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| 8-K - FORM 8-K - SITO MOBILE, LTD. | f8k081214_singletouch.htm |
Exhibit 99.1
Single Touch Reports Third Quarter Fiscal 2014 Financial Results
Achieves Double Digit Revenue Growth Quarter-Over-Quarter and Year-Over-Year
JERSEY CITY, NJ – August 12, 2014 –Single Touch Systems, Inc. (OTC BB: SITO), a technology-based mobile media solutions provider, today announced results for its fiscal third quarter ended June 30, 2014.
Financial Highlights:
| · | Revenue: For the third quarter of fiscal 2014, revenue was $2.1 million, representing an 18% increase from the previous quarter and an 11% increase from the third quarter of 2013. Revenue reflects strong growth in both media placement revenue and licensing and royalties revenue. |
| · | Gross Margins: For the third quarter of 2014, gross margins improved to 62%, compared to 58% for the same quarter in 2013. The increase is attributable to the media placement business that started in December 2013, having a relatively higher gross margin than the messaging business, and licensing and royalties revenue earned in the quarter for which there are no royalties and application costs. Underlying gross margin from messaging was 58% for the third quarter of 2014, which is unchanged from the third quarter of 2013. |
| · | Operating Profits: For the third quarter of 2014, on a pro-forma basis when separating out intellectual property (IP) related initiatives and stock based compensation expense, Single Touch’s core, underlying business generated positive operating profits, a trend that has been established during fiscal year ended September 30, 2013. |
| · | Cash Flow: Cash flow from operations was positive for Single Touch’s core business for the third quarter of 2014, a trend that has been established during fiscal year ended September 30, 2013. |
| · | Net Loss: Net loss for the third quarter of 2014 was $752,050, or $0.01 per share, compared to a net loss of $1.3 million, or $0.01 per share in the third quarter of 2013, which represents a 40% decrease that is primarily attributable to an increase in gross margin and a decrease in interest expense. |
“We have made tremendous progress meeting our operational and strategic goals this quarter,” reported Single Touch’s President and CEO, James Orsini. “In line with our plan to diversify revenue, we added six new clients and acquired our technology partner, DoubleVision Networks, which brings the ‘Followme’ product under Single Touch’s ownership and vastly increases our sales force. Additionally, we welcomed a new highly experienced board member and received overwhelming approval for a reverse stock split in order for Single Touch to become eligible to list on a national exchange. We are confident we have positioned Single Touch to continue to capture opportunities for growth and success as the company evolves into a dominant presence in the mobile media space.”
Conference call information:
Date:
Tuesday, August 12, 2014
Time: 4:30 P.M. Eastern Time (ET)
Dial in Number for U.S. & Canadian Callers: 877-407-8629
Dial in Number for International Callers (Outside of the U.S. & Canada): 201-493-6715
Participating on the call will be Single Touch's Chief Executive Officer James Orsini, Chief Financial Officer Kurt Streams, and Executive Vice President Corporate Development Jerry Hug. The Company plans to issue an earnings release prior to the call. To join the live conference call, please dial into the above referenced telephone numbers five to ten minutes prior to the scheduled conference call time. A live webcast and archive of the call will also be available on Single Touch's website at: http://singletouch.equisolvewebcast.com/q3-2014.
A replay will be available for 2 weeks starting on August 12, 2014 at approximately 8:00 P.M. ET. To access the replay, please dial 877-660-6853 in the U.S. and 201-612-7415 for international callers. The conference ID# is 414392.
About Single Touch Systems, Inc.
Single Touch Systems, Inc. is a technology based mobile solutions provider serving businesses, advertisers and brands. Through patented technologies and a modular, adaptable platform, Single Touch’s multi-channel messaging gateway enables marketers to reach consumers on all types of connected devices, with information that engages interest, drives transactions and strengthens relationships and loyalty. For more information about Single Touch Systems, Inc. visit: www.singletouch.net
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, our reliance on brand owners and wireless carriers, the possible need for additional capital as well other risks identified in our filings with the SEC. Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
| SINGLE TOUCH SYSTEMS INC. | ||||||||||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Revenue | ||||||||||||||||
| Wireless applications | $ | 1,940,147 | $ | 1,924,472 | $ | 5,844,468 | $ | 5,680,586 | ||||||||
