CORRECTION FROM SOURCE: Intrinsyc Reports 2013 First Quarter Financial Results

VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 8, 2013) - This press release replaces the one disseminated at 4:00 PM ET on May 8, 2013. The years in the the first table (titled "Interim Condensed Consolidated Statements of Financial Position") have been revised.

Intrinsyc Software International, Inc. ("Intrinsyc" or the "Company") (ICS.TO), a leading provider of solutions for the development of embedded and wireless devices, today announced its financial results for the first quarter ended March 31, 2013, reported in United States dollars and in accordance with International Financial Reporting Standards ("IFRS"). The Company's results are presented in comparison to the three months ended December 31, 2012 and the three months ended March 31, 2012, also in accordance with IFRS.

Intrinsyc achieved revenue of approximately $1.2 million in the first quarter, 23% lower than in the previous quarter, with lower core operating expenses, and increased administrative expenses associated with strategic activities and a shareholder proxy dispute. The Company reported negative EBITDA¹ of $791,740 and a net loss of $725,382.

"This was a challenging quarter as we started the year slowly due to the unexpected non-renewal of an agreement with our largest customer in 2012," stated Tracy Rees, President and CEO of Intrinsyc. "We worked hard to offset the loss of this important customer agreement and were successful in closing several new customer engagements in the quarter. Combined with our Machine-to-Machine ("M2M") and embedded computing initiatives, we expect significant revenue improvement in the second quarter and beyond. We also expect to record significant non-core operational expenses in the second quarter which will impact our financial results."

Business Highlights

Notable developments and achievements during the first quarter include the following:

• Signed several new product development agreements with embedded original equipment manufacturers ("OEMs") and technology suppliers, including:

  • Platform software development, leveraging Intrinsyc's Open-6 Reference Design, for an Android based medical device;

  • Platform software development for a new consumer device from a Fortune 500 computing company. This project leverages work the Company performed directly for a leading technology company;

  • Development of Radio Interface Layer software for a modem vendor, utilizing Intrinsyc's RapidRIL™ software;

  • An agreement with a leading silicon vendor and began development of a new embedded computing Development Kit and System on Module ("SOM"), which the Company expects to announce and launch in the second quarter;

  • Several smaller projects for leading technology vendors and embedded device OEMs.

  • A material agreement extending a long-term relationship with a Fortune 500 company that is effective through March 31, 2014; and

• Agreement with Intrinsyc's largest customer from 2012 was not renewed.

Intrinsyc announced a settlement of a proxy dispute with Stonehouse Capital ("Stonehouse") on April 17, 2013. Under the terms of the Settlement Agreement, the Company and Stonehouse have agreed on a newly constituted board of directors comprised of Messrs. Thomas Bitove, George Duguay, Skip Speaks, Daniel S. Marks and Michael W. Bird. Further, the Company cancelled the Special Meeting of Shareholders scheduled for May 14, 2013 and will hold its Annual General Shareholder Meeting on June 26, 2013 at 10:30 am in Vancouver. As a further result of this settlement, the reconstituted board has dissolved the Strategic and Special Committees.

"I am pleased that as a result of this this settlement we now have a unified board of directors, representing shareholders with substantial share ownership, and a common vision of enhancing shareholder value through the execution of the company's strategic initiatives in the embedded computing and M2M communications markets," added Mr. Rees. "I look forward to working with the reconstituted board to further our new product and market initiatives which are designed to deliver growth and enhance shareholder value."

Three Month Comparative Results

The Company reported revenue of approximately $1.2 million for three months ended March 31, 2013 as compared to approximately $1.6 million for the three months ended December 31, 2012 and approximately $2.2 million in the period ended March 31, 2012. Gross margin² was 25% in the three months ended March 31, 2013, which was lower than 31% in the three months ended December 31, 2012 and lower than the gross margin experienced of 39% in the three months ended March 31, 2012. Lower gross margin was primarily attributable to lower utilization of our engineering personnel for customer projects in the quarter.

