- Q3 Net Earnings: $1.7 million, or $0.07 per share fully diluted,

compared with net earnings of $0.5 million, or $0.02 per share fully

diluted, in Q3 2008

- Cash, cash equivalents and short-term investments increased to

$61.5 million

OTTAWA, Nov. 5 /CNW/ - Bridgewater Systems (TSX: BWC), the mobile personalization company, today announced its financial results for the three and nine months ended September 30, 2009. All amounts are stated in Canadian dollars unless otherwise noted.

"The Company delivered strong financial performance in the third quarter, highlighted by significant revenue and earnings growth over the prior year," said Ed Ogonek, CEO of Bridgewater Systems. "In addition to continued success in our core markets, we made important progress in the third quarter with our strategy to expand into the 4G market. We introduced a comprehensive product suite for the LTE market and built on our early leadership with WiMAX operators.

"Supported by a strong financial position, high revenue visibility, and our new business pipeline, we are increasing investments in growth initiatives in the coming quarters," added Mr. Ogonek. "These investments are aimed at building our operations support infrastructure, as well as accelerating our expansion in certain geographic markets and continuing our 4G product development. We believe these investments position Bridgewater to capitalize on the substantial growth in next-generation mobile data services."

Financial Highlights

- Q3 2009 revenue increased 53% to $15.8 million, compared with

$10.3 million for the same period last year. The year-over-year

increase mainly reflects license revenue from a significant project,

as well as revenue from the delivery of the WideSpan systems to

Verizon Wireless and Cricket Communications.

- Revenue for the first nine months of 2009 was $45.9 million, 50%

higher than revenue in the first nine months of fiscal 2008.

- Q3 2009 gross margin was $10.1 million (64% of revenue) versus

$7.7 million (75% of revenue) in Q3 2008, reflecting increases in

direct product costs and anticipated investments in operations

support infrastructure, as well as internal and subcontracting costs

incurred to support the increase in professional services

engagements.

- Total operating expenses in Q3 2009 were $8.5 million (54% of

revenue), compared with $7.5 million (73% of revenue) in the same

period last year.

- Net earnings for Q3 2009 were $1.7 million, or $0.07 per share fully

diluted, compared to $0.5 million, or $0.02 per share fully diluted,

in the prior year period.

- Net earnings for the year-to-date period increased to $8.7 million,

or $0.35 per share fully diluted, compared with $1.1 million, or

$0.04 per share fully diluted, for the same period in 2008.

- Increased cash, cash equivalents and short-term investments to

$61.5 million, compared with $50.4 million at December 31, 2008.

Business Highlights

- Unveiled Bridgewater's LTE product suite for the Evolved Packet Core,

including the Bridgewater(R) Home Subscriber Server and Policy

Controller. These solutions help service providers rapidly trial and

launch LTE services and manage mobile data traffic, subscribers,

applications, and devices. Several global trials with major service

providers are in the planning and implementation stages.

- Expanded the Company's 4G partner and interoperability ecosystem for

LTE and WiMAX, Some of the companies in our ecosystem include:

Starent Networks, Alvarion, Motorola, NEC, Hitachi, Samsung,

WiChorus, and Verint.

- Extended global market leadership in WiMAX with five new wins in the

quarter, bringing the total number of WiMAX customers to 38.

Bridgewater announced selection by Global Mobile, one of Taiwan's

leading 4G operators. The Company also announced selection by 4

US-based WiMAX service providers to accelerate the launch of 4G

broadband services to rural communities as part of broadband stimulus

initiatives. In addition, Bridgewater received United States

Department of Agriculture Rural Utility Service acceptance for its

WiMAX solutions.

- Awarded approximately US$18.8 million in additional orders by Verizon

Wireless for its WideSpan(R) integrated system, including subscriber

data management and service control, to manage the rapid growth in

the company's popular mobile data services.

- Won xchange magazine's Best of 4G award in the Best Mobile Internet

Application category for Bridgewater's myPolicy(TM) solution for the

Apple(R) iPhone and Research in Motion's BlackBerry(R).

Outlook

Based on its year-to-date performance, Bridgewater increased its annual guidance to:

- Revenues of $62 to $64 million

- Net earnings of $9.5 to $10.0 million.