| Licensing and royalties | 71,918 | — | 821,918 | — | ||||||||||||
| Media placement | 131,500 | — | 201,500 | — | ||||||||||||
| 2,143,565 | 1,924,472 | 6,867,886 | 5,680,586 | |||||||||||||
| Operating Expenses | ||||||||||||||||
| Royalties and application costs | 817,554 | 804,937 | 2,453,343 | 2,465,270 | ||||||||||||
| Research and development | 12,601 | 13,264 | 48,326 | 46,020 | ||||||||||||
| Compensation expense (including stock based | ||||||||||||||||
| compensation)* | 695,544 | 764,559 | 2,887,094 | 3,155,100 | ||||||||||||
| Depreciation and amortization | 152,087 | 163,292 | 453,935 | 478,227 | ||||||||||||
| General and administrative (including stock based | ||||||||||||||||
| compensation)* | 1,033,065 | 950,468 | 3,369,460 | 3,024,908 | ||||||||||||
| 2,710,851 | 2,696,520 | 9,212,158 | 9,169,525 | |||||||||||||
| Loss from operations | (567,286 | ) | (772,048 | ) | (2,344,272 | ) | (3,488,939 | ) | ||||||||
| Other Income (Expenses) | ||||||||||||||||
| Interest expense | (185,274 | ) | (490,987 | ) | (569,097 | ) | (1,078,540 | ) | ||||||||
| Net (loss) before income taxes | (752,560 | ) | (1,263,035 | ) | (2,913,369 | ) | (4,567,479 | ) | ||||||||
| Provision for income taxes | — | — | — | — | ||||||||||||
| Net income (loss) | $ | (752,560 | ) | $ | (1,263,035 | ) | $ | (2,913,369 | ) | $ | (4,567,479 | ) | ||||
| Basic and diluted loss per share | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.02 | ) | $ | (0.03 | ) | ||||
| Weighted average shares outstanding | 142,728,628 | 134,185,887 | 142,101,080 | 133,101,030 | ||||||||||||
| * Details of stock based compensation included within: | ||||||||||||||||
| Compensation Expense | $ | 70,725 | $ | 144,244 | $ | 388,520 | $ | 1,253,964 | ||||||||
| General Administrative | 269,647 | 209,517 | 1,060,242 | 696,760 | ||||||||||||
| Total | $ | 340,372 | $ | 353,761 | $ | 1,448,762 | $ | 1,950,724 | ||||||||
| SINGLE TOUCH SYSTEMS INC. | ||||||||||||
| UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||||
| June 30, | September 30, | |||||||||||
| 2014 | 2013 | |||||||||||
| Assets | ||||||||||||
| Current assets | ||||||||||||
| Cash and cash equivalents | $ | 1,976,201 | $ | 1,146,995 | ||||||||
| Accounts receivable, net - current portion | 1,603,209 | 1,347,827 | ||||||||||
| Prepaid consulting | 354,158 | 1,081,553 | ||||||||||
| Other prepaid expenses | 229,581 | 150,183 | ||||||||||
| Total current assets | 4,163,149 | 3,726,558 | ||||||||||
| Property and equipment, net | 231,426 | 238,815 | ||||||||||
| Other assets | ||||||||||||
| Accounts receivable, net | 450,000 | — | ||||||||||
| Prepaid consulting | — | 81,547 | ||||||||||
| Capitalized software development costs, net | 350,486 | 343,575 | ||||||||||
| Intangible assets: | ||||||||||||
| Patents | 367,172 | 467,837 | ||||||||||
| Patent applications cost | 1,028,096 | 768,646 | ||||||||||
| Software license | 831,000 | 831,000 | ||||||||||
| Other assets including security deposits | 116,412 | 65,228 | ||||||||||
| Total other assets | 3,143,166 | 2,557,833 | ||||||||||
| Total assets | $ | 7,537,741 | $ | 6,523,206 | ||||||||
| SINGLE TOUCH SYSTEMS INC. | ||||||||
| UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| June 30, | September 30, | |||||||
| 2014 | 2013 | |||||||
| Liabilities and Stockholders' Equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 1,498,296 | $ | 1,352,203 | ||||
| Accrued expenses | 726,186 | 209,323 | ||||||
| Accrued compensation - related party | 265,719 | 72,736 | ||||||
| Deferred licensing revenue | 303,082 | — | ||||||
| Current obligation under capital lease | 16,578 | 16,331 | ||||||
| Convertible debenture - related party | 629,755 | 585,708 | ||||||
| Convertible debentures - unrelated parties | 3,480,949 | 2,692,570 | ||||||
| Total current liabilities | 6,920,565 | 4,928,871 | ||||||
| Long-term liabilities | ||||||||
| Obligations under capital lease | 16,914 | 29,378 | ||||||
| Convertible debentures - unrelated parties | — | 440,593 | ||||||
| Total long-term liabilities | 16,914 | 469,971 | ||||||
| Total liabilities | 6,937,479 | 5,398,842 | ||||||
| Commitments and contingencies - See notes 9, 11 and 16 | ||||||||
| Stockholders' Equity | ||||||||
| Preferred stock, $.0001 par value, 5,000,000 shares authorized; | ||||||||
| none outstanding | — | — | ||||||
| Common stock, $.001 par value; 300,000,000 shares authorized, | ||||||||
| 142,728,628 shares issued and outstanding as of June 30, 2014 | ||||||||
| and $.001 par value; 200,000,000 shares authorized, | ||||||||
| 137,220,331 shares issued and outstanding as of September 30, 2013 | 142,729 | 137,220 | ||||||
| Additional paid-in capital | 133,269,919 | 130,886,161 | ||||||
| Accumulated deficit | (132,812,386 | ) | (129,899,017 | ) | ||||
| Total stockholders' equity | 600,262 | 1,124,364 | ||||||
| Total liabilities and stockholders' equity | $ | 7,537,741 | $ | 6,523,206 | ||||
Investor Contact:
Mike Bishop
The Blueshirt Group
415-217-4968
Mike@blueshirtgroup.com