LogicVision Reports Second Quarter Financial Results

Six-Month Bookings Exceed $17M

SAN JOSE, Calif., July 22 /PRNewswire-FirstCall/ -- LogicVision, Inc. (NASDAQ: LGVN), a leading provider of semiconductor built-in-self-test (BIST) and diagnostic solutions, today announced its financial results for the second quarter of 2008, ended June 30, 2008.

Second Quarter 2008 Results

Revenues in the second quarter of 2008 were $3.0 million, compared with $3.0 million in the first quarter of 2008.

Net loss in the second quarter of 2008 was $1.0 million, or $0.10 per share, compared with a net loss of $1.3 million, or $0.13 per share, reported in the first quarter of 2008.

Gross margins in the second quarter were 73 percent, compared with 72 percent in first quarter of 2008.

Operating expenses were $3.3 million in the second quarter, including $116,000 of stock-based employee compensation charges in accordance with SFAS 123 (R). This compares with $3.4 million of operating expenses in the first quarter of 2008, including $177,000 of stock-based employee compensation charges in accordance with SFAS 123(R).

At June 30, 2008 LogicVision had $6.2 million in cash, cash equivalents and investments, compared with $7.4 million at March 31, 2008. The company has no outstanding bank debt.

New orders received during the second quarter totaled $7.1 million. The Company exited the second quarter with a 12-month backlog of $10.5 million, compared with a 12-month backlog of $10.1 million at the end of the first quarter. The Company's total backlog is greater than $22 million.

"The second quarter of 2008 was another good quarter. Our revenues, net loss and cash position were in line with the guidance we gave in April, and our bookings were $7.1 million," said James T. Healy, president and CEO of LogicVision. "The new orders came from 15 customers and included a sizeable renewal from an existing major customer as well as a first-time order from a new customer that could potentially grow into a bigger account. This quarter's bookings combined with $10.5 million of new orders in the first quarter gives us a total of $17.6 million of new orders in the first half of 2008 -- making it the highest six-month booking period in the company's history."

"LogicVision's high quality, quick time to market and cost effective solutions continue to make inroads into the automotive, storage and consumer market segments. Despite the end-market softness, we are seeing increased design starts in these areas, which is where our products are being used. Some companies are interested in our solutions because we can help them to reduce their overall production costs, and others are particularly focused on our ability to help them deliver a high quality product. Overall, our potential market is growing and customers are increasingly receptive to our value proposition of helping them deliver high quality, differentiated products in a timely manner and with low comparable costs. As a result, we continue to believe that we are on track to record solid year-over-year revenue growth," said Mr. Healy.

Guidance for the Third Quarter of 2008

-- Revenues are expected to be in the range of $3.0 million to $3.2 million.

-- Net loss is expected to be in the range of $600,000 to $800,000, or a net loss in the range of $0.06 to $0.08 per share.

Conference Call

LogicVision will broadcast its conference call discussion of second quarter of 2008 financial results today, July 22, 2008 at 2 p.m. Pacific time. To listen to the call, please dial 888-390-0689, pass code: "LogicVision." A taped replay will be made available approximately one hour after the conclusion of the call and will remain available for one week. To access the replay, dial 402-530-7970. The LogicVision financial results conference call will be available via a live web cast on the investor relations section of the company's web site at http://www.logicvision.com. An archived web cast of the call will be available at http://www.logicvision.com for one year.

About LogicVision, Inc.

LogicVision (NASDAQ: LGVN) provides proprietary technologies for embedded test and yield learning that enable more efficient manufacturing test of complex semiconductors. LogicVision's embedded test solutions allow integrated circuit designers to embed test functionality into a semiconductor design that is used during semiconductor production test and throughout the useful life of the chip. The company's advanced Design for Test (DFT) product line, ETCreate, works together with Silicon Insight applications and Yield Insight to improve profit margins by reducing device field returns and test costs, accelerating silicon bring-up times and shortening both time to market and time to yield. For more information on the company and its products, please visit the LogicVision website at www.logicvision.com.


