Notify Technology Reports Results for the Second Fiscal Quarter Ended March 31, 2011

SAN JOSE, Calif., May 20, 2011 /PRNewswire/ -- Notify Technology Corporation (Pink Sheets: NTFY) today announced financial results for its second fiscal quarter ended March 31, 2011.

Total fiscal second quarter revenue decreased slightly to $1,712,765 in the three-month period ended March 31, 2011 from $1,733,849 during the same period in the prior year.  The net loss for the three month period ended March 31, 2011 was $86,926 or $(0.01) per diluted share. The company's financial performance was down from a net income of $89,103 or $0.01 per diluted share, reported for the same period in the prior year. The decrease in net income for the fiscal quarter reflects our investment in developing our new product line, NotifyMDM, released in April 2011.  

"I am very pleased we released our new NotifyMDM product on schedule," said Paul DePond, President and Chief Executive Officer of the company. "We have increased our investment in product development by 35% as compared to last year's expenditure to validate our commitment to maintain a leadership position in the mobile device management market. We feel that our new NotifyMDM product is so important an addition to our NotifyLink and NotifySync product lines that we have emphasized its development over short term profitability."

Sales and Marketing expenses were $591,866 in the three-month period ended March 31, 2011 compared to $695,294 in the three-month period ended March 31, 2010.  The decrease was the result of decreases in salary and commission expenses resulting from a decline of new NotifyLink account sales partially offset by marketing expenditures in preparation for the release of NotifyMDM.

Research and Development expenses were $762,783 in the three-month period ended March 31, 2011 compared to $520,520 in the three-month period ended March 31, 2010.  The increase was due to an increased investment in our design and testing staff to accelerate the completion of NotifyMDM and meet the demands of a rapidly expanding smart phone market.  

General and Administrative expenses increased slightly to $438,376 in the three-month period ended March 31, 2011 compared to $422,400 for the three-month period ended March 31, 2010.  

About Notify Technology Corporation

Founded in 1994, Notify Technology Corporation is an independent software vendor (ISV) who has specialized in wireless mobility solutions and services for the past 10 years. Notify's products including NotifyLink, NotifySync and NotifyMDM support all major smart phone and tablet platforms independent of wireless carrier or network.  Notify sells its mobility products directly and through authorized resellers internationally. Notify is an official Apple iPhone Enterprise Development Partner, Android Development Partner, BlackBerry Development Partner, Windows Mobile and Windows Phone Development Partner, Symbian Alliance Member, and HP/Palm Select Partner. The Company is headquartered in San Jose, California with product development and technical support located in Canfield, Ohio. For more information, visit http://www.notifycorp.com or contact 408-777-7930.

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 launch of new wireless devices and product lines and the improving performance of the Company's wireless product.  Those statements are based on unaudited 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, NotifySync and NotifyMDM revenues with any accuracy and does not know whether NotifyLink, NotifySync or NotifyMDM revenues will continue to grow at the rates recently experienced, if at all.  Increasing NotifyLink, NotifySync and NotifyMDM 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.

Contacts:

At Notify Technology Corporation:
Jerry Rice, Chief Financial Officer
Phone: 408-777-7927
jerry.rice@notifycorp.com

(Financial Tables Follow)



NOTIFY TECHNOLOGY CORPORATION

CONDENSED STATEMENTS OF INCOME



Three-Month Periods

Six-Month Periods


Ended March 31,

Ended March 31,


2011


2010


2011

2010








Revenue:







  Product revenue

$  1,712,765


$ 1,733,849


$ 3,553,251


$ 3,530,494

Total revenue

1,712,765


1,733,849


3,553,251


3,530,494

















Cost of revenue:








  Product cost

7,615


5,719


16,691


14,783

  Royalty payments

1,141


1,405


3,118


3,395

Total cost of revenue

8,756


7,124


19,809


18,178

Gross profit

1,704,009


1,726,725


3,533,442


3,512,315









Operating expenses:








  Research and development

762,783


520,520


1,484,333


974,370

  Sales and marketing

591,866


695,294


1,260,174


1,411,284

  General and administrative

438,376


422,400


864,413


907,584

Total operating expenses

1,793,025


1,638,214


3,608,920


3,293,238









Income/(loss) from operations

(89,016)


88,511


(75,478)


219,077









Other interest (expense),  net

2,090


592


3,855


1,679









Net income (loss)

$  (86,926)


$ 89,103


$ (71,623)


$ 220,756









Basic net income (loss) per share

$  (0.01)


$  0.01


$  (0.01)


$ 0.02









Basic weighted average shares outstanding

14,111,217


14,075,662


14,111,217


14,075,662









Diluted net income (loss) per share

$  (0.01)


$  0.01


$  (0.01)


$  0.01









Diluted weighted average shares outstanding

14,111,217


15,883,942


14,111,217


16,008,031













NOTIFY TECHNOLOGY CORPORATION

Condensed Balance Sheets




March 31,


Sept. 30,





2011


2010





Unaudited


Audited


 Assets:







Current assets:








Cash and cash equivalents



$  2,592,410


$  2,526,654



Accounts receivable, net



431,631


292,040



Other assets



34,920


44,570


Total current assets



3,058,961


2,863,264



Non-current assets








Property and equipment, net



275,380


306,380



Lease deposits



15,602


15,602



Total non-current assets



290,982


321,982



Total assets



$ 3,349,943


$  3,185,246


Liabilities and shareholders' deficit







Current liabilities:








Current portion of capital lease obligation



$         3,303


$       3,369



Accounts payable



59,261


55,378



Accrued payroll and related liabilities



384,457


405,203



Deferred revenue



3,141,631


2,927,067



Other accrued liabilities



132,810


123,066


Total current liabilities



3,721,462


3,514,083


Long-term liabilities:








Long-term Deferred revenue



100,419


112,696



Long-term capital lease obligations



1,677


3,174


    Total long-term liabilities



102,096


115,870


Total liabilities



3,823,558


3,629,953


Shareholders' deficit:








Preferred stock



- -


- -



Common stock



14,111


14,111



Additional paid-in capital



23,559,437


23,516,722



Accumulated deficit



(24,047,163)


(23,975,540)


Total shareholders' deficit



(473,615)


(444,707)



Total liabilities and shareholders' deficit


$  3,349,943


$  3,185,246





SOURCE Notify Technology Corporation



RELATED LINKS
http://www.notifycorp.com

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