JERSEY CITY, N.J.--(BUSINESS WIRE)--Single Touch Systems Inc. (OTC BB: SITO), a technology based mobile media solutions provider that enables businesses, advertisers and brands to easily connect with customers through its patented technologies, reported results for its fiscal first quarter ended December 31, 2011.
For the fiscal first quarter ended December 31, 2011, revenue increased 57.1% to $1.6 million, compared to revenue of $1.0 million for the same period in 2010. The increase in revenue, all of which was organic, was directly attributable to increased message volume through retailers and the launch of additional programs.
For the first fiscal quarter ended December 31, 2011, total quarterly customer message volume increased 83.0% compared to the same period last year. During the quarter, message volume increased consecutively month-to-month; November was +12.5% compared to October and December was +17.4% compared to November. These increases reflect the continued growth of the Company’s core messaging platform, combined with an expected spike in message volume associated with the holiday shopping season.
“We are extremely encouraged by the positive trends we continue to experience through our retail channels. We are especially excited about the strength of consumer adoption of Single Touch’s “Come Here, Your Product is Ready for Pickup” / “Be There, Your Delivery is on its Way” messaging solution. Retailers continue to embrace the fact that Single Touch’s technology enables them to deliver focused, relevant messages to their customers, in an efficient and cost-effective manner,” said James Orsini, Chief Executive Officer of Single Touch.
Mr. Orsini concluded, “As more and more companies recognize the importance of an integrated mobile marketing and communications strategy, Short Message Service (SMS) has emerged as the most intimate and trusted communications channel. Single Touch is well positioned to capitalize on the strength of its highly-scalable technology platform to cost effectively increase both its client base and message volume throughput.”
Loss from operations for the period ended December 31, 2011, excluding stock-based compensation and depreciation and amortization (adjusted EBIDTA) was $0.4 million compared to a loss of $0.5 million in 2010, a decrease of 17.9%.
Although Adjusted EBITDA is not a measure in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses Adjusted EBITDA to evaluate the performance of its underlying business and believes it is a useful tool for that purpose.
Please refer to “Reconciliation of Non-GAAP Measures” below.
The net loss for the period ended December 31, 2011 was $0.6 million compared to a loss of $4.9 million for the same period last year. The improvement was primarily attributable to significantly lower stock-based compensation expense of $31,000 incurred during the period, compared to $3.6 million incurred during the same period in 2010.
As of December 31, 2011, Single Touch had cash and cash equivalents of $1.6 million compared to $0.5 million at the beginning of the period. During the quarter, the Company raised $1.8 million through the issuance of convertible debt. Cash used in operations during the period was $0.6 million. Additionally, the Company invested $0.1 million in CapEx.
About Single Touch Systems Inc.
Single Touch Systems Inc. (SITO) is a technology based mobile solutions provider serving businesses, advertisers and brands. Through patented technologies and a modular, adaptable platform, SITO’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
Safe Harbor Statement
This news release contains forward-looking statements that involve risks and uncertainties and reflect Single Touch’s judgment as of the date of this release. These statements include those regarding strategy, growth and future operations. Actual events or results may differ from Single Touch’s expectations. The risks and uncertainties include reliance on brand owners and wireless carriers, the possible need for additional capital, as well as other risks identified in Single Touch’s most recent Form 10-K filing with the SEC. Single Touch disclaims any intent or obligation to update these forward-looking statements beyond the date of this press release, except as may be required by law.
