Creative Vistas > Investor Relations > Headlines >November 25, 2009

Press Release

Creative Vistas today reported its financial results for the third quarter and nine months ended September 30, 2009.

Revenues Reflect Continued Economic Weakness in North America

Revenues for the third quarter ended September 30, 2009 totaled $11.32 million, down 19% from $13.99 million in the third quarter of 2008. The decrease was due to lower sales at Dependable HomeTech (DHT), the larger of Creative Vistas’ two principal operating divisions, partially offset by increased revenues at the other principal operating unit, AC Technical Systems Ltd.

DHT, which delivers installation, repair and other services to broadband providers under the brand Dependable HomeTech, experienced a 25% year-over-year drop in revenues, to $8.89 million from $11.81 million. Most of the decrease was due to lower sales to DHT’s largest customer, which experienced a decline of 27%, to $5.37 million from $7.34 million a year earlier. DHT’s revenues from its U.S. customers decreased year-over-year by 24%, to $1.70 million from $2.24 million. The drop in revenues reflected the slowing economy and fluctuations in exchange rates.

Gross Margins Improve, Operating and Net Profit Return

Gross profit (after direct costs and project costs) for the third quarter of 2009 totaled $2.91 million, or 26% of revenues, up from $2.47 million, or 18% of revenues, in the third quarter of 2008. Creative Vistas said the improvement primarily reflects the higher set-up and training costs in 2008, when the Company was establishing its operations in the U.S.

The gross margin improvements and lower operating costs resulted in a year-over-year swing to operating profit. Income from operations in the third quarter of 2009 was $0.59 million, compared to an operating loss of ($1.45 million) a year earlier.

EBITDA (earnings before interest, taxes, depreciation and amortization) in the third quarter of 2009 totaled $1.32 million, compared to ($0.53 million) in the third quarter of 2008. EBITDA represents, for any relevant period, income (loss) before income taxes, depreciation of property, plant and equipment, interest expense (including amortization of debt issuance costs) and amortization of intangible assets. As in prior quarters, the Company’s net income and earnings per share (EPS) results for the third quarter of 2009 have been affected substantially by non-cash adjustments related to its capital structure. For that reason, the Company believes EBITDA provides a useful tool, in conjunction with GAAP reporting, for gauging the ongoing performance of its operating units.

Net income for the third quarter of 2009 was $0.72 million, or $0.02 per fully diluted share, compared to a net loss of ($3.33 million), or ($0.09) per fully diluted share, a year earlier. The net results for the third quarter of 2008 reflect a one-time loss of $0.83 million on the Company’s sale of its common stock in the broadband servicing firm 180 Connect Inc. Also, the foreign currency translation gain for the third quarter of 2009 was $0.76 million, compared to a foreign currency translation loss of ($0.38 million) for the comparable period of 2008.

On a sequential basis, the third quarter 2009 operating and net results show a return to profitability after an operating loss of ($0.57 million) and a net loss of ($0.43) in the second quarter ended June 30, 2009.

CEO Says High-Margin BI Software Initiative Is “Gaining Traction”

Commenting on the third quarter 2009 results, Creative Vistas Chief Executive Officer Dominic Burns said, “While we would have been happy to see a more robust economic environment for our business lines, our performance in the latest quarter shows some reason for optimism. Significantly, our cost-cutting efforts and the end of our launch phase in the U.S. placed us back in the black on both an operating and net basis. We also remain confident that our capital resources, including operating cash flows, will be sufficient to fund further operations and expansion. Finally, we are beginning to see the beginnings of licensing revenue for our OSS-IM View business intelligence (BI) software, which has proven its worth as part of our service to broadband providers and is now being offered as a stand-alone product to customers in a much broader range of industries. The BI product is clearly gaining traction with new and potential customers. It was not yet producing significant revenue in the third quarter of 2009, but we expect it to make a growing contribution both to overall sales and margins in 2010.”

Subsequent to the end of the third quarter, Creative Vistas noted in an October 20, 2009 release that one of its broadband-service customers, Rudder Capital Corp., reported a six-month cost saving of $175,000 from deployment of the OSS-IM View software. Rudder expected its full-year savings to reach $400,000. OSS-IM View is a next-generation business intelligence tool that provides automated intelligent decision-making for managing customer transactions, vehicles, technicians, supply chains, HR-related functions and other activities. It automates and reports on virtually every aspect throughout the supply/delivery chain.

If you would like to be added to Creative Vistas’ investor email lists or have additional questions, please contact Haris Tajyar with Investor Relations International at

For further information on Creative Vistas, please visit

About Creative Vistas

Creative Vistas Inc. is a leading provider of broadband-related services as well as security technologies and systems. Through its subsidiary, Dependable HomeTech, Creative Vistas provisions the deployment and servicing of broadband technologies to the commercial and residential market in Canada and the U.S. Through its subsidiaries AC Technical Systems Ltd. and Iview Digital Video Solutions Inc., it offers proprietary and non-proprietary technologies to the integrated electronic security and surveillance market. Its growing list of customers for broadband-related services include major cable-system operators in Ontario, Canada and U.S. metropolitan markets including New Orleans and Baton Rouge, La., Charlotte, N.C. Its security and surveillance systems are used by numerous high-profile clients including government, school boards, retail outlets, banks and hospitals. Creative Vistas is based in Ontario, Canada.

