SOURCE: Augme Technologies, Inc.

Augme Technologies, Inc.

January 10, 2011 08:28 ET

Augme Technologies, Inc. Reports 1,100% Increase in Third Quarter Revenues From Continuing Operations

Year-to-Date Revenues From Continuing Operations Increase 1,144% as Customer Utilization of AD LIFE™ Mobile Marketing Platform Continues to Exceed Expectations

NEW YORK, NY--(Marketwire - January 10, 2011) - Augme Technologies, Inc. (OTCBB: AUGT), the only patented and innovative end-to-end mobile marketing platform, today announced its operating results for the third quarter and first nine months of FY2011.

For the three months ended November 30, 2010, the Company's revenues totaled $853,169, which represented an increase of approximately 1,100% when compared with revenues from continuing operations of $71,132 in the third quarter of FY2010. Production and service delivery costs totaled $361,349, resulting in a gross profit of $491,820 for the most recent quarter, versus $28,349 in continuing operational production and service delivery costs and a continuing operational gross profit of $42,776 in the quarter ended November 30, 2009. The increase in production and service delivery costs was due to additional expenses related to the human capital necessary to facilitate the effective delivery of the Company's mobile marketing and related services to its customers.

Selling, general, and administrative ("SG&A") expenses increased to $3,064,546 in the third quarter of FY2011, compared with $1,297,543 in continuing operational SG&A expenses in the prior-year quarter. The 136% increase in SG&A expenses primarily consisted of $832,358 in non-cash stock option expense and $2,232,188 in other expenses, including payroll, accounting, consulting fees and software development expenses. Professional fees totaling approximately $991,743 represented a major component of SG&A expenses in the most recent quarter.

Depreciation and amortization ("D&A") expense totaled $261,209 in the quarter ended November 30, 2010, compared with $280,481 of continuing operational D&A expenses in the third quarter of FY2010. The decrease in depreciation and amortization expense was related to a change in intangible assets associated with an acquisition that was completed during 2009.

The Company recorded a net loss of ($2,833,928), or ($0.05) per share, in the quarter ended November 30, 2010, compared with a net loss from continuing operations of ($1,377,243), or ($0.03) per share, in the third quarter of FY2010. The $1,456,685 increase in net loss resulted from higher expenses, including non-cash expenses and professional fees, as described above.

Recognized revenues of $853,169 during the third quarter of FY2011 compared with $718,717 in the previous quarter and $286,323 in the first quarter of FY2011. In addition, deferred revenue, which is recognized over the period of contract performance, approximated $396,160 at the end of the third quarter, compared with $99,071 at the end of the previous quarter, for an increase of approximately 300%.

"The Company's performance during the most recent quarter reflects the growing number of Fortune 500 companies and brands that are utilizing our AD LIFE™ (Augme Mobile) interactive mobile marketing services platform," stated Paul Arena, Chief Executive Officer of Augme Technologies, Inc. "With industry analysts predicting exponential growth in consumer utilization of smartphones and other Internet-enabled mobile devices to access product information when making their purchasing decisions, we expect our sales to continue expanding at an impressive pace. As mobile marketing moves beyond the 'early adopter' stage and is incorporated into mainstream marketing strategies by national and regional brand name consumer packaged goods, healthcare and pharmaceutical companies, we would expect our revenue growth to accelerate in Fiscal 2012. We also believe our ability to offer an end-to-end solution that solves numerous mobile complications, using the only content rendering and device detection patents in the industry, will allow Augme to capture a growing share of the multi-billion-dollar mobile marketing industry in coming years."

For the nine months ended November 30, 2010, the Company reported revenues of $1,858,208, which represented an increase of 1,144% when compared with revenues from continuing operations of $149,334 in the corresponding period of the previous fiscal year. Gross profit improved to $1,011,821 in the first nine months of FY2011, versus a negative gross profit from continuing operations of ($49,781) in the nine months ended November 30, 2009. Total operating expenses increased to $7,533,702 in the most recent nine-month period, compared with total operating expenses from continuing operations of $3,938,855 in the first nine months of FY2010. The Company recorded a net loss of ($6,521,858), or ($0.11) per share, in the nine months ended November 30, 2010, compared with a net loss from continuing operations of ($4,379,475), or ($0.09) per share, in the prior-year period.

Business Outlook

The Company forecasts that recognizable revenues should exceed $12 million during the next twelve months, based on an estimate that approximately 50% of current bookings will convert into revenues within that period of time. The Company defines "current bookings" as the combination of signed agreements, initialed statement-of-work documents, indications of interest and commitments for AD LIFE¿ services that have been received from, but not yet delivered to, approximately two dozen Fortune 500 companies. The Company is currently doing business with three of the world's top ten pharmaceutical companies that have combined net revenues in excess of $150 billion annually. Some of Augme's other clients include three Fortune 100 companies, six Fortune 200 companies, and three Global Fortune 500 companies.

