C2 Global Technologies Inc.
OTC Bulletin Board : COBT

C2 Global Technologies Inc.

August 06, 2008 08:01 ET

C2 Global Technologies Inc. Reports 2008 Second Quarter Results

TORONTO, ONTARIO--(Marketwire - Aug. 6, 2008) - C2 Global Technologies Inc. ("C2" or the "Company") (OTCBB:COBT) today reported its financial results for the second quarter ended June 30, 2008. All amounts are stated in US dollars.

The Company had net income of $0.3 million or $0.01 per common share, basic and diluted, for the second quarter of 2008, compared to a net loss of $0.4 million or $0.01 per common share, basic and diluted, for the second quarter of 2007.

For the second quarter of 2008 the Company's revenue from continuing operations was $1.9 million, compared to $0 for the second quarter of 2007. The revenue is from a settlement and license agreement that the Company entered into in May 2008 with respect to the Company's intellectual property.

For the six months ended June 30, 2008, the Company had net income of $2.1 million compared to a net loss of $1.0 million for the six months ended June 30, 2007. The net income per common share for the six months ended June 30, 2008 was $0.09, basic and diluted, compared to a net loss of $0.04, basic and diluted, for the six months ended June 30, 2007. The Company's revenue from continuing operations for the six months ended June 30, 2008 was $8.1 million. All of the revenue is from three settlement and license agreements entered into with AT&T, Verizon and Sprint. The Company had no operating revenue for the six months ended June 30, 2007.

On June 13, 2008, the United States federal court (the "Court") issued a claim construction ("Markman") ruling in the Company's ongoing patent litigation, which was begun in June 2006. The Court rejected the claim constructions of the defendants on each of the nine disputed claim terms, while construing six of them in the manner originally proposed by the Company. For the other three claim terms, the Court adopted a construction that had not been proposed by either side.

"We are extremely pleased with our continued success in licensing our patents to companies with the stature of AT&T, Verizon and Sprint, and with the outcome of the Markman hearing. We plan to continue to pursue licenses from other entities that are using our patented technology, which includes corresponding patents in Australia, Canada, China and Europe", said Allan Silber, Chairman and CEO of C2.

Please see the Company's Annual Report on Form 10-K for the year ended December 31, 2007, filed with the SEC on March 11, 2008, and the Company's Quarterly Report on Form 10-Q for the three months ended June 30, 2008, filed with the SEC on August 5, 2008, for further information.

About C2 Global Technologies Inc.

C2's business is focused on licensing its patents, which include two foundational patents in VoIP technology. C2 plans to realize value from its intellectual property by offering licenses to service providers, equipment companies and end-users that are deploying VoIP networks for phone-to-phone communications. C2 also invests in Internet-based e-commerce businesses. For further information, please visit C2's website at www.c-2technologies.com.

Forward-Looking Statements

This release contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, as amended, that are based on management's exercise of business judgment as well as assumptions made by, and information currently available to, management. When used in this document, the words "may", "will", "anticipate", "believe", "estimate", "expect", "intend", and words of similar import, are intended to identify any forward-looking statements. You should not place undue reliance on these forward-looking statements. These statements reflect our current view of future events and are subject to certain risks and uncertainties as noted in our securities and other regulatory filings. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results could differ materially from those anticipated in these forward-looking statements. We undertake no obligation, and do not intend, to update, revise or otherwise publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of any unanticipated events. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance that our expectations will materialize. Many factors could cause actual results to differ materially from our forward-looking statements.



C2 GLOBAL TECHNOLOGIES INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

June 30, December 31,
(In thousands, except share and per share amounts) 2008 2007
-------------------------------------------------- -------------------------

(unaudited)
ASSETS

Current assets:
Cash and cash equivalents $ 797 $ 67
Deferred income tax asset 70 1,000
Other current assets 146 17
-------------------------
Total current assets 1,013 1,084
Other assets:
Intangible assets, net 10 20
Goodwill 173 173
Investments 646 519
-------------------------
Total assets $ 1,842 $ 1,796
-------------------------
-------------------------

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current liabilities:
Accounts payable and accrued liabilities $ 636 $ 402
Notes payable to a related party - 2,335
-------------------------
Total liabilities 636 2,737
-------------------------

Stockholders' equity (deficit):
Preferred stock, $10.00 par value, convertible,
non-redeemable, authorized 10,000,000
shares; issued and outstanding 597 shares at
June 30, 2008 and 607 shares at December
31, 2007; liquidation preference of $597 at
June 30, 2008 and $607 at December 31, 2007 6 6
Common stock, $0.01 par value, authorized
300,000,000 shares; issued and outstanding
22,745,410 shares at June 30, 2008 and
23,095,010 shares at December 31, 2007 227 231
Additional paid-in capital 274,723 274,672
Accumulated deficit (273,750) (275,850)
-------------------------
Total stockholders' equity (deficit) 1,206 (941)
-------------------------
Total liabilities and stockholders' equity
(deficit) $ 1,842 $ 1,796
-------------------------
-------------------------

The notes contained in our Quarterly Report on Form 10-Q are an integral
part of these condensed consolidated financial statements



C2 GLOBAL TECHNOLOGIES INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)

(In thousands, except per share Three Months Ended Six Months Ended
amounts) June 30, June 30,
------------------------------- -----------------------------------------
2008 2007 2008 2007
-----------------------------------------

Revenue: Patent licensing $ 1,900 $ - $ 8,125 $ -
Operating costs and expenses:
Patent licensing 1,308 - 4,492 -
Selling, general and
administrative 280 314 556 593
Depreciation and amortization 5 5 10 10
-----------------------------------------
Total operating costs and
expenses 1,593 319 5,058 603
-----------------------------------------
Operating income (loss) 307 (319) 3,067 (603)
-----------------------------------------
Other income (expense):
Earnings of equity accounted
investments 8 - 7 -
Other income (expense) 5 1 5 (292)
Interest expense - (47) (43) (95)
-----------------------------------------
Total other income (expense) 13 (46) (31) (387)
-----------------------------------------
Income (loss) from continuing
operations before income taxes 320 (365) 3,036 (990)
Income tax expense 9 - 930 -
-----------------------------------------
Income (loss) from continuing
operations 311 (365) 2,106 (990)
Loss from discontinued operations
(net of $0 tax) (6) (18) (6) (20)
-----------------------------------------
Net income (loss) $ 305 $ (383) $ 2,100 $ (1,010)
-----------------------------------------
-----------------------------------------

Weighted average common shares
outstanding 23,045 23,095 23,070 23,094
Weighted average preferred shares
outstanding 1 1 1 1

Net income(loss) per share:
Common shares $ 0.01 $ (0.01) $ 0.09 $ (0.04)
Preferred shares $ 0.54 $ N/A $ 3.65 $ N/A

The notes contained in our Quarterly Report on Form 10-Q are an integral
part of these condensed consolidated financial statements

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