Except for the historical information contained herein, the matters set forth in this press release, including statements as to the Company's outlook, expectations of customer renewals, the Company's ability to obtain purchase orders from new customers, new customer expansion in use of the Company's products, and increases in the adoption of the Company's products by existing customers, interest in the Company's products, growth in the market potential for the Company's products, the Company's expected financial results, including revenues and net loss, and the Company's expectations of revenue growth are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including, but not limited to, the possibility that orders could be modified or cancelled, existing customer orders may not be renewed, existing customers may not expand their use of the Company's products or increase their adoption of the Company's products, new customers may not adopt or expand their use of the Company's products, the ability of the Company to negotiate and sign customer agreements and obtain purchase orders, trends in capital spending in the semiconductor industry, the timing and nature of customer orders, whether customers accept the Company's new and existing products, the impact of competitive products and alternative technological advances, and other risks detailed in LogicVision's Quarterly Report on Form 10-Q for the quarter ended March 31, 2008 and from time to time in LogicVision's SEC reports. These forward-looking statements speak only as of the date hereof. LogicVision disclaims any obligation to update these forward-looking statements.

LogicVision, Embedded Test and LogicVision logos are trademarks or registered trademarks of LogicVision, Inc. in the United States and other countries. All other trademarks and service marks are the property of their respective owners.

                      - Summary financial data follows -

                                LOGICVISION, INC.
                      (in thousands, except per share data)

                                             Three Months
                                                 Ended       Six Months Ended
                                                     June  30,                      June  30,
                                                                                            2008        2007            2008          2007
            License                                                              $1,408      $1,457      $2,792      $2,562
            Service                                                                1,619        1,626        3,205        3,151
                    Total  revenues                                          3,027        3,083        5,997        5,713

        Cost  of  revenues:
            License                                                                    170            225            346            456
            Service                                                                    658            552        1,313        1,075
                    Total  cost  of  revenues                              828            777        1,659        1,531
        Gross  profit                                                          2,199        2,306        4,338        4,182

        Operating  expenses:
              Research  and  development                                801            927        1,809        1,882
              Sales  and  marketing                                      1,540        1,547        3,046        2,848
              General  and  administrative                            915        1,077        1,809        1,989
                    Total  operating  expenses                      3,256        3,551        6,664        6,719

        Loss  from  operations                                        (1,057)    (1,245)    (2,326)    (2,537)
        Interest  and  other  income,  net                            58              67              76            172

        Loss  before  provision  for  income  taxes        (999)    (1,178)    (2,250)    (2,365)

        Provision  for  income  taxes                                    (2)          (58)            13            (42)

        Net  loss                                                                  $(997)  $(1,120)  $(2,263)  $(2,323)
        Net  loss  per  common  share,  basic  and
          diluted                                                                $(0.10)    $(0.12)    $(0.23)    $(0.24)
        Weighted  average  number  of  shares
          outstanding,  basic  and  diluted                    9,600        9,650        9,637        9,646

                                                                LOGICVISION,  INC.
                                            (in  thousands,  except  per  share  data)

                                                                                                  June  30,                  December  31,
                                                                                                        2008                              2007
        Current  Assets:
              Cash  and  cash  equivalents                                      $4,744                        $6,783
              Short-term  investments                                              1,421                          1,544
              Accounts  receivable,  net  of  allowance
                for  doubtful  accounts  of  $12  and  $20,
                  respectively                                                              1,182                              996
              Prepaid  expenses  and  other  current  assets        1,007                          1,345
                    Total  current  assets                                            8,354                        10,668
        Property  and  equipment,  net                                              459                              510
        Goodwill                                                                                6,846                          6,846
        Other  long-term  assets,  net                                              234                              239
                    Total  assets                                                        $15,893                      $18,263

        Current  Liabilities:
              Accounts  payable                                                            $491                            $413
              Accrued  liabilities                                                    1,636                          2,015
              Deferred  revenue,  current  portion                        6,540                          5,859
                    Total  current  liabilities                                  8,667                          8,287
        Deferred  revenue                                                                      43                              605
        Other  long-term  liabilities                                              133                              165
                    Total  liabilities                                                  8,843                          9,057

        Commitments  and  contingencies

        Stockholders'  Equity:
              Preferred  stock,  $0.0001  par
                    Authorized:  5,000,000  shares;
                    Issued  and  outstanding:  no
                      shares  issued  and  outstanding                            -                                  -
              Common  stock,  $0.0001  par  value:
                    Authorized:  50,000,000  shares;
                    Issued  and  outstanding:
                      9,534,000  shares  at  June  30,  2008
                          and  9,666,000  shares  at
                            December  31,  2007                                                  1                                  1
        Additional  paid-in  capital                                        109,059                      108,921
        Accumulated  other  comprehensive  income                          37                                68
        Accumulated  deficit                                                    (102,047)                    (99,784)
                    Total  stockholders'  equity                                7,050                          9,206
                    Total  liabilities  and
                      stockholders'  equity                                      $15,893                      $18,263


Web site: http://www.logicvision.com/

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