TORONTO, ONTARIO — (Marketwired) — 08/29/13 — A correction from source is being issued with respect to the press release for Route1 Inc. that was disseminated today, Thursday August 29 at 11 am EST. There are three big changes from the original press release: 1) The beginning of the first sentence in the section named “Q2 2013 Financial Results Summary” has been changed from “For the six month period ended…” to “For the three month period ended…” 2) The end of the first sentence in the section named “Year-to-date 2013 Financial Results Summary” has been changed from “… in the second quarter of 2012” to “… in the first half of 2012.” 3) The original release did not include the section named “Paid, Active Subscribers”, which includes a small table and two paragraphs directly underneath. The corrected release follows.
(TSX VENTURE: ROI), a digital security and identity management company whose customers include the U.S. Department of Defense, the Department of Homeland Security, the Department of Energy, and the Government of Canada, today announced its financial results for the three and six month period ended June 30, 2013.
Operating results for the three and six month period ended June 30, 2012 were positively affected by the proceeds of an arbitration award which was received in January 2012. For additional information, please see Route1-s June 30, 2013 Financial Statements and Management-s Discussion & Analysis.
Q2 2013 Financial Results Summary
For the three month period ended June 30, 2013, total revenue decreased to $1.4 million from $1.9 million in the second quarter of 2012. The decrease was a result of recognizing $0.6 million of services revenue from the arbitration award during the second quarter of 2012.
Gross profit decreased during the second quarter to $1.1 million compared from $1.7 million during the same period in the prior year. The decrease in gross profit is attributable to the arbitration award. Operating expenses for the three months ended June 30, 2013 were $1.2 million compared to $1.1 million for the same period in 2012. The increase was primarily a result of:
As a result, Route1-s second quarter 2013 total comprehensive net loss was $0.1 million compared to total comprehensive net income of $0.5 million during the same period in the prior year. Earnings before interest, tax, depreciation, and amortization (EBITDA) during the three-month period amounted to ($7,000) compared to an EBITDA of $0.6 million in the second quarter of 2012.
As at June 30, 2013, Route1 had no bank debt and a cash balance of $2.6 million.
Year-to-date 2013 Financial Results Summary
For the six month period ended June 30, 2013, total revenue decreased to $2.4 million from $4.8 million in the first half of 2012. Gross profit also decreased for the six month period ended June 30, 2013 to $2.0 million from $4.0 million during the same period in the prior year. The decrease in total revenue and gross profit is a result of the arbitration award.
Operating expenses for the six months ended June 30, 2013 were $2.1 million compared to $2.3 million for the same period in 2012. The reduction in operating expenses was driven by lower professional fees, an increase in the SR&ED tax credit amount, and lower salaries and benefits costs.
As a result, Route1-s year-to-date 2013 total comprehensive net loss was $0.2 million compared to total comprehensive net income of $1.5 million during the same period in the prior year.
Paid, Active Subscribers
As at June 30, 2013, Route1 had 14,784 paying, active subscribers.
Services revenue for the three months ended June 30, 2013 includes the impact of Route1-s November 20, 2012 press release where Route1 announced that it had received a second purchase order from a component of the United States Department of Defense.
“We continue to make progress in growing our MobiKEY application software revenue base. Over the last four quarters we have grown our recurring, services revenue base by more than 22%,” said Tony P. Busseri, CEO of Route1. “We continue to aggressively pursue business opportunities that will grow our paid user base and where possible, improve the quality of our services revenue.”
Business Development Outlook
Route1 has advanced the plan it laid out to shareholders on April 11, 2013 during its fiscal year 2012 investor conference call and webcast. For confidentiality and competition reasons, Route1 is limited in what it can communicate to the market on any one specific business development opportunity but the below overview describes at a high level, current business development activity.
U.S. Department of Defense (DoD)
U.S. Government Civilian
Canadian Government
Enterprise
Product Development Progress
Recent Releases:
Route1 Design Axioms:
Upcoming Releases:
2013 and 2014 Releases Target
There are also a number of additional product development projects being considered or at a premature stage to detail as part of Route1-s Releases Target.
Product development plans are subject to change without notice, based on market factors and/or client demands.
Website
On august 26, 2013 Route1 launched a new website at .
ABOUT ROUTE1, INC.
Route1 delivers industry-leading security and identity management technologies to corporations and government agencies that require universal, secure access to digital resources and sensitive data. These customers depend on The Power of MobiNET – Route1-s universal identity management and service delivery platform. MobiNET provides identity assurance and individualized access to applications, data and networks. Headquartered in Toronto, Canada, Route1 is listed on the TSX Venture Exchange.
For more information, visit our website at: .
This news release, required by applicable Canadian laws, does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
© Route1 Inc., 2013. All rights reserved. Route1, the Route1 and shield design Logo, SECURING THE DIGITAL WORLD, Mobi, MobiSecure, MobiLINK, Route1 MobiKEY, Route1 MobiVDI, MobiKEY, MobiKEY IBAD, DEFIMNET, MobiNET, Route1 MobiNET, TruOFFICE, TruFLASH, TruOFFICE VDI, MobiKEY Fusion, MobiNET Aggregation Gateway, MobiNET Switching Array, MobiNET Secure Gateway, EnterpriseLIVE, EnterpriseLIVE Virtualization Orchestrator, MobiNET Agent, MobiKEY Classic and MobiKEY Classic 2, are either registered trademarks or trademarks of Route1 Inc. in the United States and or Canada. All other trademarks and trade names are the property of their respective owners. The DEFIMNET and MobiNET platforms, the MobiKEY, MobiKEY Classic, MobiKEY Classic 2 and MobiKEY Fusion devices, and MobiLINK are protected by U.S. Patents 7,814,216 and 7,739,726, Canadian Patent 2,578,053, and other patents pending.
Other product and company names mentioned herein may be trademarks of their respective companies.
Contacts:
Route1 Inc.
Tony Busseri
CEO
+1 416 814-2635
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