VANCOUVER, CANADA--(Marketwire - Nov. 27, 2012) - Versatile Systems Inc. (TSX VENTURE:VV) announces its results for the fourth quarter and the 2012 fiscal year.

Revenue for the three months ended June 30, 2012 was $8,832,150 generating a gross profit of $1,942,201 or 22.0% of sales compared to $10,180,289 generating a gross profit of $2,381,728 or 23.4% of sales for the same quarter last year. The Loss from Operations for the quarter amounted to $390,775 compared to $302,775 for the same quarter last year. As a result of the performance of the U.S. Eastern operations, management determined that the goodwill related to the original acquisition of Perfect Order was impaired. Further a provision should also be recorded against the Deferred income tax assets for the U.S. operations. Consequently, Versatile Systems Inc. ("Versatile" or "the Company") recorded non-cash expenses of $7,195,380 for the Goodwill impairment and a write-down of Deferred income taxes in the amount of $6,319,821. The Company also recorded $105,875 for the equity loss relating to the Investment in Equus. As a result the Net Loss for the quarter amounted to $14,075,239 ($0.09 per share) compared to the Net Loss of $438,131 ($0.00 per share) for the same period last year.

Highlights for the quarter included:

• Revenue for the three months ended June 30, 2012 was $8,832,150 compared to $10,180,289 for the same quarter last year;
• The cash used in operations before other items amounted to $381,420 for the three months ended June 30, 2012 compared to cash used in operations before other items of $162,977 for the same period last year;
• The research and development expense for the quarter amounted to $208,356 compared to $210,996 for the same quarter last year; and
• Deferred revenue at June 30, 2012 was $6,712,216 (of which $5,292,359 is expected to be recognized in the next four quarters) compared to $6,320,199 at June 30, 2011, an increase of $392,017.

The research and development expense for the quarter amounted to $208,356 compared to $210,996 for the same quarter last year. During the current quarter, the Company incurred $111,102 for research and development activities related to an iPad application for Mobiquity Sell, Mobiquity Route™ and $54,546 primarily related to Smart Sign™.

Revenue for the year ended June 30, 2012 was $39,501,388 generating a gross profit of $8,020,245 or 20.3% of sales compared to $45,903,472 generating a gross profit of $10,129,378 or 22.1% of sales for the same period last year. The Loss from Operations for the year amounted to $1,092,841 compared to $68,550 for the previous year. As a result of the performance of the U.S. Eastern operations, management determined that the goodwill related to the original acquisition of Perfect Order was impaired. Further a provision should also be recorded against the Deferred income tax assets for the U.S. operations. Consequently, the Company recorded non-cash items of $7,195,380 for the Goodwill impairment and a write-down of Deferred income tax assets in the amount of $6,120,189. The Company also recorded $220,412 for the equity loss relating to the Investment in Equus. As a result the Net Loss for the period amounted to $14,717,158 ($0.09 per share) compared to Net Loss of $255,770 ($0.00 per share) for the same period last year.

The Company adopted IFRS in the first quarter of the current fiscal year. The Company has applied the transitional exceptions and exemptions to full retroactive application of IFRS in its preparation of an opening IFRS consolidated statement of financial position at July 1, 2010. Further details of the conversion to IFRS are provided in Management's Discussion and Analysis and in the Notes to the Company's audited Consolidated Financial Statements for the year ended June 30, 2012.

The Company has a 9.2% interest in Equus Total Return, Inc. (Equus), which is a public company trading on the NYSE under the symbol EQS. The Company is deemed to exert significant influence by virtue of having four Board members in common as well as a senior executive in common. Significant influence was reached when the four directors were elected to the Equus Board in May 2010 and the senior executive was appointed in June 2010.

Equus applies generally accepted accounting principles in the United States ("US GAAP") and is not required to consolidate portfolio company investments, including those in which Equus has a controlling interest. However, under IFRS Equus is required to consolidate investments in which it has a controlling interest and equity account for those investments Equus significantly influenced. The Company prepared consolidated financial statements for Equus as at June 30, 2012 in accordance with IFRS. The Company is unable to obtain information for dates prior to June 30, 2012 that would allow the preparation of financial information for Equus that fully reflect the impact of these differences between US GAAP and IFRS. As a result, Versatile Systems Inc. was unable to determine whether any adjustments were necessary to the carrying value of its investment in Equus as at June 30, 2011 and July 1, 2010 or the equity method income (loss) for the years ended June 30, 2012 and 2011.