Total expenses (excluding other operating expenses)³ for the three months ended March 31, 2012 were approximately $1.1 million which was an increase of 44% over the preceding three months ended December 31, 2012 and a 4% increase over the three months ended March 31, 2012.

EBITDA for the three months ended March 31, 2013 was ($791,740) compared to ($264,109) in the previous three months ended December 31, 2012 and ($204,060) for the three months ended March 31, 2012.

Working capital⁴ as of March 31, 2013 was approximately $10.5 million (which included cash and cash equivalents of approximately $7.0 million and short-term investments of approximately $4.1 million). This is compared to net working capital of approximately $11.4 million as of December 31, 2012 (which included cash and cash equivalents of approximately $6.0 million and short-term investments of approximately $5.3 million).

Conference call

The Company will release its fiscal first quarter financial results on Wednesday, May 8, 2013 at 4:00 p.m. Eastern Time (1:00 p.m. Pacific Time). The company will hold a conference call to discuss the financial results at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) the same day. On the call, Tracy Rees, President and Chief Executive Officer, and George Reznik, Chief Financial Officer, will discuss the financial results announced. This conference call may be accessed in North America, toll-free, by dialing 1-877-240-9772 or direct, and internationally by dialing +1-416-340-8527 approximately 10 minutes prior to the start of the call. This conference line is operator assisted and an access PIN is not required. The conference call will also be broadcast live over the Internet and available for replay on the Company's Investor Relations Conference Calls web page (www.intrinsyc.com/investors/conference_calls.aspx). Analysts and investors are invited to participate on the call. Questions may be submitted to invest@intrinsyc.com prior to the call.

The Audit Committee of the Company has reviewed the contents of this news release.

Non-IFRS Measures

The following and preceding discussion of financial results includes reference to Gross Margin, Total Expenses (excluding other operating expenses), EBITDA and Working Capital, which are all non-IFRS financial measures. The measure of gross margin is provided as management believes this is a good indicator in evaluating the operating performance of the Company. Total expenses excluding other operating expenses is provided as a proxy for cash expenses incurred from the operations of the business. EBITDA is defined as operating loss less other operating expenses. The measure is provided as a proxy for the cash earnings from the operations of the business as operating loss for the Company includes non-cash amortization and depreciation expense, share-based compensation and loss on disposal of equipment which are classified as other operating expenses. The measure of working capital is provided as management believes this is a good indicator of the operating liquidity available to the Company.

Forward-Looking Statements

This press release contains statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking information under applicable Canadian securities legislation that involve risks and uncertainties. Such forward-looking statements or information may include financial and other projections as well as statements regarding the Company's future plans, objectives, performance, revenues, growth, profits, operating expenses or the company's underlying assumptions. The words "may", "would", "could", "will", "likely", "expect," "anticipate," "intend", "plan", "forecast", "project", "estimate" and "believe" or other similar words and phrases may identify forward-looking statements or information. Persons reading this press release are cautioned that such statements or information are only predictions, and that the Company's actual future results or performance may be materially different. Factors that could cause actual events or results to differ materially from those suggested by these forward-looking statements include, but are not limited to: the need to develop, integrate and deploy software solutions to meet the Company's customer's requirements; the possibility of development or deployment difficulties or delays; the dependence on the Company's customer's satisfaction; the timing of entering into significant contracts; customers' continued commitment to the deployment of the Company's solutions; the performance of the global economy and growth in software industry sales; market acceptance of the Company's products and services; the success of certain business combinations engaged in by the Company or by its competitors; possible disruptive effects of organizational or personnel changes; technological change, new products and standards; risks related to international expansion; concentration of sales; international operations and sales; dependence upon key personnel and hiring; reliance on a limited number of suppliers; industry growth; competition; intellectual property; product defects and product liability; currency exchange rate risk; and other factors described in the Company's reports filed on SEDAR, including its Annual Information Form and financial report for the year ended December 31, 2012. This list is not exhaustive of the factors that may affect the Company's forward-looking information.

