Lingo Media Reports Financial Results for the Second Quarter Ended June 30, 2020

TORONTOAug. 28, 2020Lingo Media Corporation (TSXV: LM) (OTCQB: LMDCF) (FSE: LIMA) (“Lingo Media” or the “Company“), an EdTech company that is ‘Changing the way the world learns languages’ through innovative online and print-based technologies and solutions, announces its financial results for the second quarter ended June 30, 2020.  All figures are reported in Canadian Dollars and are in accordance with International Financial Reporting Standards unless otherwise noted.

Q2 2020 Operational Highlights

  • Online English Language Learning:
    • enhanced reporting functionality
    • improved chat feature and capability
    • added alerts and notifications to distributor and client dashboards
    • initiated work on a new mobile APP
    • secured two sales contracts with a customer in Japan (first client in Japan)
    • secured sales contracts with two universities in Colombia
    • conducted a webinar in LATAM for teachers to help them deal with the COVID/remote teaching challenges with over 1,500 attendees
    • conducted a webinar in Asia for teachers with several hundred attendees
    • in concert with the Canadian Embassy in Colombia, presented to key organizations on how to best teach online
  • Print-Based English Language Learning:
    • expanded the existing market for PEP Primary English program into an additional province in China

Q2 2020 Financial Highlights

Second Quarter Ended June 30st  

2020

2019

Revenue

$

977,389

$

895,205

Operating and development expenses

202,275

230,372

Income before amortization,

share-based payments, depreciation, finance charges and taxes

775,114

664,833

Amortization, share-based payments, and depreciation

34,909

119,527

Finance charges, taxes, foreign exchange

115,876

114,655

Total expenses

353,060

464,554

Net profit

624,329

430,651

Total comprehensive income

557,802

4188,142

Earnings per share

$

0.02

$

0.01

  • Revenue for the second quarter ended June 30, 2020 totalled $977,389 as compared to $895,202 in Q2 2019.
  • Operating and development expenses for the quarter ended June 30, 2020 totaled $202,275 compared to the expenses of $230,372 in Q2 2019. Included as a reduction of selling, general and administrative expenses are government grants of $168,326 relating to the Company’s publishing and software projects. The Company applied Canada Emergency Wage Subsidy (“CEWS”) and received $78,287 during the second quarter as a reduction of General and Administrative Expense.
  • Net profit for the quarter ended June 30, 2020 was $624,329 or $0.02 earnings per share (basic) based on 35.5 million shares or $0.02 earnings per share (diluted) based on 40.4 million shares as compared to a net profit of $430,651 for Q2 2019 or $0.01 earnings per share (basic) based on 35.5 million shares or $0.01 earnings per share (diluted) based on 41.5 million shares.
  • Income before amortization, share-based payments, depreciation, finance charges and taxes was $775,114 in Q2 2020 compared to the income of 664,883 in Q2 2019.

Financial Highlights for the Six-Month Period Ended June 30, 2020

Six Month Period Ended June 30

2020

2019

Revenue

$

1,074,513

$

1,007,169

Operating and development expenses

3,344

610,032

Income before amortization,

share-based payments, depreciation, finance charges and taxes

1,071,169

397,137

Amortization, share-based payments and depreciation

65,694

151,695

Finance charges, taxes and foreign exchange

147,527

129,313

Total expenses

216,56

891,040

Net profit

857,948

116,129

Total comprehensive income

$

956,882

$

89,243

Earnings per share

$ 0.02

$ 0.00

  • Revenue for the six-month period ended June 30, 2020 totalled $1,074,513 compared to $1,007,169 for the same period in 2019.
  • Operating and development expenses for the six-month period ended June 30, 2020 totalled $3,344 as compared to $610,032 for the same period in 2019. The reduction of selling, general and administrative expenses is primarily due to the company received government grants of $223,326 relating to the Company’s publishing and software projects and one-time refundable tax credit, Ontario Interactive Digital Media Tax Credit in the amount of $904,940 related to the Company’s investment in digital products in 2016. The Company applied Canada Emergency Wage Subsidy (“CEWS”) and received $78,287 during the period as a reduction of General and Administrative Expense.
  • Net profit for the six-month period was $857,948 as compared to net profit of $116,129 for the same period in 2019.
  • Income before amortization, share-based payments, depreciation, finance charges and taxes was $1,071,169, as compared to $397,137 for the same period in 2019.

“We are very pleased with the addition of key distributors in our core markets and the results for the first 6 months. COVID has introduced us with both challenges, as well as, opportunities. While our markets initially experienced difficulties adjusting to the new reality of remote learning, we have been seeing enhanced acceptance by institutions to adopt additional e-learning solutions. We expect to see further opportunities in the marketplace as a result,” said Gali Bar-Ziv, President & CEO of Lingo Media.

The unaudited condensed interim financial statements for the quarter ended June 30, 2020 and Management Discussion & Analysis are available at www.sedar.com.

About Lingo Media (TSX-V: LM; OTCQB: LMDCF)

Lingo Media is a global EdTech company that is ‘Changing the way the world learns language‘, 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 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 the U.S. 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 actual results 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.

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: Lingo Media, Khurram Qureshi, CFO, Tel: (647) 831-1462, Email: investors@lingomedia.com, To learn more, visit us at www.lingomedia.com