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TORONTO, ONTARIO--(Marketwired - Mar 14, 2016) - GuestLogix Inc. (TSX:GXI) ("GuestLogix" or the "Company"), the leading global provider of ancillary-focused merchandising, payment and business intelligence technology to airlines and the passenger travel industry, announced today that in light of the ongoing proceedings commenced under the Companies' Creditors Arrangement Act (the "CCAA"), it does not currently intend to prepare or file consolidated audited financial statements for the period ended December 31, 2015 (the "2015 Annual Financials"). GuestLogix also announced today that the independent committee of its directors formed on December 16, 2015 (the "Special Committee") has concluded its internal review and provided its recommendations to the Company's board of directors (the "Board").
In developing its recommendations, the Special Committee considered a number of factors and consulted with and carefully considered the input of its own advisors and the Company's independent auditor. Following completion of its review, in reliance on the informed advice of the Company's independent auditor that the Company's revenue recognition accounting policies and its historical financial statements are in compliance with IFRS, the Special Committee recommended to the Board that a restatement of its 2013 and 2014 financial statements is not necessary. With respect to the Company's unaudited condensed interim consolidated 2015 financial statements, the Company, following consultation with and in reliance on advice received from the Company's independent auditor, is satisfied that the Company's current revenue recognition accounting policies are in compliance with IFRS. As a result, the Company has concluded that its unaudited condensed interim consolidated 2015 financial statements do not require restatement (subject to year-end adjustments if and when the Company prepares consolidated audited 2015 financial statements).
As previously disclosed, on February 9, 2016, the Company sought and obtained protection under the CCAA pursuant to an initial order (the "Initial Order") of the Ontario Superior Court of Justice (the "Court"). PricewaterhouseCoopers Inc. was appointed as monitor (the "Monitor") in the proceedings. The Initial Order was amended on February 12, 2016 to, among other things, include GuestLogix Ireland Limited (collectively with GuestLogix, the "Applicants") in the CCAA proceedings and approve an interim financing facility to be provided by the Company's senior and subordinated lenders in the maximum amount of US$3 million. On February 19, 2016, the Court granted an order authorizing and directing the Applicants to commence a court supervised sale and investment solicitation process (the "SISP"). On March 4, 2016, the Court extended the initial stay period set out in the Initial Order to May 6, 2016. The deadline for the receipt by the Company of non-binding expressions of interest is March 18, 2016.
The Company considered a number of factors in making its determination not to prepare and file 2015 audited financial statements at this time, including the significant amount of scarce management time and money that would be required, particularly because substantial management attention is required to administer the SISP and the CCAA proceedings more generally. The Company also considered the fact that it does not currently expect that any audit for the 2015 Annual Financials could be completed until after the initial deadline for bids under the SISP. Since the CCAA proceedings commenced, and in compliance with the CCAA and the orders of the Court, the Company has provided the Monitor with full access to its accounting records, and the Monitor has filed with the Court periodic reports which have included the Company's cash flow projections and other financial information. The Company anticipates that the Monitor will continue to file reports with the Court updating relevant financial information concerning the Company. The Monitor's reports and other Court materials are available on its website at www.pwc.com/ca/en/services/insolvency-assignments/guestlogix.html.
GuestLogix is a global leader in comprehensive merchandising, payment and business intelligence technology delivered to the passenger travel industry, both onboard and off-board. Bringing over a decade of expertise as the industry's most trusted onboard transaction processing partner to airlines, rail operators and elsewhere in the passenger travel industry, GuestLogix powers the industry's growing reliance on ancillary revenue generation. Both direct to operators as well as through partnerships with global leaders in catering, duty-free, inflight entertainment and self-service retail experts, the Company provides the payment services touching over 1 billion travelling consumers each year. On December 23, 2014, GuestLogix announced the acquisition of OpenJaw Technologies, a Dublin-based technology company focused on travel retailing innovation in the e-commerce segment. GuestLogix' global headquarters and centre for product innovation is located in Toronto, with regional offices located in Dallas, London, Dublin, Galway, Madrid and Hong Kong, and product innovation labs located in Moncton and Kraków. More information is available at www.guestlogix.com and www.openjawtech.com.
© 2016 GuestLogix. All Rights Reserved.
This news release contains certain statements that constitute forward-looking statements under applicable securities legislation. All statements other than statements of historical fact are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", or the negative of these terms or other comparable terminology. These statements are only as of the date of this document and the Company does not undertake to publicly update these forward-looking statements except in accordance with applicable securities laws. Forward-looking statements, including but without limitation, statements concerning the implementation and status of CCAA proceedings including the SISP and the status of the Company's fiscal 2015 financial statements including any voluntary changes in accounting policy are based on current expectations, estimates, projections and assumptions, which the Company believes are reasonable but which may prove to be incorrect and, therefore, such forward-looking statements should not be unduly relied upon. These forward-looking statements involve known and unknown risks, uncertainties which may cause actual results or performance to be materially different from any future results or performance expressed or implied herein. These risks, uncertainties and other factors relating to the Company include, but are not limited to, the level of indebtedness of the Company, the implementation and impact of obtaining any reorganization or restructuring of the assets, business and financial affairs of the Company, future co-operation of the creditors of the Company, the Company's ability to generate sufficient cash-flow from operations or to obtain adequate financing to fund capital expenditures and working capital needs and to meet the Company's ongoing obligations during the CCAA process the ability to conclude a successful transaction pursuant to the SISP,, the ability to maintain relationships with suppliers, customers, employees, stockholders and other third parties in light of the Company's current liquidity situation and the CCAA proceedings. In addition, actual results could differ materially from those anticipated in these forward-looking statements as a result of the risk factors set forth under "Risks Factors" in the Company's Annual Information Form filed on March 16, 2015 with the regulatory authorities in Canada. The forward‐looking information included in this press release is expressly qualified in its entirety by this cautionary statement. GuestLogix assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.
Chief Executive Officer