Veriteq (DIGA) 8-K Digital Angel Announces Fourth Quarter and Fiscal Year 2010 Financial Results

Exhibit 99.1

FOR IMMEDIATE RELEASE:

DIGITAL ANGEL ANNOUNCES FOURTH QUARTER AND FISCAL YEAR 2010 FINANCIAL RESULTS

SO. ST. PAUL, MN, March 30, 2011 - Digital Angel (OTC Bulletin Board: DIGA), an advanced technology company in the field of animal identification and emergency identification solutions, today announced financial results for the fourth quarter and fiscal year ended December 31, 2010.

Joseph Grillo, Digital Angel’s Chief Executive Officer, commented, “As a result of the corporate and operational changes made in 2010, we reduced overhead costs and lowered expenses.  Despite this progress, capital constraints and limited options for corporate financing made 2010 a challenging year.  AgriCapital Corporation, a financial advisor hired by the Digital Angel Board of Directors in fourth quarter of 2010 to explore alternative strategies for the business, has narrowed the list and provided management and the Board with several options that are actively being explored.”

The financial results are shown below in the data tables.

Results Conference Call

The Company will host a conference call to discuss the results at 10:00 a.m. ET today. Interested participants should call (877) 470-1843 within the United States and Canada, or (706) 643-9051 internationally. Please use access code 54411746.  Alternatively, a simultaneous webcast of the live conference call can be accessed through Digital Angel’s website at www.digitalangel.com.

For persons unable to participate in either the conference call or the webcast, a replay will be available from March 30, 2011 at approximately 11:00 a.m. ET to April 30, 2011 at 11:59 p.m. ET. For the telephonic replay, dial (800) 642-1687 (USA/Canada) or (706) 645-9291 (international), using access code 54411746. The webcast replay can also be accessed through Digital Angel's website at www.digitalangel.com

About Digital Angel

Digital Angel (OTCBB: DIGA) is an advanced technology company in the field of animal identification and emergency identification solutions. Digital Angel's products are utilized around the world in such applications as pet identification, using its patented, FDA-approved implantable microchip; livestock identification and herd management using visual and radio frequency identification (RFID) ear tags; and global positioning systems (GPS) search and rescue beacons for army, navy and air force applications worldwide. For further information please visit www.digitalangel.com.

Safe Harbor Statement

This press release contains certain "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Forward-looking statements included in this press release include, without limitation, those concerning expectations regarding the expected benefits of the technology and impact of the new orders on the Company's financial results. These forward-looking statements are based on the Company's current expectations and beliefs and are subject to a number of risks, uncertainties and assumptions. Additional information about these and other factors that could affect the Company's businesses is set forth in the Company's Form 10-K under the caption "Risk Factors" filed with the Securities and Exchange Commission ("SEC") on April 1, 2010, and subsequent filings with the SEC. The Company undertakes no obligation to update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this statement or to reflect the occurrence of unanticipated events, except as required by law.

Non-GAAP Financial Measure

To supplement the Company’s preliminary consolidated financial statements presented in accordance with generally accepted accounting principles (“GAAP”), the Company provides EBITDA, which is a non-GAAP financial measure. EBITDA is defined as operating income (loss) plus depreciation and amortization as presented in the Company’s Preliminary Consolidated Statement of Operations. EBITDA should not be considered as an alternative to operating income or net income (as determined in accordance with GAAP) as a measure of the Company’s operating performance or to net cash provided by operating, investing and financing activities (as determined in accordance with GAAP) as a measure of the Company’s ability to meet cash needs. The Company believes that EBITDA is a measure commonly reported and widely used by investors and other interested parties as a measure of a company’s operating performance and debt servicing ability because it assists in comparing performance on a consistent basis without regard to capital structure, depreciation and amortization or non-operating factors (such as historical cost). This information has been disclosed here to permit a more complete comparative analysis of the Company’s operating performance relative to other companies. EBITDA may not, however, be comparable in all instances to other similar types of measures. For supplemental information to facilitate evaluation of the impact of depreciation and amortization, and comparisons with historical results, see the attached tables showing the detailed reconciliation of results reported under GAAP to non-GAAP results for the three-month periods and full-year periods ended December 31, 2010 and 2009.

