing. The Company’s data shows that when in-store labs are connected directly, store volumes have experienced triple digit growth and in some cases have increased by as much as 400%.
About PhotoChannel
Founded in 1995, PhotoChannel operates PNI Digital Media to provide services for major retailers, wireless carriers and content providers. The PNI Digital Media Platform connects consumer ordered digital content with retailers that have on demand manufacturing capabilities for the production of merchandise. Currently PNI Digital Media generates transactions for some of the world’s largest photo retailers with their thousands of locations and millions of customers For more information please visit
www.pnidigitalmedia.com.
WARNING: The TSX Venture Exchange has neither approved nor disapproved the information contained in this release. PhotoChannel relies upon litigation protection for "forward-looking" statements.CaveatThe statements that are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties. PhotoChannel’s actual results could differ materially for those expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, changes in technology, employee retention, inability to deliver on contracts, failure of customers to continue marketing the online solution, competition, general economic conditions, foreign exchange and other risks detailed in the Company’s annual report and other filings. Additional information related to the Company can be found on SEDAR at www.sedar.com.
For Financial Information, Contact:
Robert Chisholm,CFO
(604) 893-8955 ext. 224
rchisholm@photochannel.com
Investor Information:
(866) 345-0115
For Media Inquiries, Contact:
Niti Maini, Public Relations
(604) 893-8955 ext. 313
nmaini@photochannel.com
