Company News — Plaintree Systems Inc.

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Plaintree posts huge loss for fiscal 2005

Plaintree Systems lost almost $2 million last year, despite higher product sales and keeping a close eye on expenditures.

The maker of wireless intra-red transmission products says sales increased 33 per cent to $345,000 and the company earned $762,000 relating to partnership income.

Actual cash used by the company in operating activities decreased by $118,598 to $653,307 in 2005 from the previous year.

Net losses for 2005 totalled $1,977,305 compared to $710,451 for fiscal 2004, an increase of $1,266,854.

Plaintree said contributing factors to the increased loss include non-cash amortization expense of $694,043 associated with the equity component and deferred charges assigned to the convertible debentures, increased sales and marketing expense of $367,106 and the realization of a gain on proposal to creditors of $371,395 in fiscal 2004 which was not repeated in fiscal 2005.

"Plaintree is investing in marketing and sales activities while continuing to demonstrate Plaintree's fiscal conservatism in every aspect of the business," CEO David Watson said in a statement. "We look forward to reaping the benefits of this increased sales activity in the near future."

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