Factors supporting Bridgewater's annual outlook include: high revenue visibility due to significant multi-year contracts with Tier 1 customers; a large installed customer base in existing and emerging markets; long-term industry trends, particularly the growth in mobile data services and applications.

The complete financial statements and management's discussion and analysis for the three and nine months ended September 30, 2009 can be found at www.bridgewatersystems.com or at www.sedar.com.

Conference Call and Webcast

A conference call and webcast will be held today, Thursday, November 5, 2009, at 8:30 am EDT to discuss this announcement. The telephone numbers to access the call are 416-644-3432 or 1-877-974- 0446. To access the live webcast, please visit www.bridgewatersystems.com or www.newswire.ca. Participants will require Windows Media Player(TM) to listen to the webcast.

About Bridgewater Systems

Bridgewater Systems, the mobile personalization company, enables service providers to efficiently manage and profit from mobile data services, content and commerce. The company's market leading mobile personalization portfolio provides a real-time, unified view of subscribers including entitlements, devices, networks, billing profiles, preferences and context. Anchored by Bridgewater's Subscriber Data Broker(TM), the portfolio of carrier-grade and standards-based products includes the Bridgewater(R) Service Controller (AAA), the Bridgewater(R) Policy Controller (PCRF) and the Bridgewater(R) Home Subscriber Server (HSS). More than 140 leading service providers including America Movil, Bell Canada, Clearwire, Cox, Hutchison Telecom, Iusacell, Scartel, SmarTone- Vodafone, Sprint, Tata Teleservices, Tatung, Telmex, Telstra, and Verizon Wireless use Bridgewater's solutions to rapidly deliver innovative mobile services. For more information, visit us at www.bridgewatersystems.com.

Bridgewater, Bridgewater Systems, the Bridgewater Systems logo, WideSpan, Smart Caps, myPolicy, and Subscriber Data Broker are trademarks or registered trademarks of Bridgewater Systems Corporation. All other company, product names and any registered and unregistered trademarks mentioned are used for identification purposes only and remain the exclusive property of their respective owners.

Certain statements in this release, including the guidance provided above, constitute forward-looking statements or forward- looking information within the meaning of applicable securities laws and are made pursuant to the "safe harbour" provisions of such laws. These statements are subject to certain assumptions, risks and uncertainties. Readers are cautioned not to place undue reliance on such statements. Risk factors that may cause the actual results, performance, achievements or developments of the Company to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements can be found in the public documents filed by the Company with Canadian securities regulatory authorities. In particular, actual results could differ materially from those expressed in any forward- looking statements. For a list of risk factors, please refer to Bridgewater's Annual Information Form dated March 31, 2009. The Company assumes no obligation to update or revise any forward- looking statements, whether as a result of new information, future events or otherwise.

BRIDGEWATER SYSTEMS CORPORATION

Consolidated Statements of Earnings and

Comprehensive Earnings

(expressed in Canadian dollars)

(unaudited)

----------------------------------------------------------------- --------

Three months ended Nine months ended

--------------------------- ---------------------------

September 30, September 30, September 30, September 30,

2009 2008 2009 2008

------------- ------------- ------------- -------------

------------- -------------

Revenue

Product $ 11,550,556 $ 5,963,509 $ 33,967,118 $ 19,667,267

Service and

support 4,218,772 4,330,185 11,979,795 10,987,453

----------------------------------------------------------------- --------

15,769,328 10,293,694 45,946,913 30,654,720

Cost of sales 5,636,789 2,555,297 13,043,502 6,609,576

----------------------------------------------------------------- --------

Gross margin 10,132,539 7,738,397 32,903,411 24,045,144

----------------------------------------------------------------- --------

Expenses

Sales and

marketing 3,408,637 3,329,261 9,623,026 9,825,762

Research and

development 3,863,831 3,215,931 11,045,295 11,599,745

General and

administration 1,100,750 920,117 4,204,437 2,867,302

Bad debt

(recovery) expense - (9,854) (263,897) 57,612

Stock-based

compensation 100,598 72,050 271,086 168,818

----------------------------------------------------------------- --------

8,473,816 7,527,505 24,879,947 24,519,239

----------------------------------------------------------------- --------

Earnings (loss)

before undernoted

items 1,658,723 210,892 8,023,464 (474,095)

