Despite doubling revenue, IDC sees loss

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Imaging Dynamics Company (IDC), a Canadian supplier of digital radiography (DR) equipment, this week reported strong revenue growth in its Q1 financial results. Revenues for the three-month period ended March 31, 2006 grew 102 percent to a record $9.2 million compared to revenues of approximately $4.6 million in the first quarter of 2005. The company credits the rise in revenue to sales of its Xplorer series of digital x-ray systems.
Yet IDC also reported a net loss of about $147,000 during the quarter, compared to net earnings of $387,000 for the same period in 2005.
Several factors came into play regarding IDC’s overall financial picture for Q1, such as an attempt to support OEM partners awaiting the company’s new lower cost Xaminer series — to begin shipping this month — which involved an interim measure of shipping limited Xplorer product at Xaminer pricing to specific market segments. As a result of this move, the company reported gross margin of 35 percent compared to 44 percent for the Q1 of 2005. IDC views the gross margin decrease as temporary until the release of the Xaminer line. Margins were also impacted to a lesser degree by the continued decline of the U.S. dollar versus the Canadian dollar and increased freight costs, IDC said.