Lingo Media Reports 2016 Financial Results

TORONTO, ON–(May 02, 2017) – Lingo Media Corporation (TSX VENTURE: LM) (OTCQB: LMDCF) (“Lingo Media” or the “Company“),an EdTech company that is ‘Changing the way the world learns English’ through innovative online and print-based technologies and solutions, announces its financial results for the fourth quarter and year ended December 31, 2016. All figures are reported in Canadian Dollars and are in accordance with International Financial Reporting Standards unless otherwise noted.

“2016 was a year of successful development for our online division as we completed and launched English for Success, a series of lessons and activities derived from ELL Library as a premium solution for governments and educational institutions. As a result of delays in the launch of a large project, SENA in Latin America, we ended up with decreased revenues for the year. The EdTech market for our online training products continues to be strong in Latin America and beyond and we have a large sales pipeline that we expect to convert into sales contracts in the balance of 2017,” said Michael Kraft, President & CEO of Lingo Media.

Operational Highlights – 2016

  • Online English Language Learning:
    • developed and released ELL Studio, a speech recognition and practice pronunciation mobile app that enables learners to practice their spoken English skills anywhere, any time
    • completed the development of ELL Technologies’ new online French course in addition to an online Portuguese course
    • entered into and launched a partnership with Telefonica Educación Digital S.L.U. to market, sell and distribute ELL Technologies’ full suite of English language training products in Peru
    • secured a distribution agreement with Gale, a subsidiary of Cengage Learning, to market and sell a co-branded version of ELL Scholar, named Gale-Lingo, as a self-study solution for digital libraries world wide, excluding Latin America
    • started to market and sell, English for Success, a series of lessons and activities derived from ELL Library as a premium solution for governments and educational institutions
    • entered into a software licensing contract for ELL Technologies’ programs with a distributor group in China
    • entered into a sales contract with Universidad de San Martin de Porres in Peru through Telefonica
    • entered into a sales contract with Certus, an educational institution in Peru through Telefonica
    • secured a sales contract with Universidad Da Vinci to teach English to students training to become teachers in Mexico
    • entered into a sales agreement with Euroidiomas to offer a blended solution to teach English teachers in MINEDU (Ministry of Education of Peru)
    • secured a distribution agreement with Innovalingua, a reseller in Mexico, with offices in Mexico City and Baja California, and a team dedicated to selling ELL Technologies products
    • forged a strategic partnership with Virtual Educa, an initiative of the Organization of American States promoting a better education through technology in Latin America
  • Print-Based English Language Learning:
    • expanded the market for PEP Primary English and Starting Line programs with People’s Education Press by launching into three new provinces across China

Corporate Highlights – 2016

  • loans payable of $580,000 were retired and repaid in full as of the year-end in addition to subsequent to year-end bridge loans have also been repaid in full
  • warrants and stock options were exercised resulting in net proceeds of $2,273,829
  • expanded sales channel with the strategic hire of Laurent Glorieux, with more than 16 years of experience to lead the sales team and expansion into Asia and the Middle East

Financial Highlights for the Year Ended December 31, 2016

         
Year Ended December 31st   2016   2015
Revenue   $ 3,195,221   $ 4,925,735
Operating expenses     1,750,120     1,442,574
Income before amortization, share-based payments, depreciation, finance charges and taxes     1,445,101     3,483,161
Amortization, sharebased payments, and depreciation     1,010,782     881,337
Finance charges, taxes, foreign exchange     370,072     69,767
Total expenses     3,130,974     2,393,678
Net profit     64,247     2,532,057
Earnings per share (basic)   $ 0.00   $ 0.10
Earnings per share (fully diluted)   $ 0.00   $ 0.09
             
  • Revenue for the year ended December 31, 2016 totalled $3,195,221 as compared to $4,925,735 in 2015, a 35% decrease.
  • Operating expenses for the year ended December 31, 2016 totalled $1,750,120 compared to $1,442,574 in 2015.
  • Net profit for the year ended December 31, 2016 decreased to $64,247 or $0.00 per share (basic) based on 34 million shares as compared to $2,532,057 for 2015 or $0.101 per share (basic) based on 26.3 million shares.
  • Income before amortization, share-based payments, depreciation, finance charges and taxes was $1,445,101 compared to $3,483,161 in 2015.

