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Frontline Reports Third Quarter 2011 Financial Results

(November 11, 2011)

TORONTO, ONTARIO -- (Marketwire) -- 11/11/11 -- Frontline Technologies Inc. (TSX:FLC), a provider of technology-based equity and options trading services, IT infrastructure support and network managed services, released its third quarter results for the quarter ended September 30, 2011, the third set of consolidated financial statements prepared under International Financial Reporting Standards (IFRS). The net loss was $0.5 million or ($0.02) per share compared to a net loss of $1.8 million or ($0.12) per share in the same quarter of the previous year. Included in the $0.5 million loss are restructuring and acquisition costs of $0.4 million related to legal fees and lease write-offs incurred during the quarter.

Major elements of the third quarter statements include:

-- Revenue increased by 53% to $1.9 million for the third quarter of 2011 from the same year-ago quarter mainly as a result of the acquisition of Frontline Technologies Corporation. -- Operating expenses in continuing operations increased 48% or $1.4 million for the third quarter of 2011 from the same year-ago quarter mainly as a result of an increase in operating expenses due to the acquisition of Frontline Technologies Corporation and restructuring and acquisition costs. -- Working capital position of $4.8 million at September 30, 2011 as compared to $10.3 million at December 31, 2010. -- A $1.8 million one time gain on the referral of clients to ConvergEx included in discontinued operations.

"With the integration of the two companies nearing completion, we are very pleased with the outcome from rationalizing our costs and we are continuing to focus our attention on revenue growth with the completion of our strengthened product suite" said Hoss Astaraki, Chairman and CEO.


---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Financial Highlights (in millions of dollars, except per share data) (Three and nine month periods Three months ended Nine months ended unaudited) (note 1) September 30, September 30, 2011 2010 2011 2010 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Revenue $ 1.9 $ 1.3 $ 5.1 $ 4.1 Operating expenses $ 4.3 $ 2.9 $ 11.3 $ 8.9 Loss from continuing operations $ (2.4) $ (1.7) $ (6.3) $ (4.9) Net loss $ (0.5) $ (1.8) $ (4.8) $ (5.2) Basic and diluted loss per share $ (0.02) $ (0.12) $ (0.25) $ (0.36) ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Note 1 The financial statements for the period ended September 30, 2011 have been prepared in accordance with International Financial Reporting Standards ("IFRS"). The company adopted IFRS as at January 1, 2011 with a transition date of January 1, 2010. The comparative figures for 2010 have been restated to comply with IFRS and are presented accordingly.

Frontline is also pleased to announce that John Culbert has joined Frontline in the role of Chief Financial Officer. John has served in various senior financial roles in private financial companies in Canada for over 15 years. Most recently, John served as Chief Financial Officer of Fidelity Clearing Canada ULC. John will fill the role previously served by David Evans. "We are excited to welcome John to our leadership team. John's knowledge and experience working with financial companies makes him an extremely valuable addition to our leadership team", said Hoss Astaraki, Chief Executive Officer. "We also would like to take the opportunity to thank David for his contribution to Frontline. He has been an important member of our team and we are very appreciative for all that he has done for the Company."

For further information about Frontline Technologies Inc., the results for the third quarter 2011 and the meaning of certain references, this quarterly earnings release should be read in conjunction with our Third Quarter 2011 Condensed Interim Consolidated Financial Statements and Management's Discussion and Analysis for the three and nine months ended September 30, 2011, which can be accessed at sedar.com. Unless otherwise indicated, all dollar amounts are expressed in Canadian dollars and have been taken from our Third Quarter 2011 Condensed Interim Consolidated Financial Statements prepared in accordance with International Accounting Standard 34: Interim Financial Reporting using the policies we expect to apply in our annual financial statements for the year ending December 31, 2011, prepared in accordance with International Financial Reporting Standards ("IFRS").

About Frontline Technologies

Frontline Technologies Inc. is a provider of trading technology services for equities and options and also offers IT infrastructure support and network managed services. Frontline Technologies is listed on the Toronto Stock Exchange (Ticker-FLC) - additional information is available at www.frontline.ca.

Forward looking statement disclaimer

Except for historical information contained herein, the matters discussed in this press release are based on forward-looking statements that involve risk and uncertainty. A variety of important factors could cause results to differ materially from such statements, including but not limited to economic, competitive, governmental and technological factors affecting the company's operation, markets, products, prices and other factors.