| SINGLE TOUCH SYSTEMS, INC | ||||||||||
| UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||
| For the Three Months Ended | ||||||||||
| December 31, | ||||||||||
| 2011 | 2010 | |||||||||
| Revenue | ||||||||||
| Wireless applications | $ | 1,589,673 | $ | 1,011,738 | ||||||
| Operating Expenses | ||||||||||
| Royalties and application costs | 763,321 | 506,455 | ||||||||
| Research and development | 37,200 | 23,339 | ||||||||
| Compensation expense (including stock based | 693,823 | 3,994,398 | ||||||||
| compensation of $9,690 in 2011 and $2,700,000 in 2010) | ||||||||||
| Depreciation and amortization | 155,471 | 137,287 | ||||||||
| General and administrative (including stock based | ||||||||||
| compensation of $21,416 in 2011 and $1,185,281 in 2010) | 530,670 | 583,845 | ||||||||
| 2,180,485 | 5,245,324 | |||||||||
|
Loss from operations |
(590,812 | ) | (4,233,586 | ) | ||||||
| Other Income (Expenses) | ||||||||||
| Net gain (loss) on settlement of indebtedness | - | (651,315 | ) | |||||||
| Interest income | 25 | - | ||||||||
| Interest expense | (37,609 | ) | (13,622 | ) | ||||||
| Net (loss) before income taxes | (628,396 | ) | (4,898,523 | ) | ||||||
| Provision for income taxes | (800 | ) | (800 | ) | ||||||
| Net income (loss) | $ | (629,196 | ) | $ | (4,899,323 | ) | ||||
| Basic and diluted loss per share | $ | (0.00 | ) | $ | (0.04 | ) | ||||
| Weighted average shares outstanding | 130,182,392 | 124,734,617 | ||||||||
| SINGLE TOUCH SYSTEMS, INC | |||||||
| CONSOLIDATED BALANCE SHEETS | |||||||
| December 31, | September 30, | ||||||
| 2011 | 2011 | ||||||
| (Unaudited) | |||||||
| Assets | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 1,606,548 | $ | 523,801 | |||
| Accounts receivable - trade | 1,147,839 | 907,275 | |||||
| Prepaid expenses | 59,360 | 93,872 | |||||
| Other current asset | 155,000 | 155,000 | |||||
| Total current assets | 2,968,747 | 1,679,948 | |||||
| Property and equipment, net | 278,855 | 303,214 | |||||
| Other assets | |||||||
| Capitalized software development costs, net | 393,506 | 395,188 | |||||
| Intangible assets: | |||||||
| Patents | 560,290 | 714,623 | |||||
| Patent applications cost | 705,488 | 544,240 | |||||
| Deposits and other assets | 100,634 | 99,481 | |||||
| Total other assets | 1,759,918 | 1,753,532 | |||||
| Total assets | $ | 5,007,520 | $ | 3,736,694 | |||
|
Reconciliation of Non-GAAP Measures |
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| For the Three Months Ended December 31, | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2011 | 2010 | GAAP | Adjusted EBITDA | |||||||||||||||||||||||||||||||||||||||||||||||||
| Adjust- | Adjusted | Adjust- | Adjusted | Change | Change | |||||||||||||||||||||||||||||||||||||||||||||||
| GAAP | ments | EBITDA | GAAP | ments | EBITDA |
$ |
% |
$ |
% |
|||||||||||||||||||||||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Wireless Applications | $ | 1,589,673 | $ | 1,589,673 | $ | 1,011,738 | $ | 1,011,738 | $ | 577,935 | 57 | % | $ | 577,935 | 57 | % | ||||||||||||||||||||||||||||||||||||
| Operating Expenses | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Royalties and Application Costs | $ | 763,321 | $ | 763,321 | $ | 506,455 | $ | 506,455 | $ | 256,866 | 51 | % | $ | 256,866 | 51 | % | ||||||||||||||||||||||||||||||||||||
| Research and Development | $ | 37,200 | $ | 37,200 | $ | 23,339 | $ | 23,339 | $ | 13,861 | 59 | % | $ | 13,861 | 59 | % | ||||||||||||||||||||||||||||||||||||
