Notify Technology Reports Results for the Fiscal Year Ended September 30, 2009
Notify achieves net profit for the year on a 30% increase in total revenue over
the prior year.
SAN JOSE, Calif., Dec. 14 /PRNewswire-FirstCall/ -- Notify Technology
Corporation (OTC Bulletin Board: NTFY) today announced financial results for its
fiscal year ended September 30, 2009.
Total fiscal fourth quarter revenue increased 27% to $1,665,621 in the
three-month period ended September 30, 2009 from $1,309,280 during the same
period in the prior year. Total annual revenue increased 30% for the fiscal year
ended September 30, 2009 to $6,032,257 from $4,640,723 for the fiscal year ended
September 30, 2008. The company had net income for the fiscal quarter ended
September 30, 2009 of $104,328 or $0.01 per diluted share. The income realized
during the third and fourth quarters resulted in net income for the fiscal year
of $70,685, or $0.00 per diluted share. The company's 2009 fiscal year's
financial performance is a clear improvement from the net loss of $287,680, or
$(0.02) per diluted share, reported for the previous fiscal year ended September
30, 2008.
"It gives me great pleasure to report the financial results of our 2009 fourth
fiscal quarter and our overall fiscal year end to our shareholders as it
reflects our transition to achieving continued quarter to quarter profitability
and an increase in our available cash. Not only did we have our second
consecutive profitable quarter, but we also recorded our first profitable year,"
said Paul DePond, President and CEO of the company. "There is a lot of
excitement these days as the wireless smart phone market continues to show
unprecedented growth as business professionals continue to upgrade their
traditional cell phone for a more feature rich smart phone. We are very pleased
that both NotifyLink(TM) and NotifySync(TM) product revenues continue to
increase quarter to quarter in spite of the challenging economic conditions of
the past year."
The increase in net income for the fiscal year was largely attributable to the
30% growth in total revenue over the prior year. The company also experienced a
54% increase in cash and cash equivalents at September 30, 2009 as compared to
cash and cash equivalents at September 30, 2008. The company's deferred revenue
balance at September 30, 2009 was 29% higher than the comparable balance at
September 30, 2008. Management believes that this increase signifies that the
company closed new contracts during fiscal 2009 at a rate faster than its old
contracts expired, which explains the improvements on both the statement of
operations and the balance sheet.
Sales and marketing expenses were $2,322,315 in the twelve-month period ended
September 30, 2009 compared to $1,881,552 in the twelve-month period ended
September 30, 2008. The increase was primarily the result of an increase in
salary and commission expenses related to ongoing business and the launch of the
new NotifySync(TM) product in January 2009.
The Company expended $1,917,614 for research and development in the twelve-month
period ended September 30, 2009 compared to $1,620,526 in the twelve-month
period ended September 30, 2008. Virtually all of the increase is due to
personnel increases as the company invested heavily in expanding the
NotifyLink(TM) product line and readying the NotifySync product line for launch
in January 2009.
General and administrative costs also increased to $1,574,958 in the
twelve-month period ended September 30, 2009 compared to $1,286,112 for the
twelve-month period ended September 30, 2008. The increase was due to non-cash
compensation expense due to option vesting, legal expenses, rent, depreciation
and an increase in bad debt reserves due to sales volume increases.
About Notify Technology Corporation
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Founded in 1994, Notify Technology Corporation, (OTC Bulletin Board: NTFY) is an
innovative software company developing mobility products for organizations of
all sizes. Notify's wireless solutions provide secure synchronized email and PIM
access and management to any size organization on a variety of wireless 2-way
devices and networks. Notify sells its wireless products directly and through
authorized resellers internationally. The Company is headquartered in San Jose,
California. For more information, visit http://www.notifycorp.com or contact
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408-777-7920.
Forward-Looking Statements: This press release contains forward-looking
statements related to Notify Technology Corporation that involve risks and
uncertainties, including, but not limited to, statements regarding the changes
in asset balances on the balance sheet, the significance of changes in the
balance of deferred revenue, the launch of new wireless devices and product
lines and the improving performance of the Company's wireless products. Those
statements are based on current information and expectations and there are
important factors that could cause actual results to differ materially from
those anticipated by such statements. These risks include, but are not limited
to, Notify's ability to deliver products and manage growth, its ability to
continue to improve its existing products or develop new products or
technologies, and its ability to maintain revenue growth as well as other risks.