Foreign exchange

(loss) gain (225,009) 76,922 (130,401) 627,553

Interest and

other income 74,095 275,595 472,989 987,097

----------------------------------------------------------------- --------

Earnings before

income taxes 1,507,809 563,409 8,366,052 1,140,555

Future income tax

recovery (expense) 143,000 (80,000) 313,000 (80,000)

----------------------------------------------------------------- --------

NET EARNINGS AND

COMPREHENSIVE

EARNINGS $ 1,650,809 $ 483,409 $ 8,679,052 $ 1,060,555

----------------------------------------------------------------- --------

----------------------------------------------------------------- --------

Net earnings

per share -

basic $ 0.07 $ 0.02 $ 0.36 $ 0.05

Net earnings

per share -

diluted 0.07 0.02 0.35 0.04

Weighted average

number of shares

outstanding -

basic 24,359,491 22,758,098 23,940,792 22,546,214

Weighted average

number of shares

outstanding -

diluted 25,237,721 24,208,862 24,909,273 24,216,263

BRIDGEWATER SYSTEMS CORPORATION

Consolidated Balance Sheets

(expressed in Canadian dollars)

(unaudited)

----------------------------------------------------------------- --------

September 30, December 31,

2009 2008

-------------- --------------

--------------

CURRENT ASSETS

Cash and cash equivalents $ 43,326,794 $ 50,363,771

Short-term investments 18,166,784 -

Accounts receivable 16,552,336 13,423,994

Unbilled receivables 8,336,658 968,363

Deferred cost of sales 8,334,939 3,518,085

Prepaid expenses and other assets 5,864,554 1,735,267

Future income tax asset 2,567,000 2,557,000

----------------------------------------------------------------- --------

103,149,065 72,566,480

DEFERRED COST OF SALES - 5,525,354

FUTURE INCOME TAX ASSET 6,066,000 5,763,000

CAPITAL ASSETS 4,124,488 3,351,911

----------------------------------------------------------------- --------

$ 113,339,553 $ 87,206,745

----------------------------------------------------------------- --------

----------------------------------------------------------------- --------

CURRENT LIABILITIES

Accounts payable and

accrued liabilities $ 6,493,218 $ 7,305,923

Deferred revenue 42,120,710 24,013,113

----------------------------------------------------------------- --------

48,613,928 31,319,036

----------------------------------------------------------------- --------

SHAREHOLDERS' EQUITY

Share capital 69,596,430 68,444,332

Contributed surplus 838,006 834,041

Deficit (5,708,811) (13,390,664)

----------------------------------------------------------------- --------

64,725,625 55,887,709

----------------------------------------------------------------- --------

$ 113,339,553 $ 87,206,745

----------------------------------------------------------------- --------

----------------------------------------------------------------- --------

BRIDGEWATER SYSTEMS CORPORATION

Consolidated Statements of Cash Flows

(expressed in Canadian dollars)

(unaudited)

----------------------------------------------------------------- --------

Three months ended Nine months ended

--------------------------- ---------------------------

September 30, September 30, September 30, September 30,

2009 2008 2009 2008

------------- ------------- ------------- -------------

------------- -------------

NET (OUTFLOW)

INFLOW OF CASH

RELATED TO THE

FOLLOWING

ACTIVITIES:

OPERATING

Net earnings $ 1,650,809 $ 483,409 $ 8,679,052 $ 1,060,555

Items not

affecting

cash

Bad debt

expense - - 223,838 67,466

Stock-based

compensation 100,598 72,050 271,086 168,818

Foreign

exchange loss

(gain) on

cash held in

foreign

currency 1,541,372 (311,360) 3,192,622 (322,264)

Future income

tax (recovery)

expense (143,000) 80,000 (313,000) 80,000

Amortization of

capital assets 419,057 385,226 1,012,178 997,811

----------------------------------------------------------------- --------

3,568,836 709,325 13,065,776 2,052,386

Changes in

non-cash

operating

working

capital items 2,833,209 (1,654,967) 2,802,205 (1,905,827)

----------------------------------------------------------------- --------

6,402,045 (945,642) 15,867,981 146,559

----------------------------------------------------------------- --------

INVESTING

Repayment of

note receivable - - - 10,000,000

Purchase of

short-term

investments (18,166,784) - (18,166,784) -

Purchases of

capital assets (474,191) (90,516) (1,433,330) (995,842)

