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01 Communique Reports First Quarter Fiscal 2011 Results

^{Published on 2011-03-15 13:15:39 - Market Wire}
 

TORONTO, March 15 /CNW/ - 01 Communique Laboratory Inc. (TSX: ONE) today announced results for its first quarter of fiscal 2011, which ended January 31. Revenue was $135,265 compared to revenue of $75,035 for 2010. The loss for the period was $829,936 compared to a loss of $416,751 for 2010. We completed the period with $4,726,881 of cash and cash equivalents on hand.

"We are moving forward with our plan to build value in our company based on our intellectual property," said Andrew Cheung, President and CEO for 01. "At the present time, we are protecting our intellectual property rights on two fronts. In the LogMeIn patent infringement case we are waiting for a court order on a summary judgment motion as we prepare in earnest for trial scheduled to commence May 2, 2011. In the Citrix patent infringement case we are now waiting for the Court's decision on our motion to lift the stay. We have also released our new online meeting product, I'm InTouch Meeting, opening up the online collaboration market for our products. We remain committed to participate in the growth of the remote access and online meeting/communications market and believe our strategy of direct sales combined with product and IP licensing provides us with the best opportunity to achieve this goal."

Highlights -

• The loss includes $442,953 of patent litigation and re-examination costs, the majority of which relate to the patent litigation with LogMeIn. Excluding these costs the adjusted loss becomes $386,983 which is lower than the first quarter of 2010.
  
  
• On December 15, 2010, Dell entered into a settlement agreement, whereby Dell has discontinued the Dell Remote Access Products and Services accused of infringement in the action and paid us a settlement amount. The settlement amount is not material to either company.
  
  
• We are in various stages of communication with a number of companies with an objective to enter into partnerships and licensing agreements. Our goal is to develop IP licensing revenue from companies looking to market our product offerings along the lines of our agreement with Hitachi Business Solution of Japan as well as enter into licensing arrangements with respect to our patents.
  
  
• We recently released our new online collaboration product, I'm InTouch Meeting, a web-based service that enables users to easily conduct online meetings by inviting up to 15 attendees to join the meeting using their desktop PC's.  We are marketing it on a subscription basis, similar to the I'm InTouch hosted service, whereby we host the infrastructure servers and charge a subscription fee.  

Financial Highlights -

The loss was $829,936 for the first quarter 2011, which compares to a corresponding loss of $416,751 for the same period in 2010, representing an increase of $413,185.  This increase is a result of:

1. Revenue increase of $60,230 primarily a result of an increase in licensing revenue.
2. An increase of $442,953 in patent litigation and re-examination expenses. The 2011 expense relates primarily to expenses for the litigation against LogMeIn.
3. Selling, general and administrative expenses ("SG&A") expenses net of stock based compensation were $262,017 for 2011 compared to $213,395 for 2010, an increase of $48,622. SG&A expenses have increased during the period with the majority of the increase a result of an increase in salary related costs and the costs associated with operating the Company's U.S. office.  
4. Research and development expenses of $235,354 for 2011 compared to $181,586 for 2010 an increase of $53,768. The majority of the increase is a result in an increase in contract fees and an increase in costs associated with an increase in head count.
5. Operating expenses, excluding stock-based compensation and patent enforcement and re-examination expenses are expected to continue at approximately the current level for the next quarter. In addition, the Company expects to continue to incur a significant amount of expenses in preparation for the May 2, 2011 trial.

We completed the period with cash and cash equivalents of $4,726,881 a decrease of $142,517 for the first quarter from the $4,869,398 on hand at the beginning of the quarter. This decrease is a result of:

1. Cash being used to fund the operating activities of $550,879, which is the loss for the quarter of $829,936 adjusted for non-cash expenses of $3,738 for depreciation and amortization, $30,250 for stock-based compensation, and an increase in non-cash working capital of $245,069.
2. Cash provided by the issuance of common shares on exercise of options, debenture warrants and agent units options for $409,171.

The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.

About 01 Communique
Established in 1992, 01 Communique (TSX: ONE) offers a suite of remote access services designed for small-medium sized business, mobile professionals and IT service providers. 01's software as a service offerings are deployed on-demand and include functionality enabling on-line meetings, remote computing and IT support. 01's suite of products includes its remote access offering I'm InTouch ([ www.imintouch.com ]), its online meeting offering ([ www.imintouchmeeting.com ]) and its remote support offering I'm OnCall ([ www.imoncall.com ]) products are protected in the U.S.A. by its patents #6928479 / #6938076. For more information, visit [ www.01com.com ] or call (905) 795-2888 or (800) 668-2185 (North America only).

Cautionary Note Regarding Forward-looking Statements.
Certain statements in this news release may constitute "forward-looking" statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this news release, such statements use such words as "may", "will", "expect", "believe", "plan", "intend", "are confident" and other similar terminology. These statements reflect current expectations regarding future events and operating performance and speak only as of the date of this news release.  Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved.  A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed under "Risk Factors" in the company's Annual Information Form filed on SEDAR.  Although the forward-looking statements contained in this news release are based upon what management of the Company believes are reasonable assumptions, the company cannot assure investors that actual results will be consistent with these forward looking statements. These forward-looking statements are made as of the date of this news release, and the company assumes no obligation to update or revise them to reflect new events or circumstances.