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TMCNet:  Single Touch Reports First Quarter Fiscal 2013 Revenues Increase 22% to Approximately $2,000,000

[February 14, 2013]

Single Touch Reports First Quarter Fiscal 2013 Revenues Increase 22% to Approximately $2,000,000

(Marketwire Via Acquire Media NewsEdge) JERSEY CITY, NJ -- (Marketwire) -- 02/14/13 -- Single Touch Systems, Inc. (OTCBB: SITO), a technology based mobile media solutions provider, today reported financial results for its fiscal 2013 first quarter ended December 31, 2012.

Fiscal 2013 Q1 Highlights Include: Revenues increase to nearly $2,000,000, a 22% rise over the prior year period Driven by 18% organic growth in number of mobile messages -- sent 77 million in the quarter as compared to 65 million in the prior year period Gross margins improved to 55%, up from 52% in the same period last year Reached a record cumulative half billion mobile messages sent Formed Single Touch Interactive R&D IP to protect and monetize our patents "We are pleased with the progress achieved in the first quarter both in our operating business and in our IP monetization efforts. We anticipate continued positive developments in terms of growth and market adoption of our services and technologies, and we therefore reiterate our projection of revenue growth of more than 50% in fiscal 2013 over fiscal 2012, driven by a combination of growth through existing clients, a growing pipeline of prospective new clients and an increase in premium sponsored messaging. Our gross margins improved in the first quarter, and we anticipate that to continue, with a target 60% for the 2013 fiscal year. Based on these growth rates, we anticipate becoming profitable on a cash basis during fiscal 2013." "Single Touch took its most important step to date regarding monetizing our robust IP portfolio," stated Single Touch Chairman and Chief Technology Officer Anthony Macaluso. "In October we established our new subsidiary, Single Touch Interactive R&D IP. This was a milestone and a very important step in unlocking the value of our IP and creating a powerful business model as a company that creates, protects and monetizes our intellectual property and technology in the mobile space." Revenues in the first quarter increased by 22%, to $1,947,278, compared to $1,589,673 in the first quarter of fiscal 2012. Royalties and application costs, which represent the direct out-of-pocket costs associated with revenue, totaled $883,793 in the period ended December 31, 2012, compared to $763,321 in the prior year period, an increase of 16%. Because a portion of royalties and application costs is fixed and all such costs are being monitored and reduced wherever possible, they have grown at a lesser rate than revenue. Gross margin was $1,063,485, or 55%, for the first quarter of fiscal 2013, compared to $826,352, or 52%, in the same period of the prior year.

Adjusted general and administrative expenses in the first quarter of fiscal 2013 increased 51%, to $770,703, from $509,254 in the first quarter of fiscal 2012. Adjusted professional fees rose by more than $180,000, from $151,954 in the first quarter of fiscal 2012 to $335,739 in the first quarter of fiscal 2013. This increase was caused by additional legal fees both for the Company's IP monetization efforts and for compliance with SEC filing requirements, mostly one-off costs for our most recent private placement and for the registration of its underlying securities.

On a GAAP basis, loss from operations increased from $590,812 in the first quarter of fiscal 2012 to $1,922,869 in the first quarter of fiscal 2013. Adjusted EBITDA, which we define as operating income before depreciation, amortization of intangible assets, stock-based compensation, and special charges, on the other hand, narrowed to a loss of $361,542 in the first quarter of fiscal 2013 from a loss of $404,235 in the same period of the prior year.

A table reconciling operating income on a GAAP basis to Adjusted EBITDA is presented below. We use EBITDA to measure the results of our underlying business.

The Company's net loss for the fiscal quarter ended December 31, 2012 was $2,232,155, or $0.02 per basic and diluted share. This is higher than the net loss incurred during the fiscal quarter ended December 31, 2011 of $629,196, or $0.00 per basic and diluted share rounded off.

As of December 31, 2012, the Company had cash on hand of $1,378,363, total assets of $6,486,510 and shareholders' equity of $1,067,689.

About Single Touch Systems, Inc.

