Notify Technology Reports Results for the First Fiscal Quarter Ended December 31, 2011

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Mar 08, 2012, 09:30 ET

SAN JOSE, Calif., March 8, 2012 /PRNewswire/ -- Notify Technology Corporation (NTFY.PK) today announced financial results for its first fiscal quarter ended December 31, 2011.

Total fiscal first quarter revenue decreased to $1,606,851 in the three-month period ended December 31, 2011 from $1,840,487 during the same period in the prior year. The net loss for the three month period ended December 31, 2011 was $410,761 or $(5.82) per diluted share. The company's financial performance was down from a net income of $15,303 or $0.19 per diluted share, reported for the same period in the prior year. The decrease in net income for the fiscal quarter reflects the combined impact of a decline in sales of the NotifyLink product line and the expense of our investment in developing our new mobile device management product line, NotifyMDM.

"This past quarter we announced our first NotifyMDM OEM relationship with CommonTime LTD located in the United Kingdom. CommonTime will integrate our NotifyMDM technology into their product line and make it available to their new and current customers around the world as CommonTime MDM," said Paul DePond, President and Chief Executive Officer of the company. "As a result of our commitment to achieving a leadership position in the mobile device management market, we have increased our development expenses by 19% as compared to last year's expenditures while forgoing any short term profitability."

Sales and Marketing expenses were $741,899 in the three-month period ended December 31, 2011 compared to $668,309 in the three-month period ended December 31, 2010. The increase was the result of additions to our outside sales force and by marketing expenditures to support the new product introduction of NotifyMDM.

Research and Development expenses were $855,614 in the three-month period ended December 31, 2011 compared to $721,550 in the three-month period ended December 31, 2010. The increase was due to an increased investment in our design and testing staff to accelerate the completion of our new NotifyMDM product and meet the demands of a rapidly expanding smart phone and tablet market.

General and Administrative expenses decreased to $409,159 in the three-month period ended December 31, 2011 compared to $426,037 for the three-month period ended December 31, 2010. The decrease was in compensation and legal expense.

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 11 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.

(Financial Tables Follow)

NOTIFY TECHNOLOGY CORPORATION
CONDENSED STATEMENTS OF OPERATIONS

		Three-Month Periods
		Ended December 31,
		2011	2010
		(Unaudited)

Revenue:
Product sales		$ 1,606,851	$ 1,840,487
Total revenue		1,606,851	1,840,487


Cost of revenue:
Product cost		15,287	9,076
Royalty payments		765	1,977
Total cost of revenue		16,052	11,053
Gross profit		1,590,799	1,829,434

Operating expenses:
	Research and development	855,594	721,550
	Sales and marketing	741,899	668,309
	General and administrative	409,159	426,037
Total operating expenses		2,006,652	1,815,896

Income (loss) from operations		(415,853)	13,538

Interest income and other, net		5,092	1,765
Net income (loss) before provision for
income taxes		(410,761)	15,303

Provision for income taxes		- -	- -
Net income (loss)		$ (410,761)	$ 15,303

Basic net income (loss) per share
		$ (5.82)	$ 0.22

Basic weighted average shares		70,541	70,541
outstanding

Diluted net income (loss) per share
		$ (5.82)	$ 0.19

Diluted weighted average shares
outstanding		70,541	79,400

NOTIFY TECHNOLOGY CORPORATION
Condensed Balance Sheets
			Dec. 31,	Sept. 30,
			2011	2011
			Unaudited	Audited
Assets:
Current assets:
		Cash and cash equivalents	$ 1,430,748	$ 2,040,580
		Accounts receivable, net	876,071	271,251
		Other assets	43,527	83,235
Total current assets			2,350,346	2,395,066
	Non-current assets
		Property and equipment, net	286,906	312,272
		Lease deposits	15,602	15,602
	Total non-current assets		302,508	327,874
		Total assets	$ 2,652,854	$ 2,722,940
Liabilities and shareholders' deficit
Current liabilities:
		Current portion of capital lease obligation	$ 2,706	$ 2,665
		Accounts payable	40,725	65,103
		Accrued payroll and related liabilities	519,318	426,151
		Deferred revenue	3,112,937	2,839,051
		Other accrued liabilities	106,456	128,915
Total current liabilities			3,782,142	3,461,885
Long-term liabilities:
		Long-term Deferred revenue	82,003	88,142
		Long-term capital lease obligations	11,428	12,120
Total long-term liabilities			93,431	100,262
Total liabilities			3,875,573	3,562,147
Shareholders' deficit:
		Preferred stock	- -	- -
		Common stock	71	71
		Additional paid-in capital	23,651,279	23,624,030
		Accumulated deficit	(24,874,069)	(24,463,308)
Total shareholders' deficit			(1,222,719)	(839,207)
		Total liabilities and shareholders' deficit	$ 2,652,854	$ 2,722,940