Intellectual Property Portfolio

Augme's solutions are supported by its intellectual property portfolio. The Company now owns four patents and has additional patents pending with the United States Patent & Trademark Office ("USPTO"). The patents contain a broad range of claims covering the Company's proprietary technologies and products. Augme also owns four trademarks protecting the names of its products and identity in the marketplace.

Litigation Update

Tacoda, Inc., AOL, LLC, Time Warner, Inc., and Platform-A, Inc.

In 2007, Augme filed a lawsuit against Tacoda, Inc. in the U.S. District Court, Southern District of New York, alleging infringement of Augme-owned U.S. Patent Nos. 6,594,691 ("Method and System for Adding Function to a Web Page") and 7,269,636 ("Method and Code Module for Adding Function to a Web Page").

In Augme's case against Tacoda, Inc.; AOL, LLC; Time Warner, Inc. and Platform-A, Inc., Judge Robert W. Sweet endorsed a letter on August 26, 2010 that was dated August 17, 2010, requesting that the Court assign to Magistrate Judge Ronald L. Ellis the above action for settlement purposes. On October 28, 2010, a mediation hearing was held before Magistrate Judge Ronald L. Ellis. It was also ordered that all proceedings relating to the mediation hearing were to be held confidential, that all information disclosed between the parties would be subject to the strict confidentiality requirements of mediation hearing practices, and that this confidentiality would carry on subsequent to the meeting.

Yahoo! Inc.

On November 16, 2009, Augme filed a Complaint against Yahoo! Inc. for patent infringement relating to U.S. Patent Nos. 6,594,691 and 7,269,636, which patents relate to methods and systems for delivery of selected content from a network to a web page visitor. The matter is currently pending in the United States District Court for the Northern District of California, Case No. C-09-5386 EDL. The remedies available to Augme, if successful, include an injunction prohibiting any infringing actions, an award of damages adequate to compensate for the infringement, and costs of the action.

On November 12, 2010, Yahoo! filed a motion for summary judgment with the United States District Court for the Northern District of California. On December 3, 2010, an order was issued by Magistrate Judge Joseph C. Spero denying the Yahoo! motion without prejudice. On December 3, 2010, Yahoo! filed a Notice of Motion and Motion for Leave to File Amended Answer with Additional Counterclaims and to join WorldTalk Radio, LLC as a Counterclaim Defendant. Augme denies that any merit exists with respect to these counterclaims and will continue to pursue the prosecution of Yahoo!'s infringement against the Company's patent claims.

About Augme Technologies, Inc.

Augme Technologies, Inc. (OTCBB: AUGT) is the technology and services leader in interactive media marketing platforms that enable marketers and agencies to seamlessly integrate brands, promotions, video and other digital content through the power of the Internet and mobile communications. Augme's intuitive new media marketing platforms allow companies to quickly create, deploy and measure rich-media, interactive marketing campaigns across all networks and devices. Campaigns built on Augme marketing platforms strengthen customer loyalty by delivering personalized brand experiences to customers where they work, play and live. By leveraging the power of its AD LIFE™ mobile marketing solution with complementary services such as video content delivery (BOOMBOX®) and ad network provisioning (AD SERVE™), Augme connects brands and content to consumers in a network of mobile and multimedia experiences that enables companies and their marketing agencies to build sales and monetize brand interactions. Augme is headquartered in New York City. For more information, visit www.augme.com.

Augme Technologies, Inc.™, Augme™, AD LIFE™, BOOMBOX®, AD SERVE™ and the Augme logo are trademarks of Augme Technologies, Inc. All rights reserved.

Forward-Looking Statements

This release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements regarding our expected future financial position, results of operations, cash flows, financing plans, business strategy, products and services, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as "anticipate," "if," "believe," "plan," "estimate," "expect," "intend," "may," "could," "should," "will," and other similar expressions are forward-looking statements. All forward-looking statements involve risks, uncertainties and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. Factors that may cause actual results to differ materially from those in the forward-looking statements include those set forth in our Form 10-K and other reports filed with the SEC. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.

(Financial Highlights Follow)



                     AUGME TECHNOLOGIES, INC.
                   CONSOLIDATED BALANCE SHEETS
                FOR THE PERIOD ENDED NOVEMBER 30,
                          (Unaudited)



                             ASSETS

                                                      2010         2009
                                                  ------------ ------------
Current Assets

  Cash and cash equivalents                       $    657,584 $    105,432

  Accounts Receivable, net of allowance for
   doubtful accounts of $74,783 and $63,747,
   respectively                                      1,073,276      255,309

Stock subscriptions receivable                         400,000            0

  Prepaid Expenses and Other Current Assets            201,848       59,829

                                                  ------------ ------------
    Total Current Assets                             2,332,708      420,570

                                                  ------------ ------------


Property and equipment, net of accumulated
 depreciation of $965,453 and $733,241,
 respectively                                          664,239     493,161

Goodwill                                            13,106,969   13,122,860

Intangible assets, net of accumulated
 amortization of $1,977,392 and $1,456,679,
 respectively                                        3,932,786    4,672,565