Financial Highlights for the Fourth Quarter Ended December 31, 2016

           
Fourth Quarter Ended December 31st   2016     2015
Revenue   $ 736,309     $ 1,276,248
Operating expenses     531,817       238,087
Income before amortization, share-based payments, depreciation, finance charges and taxes     204,492       1,038,161
Amortization, share-based payments, and depreciation     262,452       309,031
Finance charges, taxes, foreign exchange     (21,904 )     95,905
Total expenses     772,365       643,023
Net profit (loss)     (36,056 )     633,225
Earnings (loss) per share (basic)   $ (0.00 )   $ 0.02
               
  • Revenue for the fourth quarter ended December 31, 2016 totalled $736,309 compared to $1,276,248 for the same period in 2015.
  • Operating expenses for the quarter ended December 31, 2016 totalled $531,817 as compared to $238,087 in 2015, due to non-recurring one time costs.
  • Net loss for the quarter was $36,056 or ($0.00) loss per share (basic) based on 34 million shares as compared to net profit $633,225 for the same period for 2015 or $0.02 (basic) based on 28.7 million shares.
  • Income before amortization, share-based payments, depreciation, finance charges and taxes was $204,492 compared to $1,038,161 in 2015.

Balance Sheet as at December 31, 2016

  • Cash and cash equivalents as at December 31, 2016 totalled $84,303 as compared to $409,022 as at December 31, 2015.
  • Total liabilities as at December 31, 2016 totalled $731,159 as compared to $1,186,167 as at December 31, 2015, an improvement of $455,008.
  • Current ratio improved to 5.1:1 for the period ended December 31, 2016 as compared to 2.4:1 as at December 31, 2015.
  • Book value improved to $6,445,033 as at December 31, 2016 as compared to $4,046,784 as at December 31, 2015

“We believe we are on the right track with a very deep and active sales pipeline combined with market acceptance of our products achieved over the past 18 months. We are also excited about what lies ahead including the proposed business combination with Schoold which we announced at the end March and anticipate entering into definitive deal terms over the next 30 days,” said Michael Kraft.

The audited financial statements for the year ended December 31, 2016 and Management Discussion & Analysis are available at www.sedar.com.

About Lingo Media (TSX VENTURE: LM) (OTCQB: LMDCF)

Lingo Media is a global EdTech company that is ‘Changing the way the world learns English’, developing and marketing products for learners of English through various life stages, from classroom to boardroom. By integrating education and technology, the company empowers English language educators to easily transition from traditional teaching methods to digital learning.

Lingo Media provides both online and print-based solutions through two distinct business units: ELL Technologies and Lingo Learning. ELL Technologies provides online training and assessment for English language learning, while Lingo Learning is a print-based publisher of English language learning programs in China.

Lingo Media has formed successful relationships with key government and industry organizations internationally, with a particularly strong presence in Latin America and China, and continues to both extend its global reach and expand its product offerings.

Follow Lingo Media On:

Facebook: https://www.facebook.com/LingoMedia
Twitter: @LingoMediaCorp
YouTube: https://www.youtube.com/lingomedialm
LinkedIn: https://www.linkedin.com/company/lingo-media-corporation
RSS: http://feeds.feedburner.com/LingoMedia

Portions of this press release may include “forward-looking statements” within the meaning of securities laws.These statements are made in reliance upon Sections 21E and 27A of the Securities Exchange Act of 1934, which involve known and unknown risks, uncertainties or other factors that could cause actual results to differ materially from the results, performance, or expectations implied by these forward-looking statements. These statements are based on management’s current expectations and involve certain risks and uncertainties. Actual results may vary materially from management’s expectations and projections and thus readers should not place undue reliance on forward-looking statements. Lingo Media has tried to identify these forward-looking statements by using words such as “may,” “should,” “expect,” “hope,” “anticipate,” “believe,” “intend,” “plan,” “estimate” and similar expressions. Lingo Media’s expectations, among other things, are dependent upon general economic conditions, the continued and growth in demand for its products, retention of its key management and operating personnel, its need for and availability of additional capital as well as other uncontrollable or unknown factors. No assurance can be given that the actualresults will be consistent with the forward-looking statements. Except as otherwise required by US Federal securities laws, Lingo Media undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason. Certain factors that can affect the Company’s ability to achieve projected results are described in the Company’s filings with the Canadian and United States securities regulators available on www.sedar.com or www.sec.gov/edgar.shtml.

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NEITHER THE 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

For further information, contact:

Lingo Media
Michael Kraft
President & CEO
Tel: (+1) 416-927-7000 Ext. 23
Toll Free: 1-866-927-7011
Email: mkraft@lingomedia.com
To learn more, visit us at www.lingomedia.com