HDX Announces Financial Results for the First Quarter 2009

TORONTO, May 15, 2009 (Canada NewsWire via COMTEX) -- HDX | Quote | Chart | News | PowerRating -- Hosted Data Transaction Solutions Inc. ("HDX") announced today its financial results for the three-month period ending March 31, 2009. HDX is listed on the TSX under the symbol "HDX".

Paul Howell, President and CEO states, "the HDX team continued to grow during the 1st quarter of 2009. New sales and technical staff were hired in B.C., Alberta, Ontario, Quebec, and Nova Scotia. Key infrastructure and staffing investments have been made specifically in the Montreal, QC region to address the growing business opportunity for HDX in French speaking Canada".

Mr. Howell noted that, "during the quarter, HDX installed the HDX Fingerprints(TM) point of sale solution at over fifty restaurants in five separate quick service restaurant chains. HDX installed 290 sites of integrated debit and credit and released version II of the Company's hosted enterprise management suite, HDX Webview(TM). The business intelligence tool has been installed at a tier one quick service restaurant chain and will continue to be enhanced and marketed to new and existing clients".

HDX achieved record 1st quarter sales of $2,077,200 for the quarter, compared to $1,585,575 for the three months ended March 31, 2008. The Company was able to maintain a gross margin of $1,281,713 for the three months ended March 31, 2009, compared to $899,436 for the three months ended March 31, 2008. Recurring contract revenue, represented as deferred revenue, was $1,018,066 compared to $833,714 for the three months ended March 31, 2008.

Recurring contract revenue grows at a rate commensurate with the number of systems installed and the number of service and support contracts invoiced.

The former Dexit office at 1 Richmond Street was sublet and vacated effective January 7th 2009. In the first quarter of 2009 the Company recognized a liability of $257,475 for the remaining net lease obligation, which will result in an annual reduction in operating expenses of more than $240,000 beginning in Q3 2009. In the first quarter of 2009, lease costs were $84,000 for the vacated 1 Richmond Street offices. As of the third quarter 2009, the Company will be free of this overhead except for a lease sublease subsidy of $8,143 per month or $97,716 per year for the Richmond Street office lease which expires May 2011.

Management is focused on growing the business organically by marketing the Company's solutions and services to the Quick Service Restaurant industry and the Table Service Restaurant industry in Canada and the United States.

HDX continues to pursue selective acquisitions to further its growth, which the Company expects will be primarily focused on POS services companies which can be acquired at attractive multiples. During 2007 the Company completed one point of sale company acquisition and during the first quarter of 2008 the Company acquired Biz-Pro Ltd. and Sabrepoint Inc.

    <<
    Highlights and Summary for the Quarter

    -   Revenue was $2,077,200 for the three months ended March 31, 2009,
        compared to $1,585,575 for the three months ended March 31, 2008;

    -   Deferred revenue, which represents annual recurring revenues that
        have not yet been recognized as revenue, was $1,018,066 compared to
        $833,714 for the three months ended March 31, 2008;

    -   Gross margin was $1,281,713 for the three months ended March 31,
        2009, compared to $899,436 for the three months ended March 31, 2008;

    -   EBITDA loss (Earnings before interest taxes depreciation and
        amortization) for the three months ended March 31, 2009, was
        $539,406 compared to $475,141 for the three months ended March 31,
        2008;

    -   HDX's cash, cash equivalents and short term investments totaled
        $650,808 as at March 31, 2009; and

    -   Net income (loss) which includes non-cash expenses such as
        amortization and stock-based compensation charges of $249,415 was
        $639,140 for the three months ended March 31, 2009, compared to a
        $664,752 for the three months ended March 31, 2008.
    >>

Additional information on HDX first quarter 2009 financial results will be available in the financial reports filed by the Company with Sedar at www.sedar.com and posted to the Investor Relations section of the Company's website at www.dexit.com.

About the Company

Hosted Data Transaction Solutions Inc. is in the business of managing merchant transactions with consumers and facilitating payment. HDX develops and deploys touch screen POS system software and associated enterprise management tools and has developed and deployed numerous POS applications. HDX also provides system hardware integration services, merchant staff training, system installation services, and post sale software and hardware support services.

HDX leading edge technology also includes customer self serve kiosks and "line buster" mobile point of sale terminals. These products have been designed to dramatically enhance customer throughput and drastically reduce customer queues. These technologies are especially effective in high foot traffic environments that have limited cash register counter space, limited retail square footage, and the absence of a drive through.

The Company offers a complete suite of products and solutions for merchants. HDX develops, sells, deploys, and supports:

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    -   Touch Screen POS Systems for Quick Service
    -   Integrated RFID Gift Card Payment System
    -   Self Serve Customer Kiosks
    -   Mobile Wireless POS Terminals
    -   Fine Dining/Table Service POS Systems
    -   Integrated Digital Video Surveillance and Recording Systems
    -   Electronic cash registers
    -   Web enabled business intelligence applications
    >>

Forward-Looking Statements

This discussion includes certain forward-looking statements that are based upon current expectations, which involve risks and uncertainties associated with our business and the environment in which the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking, including those identified by the expressions "anticipate", "believe", "plan", "estimate", "expect", "intend", and similar expressions to the extent they relate to the Company or its management. The forward-looking statements are not historical facts, but reflect HDX's current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under "Risks and Uncertainties" in the Annual Information Form filed on March 30, 2009 with the regulatory authorities. HDX 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.

SOURCE: Hosted Data Transaction Solutions Inc.

Paul Howell, President, CEO, Hosted Data Transaction Solutions Inc. (HDX), (416)
703-6462, extension 2263

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