Contacts:

Digital Angel Corporation

KCSA Strategic Communications

Todd Fromer / Rob Fink

212-896-1206

digitalangel@kcsa.com

DIGITAL ANGEL CORPORATION AND SUBSIDIARIES

Preliminary

Consolidated Balance Sheets Data

(in thousands)

	December 31,		December 31,
	2010		2009
Assets	(unaudited)
Current assets
Cash and cash equivalents	$	903	$	1,895
Restricted cash		—		202
Accounts receivable, net		5,155		6,370
Inventories		8,859		8,980
Other current assets		1,665		2,514
Current assets of discontinued operations		339		3,735
Total current assets		16,921		23,696
Property and equipment, net		5,238		6,998
Goodwill and intangibles, net		13,054		14,790
Other assets, net		716		1,195
Other assets of discontinued operations		—		365
Total assets	$	35,929	$	47,044
Liabilities and Stockholders’ Equity
Current liabilities
Notes payable and current maturities of long-term debt	$	3,794	$	9,297
Accounts payable.		7,924		7,905
Advances from factors		523		1,019
Accrued expenses.		6,810		6,580
Deferred gain on sale		584		960
Deferred revenue		529		548
Current liabilities of discontinued operations		732		2,955
Total current liabilities		20,896		29,264
Long-term debt and notes payable		1,919		392
Other liabilities		606		1,445
Total liabilities		23,421		31,101
Total stockholders’ equity		12,508		15,943
Total liabilities and stockholders’ equity	$	35,929	$	47,044

DIGITAL ANGEL CORPORATION AND SUBSIDIARIES

Preliminary

Consolidated Statements of Operations Data

 (in thousands, except per share data)

	For the Three-Months Ended December 31,
	2010			2009
	(Unaudited)			(Unaudited)
Revenue	$	9,017		$	9,920
Cost of sales		6,231			5,834
Gross profit		2,786			4,086
Selling, general and administrative expenses		3,603			5,496
Research and development expenses		265			353
Restructuring, severance and separation expenses		118			223
Goodwill and asset impairments		—			7,339
Operating loss		(1,200	)		(9,325	)
Interest and other income (expense), net		136			150
Interest expense		(231	)		(489	)
Loss from continuing operations before income tax benefit		(1,295	)		(9,664	)
Benefit for income taxes		2			20
Loss from continuing operations		(1,293	)		(9,644	)
Income from discontinued operations		809			988
Net loss		(484	)		(8,656	)
Loss attributable to the noncontrolling interest, continuing operations		10			108
Income attributable to the noncontrolling interest, discontinued operations		(12	)		(15	)
Net loss attributable to Digital Angel Corporation	$	(486	)	$	(8,563	)
(Loss) income per common share – basic and diluted
Loss from continuing operations	$	(0.05	)	$	(0.44	)
Income from discontinued operations		0.03			0.04
Net loss	$	(0.02	)	$	(0.40	)

DIGITAL ANGEL CORPORATION AND SUBSIDIARIES

Preliminary

Consolidated Statements of Operations Data

 (in thousands, except per share data)

	For the Twelve-Months Ended December 31,
	2010			2009
	(Unaudited)
Revenue	$	37,720		$	42,565
Cost of sales		24,570			25,985
Gross profit		13,150			16,580
Selling, general and administrative expenses		17,645			22,520
Research and development expenses		1,031			1,206
Restructuring, severance and separation expenses		1,347			678
Goodwill and asset impairments		—			7,339
Operating loss		(6,873	)		(15,163	)
Interest and other (expense) income, net		(189	)		319
Interest expense		(1,185	)		(2,176	)
Loss from continuing operations before income tax (provision) benefit		(8,247	)		(17,020	)
(Provision) benefit for income taxes		(21	)		24
Loss from continuing operations		(8,268	)		(16,996	)
Income from discontinued operations		2,424			4,566
Net loss		(5,844	)		(12,430	)
Loss attributable to the noncontrolling interest, continuing operations		59			135
Income attributable to the noncontrolling interest, discontinued operations		(33	)		(69	)
Net loss attributable to Digital Angel Corporation	$	(5,818	)	$	(12,364	)
(Loss) income per common share – basic and diluted
Loss from continuing operations	$	(0.30	)	$	(0.90	)
Income from discontinued operations		0.09			0.24
Net loss	$	(0.21	)	$	(0.66	)

DIGITAL ANGEL CORPORATION AND SUBSIDIARIES

Preliminary

Reconciliation to Non-GAAP Financial Information

(in thousands) (unaudited)

	For the Three-Months Ended December 31,
	2010			2009
Operating loss	$	(1,200	)	$	(9,325	)
Depreciation and amortization		732			1,049
EBITDA		(468	)		(8,276	)
Asset impairment, restructuring, severance and separation expenses		118			7,562
Adjusted EBITDA1	$	(350	)	$	(714	)

1Adjusted EBITDA is regular EBITDA with asset impairment, restructuring, severance and separation expenses backed out.

DIGITAL ANGEL CORPORATION AND SUBSIDIARIES

Preliminary

Reconciliation to Non-GAAP Financial Information

(in thousands) (unaudited)

	For the Twelve-Months Ended December 31,
	2010			2009
Operating loss	$	(6,873	)	$	(15,163	)
Depreciation and amortization		3,168			3,947
EBITDA		(3,705	)		(11,216	)
Asset impairment, restructuring, severance and separation expenses		1,347			8,017
Adjusted EBITDA1	$	(2,358	)	$	(3,199	)

1Adjusted EBITDA is regular EBITDA with asset impairment, restructuring, severance and separation expenses backed out.