Company Posts its Tenth Consecutive Quarter of Growth in
Services Revenue and MobiKEY Subscribers
Toronto, August 11, 2016 – Route1 Inc. (TSXV: ROI) (the Company or Route1), a world-leader in secure data protection technologies and user authentication for government and enterprise, today announced its second quarter (Q2) and year to date (YTD) financial results for the period ended June 30, 2016.
During the second quarter of 2016 Route1 realized growth in revenue from MobiKEY application software subscribers (recurring revenue). Revenue from Services includes MobiKEY application software, the MobiNET (DEFIMNET) platform and other appliance licensing or yearly maintenance. The net increase in MobiKEY application software subscribers primarily came from agencies and components within the U.S. Department of Defense and the U.S. Navy.
Earnings before interest, tax, depreciation, and amortization (Adjusted EBITDA) during the second quarter of 2016 amounted to approximately $278,000 compared to $227,000 in Q2 2015.
Route1 generated cash from operating activities of approximately $3.7 million during Q2 2016 compared with cash generated of $2.6 million in Q2 2015. As at June 30, 2016, the Company had no bank debt and a cash balance of $3.7 million.
Route1’s cash position is at its highest level during the second quarter of the fiscal year as a direct result of the timing of annual enterprise user subscription renewal payments.
Share Repurchase Program
On September 22, 2015, the Company announced with approval from the TSX Venture Exchange its intention to make a Normal Course Issuer Bid (NCIB). The NCIB permits the Company to purchase for cancellation up to 5% of the common shares in the public float. The maximum number of shares allowed for repurchase is 18,262,570. Purchases under the NCIB commenced September 27, 2015 and will end September 26, 2016, or the date upon which the maximum number of common shares have been purchased by the Company. As of August 1, 2016 the Company had purchased a total of 12,144,000 common shares under the NCIB.
Since the first NCIB was announced on February 28, 2012, Route1 has repurchased a total of 35,813,200 of its common shares, representing 9.2% of Route1’s common shares outstanding as at February 28, 2012.
As at August 1, 2016, Route1 has 353,107,414 common shares outstanding.
Peter Chodos Appointed CFO
Effective August 29, 2016, Peter Chodos will become Route1’s Executive Vice President and Chief Financial Officer. Peter has been an independent member of Route1’s Board of Directors since September 2009, serving most recently as the Company’s Chair of the Compensation Committee and as a member of the Company’s Audit Committee. He has over 35 years of experience in the capital markets including private and public financings of debt and equity as well as mergers, acquisitions, and divestitures in Canada, the United States, and the United Kingdom. Peter was one of the founders of Lawrence Asset Management Inc. in late 2001 and left the firm in 2004 to co-found Mt. Auburn Capital Corp., where he engaged in structuring and distributing investment products for retail investors. He received his Masters of Business Administration degree from Harvard University and a Bachelor of Commerce degree from McGill University. Mr. Chodos is a Chartered Professional Accountant and a Chartered Business Valuator.
Concurrent with Peter’s appointment as Route1’s CFO, Louis De Jong will join Route1’s Audit Committee, Mark Boensel will take over the role of Chair of the Compensation Committee and David Fraser will join the Compensation Committee. Peter will continue to be a member of Route1’s Board of Directors but will no longer serve as an independent Director.
Tom Lieu has left Route1 to take on the role of Chief Financial Officer with Newzulu. Tom performed exceptionally during his tenure with Route1 from April 2012 to August 2016, and the Company’s Board of Directors and management wish him success with his new career opportunity.
Business and Product Development Highlights
Route1 provided a Q2 2016 Operations Update through a news release issued on August 3, 2016 that provided highlights on business and product development activities. The news release is archived on the Company’s website and can be found at www.route1.com/investors/press-releases.html.
About Route1, Inc.
Route1 Inc. is a world-leader in secure data protection technologies and user authentication for government and enterprise. Route1 solutions enable the workforce to be more productive and more flexible without compromising system access, data-at-rest, or data-in-use. The Company’s suite of patented enterprise security solutions combines best-in-class authentication, data security and secure communications with streamlined administration tools, running on a proven, trusted infrastructure. From mobile access to business continuity to best-in-class full system encryption, Route1 offers the most effective, affordable methods to secure the digital fortress, while meeting or exceeding the highest standards for government and industry. Route1 has Full Authority to Operate from the U.S. Department of Defense, the U.S. Department of the Navy, the U.S. Department of Homeland Security, the U.S. Department of the Interior, and other government agencies. The Company is also trusted by enterprise security teams in the banking, healthcare, legal and education sectors, among others. With offices in Washington, D.C., Boca Raton, FL and Toronto, Canada, Route1 serves public and private sector clients around the world. Route1 is listed on the TSX Venture Exchange under the ticker symbol TSXV: ROI.
For more information, visit our website at: www.route1.com.
For More Information Contact:
Tony Busseri, CEO
+1 416 814-2635
Facebook: Route1 Inc.
Jay Morakis, M Group Strategic Communications
+1 212 266-0191
This news release, required by applicable Canadian laws, does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
© 2016 Route1 Inc. All rights reserved. Route1 Inc. is the owner of, or licensed user of, all copyright in this document, including all photographs, product descriptions, designs and images. No part of this document may be reproduced, transmitted or otherwise used in whole or in part or by any means without prior written consent of Route1 Inc. Route1, Route 1, the Route1 and shield design Logo, MobiDESK, Mobi, Route1 MobiVDI, Route1 MobiDESK, Route1 MobiBOOK, Route1 MobiKEY, Route1 MobiNET, IBAD, MobiVDI, MobiNET, DEFIMNET, Powered by MobiNET, Route1 Mobi, Route1 MobiLINK, TruOFFICE, MobiLINK, EnterpriseLIVE, PurLINK, TruCOMMAND, MobiMICRO and MobiKEY are either registered trademarks or trademarks of Route1 Inc. in the United States and/or Canada. All other trademarks and trade names are the property of their respective owners.
The DEFIMNET and MobiNET platforms, the MobiKEY, MobiKEY Classic, MobiKEY Classic 2, MobiKEY Classic 3, MobiKEY Fusion, MobiKEY Fusion2, and MobiKEY Fusion3 devices, and MobiLINK are protected by U.S. Patents 7,814,216, 7,739,726, 9,059,962, 9,059,997 and 9,319,385, Canadian Patent 2,578,053, and other patents pending. The MobiKEY Classic 2 and MobiKEY Classic 3 devices are also protected by U.S. Patents 6,748,541 and 6,763,399, and European Patent 1001329 of Aladdin Knowledge Systems Ltd. and used under license. Other patents are registered or pending in various countries around the world.
Other product and company names mentioned herein may be trademarks of their respective companies.