FRONTLINE TECHNOLOGIES INC. (FORMERLY BELZBERG TECHNOLOGIES INC.) Condensed Interim Consolidated Statements of Financial Position (in thousands of Canadian dollars) (Not audited or reviewed by the Company's external auditor) ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- September 30, December 31, 2011 2010 ---------------------------------------------------------------------------- ASSETS Current assets: Cash and cash equivalents $ 5,180 $ 8,319 Cash and cash equivalents segregated under regulations and other - 2,143 Cash and cash equivalents on deposit with clearing and depository organizations - 1,630 Receivable from brokers, dealers and clearing organizations - 168 Accounts receivable 713 1,718 Prepaid expenses and other receivables 177 346 Securities borrowed - 6,186 Assets held for sale 2,262 - ---------------------------------------------------------------------------- 8,332 20,510 Equipment 1,028 1,075 Investments - 30 Goodwill and intangible assets 5,898 77 ---------------------------------------------------------------------------- Total assets $ 15,258 $ 21,692 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Bank indebtedness $ 513 $ - Accounts payable and accrued liabilities 1,991 2,336 Payable to customers - 1,733 Deferred revenue 105 - Securities loaned - 6,186 Current portion of long-term debt 200 - Current portion of obligations under finance leases 101 - Liabilities held for sale 573 - ---------------------------------------------------------------------------- 3,483 10,255 Non-current liabilities: Long-term debt 1,400 - Obligations under finance leases 91 - Deferred revenue 17 - Future income taxes 432 - ---------------------------------------------------------------------------- Total liabilities 5,423 10,255 ---------------------------------------------------------------------------- Shareholders' equity: Share capital 2 23,612 Contributed surplus 4,589 4,570 Retained earnings (deficit) 5,475 (16,220) Foreign currency translation reserve (231) (525) ---------------------------------------------------------------------------- Total shareholders' equity 9,835 11,437 ---------------------------------------------------------------------------- --------------------------------------------------------------------------- Total liabilities and shareholders' equity $ 15,258 $ 21,692 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- FRONTLINE TECHNOLOGIES INC. (FORMERLY BELZBERG TECHNOLOGIES INC.) Condensed Interim Consolidated Statements of Comprehensive Income (Loss) (In thousands of Canadian dollars, except per share amounts) (Not audited or reviewed by the Company's external auditor) ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Three months ended Nine months ended September 30, September 30, 2011 2010 2011 2010 ---------------------------------------------------------------------------- Revenue $ 1,923 $ 1,259 $ 5,079 $ 4,058 ---------------------------------------------------------------------------- Operating expenses: Compensation and related benefits 1,429 931 4,013 2,896 Telecommunication and data-feed services 1,091 1,010 3,299 3,122 Administrative and other 1,729 923 3,966 2,868 ---------------------------------------------------------------------------- 4,249 2,864 11,278 8,886 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Loss before the undernoted (2,326) (1,605) (6,199) (4,828) ---------------------------------------------------------------------------- Foreign exchange loss 51 58 106 110 Interest expense 12 - 17 1 Interest income - - - (2) ---------------------------------------------------------------------------- 63 58 123 109 ---------------------------------------------------------------------------- Loss before discontinued operations (2,389) (1,663) (6,322) (4,937) Income (loss) from discontinued operations 1,900 (97) 1,491 (289) ---------------------------------------------------------------------------- Loss for the period (489) (1,760) (4,831) (5,226) ---------------------------------------------------------------------------- Other comprehensive income (loss): Change in accumulated foreign currency translation adjustment: Current operations (823) 308 (1,725) 102 Discontinued operations 1,344 (733) 2,019 (626) ---------------------------------------------------------------------------- 521 (425) 294 (524) ---------------------------------------------------------------------------- Total comprehensive income (loss) $ 32 $ (2,185) $ (4,537) $ (5,750) ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Loss per share: Loss from continuing operations per common and Class A Restricted share - basic and diluted $ (0.10) $ (0.11) $ (0.32) $ (0.34) Income (loss) per common and Class A Restricted share - basic and diluted 0.02 (0.12) (0.25) (0.36) ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Weighted average number of common and Restricted Class A shares outstanding (in thousands) 22,520 14,638 19,530 14,650 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- FRONTLINE TECHNOLOGIES INC. (FORMERLY BELZBERG TECHNOLOGIES INC.) Condensed Interim Consolidated Statements of Cash Flows (In thousands of Canadian dollars) (Not audited or reviewed by the Company's external auditor) ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Three months ended Nine months ended September 30, September 30, 2011 2010 2011 2010 ---------------------------------------------------------------------------- Cash provided by (used in): Operating activities: Loss for the period $ (489) $ (1,760) $ (4,831) $ (5,226) Income (loss) from discontinued operations 1,900 (97) 1,491 (289) ---------------------------------------------------------------------------- Loss from continuing operations (2,389) (1,663) (6,322) (4,937) Adjusted for: Depreciation of property and equipment 280 291 764 971 Amortization of intangible assets 114 23 247 69 Unrealized foreign exchange (gain) loss 170 (417) (371) 206 Interest expense 12 - 17 1 Interest income - - - (2) Stock-based compensation 14 68 19 237 Changes in non-cash working capital items 1,009 (214) 1,473 (1,593) Interest paid (12) - (17) (1) Interest received - - - 2 ---------------------------------------------------------------------------- (802) (1,912) (4,190) (5,047) ---------------------------------------------------------------------------- Financing activities: Increase in bank indebtedness 345 - 362 - Repayment of obligations under finance leases (24) - (45) - Repayment of long-term debt (280) - (280) - Issuance of Class A restricted shares - - 2,916 - Repurchase of common shares - - - (67) ---------------------------------------------------------------------------- 41 - 2,953 (67) ---------------------------------------------------------------------------- Investing activities: Acquisition of business - - (3,916) - Purchase of equipment - (51) (260) (422) ---------------------------------------------------------------------------- - (51) (4,176) (422) ---------------------------------------------------------------------------- Net decrease in cash and cash equivalents from continuing operations (761) (1,963) (5,413) (5,536) Net increase (decrease) in cash and cash equivalents from discontinued operations 2,033 214 2,274 (1,321) ---------------------------------------------------------------------------- Net change in cash and cash equivalents 1,272 (1,749) (3,139) (6,857) Cash and cash equivalents, beginning of period 3,908 10,562 8,319 15,670 ---------------------------------------------------------------------------- Cash and cash equivalents, end of period $ 5,180 $ 8,813 $ 5,180 $ 8,813 ----------------------------------------------------------------------------

Contacts:
Frontline Technologies Inc.
John Culbert
Chief Financial Officer
(416) 360-1812
InvestorInfo@frontline.ca
www.frontline.ca


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