As a result of the foregoing the Company's auditors could not issue an unqualified Auditors Report to accompany the Company's June 30, 2012 consolidated financial statements. As applicable legislation does not permit such a qualification, the Company had to seek exemptive relief under National Instrument 52-107 from the British Columbia Securities Commission and the Ontario Securities Commission (collectively "the Regulators"). The Regulators granted this relief with a Decision dated November 20, 2012, which permits the Company's auditors to issue their Auditors Report with a qualified opinion. The Decision also permits the Company's auditors to qualify their Auditors Report to accompany the Company's June 30, 2013 consolidated financial statements is so far as those statements relate to comparative information for the year ended June 30, 2012.

About Versatile

Versatile provides business solutions that enable companies to improve sales, marketing and distribution of their products. Versatile also provides information technology services for the implementation, maintenance and security of mission-critical computer environments. Versatile has the ability to architect solutions involving both proprietary and third party components. For more information: www.versatile.com.

Forward-Looking Statements

This document may contain forward-looking statements relating to Versatile's operations or to the environment in which it operates, which are based on Versatile's operations, estimates, forecasts and projections. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict or are beyond Versatile's control. A number of important factors including those set forth in other public filings could cause actual outcomes and results to differ materially from those expressed in these forward-looking statements. Consequently, readers should not place any undue reliance on such forward-looking statements. In addition, these forward-looking statements relate to the date on which they are made. Versatile disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Versatile Systems Inc.
Consolidated Statements of Financial Position
Expressed in U.S. dollars		June 30, 2012			June 30, 2011				July 1, 2010
ASSETS
Current Assets
	Cash and cash equivalents	$	434,725		$	978,656		$	1,738,036
	Accounts receivable		5,994,377			7,134,328			10,580,706
	Prepaid expenses		4,152,994			4,555,890			5,879,584
	Inventory		2,347,110			1,849,635			1,719,477
			12,929,206			14,518,509			19,917,803
Long-term accounts receivable			181,366			401,742			265,612
Long-term prepaid expenses			1,278,432			561,404			575,186
Investment in Equus			2,105,473			2,311,109			2,203,043
Capital assets			251,591			270,437			519,391
Intangible assets			167,206			159,544			174,228
Deferred income tax assets			880,407			7,001,156			6,965,850
Goodwill			2,718,970			9,914,350			9,914,350
		$	20,512,651		$	35,138,251		$	40,535,463
LIABILITIES
Current Liabilities
	Line of credit	$	1,988,675		$	1,007,767		$	1,353,312
	Accounts payable and accrued liabilities		5,544,888			6,823,643			9,955,342
	Current portion of deferred revenue		5,292,359			5,670,932			7,432,210
			12,825,922			13,502,342			18,740,864
Deferred Revenue			1,419,857			649,267			710,269
			14,245,779			14,151,609			19,451,133
SHAREHOLDERS' EQUITY
	Share Capital		54,433,709			54,433,709			54,433,709
	Warrants reserve		-			42,000			186,367
	Equity Reserve		4,629,219			4,578,470			4,231,539
	Deficit		(52,458,434	)		(37,741,276	)		(37,485,506	)
	Accumulated other comprehensive loss		(337,622	)		(326,261	)		(281,779	)
			6,266,872			20,986,642			21,084,330
		$	20,512,651		$	35,138,251		$	40,535,463

Versatile Systems Inc.
Consolidated Statements of Operations and Comprehensive Loss
(Unaudited - Prepared by Management)
Expressed in U.S. dollars		Three months ended June 30						Twelve months ended June 30
			2012			2011			2012			2011
			(unaudited)			(unaudited)
SALES		$	8,832,150		$	10,180,289		$	39,501,388		$	45,903,472
COST OF SALES			6,889,949			7,798,561			31,481,143			35,774,094
			1,942,201			2,381,728			8,020,245			10,129,378
EXPENSES
	Selling and marketing		1,269,214			1,186,724			4,571,281			4,659,897
	General and administrative		819,595			929,913			3,420,726			3,702,160
	Research and development		208,356			210,996			927,881			960,399
	Amortization of capital assets		43,164			51,473			168,388			225,227
	Legal fees		-			199,293			-			492,950
	Share-based compensation		-			141,658			8,749			202,564
	Foreign exchange loss (gain)		(7,353	)		(35,554	)		16,061			(45,269	)
			2,332,976			2,684,503			9,113,086			10,197,928
LOSS FROM OPERATIONS			(390,775	)		(302,775	)		(1,092,841	)		(68,550	)
	Interest expense		(62,203	)		(2,616	)		(82,282	)		(16,426	)
	Goodwill impairment		(7,195,380	)		-			(7,195,380	)		-
	Equity income (loss) from Investment in Equus		(105,875	)		43,181			(220,412	)		103,053
	Write-down of Investment in Equus to fair value		-			(304,543	)		-			(304,543	)
	Loss on sale of capital assets and investment		(190	)		(1,410	)		(1,724	)		(4,610	)
LOSS BEFORE INCOME TAXES			(7,754,423	)		(568,163	)		(8,592,639	)		(291,076	)
Current income tax expense			(995	)		(995	)		(4,330	)		-
Deferred income tax (expense) recovery			(6,319,821	)		131,027			(6,120,189	)		35,306
NET LOSS		$	(14,075,239	)	$	(438,131	)	$	(14,717,158	)	$	(255,770	)
Other comprehensive loss
	Foreign exchange translation		2,317			(11,189	)		(11,361	)		(44,482	)
Total comprehensive loss		$	(14,072,922	)	$	(449,320	)	$	(14,728,519	)	$	(300,252	)
LOSS PER SHARE (basic and diluted)			($0.09	)		($0.00	)		($0.09	)		($0.00	)