In particular, management cannot predict future NotifyLink and NotifySync
revenues with any accuracy and does not know whether NotifyLink and NotifySync
revenues will continue to grow at the rates recently experienced, if at all.
Increasing NotifyLink and NotifySync revenues will require, among other things,
continued investments in the Company's sales and marketing organization and
Notify has limited available cash resources to make these investments. These
forward-looking statements are made in reliance on the "safe harbor" provisions
of the Private Securities Litigation Reform Act of 1995. For further information
about these factors that could affect Notify Technology's future results, please
see the Company's filings with the Securities and Exchange Commission.
Prospective investors are cautioned that forward-looking statements are not
guarantees of performance. Actual results may differ materially from
management's expectations.
(Financial Tables Follow)
NOTIFY TECHNOLOGY CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
Three-Month Periods Twelve-Month Periods
Ended September 30, Ended September 30,
2009 2008 2009 2008
------------ ------------ ------------ ------------
Revenue:
Product revenue $ 1,665,621 $ 1,309,280 $ 6,032,257 $ 4,640,723
------------ ------------ ------------ ------------
Total revenue 1,665,621 1,309,280 6,032,257 4,640,723
------------ ------------ ------------ ------------
Cost of revenue:
Product cost -- 2,705 8,620 14,160
Royalty payments 35,891 34,312 144,963 139,595
------------ ------------ ------------ ------------
Total cost of revenue 35,891 37,017 153,583 153,755
------------ ------------ ------------ ------------
Gross profit 1,629,730 1,272,263 5,878,674 4,486,967
------------ ------------ ------------ ------------
Operating expenses:
Research and development 467,883 433,566 1,917,614 1,620,526
Sales and marketing 614,023 507,392 2,322,315 1,881,552
General and administrative 447,481 324,443 1,574,958 1,286,112
------------ ------------ ------------ ------------
Total operating expenses 1,529,387 1,265,401 5,814,887 4,788,190
------------ ------------ ------------ ------------
Income (loss) from operations 100,343 6,862 63,787 (301,220)
Other interest (expense), net 3,985 2,252 6,898 13,542
------------ ------------ ------------ ------------
Net income (loss) $ 104,328 $ 9,114 $ 70,685 $ (287,680)
============ ============ ============ ============
Basic net income (loss) per share $ 0.01 $ 0.00 $ 0.00 $ (0.02)
============ ============ ============ ============
Basic weighted average shares
outstanding 14,075,662 13,968,995 14,075,662 13,968,995
============ ============ ============ ============
Diluted weighted net income (loss)
per share $ 0.01 $ 0.00 $ 0.00 $ (0.02)
============ ============ ============ ============
Diluted weighted average shares
outstanding 16,031,553 13,968,995 14,754,252 13,968,995
============ ============ ============ ============
NOTIFY TECHNOLOGY CORPORATION
Condensed Balance Sheets
Sept. 30, Sept. 30,
2009 2008
------------ ------------
Audited Audited
Assets:
Current assets:
Cash and cash equivalents $ 1,565,447 $ 1,010,607
Accounts receivable, net 810,543 509,735
Other assets 40,540 39,452
------------ ------------
Total current assets 2,416,530 1,559,794
Non-current assets
Property and equipment, net 247,117 173,224
Lease deposits 15,602 --
------------ ------------
Total non-current assets 262,719 173,224
------------ ------------
Total assets $ 2,679,249 $ 1,733,018
============ ============
Liabilities and shareholders' deficit
Current liabilities:
Current portion of capital lease obligation $ 4,142 $ 4,445
Accounts payable 75,340 40,045
Accrued payroll and related liabilities 454,946 349,292
Deferred revenue 2,995,906 2,418,235
Other accrued liabilities 140,464 171,108
------------ ------------
Total current liabilities 3,670,798 2,983,125
------------ ------------
Long-term liabilities:
Long-term Deferred revenue 137,250 --
Long-term capital lease obligations 6,543 10,685
------------ ------------
Total long-term liabilities 143,793 10,685
------------ ------------
Total liabilities 3,814,591 2,993,810
------------ ------------
Shareholders' deficit:
Common stock 14,076 14,076
Additional paid-in capital 23,442,160 23,387,395
Accumulated deficit (24,591,578) (24,662,263)
------------ ------------
Total shareholders' deficit (1,135,342) (1,260,792)
------------ ------------
Total liabilities and shareholders' deficit $ 2,679,249 $ 1,733,018
============ ============