Deposits                                                27,450          -0-

TOTAL ASSETS                                      $ 20,064,152 $ 18,709,156
                                                  ------------ ------------




                         AUGME TECHNOLOGIES, INC.
                      CONSOLIDATED BALANCE SHEETS
                   FOR THE PERIOD ENDED NOVEMBER 30,
                             (Unaudited)


              LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)


                                                   2010          2009
                                              -------------  -------------
Current Liabilities

  Accounts payable                            $   1,026,121  $   1,035,944

  Accrued liabilities                               246,458        169,456

  Deferred revenue, current                         396,160        433,585

  Derivative Liabilities                                -0-        151,472
                                              -------------  -------------
  Total current liabilities                       1,668,739      1,790,457


Long-term deferred revenue                           12,930         14,169

Capital Lease Obligations                               -0-         22,865
                                              -------------  -------------
  Total liabilities                               1,681,669      1,827,491
                                              -------------  -------------

Stockholders' Equity (Deficit)

Common stock, $.0001 par value; 100,000,000
 shares authorized, 61,734,440 and 57,256,750
 shares issued and outstanding, respectively          6,173          5,390
                                              -------------  -------------
Additional paid-in capital                       52,372,736     40,951,374
                                              -------------  -------------
Accumulated deficit                             (33,996,426)   (24,075,099)
                                              -------------  -------------
Total Stockholders' Equity                       18,382,483     16,881,665
                                              -------------  -------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $  20,064,152  $  18,709,156
                                              =============  =============




                    AUGME TECHNOLOGIES, INC.
            CONSOLIDATED STATEMENTS OF OPERATIONS
                         (Unaudited)




                                                     For the       For the
                                                       Three         Three
                                                      Months        Months
                                                       Ended         Ended
                                                 November 30,  November 30,
                                                        2010          2009
                                                  -----------  -----------
REVENUE                                           $   853,169  $    71,132


COST OF REVENUES (Excluding depreciation):

Production and service delivery
 costs                                                361,349       28,349
                                                  -----------  -----------

Gross Profit                                          491,820       42,776


OPERATING EXPENSES:

Selling, general and administrative                 3,064,546    1,297,543

Depreciation and amortization                         261,209      280,481
                                                  -----------  -----------

Total Operating Expenses                            3,325,755    1,578,024
                                                  -----------  -----------
LOSS FROM OPERATIONS                               (2,833,935)  (1,535,241)

OTHER INCOME

Interest income/(expense), net                              7         (590)

Gain (Loss) in derivative instruments                     -0-      158,588

LOSS FROM CONTINUING OPERATIONS                    (2,833,928)  (1,377,243)

LOSS FROM DISCONTINUED OPERATIONS                         -0-     (381,005)
                                                  -----------  -----------
NET LOSS                                          $(2,833,928) $(1,758,248)
                                                  ===========  ===========

BASIC AND DILUTED NET LOSS PER SHARE:

  Loss from continuing operations                 $     (0.05) $     (0.03)

  Loss from discontinued operations                       -0-        (0.01)

NET LOSS PER SHARE - basic and diluted:           $     (0.05) $     (0.03)

WEIGHTED AVERAGE SHARES OUTSTANDING

Basic and diluted                                  60,412,028   52,979,068





                       AUGME TECHNOLOGIES, INC.
                CONSOLIDATED STATEMENTS OF OPERATIONS
                           (Unaudited)



                                                   For the         For the
                                                      Nine            Nine
                                                    Months          Months
                                                     Ended           Ended
                                               November 30,    November 30,
                                                      2010            2009
                                            --------------  --------------
REVENUE                                     $    1,858,208  $      149,334

COST OF REVENUES (Excluding depreciation):

Production and service delivery costs              846,387         199,110
                                            --------------  --------------

Gross Profit                                     1,011,821         (49,781)


OPERATING EXPENSES:

Selling, general and administrative              6,780,777       3,297,252

Depreciation and amortization                      752,925         641,603
                                            --------------  --------------

Total Operating Expenses                         7,533,702       3,938,855
                                            --------------  --------------
LOSS FROM OPERATIONS                            (6,521,881)     (3,988,631)

OTHER INCOME

Interest income/(expense), net                          23            (980)

Gain (Loss) in derivative instruments                  -0-        (389,864)

LOSS FROM CONTINUING OPERATIONS                 (6,521,858)     (4,379,475)

LOSS FROM DISCONTINUED OPERATIONS                      -0-        (599,555)

                                            --------------  --------------
NET LOSS                                    $   (6,521,858) $   (4,979,030)
                                            ==============  ==============


BASIC AND DILUTED NET LOSS PER SHARE:
  Loss from continuing operations           $        (0.11) $        (0.09)
  Loss from discontinued operations                    -0-  $        (0.01)

NET LOSS PER SHARE - basic and diluted:     $        (0.11) $        (0.10)
WEIGHTED AVERAGE SHARES OUTSTANDING
  Basic and diluted                             58,549,934      49,347,095

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