----------------------------------------------------------------- --------

(18,640,975) (90,516) (19,600,114) 9,004,158

----------------------------------------------------------------- --------

FINANCING

Proceeds from

issuance of

common shares 204,124 363,179 2,374,927 932,534

Repurchase of

shares under

normal course

issuer bid (698,807) - (2,487,149) -

Share issuance

costs - - - (66,558)

----------------------------------------------------------------- --------

(494,683) 363,179 (112,222) 865,976

----------------------------------------------------------------- --------

Foreign exchange

(loss) gain on

cash held in

foreign currency (1,541,372) 311,360 (3,192,622) 322,264

----------------------------------------------------------------- --------

NET CASH (OUTFLOW)

INFLOW (14,274,985) (361,619) (7,036,977) 10,338,957

CASH AND CASH

EQUIVALENTS,

BEGINNING

OF PERIOD 57,601,779 39,271,815 50,363,771 28,571,239

----------------------------------------------------------------- --------

CASH AND CASH

EQUIVALENTS,

END OF PERIOD $ 43,326,794 $ 38,910,196 $ 43,326,794 $ 38,910,196

----------------------------------------------------------------- --------

----------------------------------------------------------------- --------

Supplementary

information:

Cash on hand and

bank balances $ 12,514,071 $ 11,485,740 $ 12,514,071 $ 11,485,740

Cash equivalents 30,812,723 27,424,456 30,812,723 27,424,456

----------------------------------------------------------------- --------

Total cash

and cash

equivalents $ 43,326,794 $ 38,910,196 $ 43,326,794 $ 38,910,196

--------------------------------------------- ------------------- --------

--------------------------------------------- ------------------- --------

Interest

received $ 74,095 $ 275,595 $ 469,596 $ 987,097

BRIDGEWATER SYSTEMS CORPORATION

Consolidated Statements of Shareholders' Equity

(expressed in Canadian dollars)

(unaudited)

----------------------------------------------------------------- --------

Common Shares Contributed

Number Amount Surplus

------ ------ -------

----------------------------------------------------------------- --------

Three months ended

September 30, 2009

-------------------

Balance at June 30, 2009 24,361,445 $ 69,732,077 $ 762,411

----------------------------------------------------------------- --------

Stock-based compensation - - 100,598

Repurchase of shares under

normal course issuer bid (128,345) (364,774)

Exercise of stock options 96,895 229,127 (25,003)

Net earnings - - -

----------------------------------------------------------------- --------

Balance at September 30, 2009 24,329,995 $ 69,596,430 $ 838,006

----------------------------------------------------------------- --------

----------------------------------------------------------------- --------

Nine months ended

September 30, 2009

-------------------

Balance at December 31, 2008 22,969,701 $ 68,444,332 $ 834,041

----------------------------------------------------------------- --------

Stock-based compensation - - 271,086

Repurchase of shares under

normal course issuer bid (528,485) (1,489,950) -

Exercise of stock options 1,888,779 2,642,048 (267,121)

Net earnings - - -

----------------------------------------------------------------- --------

Balance at September 30, 2009 24,329,995 $ 69,596,430 $ 838,006

----------------------------------------------------------------- --------

----------------------------------------------------------------- --------

----------------------------------------------------------------- --------

Shareholders'

Deficit Equity

------- ------

-----------------------------------------------------------

Three months ended

September 30, 2009

-------------------

Balance at June 30, 2009 $ (7,025,587) $ 63,468,901

-----------------------------------------------------------

Stock-based compensation - 100,598

Repurchase of shares under

normal course issuer bid (334,033) (698,807)

Exercise of stock options - 204,124

Net earnings 1,650,809 1,650,809

-----------------------------------------------------------

Balance at September 30, 2009 $ (5,708,811) $ 64,725,625

-----------------------------------------------------------

-----------------------------------------------------------

Nine months ended

September 30, 2009

-------------------

Balance at December 31, 2008 $(13,390,664) $ 55,887,709

-----------------------------------------------------------

Stock-based compensation - 271,086

Repurchase of shares under

normal course issuer bid (997,199) (2,487,149)

Exercise of stock options - 2,374,927

Net earnings 8,679,052 8,679,052

-----------------------------------------------------------

Balance at September 30, 2009 $ (5,708,811) $ 64,725,625

-----------------------------------------------------------

-----------------------------------------------------------

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