Nightingale fiscal 2011 revenue increases 5% to $17.4 million

- Increased gross profit by $1.9 million to $14.2 million -

- Achieved EBITDA of $1.9 million -

- Generated a record $3.1 million in cash from operations -

- Increased deferred revenue $2.3 million to $7.5 million -

Nightingale Informatix Corporation ("Nightingale" or the "Company") (TSX-V: NGH), an application service provider (ASP) of electronic medical record (EMR) software and related services, announces its financial results for the quarter and year ended March 31, 2011. All results are reported in Canadian dollars unless otherwise stated.

Fiscal 2011 Financial Summary

• Revenue increased 5% to $17.4 million from $16.6 million in F2010, reflecting a $2.7 million increase in software revenue (EMR and Practice Management), which was partially offset by an anticipated $1.2 million reduction in transcription revenue. In addition, revenue was negatively impacted by $0.7 million related to foreign exchange.
  • Total software revenue increased 22% to $14.8 million from $12.1 million in F2010, predominantly as a result of significant growth in the Company's EMR customer base.

• Gross profit was $14.2 million, or 82% of revenue, up from $12.2 million, or 74% of revenue, in F2010, reflecting the Company's success in generating a greater proportion of high-margin EMR software revenue.
• Expenses were $14.5 million compared to $13.7 million in F2010 as the Company increased investments in strategically important areas of the business.
• EBITDA increased 54% to $1.9 million from $1.2 million in F2010.
• Net loss was $1.0 million, a reduction of $2.5 million compared to F2010.
• Cash from operations increased to $3.1 million from $(1.1) million in F2010.
• Cash and Cash equivalents grew 132% to $4.2 million from $1.8 million as at March 31, 2010.
• Total deferred revenue was $7.5 million up from $6.8 million at December 31, 2010 and $5.2 million at March 31, 2010, reflecting the Company's success in signing new EMR customers throughout F2011.
• Completed debt and private placement financings for aggregate gross proceeds of $6.3 million, reducing total indebtedness and covenant based debt as well as increasing equity.
• Signed agreements with healthcare providers across Canada and the U.S. to deploy more than 850 EMR seats, (including 200 seats in Q4 F2011) up 193% from 290 seats in F2010.
• Subsequent to year end, received U.S. certification for Nightingale On Demand V10.0 as a Complete EHR by the Certification Commission for Health Information Technology (CCHIT®) (as announced in a separate press release today).

Q4 Fiscal 2011 Financial Summary

• Revenue was $4.4 million, up from $4.2 million in Q4 F2010 as a result of an increase in software and related professional services revenue.
  • Total software revenue increased $0.5 million, or 14%, to $3.9 million from $3.4 million in Q4 F2010.
• Gross profit was $3.7 million, or 86% of revenue, up from $3.2 million, or 76% of revenue, in Q4 F2010.
• Expenses were $3.9 million compared to $3.5 million in Q4 F2010.
• EBITDA was $0.4 million compared to $0.4 in Q4 F2010.
• Net loss was $0.2 million, a reduction of $1.3 million compared to Q4 F2010.
• Cash from operations increased to $1.2 million from $0.2 million in Q4 F2010.

"In fiscal 2011, we improved all of our important operating performance trends," said Sam Chebib, President and CEO of Nightingale. "We grew our EMR customer base, resulting in improvements in revenue, gross margins and operating cash generation. In addition, we reduced the financial risk in our operations. We strengthened our balance sheet by completing a debt and private placement financing that enabled us to increase our cash balance and repay our subordinated debt, reducing our overall debt levels and interest expense. During the year, we successfully capitalized on the opportunities in the growing EMR market, and with our stronger results, investments in sales and marketing and research and development, increased financial flexibility and recent certification of our product in the U.S., we are in an even better position to continue doing so going forward."

Mr. Chebib continued: "We have entered fiscal 2012 with a strong revenue backlog as we continue to work to implement many of the new EMR seats we signed in the latter part of fiscal 2011. We expect our EMR business to continue to be our primary growth driver in fiscal 2012 and plan to strategically invest in the business accordingly. However, the potential for quarterly fluctuations in our seat sales remains. As such, we will continue to carefully manage our expenses and cash, focusing on the significant long-term growth potential the North American EMR market presents."

Fiscal 2011 Year- End and Q4 Financial Review
Revenue for fiscal 2011 was $17.4 million, up 5% from $16.6 million for fiscal 2010. The year-over-year improvement was the result of a $2.7 million increase in revenue from the Company's software business, which was partially offset by an anticipated decrease in lower-margin transcription revenue totaling $1.2 million.  In addition, total revenues were negatively impacted by $0.7 million related to foreign exchange (the Company generated 52% of F2011 revenue in the US) which predominantly affected the Company's recurring revenue results. Revenue for Q4 fiscal 2011 increased to $4.4 million from $4.2 million in Q4 F2010.

Recurring Revenue for fiscal 2011 was $10.7 million compared to $13.1 million for fiscal 2010. The year-over-year decline is primarily a result of a reduction in transcription revenue (decreased to $0.3 million from $1.5 million in fiscal 2010) and the negative impact due to foreign exchange. Recurring Revenue for Q4 fiscal 2011 was $2.5 million compared to $2.9 million for Q4 fiscal 2010. Going forward, Nightingale does not expect transcription to represent a material component of its business.

Non-Recurring Revenue for fiscal 2011 increased 92% to $6.7 million from $3.5 million for fiscal 2010 due to significantly higher EMR software licensing and related professional services revenue. Non-Recurring Revenue for Q4 fiscal 2011 increased 44% to $1.9 million from $1.3 million in Q4 fiscal 2010.

For fiscal 2011, gross profit was $14.2 million, or 82% of revenue, up from $12.2 million, or 74% of revenue, for the previous fiscal year, reflecting a greater proportion of higher margin EMR software sales in fiscal 2011. Gross profit for Q4 fiscal 2011 was $3.7 million, or 86% of revenue, up from $3.2 million, or 76% of revenue, in Q4 F2010.

Operating expenses for fiscal 2011 (excluding stock-based compensation and amortization) were $12.3 million compared to $11.0 million for fiscal 2010. The year-over-year change was a result of Nightingale's increased investments to support its long-term growth initiatives. In particular, the Company increased its investments in sales and marketing; research and development; as well as EMR implementation and customer training, as the Company continues to see greater buying activity in the North American EMR market. The increases in these expenses was partially offset by a decrease in costs related to the Company's transcription business in addition to a positive $0.5 million foreign exchange impact, as the Company generated 43% of fiscal 2011 operating expenses in U.S. dollars. Operating expenses for Q4 fiscal 2011 were $3.3 million compared to $2.8 million for Q4 fiscal 2010.

As a result of the Company's success in growing its top-line results and delivering stronger gross margins, for fiscal 2011, Nightingale generated EBITDA of $1.9 million, a 54% improvement over EBITDA of $1.2 million in fiscal 2010. For Q4 fiscal 2011, the Company generated its ninth consecutive quarter of positive EBITDA, recording EBITDA of $0.4 million compared to $0.4 million in Q4 fiscal 2010.

For fiscal 2011, net loss was $1.0 million, an improvement of $2.5 million compared to net loss of $3.4 million in fiscal 2010. Net loss for Q4 fiscal 2011 was $0.2 million, a $1.3 million reduction compared to net loss of $1.5 million for Q4 F2010.

Cash and cash equivalents grew to $4.2 million at March 31, 2011, up 132% from $1.8 million at March 31, 2010.  At March 31, 2011, total common shares issued and outstanding were 76,310,915.