Brampton, Ontario, March 17, 2020 – DATA Communications Management Corp. (“DCM” or the “Company”, TSX: DCM) today announced, owing to, among other things, COVID-19’s impact on certain human resources as well as the recent implementation of its Enterprise Resource Planning (“ERP”) system, it is unable to meet its filing deadline (the “Filing Deadline”) of March 30, 2020 to file its audited annual financial statements for the year ended December 31, 2019 (the “2019 Annual Financial Statements”), annual management’s discussion and analysis (“MD&A”) for the corresponding period and management certifications of annual filings (collectively, the “Filings”).
The principal reason for the delay relates to a confluence of events, including continuing remediation efforts with respect to our previously reported implementation of a new ERP system company-wide (excluding Eclipse, Thistle and Perennial) on June 3, 2019, which resulted in the issuance of inaccurate invoices and delays in collection of accounts receivable, together with the COVID-19 outbreak which has resulted in the Company and many of its customers and suppliers, including DCM’s external auditor, activating business continuity procedures, including work from home policies, which are expected to contribute to delays in timely completion of the Filings.
Collectively, these events have created the need for additional time to finalize the 2019 Annual Financial Statements and MD&A, including management’s assessment of the effectiveness of internal control over financial reporting as at December 31, 2019 and to prepare its financial statements for audit by DCM’s external auditor.
The Company expects to make the Filings and any other periodic disclosure required to be filed under applicable securities laws as soon as practicable once it has completed this work and the audit.
The Company has informed staff of the Ontario Securities Commission (the “OSC”) about its anticipated delay of the Filings and has applied to the OSC pursuant to Part 4 of National Policy 12-203 – Management Cease Trade Orders (“NP 12-203”) for a Management Cease Trade Order (“MCTO”) pending the filing of the Filings. If a MCTO is issued, the Company intends to satisfy the provisions of the “alternative information guidelines” set out in NP 12-203, including the requirement to file bi-weekly status reports in the form of news releases containing prescribed updating information, until the Filings are made. A MCTO would not generally affect the ability of persons who are not directors, officers or insiders of the Company to trade in securities of the Company. There can be no assurance that a MCTO will be issued. The Company has established a blackout on trading by directors, officers and other insiders of the Company, and intends to continue the blackout until the Filings have been made.
Forward-Looking Statements
Certain statements in this press release constitute “forward looking” statements that involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, objectives or achievements of DCM or industry results, to be materially different from any future results, performance, objectives or achievements expressed or implied by such forward looking statements. When used in this press release, words such as “may”, “would”, “could”, “will”, “expect”, “anticipate”, “estimate”, “believe”, “intend”, “plan”, and other similar expressions are intended to identify forward looking statements. These statements reflect DCM’s current views regarding future events and operating performance, are based on information currently available to DCM, and speak only as of the date of this press release. These forward looking statements involve a number of risks, uncertainties and assumptions and should not be read as guarantees that future performance or results will be achieved. Many factors could cause the actual results, performance, objectives or achievements of DCM to be materially different from any future results, performance, objectives or achievements that may be expressed or implied by such forward looking statements, including the changes in the Company’s senior management and other factors discussed elsewhere in this press release and under the headings “Liquidity and capital resources” and “Risks and Uncertainties” in DCM’s management’s discussion and analysis and other publicly available disclosure documents, as filed by DCM on SEDAR (www.sedar.com).
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward looking statements prove incorrect, actual results may vary materially from those described in this press release as intended, planned, anticipated, believed, estimated or expected. Unless required by applicable securities law, DCM does not intend and does not assume any obligation to update these forward looking statements.
For further information, contact:
Mr. Gregory Cochrane
Chief Executive Officer
DATA Communications Management Corp.
Tel: (905) 791-3151
Mr. James E. Lorimer
Chief Financial Officer
DATA Communications Management Corp.
Tel: (905) 791-3151