Versatile Systems Inc.

Consolidated Statements of Changes in Shareholders' Equity

(Unaudited - Prepared by Management)

Expressed in U.S. dollars
											Accumulated
											other
		Share		Warrant			Equity				comprehensive
		Capital		Reserve			Reserve		Deficit		loss				Total
Balance, July 1, 2010	$	54,433,709	$	186,367		$	4,231,539	$	(37,485,506	)	$	(281,779	)	$	21,084,330
Net loss		-		-			-		(255,770	)		-			(255,770	)
Foreign exchange on the
translation of VMS-UK		-		-			-		-			(44,482	)		(44,482	)
Expiration of warrants		-		(144,367	)		144,367		-			-			-
Share-based compensation
expense		-		-			202,564		-			-			202,564
Balance, June 30, 2011		54,433,709		42,000			4,578,470		(37,741,276	)		(326,261	)		20,986,642
Balance, June 30, 2011		54,433,709		42,000			4,578,470		(37,741,276	)		(326,261	)		20,986,642
Net loss		-		-			-		(14,717,158	)		-			(14,717,158	)
Foreign exchange on the
translation of VMS-UK		-		-			-		-			(11,361	)		(11,361	)
Expiration of warrants		-		(42,000	)		42,000		-			-			-
Share-based compensation
expense		-		-			8,749		-			-			8,749
Balance, June 30, 2012	$	54,433,709	$	-		$	4,629,219	$	(52,458,434	)	$	(337,622	)	$	6,266,872

Versatile Systems Inc.
Consolidated Statements of Cash Flows
(Unaudited - Prepared by Management)
Expressed in U.S. dollars		Three months ended June 30						Twelve months ended June 30
		2012			2011			2012			2011
		(unaudited)			(unaudited)
OPERATING ACTIVITIES
Net loss		$	(14,075,239	)	$	(438,131	)	$	(14,717,158	)	$	(255,770	)
Items not involving cash
	Amortization of capital assets		43,164			56,998			177,159			256,075
	Share-based compensation		-			141,658			8,749			202,564
	Goodwill impairment		7,195,380			-			7,195,380			-
	Equity loss (income) from Equus Investment		105,875			(43,181	)		220,412			(103,053	)
	Write-down of Investment in Equus		-			304,543			-			304,543
	Loss on sale of capital assets and investments		190			1,410			1,724			4,610
	Unrealized foreign exchange gain (loss)		29,389			(55,247	)		11,498			(54,014	)
	Deferred income taxes		6,319,821			(131,027	)		6,120,189			(35,306	)
Cash flow used in operations before other items			(381,420	)		(162,977	)		(982,047	)		319,649
	Net change in non-cash operating balance sheet items		326,310			502,259			(344,877	)		(432,742	)
			(55,110	)		339,282			(1,326,924	)		(113,093	)
INVESTING ACTIVITIES
	Purchase of shares in Equus		-			-			(14,776	)		(309,556	)
	Proceeds from disposition of capital assets		(17,387	)		(30,387	)		17,640			76,968
	Intangible assets - contract cost additions		(80,321	)		(81,223	)		(321,283	)		(324,891	)
	Intangible assets - contract cost recognized		107,293			102,056			313,621			339,116
	Purchase of capital assets		(29,957	)		26,465			(193,117	)		(82,379	)
			(20,372	)		16,911			(197,915	)		(300,742	)
FINANCING ACTIVITIES
	Proceeds from (Repayment of) line of credit		220,903			(131,060	)		980,908			(345,545	)
			220,903			(131,060	)		980,908			(345,545	)
Increase (Decrease) in cash and cash equivalents			145,421			225,133			(543,931	)		(759,380	)
Cash and cash equivalents, beginning of period			289,304			753,523			978,656			1,738,036
Cash and cash equivalents, end of period		$	434,725		$	978,656		$	434,725		$	978,656