Single Touch Systems, Inc. is a technology based mobile solutions provider serving businesses, advertisers and brands. Through patented technologies and a modular, adaptable platform, Single Touch's multi-channel messaging gateway enables marketers to reach consumers on all types of connected devices, with information that engages interest, drives transactions and strengthens relationships and loyalty. For more information about Single Touch Systems, Inc. visit: www.singletouch.net Forward-Looking Statements This news release may contain forward-looking statements that involve risks and uncertainties and reflect Single Touch's judgment as of the date of this release. These statements may include those regarding strategy, growth and future operations. Actual events or results may differ from Single Touch's expectations. The risks and uncertainties include reliance on brand owners and wireless carriers, the possible need for additional capital, as well as other risks identified in Single Touch's filings with the SEC. Single Touch disclaims any intent or obligation to update these forward-looking statements beyond the date of this press release, except as may be required by law.

SINGLE TOUCH SYSTEMS, INC UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ---------------------------------------------------------------------------- For the Three Months Ended December 31, 2012 2011 ------------- ------------- Revenue Wireless applications $ 1,947,278 $ 1,589,673 ------------- ------------- Operating Expenses Royalties and application costs 883,793 763,321 Research and development 8,706 37,200 Compensation expense (including stock based compensation of $1,109,720 in 2013 and $9,690 in 2012) 1,755,338 693,823 Depreciation and amortization 154,786 155,471 General and administrative (including stock basedcompensation of $296,821 in 2013 and $21,416 in 2012) 1,067,524 530,670 ------------- ------------- 3,870,147 2,180,485 ------------- ------------- Loss from operations (1,922,869) (590,812) Other Income (Expenses) Interest income 21 25 Interest expense (308,507) (37,609) ------------- ------------- Net (loss) before income taxes (2,231,355) (628,396) Provision for income taxes (800) (800) ------------- ------------- Net income (loss) $ (2,232,155) $ (629,196) ============= ============= Basic and diluted loss per share $ (0.02) $ (0.00) ============= ============= Weighted average shares outstanding 132,472,392 130,182,392 ============= ============= SINGLE TOUCH SYSTEMS, INC UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS ---------------------------------------------------------------------------- December 31, September 30, 2012 2012 Assets Current assets Cash and cash equivalents $ 1,378,363 $ 2,157,707 Overpayment due from officer 25,118 - Accounts receivable - trade 1,370,782 1,085,840 Prepaid expenses 900,378 129,290 ------------- ------------- Total current assets 3,674,641 3,372,837 ------------- ------------- Property and equipment, net 205,155 228,499 ------------- ------------- Other assets Capitalized software development costs, net 403,254 383,227 Intangible assets: Patents 568,501 602,056 Patent applications cost 719,681 667,858 Software license 831,000 76,000 Deposit - related party - 155,000 Other assets including security deposits 84,278 84,278 ------------- ------------- Total other assets 2,606,714 1,968,419 ------------- ------------- Total assets $ 6,486,510 $ 5,569,755 ------------- ------------- SINGLE TOUCH SYSTEMS, INC UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS --------------------------------------------------------------------------- December 31, September 30, 2012 2012 ------------- ------------- (Unaudited) Liabilities and Stockholders' Equity (Deficit) Current liabilities Accounts payable $ 1,044,429 $ 768,263 Accrued expenses 226,866 200,591 Accrued compensation - related party 76,783 72,730 Current obligation on patent acquisitions - 87,500 Convertible debentures - unrelated parties 104,435 294,241 Total current liabilities 1,452,513 1,423,325 ------------- ------------- Long-term liabilities Deferred revenue 25,000 25,000 Convertible debenture - related party 542,087 527,512 Convertible debentures - unrelated parties 3,399,221 2,685,280 Total long-term liabilities 3,966,308 3,237,792 ------------- ------------- Total liabilities 5,418,821 4,661,117 ------------- ------------- Stockholders' Equity Preferred stock, $.0001 par value, 5,000,000 shares authorized; none outstanding - - Common stock, $.001 par value; 200,000,000 shares authorized, 132,472,392 shares issued and outstanding as of December 31, 2012 and September 30, 2012 132,472 132,472 Additional paid-in capital 127,816,823 125,425,617 Accumulated deficit (126,881,606) (124,649,451) ------------- ------------- Total stockholders' equity 1,067,689 908,638 ------------- ------------- Total liabilities and stockholders' equity $ 6,486,510 $ 5,569,755 ============= ============= RECONCILIATION OF NON-GAAP MEASURES For the Three Months Ended December 31, ------------------------------------------------ 2012 ----------------------------------------------- Adjust- Adjusted GAAP ments EBITDA --------------- -------------- --------------- Revenue Wireless Applications $ 1,947,278 $ 1,947,278 Operating Expenses Royalties and Application Costs $ 883,793 $ 883,793 Research and Development $ 8,706 $ 8,706 Compensation expense (including stock-based compensation) $ 1,755,338 $ (1,109,720) $ 645,618 Depreciation and amortization $ 154,786 $ (154,786) $ - General and administrative (including stock-based compensation) $ 1,067,524 $ (296,821) $ 770,703 --------------- -------------- --------------- $ 3,870,147 $ (1,561,327) $ 2,308,820 Loss from Operations/Adjusted EBITDA $ (1,922,869) $ 1,561,327 $ (361,542) RECONCILIATION OF NON-GAAP MEASURES For the Three Months Ended December 31, ------------------------------------------------ 2011 ----------------------------------------------- Adjust- Adjusted GAAP ments EBITDA --------------- -------------- --------------- Revenue Wireless Applications $ 1,589,673 $ 1,589,673 Operating Expenses Royalties and Application Costs $ 763,321 $ 763,321 Research and Development $ 37,200 $ 37,200 Compensation expense (including stock-based compensation) *$ 693,823 $ (9,690) $ 684,133* Depreciation and amortization $ 155,471 $ (155,471) $ - General and administrative (including stock-based compensation) *$ 530,670 $ (21,416) $ 509,254* --------------- -------------- --------------- $ 2,180,485 $ (186,577) $ 1,993,908 Loss from Operations/Adjusted EBITDA $ (590,812) $ 186,577 $ (404,235) For the Three Months Ended December 31, ---------------------------------------- 2012 -------------------------------------- Adjust- Adjusted GAAP ments EBITDA ------------ ----------- ------------ Professional Fees $ 337,633 $ (1,894) $ 335,739* Travel $ 167,843 $ 167,843 Consulting expense $ 437,479 $ (294,927) $ 142,552* Office rent $ 53,820 $ 53,820 Insurance expense $ 28,969 $ 28,969 Equipment lease $ - $ - Trade shows $ 790 $ 790 Telephone $ 12,725 $ 12,725 Office expense $ 11,719 $ 11,719 Other $ 16,546 $ 16,546 ------------ ----------- ------------ Total General and Administrative Expenses $ 1,067,524 $ (296,821) $ 770,703 For the Three Months Ended December 31, --------------------------------------- 2011 --------------------------------------- Adjust- Adjusted GAAP ments EBITDA ------------ ----------- ------------- Professional Fees $ 166,960 $ (15,006) $ 151,954* Travel $ 138,841 $ 138,841 Consulting expense $ 106,925 $ (6,410) $ 100,515* Office rent $ 45,291 $ 45,291 Insurance expense $ 28,156 $ 28,156 Equipment lease $ - $ - Trade shows $ 12,000 $ 12,000 Telephone $ 11,610 $ 11,610 Office expense $ 8,056 $ 8,056 Other $ 12,831 $ 12,831 ------------ ----------- ------------- Total General and Administrative Expenses $ 530,670 $ (21,416) $ 509,254 * Adjustment represents the elimination of stock-based compensation recorded in accordance with GAAP but not considered in the calculation of Adjusted EBITDA.

* Adjustment represents the elimination of stock-based compensation recorded in accordance with GAAP but not considered in the calculation of Adjusted EBITDA.

Add to Digg Bookmark with del.icio.us Add to Newsvine Investor and Media Contact: Robert Haag Hampton Growth 877-368-3566 Email Contact Source: Single Touch Systems

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