Forward-Looking Statements: Statements about the Company's future expectations, including future revenues and earnings, and all other statements in this press release other than historical facts are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as the term is defined in the Private Securities Litigation Reform Act of 1995. The Company's actual results could differ materially from expected results for reasons described from time to time in the Company's public filings. The Company undertakes no obligation to update forward-looking statements to reflect subsequently occurring events.

Creative Vistas, Inc.

Condensed Consolidated Balance Sheets


September 30, 2009


December 31, 2008

Current Assets
Cash and bank balances $ 2,576,425 $ 4,770,337
Accounts receivable, net of allowance for doubtful accounts of $228,096 and $323,183



Income tax recoverable 329,585 188,525
Inventory and supplies 793,428 829,318
Prepaid expenses 521,324 289,638
Due from related parties     2,388       2,094  
Total current assets     9,590,364       10,651,239  
Property plant and equipment, net of depreciation 7,142,906 9,214,623
Deposits 116,588 460,376
Intangible assets 650,623 850,136
Deferred financing costs, net 419,398 483,331
Deferred income taxes     36,673       35,343  
    $ 17,956,552     $ 21,695,048  
Liabilities and Shareholders' (Deficit)
Current Liabilities
Bank Indebtedness $ 2,307,548 $ 1,581,912
Accounts payable and accrued liabilities 4,882,072 5,800,061
Current portion of obligation under capital leases 1,470,402 2,125,312
Deferred income 122,151 118,595
Deferred income taxes 25,858 25,858
Current portion of term notes 7,387,500 1,750,000
Current portion of other payable 280,374 245,902
Due to related parties     7,174       6,292  
Total current liabilities     16,483,079       11,653,932  
Term notes 8,260,524 14,062,290
Notes payable to related parties 1,500,000 1,500,000
Obligation under capital lease 3,870,707 4,554,240
Due to related parties     215,766       189,237  
      30,330,076       31,959,699  
Shareholders' (deficit)
Share capital
50,000,000 no par value preferred shares undesignated, none issued or outstanding
100,000,000 no par value common shares 37,488,714 at September 30, 2009 and 37,224,926 at December 31, 2008 issued and outstanding
Common stock 6,555,754 6,488,137
Additional paid-in capital 14,127,379 14,005,627
Accumulated (deficit) (32,241,221 ) (31,357,923 )
Accumulated other comprehensive income (loss)     (815,436 )     599,508  
      (12,373,524 )     (10,264,651 )
    $ 17,956,552     $ 21,695,048  
Creative Vistas, Inc.
Condensed Consolidated Statements of Operations
    Three months ended   Nine months ended
    September 30,   September 30,
    2009   2008   2009   2008
Contract and service revenue        
Contract $ 2,039,619 $ 1,756,739 $ 4,368,893 $ 5,022,254
Service 9,281,162 12,204,635 25,217,432 32,299,736
Other     1,662       33,208       12,117       48,807  
      11,322,443       13,994,582       29,598,442       37,370,797  
Direct Expenses (excluding depreciation)
Contract 1,152,944 1,169,824 2,411,632 3,153,590
Service 7,034,600 10,082,945 19,704,627 26,159,547
Project expenses 229,520 269,309 666,687 861,381
Selling expenses 205,248 259,436 610,888 739,415
General and administrative expenses 1,370,361 2,745,487 4,193,898 8,783,283
Depreciation expense 657,033 728,492 2,028,390 1,847,254
Amortization of intangible assets     86,515       188,622       253,238       568,557  
      10,736,221       15,444,115       29,869,360       42,113,027  
Income (Loss) from operations     586,222       (1,449,533 )     (270,918 )     (4,742,230 )
Interest and other expenses (income)
Net financing expenses 585,668 603,392 1,766,402 6,419,775
Realized loss on disposal of available for sale securities





Amortization of deferred charges 41,008 69,666 120,537 159,581
Foreign currency translation (gain) loss     (760,897 )     384,502       (1,274,559 )     520,277  
      (134,221 )     1,880,476       612,380       7,922,549  
Income (Loss) before income taxes 720,443 (3,330,009 ) (883,298 ) (12,664,779 )
Income taxes     -       -       -       -  
Net income (loss)     720,443       (3,330,009 )     (883,298 )     (12,664,779 )
Other comprehensive (loss):
Unrealized gain – available for sale securities





Foreign currency translation adjustment    










Comprehensive (loss)   $ (160,247 )   $ (2,085,421 )   $ (2,298,241 )   $ (12,253,060 )
Basic weighted-average shares 37,478,649 37,224,926 37,426,516 36,834,445
Diluted weighted-average shares     44,508,726       37,224,926       37.426,516       36,834,445  
Basic earnings (loss) per share $ 0.02 $ (0.09 ) $ (0.02 ) $ (0.34 )
Diluted earnings (loss) per share   $ 0.02     $ (0.09 )   $ (0.02 )   $ (0.34 )

Investor Relations International for Creative Vistas
Haris Tajyar, 1-818-382-9702