| Compensation expense (including | $ | - | $ | - | ||||||||||||||||||||||||||||||||||||||||||||||||
| stock-based compensation) | $ | 693,823 | $ | (9,690 | ) | $ | 684,133 | $ | 3,573,198 | $ | (3,182,508 | ) | $ | 390,690 | $ | (2,879,375 | ) | -81 | % | $ | 293,443 | 75 | % | |||||||||||||||||||||||||||||
| Depreciation and amortization | $ | 155,471 | $ | (155,471 | ) | $ | - | $ | 137,287 | $ | (137,287 | ) | $ | - | $ | 18,184 | 13 | % | ||||||||||||||||||||||||||||||||||
| General and administrative (including | $ | - | $ | - | ||||||||||||||||||||||||||||||||||||||||||||||||
| stock-based compensation) | $ | 530,670 | $ | (21,416 | ) | $ | 509,254 | $ | 1,005,045 | $ | (421,200 | ) | $ | 583,845 | $ | (474,375 | ) | -47 | % | $ | (74,591 | ) | -13 | % | ||||||||||||||||||||||||||||
| $ | 2,180,485 | $ | (186,577 | ) | $ | 1,993,908 | $ | 5,245,324 | $ | (3,740,995 | ) | $ | 1,504,329 | $ | (3,064,839 | ) | -58 | % | $ | 489,579 | 33 | % | ||||||||||||||||||||||||||||||
| Loss from Operations/Adjusted EBITDA | $ | (590,812 | ) | $ | 186,577 | $ | (404,235 | ) | $ | (4,233,586 | ) | $ | 3,740,995 | $ | (492,591 | ) | $ | 3,642,774 | -86 | % | $ | 88,356 | -18 | % | ||||||||||||||||||||||||||||
| For the Three Months Ended December 31, | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2011 | 2010 | GAAP | Adjusted EBITDA | |||||||||||||||||||||||||||||||||||||||||||||||||
| Adjust- | Adjusted | Adjust- | Adjusted | Change | Change | |||||||||||||||||||||||||||||||||||||||||||||||
| GAAP | ments | EBITDA | GAAP | ments | EBITDA |
$ |
% |
$ |
% |
|||||||||||||||||||||||||||||||||||||||||||
| Professional Fees | $ | 166,960 | $ | (15,006 | ) | $ | 151,954 | $ | 253,821 | $ | 253,821 | $ | (86,861 | ) | -34 | % | $ | (101,867 | ) | -40 | % | |||||||||||||||||||||||||||||||
| Travel | $ | 138,841 | $ | 138,841 | $ | 55,049 | $ | 55,049 | $ | 83,792 | 152 | % | $ | 83,792 | 152 | % | ||||||||||||||||||||||||||||||||||||
| Consulting expense | $ | 106,925 | $ | (6,410 | ) | $ | 100,515 | $ | 605,195 | $ | (421,200 | ) | $ | 183,995 | $ | (498,270 | ) | -82 | % | $ | (83,480 | ) | -45 | % | ||||||||||||||||||||||||||||
| Office rent | $ | 45,291 | $ | 45,291 | $ | 29,704 | $ | 29,704 | $ | 15,587 | 52 | % | $ | 15,587 | 52 | % | ||||||||||||||||||||||||||||||||||||
| Insurance expense | $ | 28,156 | $ | 28,156 | $ | 17,586 | $ | 17,586 | $ | 10,570 | 60 | % | $ | 10,570 | 60 | % | ||||||||||||||||||||||||||||||||||||
| Equipment lease | $ | - | $ | - | $ | 22,500 | $ | 22,500 | $ | (22,500 | ) | -100 | % | $ | (22,500 | ) | -100 | % | ||||||||||||||||||||||||||||||||||
| Trade shows | $ | 12,000 | $ | 12,000 | $ | - | $ | - | $ | 12,000 | $ | 12,000 | ||||||||||||||||||||||||||||||||||||||||
| Telephone | $ | 11,610 | $ | 11,610 | $ | 7,836 | $ | 7,836 | $ | 3,774 | 48 | % | $ | 3,774 | 48 | % | ||||||||||||||||||||||||||||||||||||
| Office expense | $ | 8,056 | $ | 8,056 | $ | 2,745 | $ | 2,745 | $ | 5,311 | 193 | % | $ | 5,311 | 193 | % | ||||||||||||||||||||||||||||||||||||
| Other | $ | 12,831 | $ | 12,831 | $ | 10,609 | $ | 10,609 | $ | 2,222 | 21 | % | $ | 2,222 | 21 | % | ||||||||||||||||||||||||||||||||||||
| Total General and Administrative Expenses | $ | 530,670 | $ | (21,416 | ) | $ | 509,254 | $ | 1,005,045 | $ | (421,200 | ) | $ | 583,845 | $ | (474,375 | ) | -47 | % | $ | (74,591 | ) | -13 | % | ||||||||||||||||||||||||||||