These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information. All forward-looking statements made in this press release are qualified by this cautionary statement and there can be no assurance that actual results or developments anticipated by the Company will be realized. The Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

About Intrinsyc Software International, Inc.

Intrinsyc is a product development company that provides hardware, software, and service solutions that enable next-generation embedded and wireless products. Solutions span the development life cycle from concept to production and help device makers and technology suppliers create compelling differentiated products with faster time-to-market. We help our customers deliver compelling products using our unmatched expertise with the leading operating system, silicon, and wireless technology. Intrinsyc is publicly traded (ICS.TO) and is headquartered in Vancouver, Canada.

INTRINSYC SOFTWARE INTERNATIONAL, INC.
Interim Condensed Consolidated Statements of Financial Position
(Unaudited and Expressed in U.S. dollars)
As at		March 31, 2013		December 31, 2012
ASSETS
Current assets
	Cash and cash equivalents	$	7,003,528	$	6,039,313
	Short-term investments		4,082,563		5,285,918
	Trade and other receivables		1,187,167		1,529,500
	Inventory		70,790		91,548
	Prepaid expenses		120,388		98,118
			12,464,436		13,044,397
Non-Current Assets
	Prepaid expenses		54,170		50,256
	Equipment		271,269		301,472
	Intangible assets		14,527		16,546
Total assets		$	12,804,402	$	13,412,671
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
	Trade and other payables	$	1,529,501	$	1,189,068
	Deferred revenue		442,472		417,687
Total liabilities			1,971,973		1,606,755
Shareholders' equity
	Share capital		108,288,585		108,288,585
	Other capital reserves		9,833,464		9,824,896
	Deficit		(107,818,187)		(107,092,805)
	Translation of foreign operations reserve		528,567		785,240
Total shareholders' equity			10,832,429		11,805,916
Total liabilities and shareholders' equity		$	12,804,402	$	13,412,671

INTRINSYC SOFTWARE INTERNATIONAL, INC.
Interim Condensed Consolidated Statements of Operations
(Unaudited and Expressed in U.S. Dollars)
For the		Three months ended March 31, 2013		Three months ended March 31, 2012
Revenues		$	1,206,352	$	2,160,004
Cost of sales			909,852		1,320,726
			296,500		839,278
Expenses
	Sales and marketing		241,288		471,877
	Research and development		26,299		53,766
	Administration		820,653		517,695
	Other operating expenses		37,119		65,976
			1,125,359		1,109,314
Operating loss			828,859		270,036
Other expenses (earnings)
	Foreign exchange loss (gain)		(75,993)		85,096
	Interest income		(29,097)		(35,497)
			(105,090)		49,599
Loss before income taxes			723,769		319,635
Income tax expense			1,613		997
Net loss for the period		$	725,382	$	320,632
Loss per share (basic and fully diluted)		$	0.00	$	0.00
Weighted average number of shares outstanding			163,259,070		163,259,070

INTRINSYC SOFTWARE INTERNATIONAL, INC.
Interim Condensed Consolidated Statements of Comprehensive Loss
(Unaudited and Expressed in U.S. Dollars)
For the	Three months ended March 31, 2013		Three months ended March 31, 2012
Net loss for the period	$	(725,382)	$	(320,632)
Other comprehensive income (loss):
Translation of foreign operations reserve		(256,673)		240,163
Comprehensive loss for the period	$	(982,055)	$	(80,469)

INTRINSYC SOFTWARE INTERNATIONAL, INC.
Interim Condensed Consolidated Statements of EBITDA and Loss
(Unaudited and Expressed in U.S. Dollars)
For the		Three months ended March 31, 2013		Three months ended March 31, 2012
Revenues		$	1,206,352	$	2,160,004
Cost of sales			909,852		1,320,726
			296,500		839,278
Expenses
	Sales and marketing		241,288		471,877
	Research and development		26,299		53,766
	Administration		820,653		517,695
			1,088,240		1,043,338
EBITDA			(791,740)		(204,060)
	Other operating expenses		37,119		65,976
	Foreign exchange loss (gain)		(75,993)		85,096
	Interest income		(29,097)		(35,497)
	Income tax expense		1,613		997
			(66,358)		116,572
Net loss for the period under IFRS		$	(725,382)	$	(320,632)

INTRINSYC SOFTWARE INTERNATIONAL, INC.
Interim Condensed Consolidated Statements of Changes in Shareholders' Equity
(Unaudited and Expressed in U.S. Dollars)
	Share Capital		Other Capital Reserves		Deficit		Translation of Foreign Operations Reserve		Total Shareholders' Equity
Balance, January 1, 2013	$	108,288,585	$	9,824,896	$	(107,092,805)	$	785,240	$	11,805,916
Net loss for the period		-		-		(725,382)		-		(725,382)
Stock-based compensation		-		8,568		-		-		8,568
Translation of foreign operations into U.S. dollars		-		-		-		(256,673)		(256,673)
Balance, March 31, 2013	$	108,288,585	$	9,833,464	$	(107,818,187)	$	528,567	$	10,832,429
Balance, January 1, 2012	$	108,288,585	$	9,750,619	$	(106,218,167)	$	514,748	$	12,335,785
Net loss for the period		-		-		(320,632)		-		(320,632)
Stock-based compensation		-		39,987		-		-		39,987
Translation of foreign operations into U.S. dollars		-		-		-		240,163		240,163
Balance, March 31, 2012	$	108,288,585	$	9,790,606	$	(106,538,799)	$	754,911	$	12,295,303

INTRINSYC SOFTWARE INTERNATIONAL, INC. Interim Condensed Consolidated Statements of Cash Flows (Unaudited and Expressed in U.S. Dollars)
For the		Three months ended March 31, 2013		Three months ended March 31, 2012
Cash provided by (used in):
Operating Activities
	Net loss for the period	$	(725,382)	$	(320,632)
Adjustments to reconcile net loss to net cash flows:
	Depreciation of equipment		25,629		25,989
	Amortization of intangible assets		1,689		-
	Non-cash interest		-		3,735
	Share-based compensation		8,568		39,987
	Loss on disposal of equipment		1,233		-
			(688,263)		(250,921)
Working capital adjustments:
	Trade and other receivables		313,033		(118,345)
	Inventory		19,007		(31,046)
	Prepaid expenses		(29,498)		90,771
	Trade and other payables		368,025		178,668
	Deferred revenue		33,724		(129,498)
			704,291		(9,450)
Cash provided by (used in) operating activities			16,028		(260,371)
Investing Activities
	Redemption (purchase) of short-term investments		1,084,991		(2,916,346)
	Purchase of equipment		(2,729)		(3,210)
Cash provided by (used in) investing activities			1,082,262		(2,919,556)
Financing Activities
Cash provided by (used in) financing activities			-		-
Effect of exchange rate changes on cash and cash equivalents			(134,075)		172,262
Increase (decrease) in cash and cash equivalents			964,215		(3,007,665)
Cash and cash equivalents, beginning of period			6,039,313		9,382,653
Cash and cash equivalents, end of period		$	7,003,528	$	6,374,988

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¹ Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. This measure does not have a comparable IFRS measure. EBITDA referenced here relates to operating loss less other operating expenses. Please refer to the reconciliation of EBITDA to reported financial results attached to this press release.

² Non-IFRS measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Gross Margin referenced here relates to revenues less cost of sales.

³ Non-IFRS measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Total Expenses excludes other operating expenses.

⁴ Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. This measure does not have a comparable IFRS measure. Working Capital is defined as current assets less current liabilities.