SOURCE: Augme Technologies, Inc.

July 12, 2010 08:30 ET

Augme Technologies, Inc. Reports First Quarter Operating Results

Ad Life™ Mobile Platform Exceeds Expectations Due to Strong Customer Demand

NEW YORK, NY--(Marketwire - July 12, 2010) - Augme Technologies, Inc. (OTCBB: AUGT), a leading developer and provider of patented and innovative smart mobile technology, today announced its operating results for the first quarter of FY2011.

Augme Technologies, Inc. ("the Company") today announced revenue of $286,323 for the three months ended May 31, 2010, representing a 740% increase when compared with $38,693 of continuing operational revenue in the first quarter of FY2010. Production and service delivery costs totaled $233,337 in the most recent quarter, versus $65,001 of continuing operational production and service delivery costs in the quarter ended May 31, 2009, reflecting additional costs related to human capital in order to facilitate the delivery of the Company's new service-oriented philosophy.

Selling, general, and administrative ("SG&A") expenses of $1,542,057 in the first quarter of FY2011 compared with $892,843 of continuing operational SG&A expenses in the quarter ended May 31, 2009. The 73% increase primarily consisted of $430,833 of higher non-cash stock option expense, $127,520 in outside contracting costs associated with an increased level of product development, and a $90,726 increase in accounting, consulting and various other expenses. 

Depreciation and amortization expenses totaled $247,459 in the quarter ended May 31, 2010, compared with $155,532 of continuing operational depreciation and amortization expenses in the prior-year period. The total increase in depreciation and amortization expenses related to intangible assets associated with an acquisition last year.

During the quarter ended May 31, 2010, the Company incurred a net loss of $1,736,510, compared with a net loss of $1,258,750 in the first quarter of FY2010. The $477,760 increase in net loss resulted from higher expenses, including non-cash expenses, as described above.

These financial results represent the fourth consecutive quarter of sequential revenue growth averaging approximately 100% each quarter on a compound basis for the Company. Current business bookings are estimated at 2.0 to 2.5 times more than the revenues being recognized on a quarterly basis. "We are pleased with our performance this quarter, particularly with strong customer demand for our AD LIFE™ (Augme Mobile) interactive platform," stated Paul Arena, Chief Executive Officer of Augme Technologies, Inc. "Branding and advertising agencies, along with blue-chip company internal marketing departments, are responding with enthusiasm to our ability to create, deliver, manage and track interactive marketing campaigns targeting mobile consumers through traditional print advertising channels. AD LIFE continues to move towards its objective of becoming the premier mobile marketing provider for the world's largest consumer packaged goods ("CPG") companies and their marketing agencies. By integrating the AD LIFE platform into the marketing strategies of our formidable clients, we anticipate high annualized growth rates to continue as the platform is utilized across multiple brands under individual master contracts. AD LIFE is experiencing significant momentum, as evidenced by our success with Fortune 500 CPG clients and some of the most popular household brands. In many cases, we were able to compete successfully against major corporations for these clients."

Business Outlook

Augme is developing an improved service delivery model that deploys software as a service ("SaaS") licensing through channel partners. The Company's technology has been built around a .NET core framework designed to enable medium-to-large companies to connect AD LIFE as a software module into their existing enterprise resource planning ("ERP") systems for real-time data reporting.

It is expected that the new SaaS software license model will launch during the third quarter of the current fiscal year (FY2011). More details will be provided as they become available.

Intellectual Property Portfolio

Augme's solutions are supported by its intellectual property portfolio. The Company has been issued two patents and has been notified that two additional patents will be allowed pending formal issuance by the United States Patent & Trademark Office ("USPTO"). Additional patent applications are pending or in process for filing. 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 its 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").

On September 10, 2008, the Company filed a complaint against AOL, LLC in the U.S. District Court, Central District of California, for infringement of its trademark BOOMBOX RADIO. On January 21, 2009, a First Amended Complaint was filed against AOL, LLC; Time Warner, Inc.; and Platform-A, Inc., for trademark infringement relating to the word-mark BOOMBOX RADIO and infringement of U.S. Patent Nos. 6,594,691 and 7,269,636. Per court order dated April 14, 2009, the case was transferred to the U.S. District Court, Southern District of New York, where Augme's complaint against Tacoda, Inc. for infringement of U.S. Patent Nos. 6,594,691 and 7,269,636 is pending.

In Augme's case against AOL, Platform-A and Time Warner, the Company has moved to have the Tacoda case and the AOL case joined by the court, and to proceed on the trademark claims. An agreement has been reached to explore settlement and to proceed to mediation before a retired federal judge with respect to the trademark claims.

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. The case is scheduled for a settlement conference on July 28, 2010.

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 provide companies the control they need to quickly create, deploy and measure media-rich, interactive marketing campaigns across all networks and devices. Campaigns built on Augme marketing platforms condense the customer loyalty cycle by delivering personalized brand experience to customers where they work, play and live. Through its three operating divisions, including mobile marketing (AD LIFE™), video content delivery (AD BOOM™) and ad network provisioning (AD SERVE™), Augme is connecting brands and content to consumers in a network of mobile and multimedia experiences that enable companies and their marketing agencies to create new markets and monetize brand interactions. Augme is headquartered in New York City. For more information, visit the Company's website at www.augme.com.

Augme Technologies, Inc.™, Augme™, AD LIFE™, AD BOOM™, AD SERVE™ and the Augme logo are trademarks of Augme Technologies, Inc. All rights reserved. 2009-10.

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.

AUGME TECHNOLOGIES, INC.  
CONSOLIDATED BALANCE SHEETS  
FOR THE PERIOD ENDED MAY 31,  
(Unaudited)  
   
ASSETS  
  2010     2009  
Current Assets              
  Cash and cash equivalents $ 178,507     $ 371,980  
  Accounts Receivable, net of allowance for doubtful accounts of $62,146 and $63,747, respectively   122,906       799,393  
  Prepaid Expenses and Other Current Assets   125,159       62,328  
    Total Current Assets   426,572       1,233,701  
               
               
Property and equipment, net of accumulated depreciation of $805,480 and $753,241, respectively   496,569       539,929  
Goodwill   13,106,969       386,746  
Intangible assets, net of accumulated amortization of $1,631,899 and $1,456,679, respectively   4,278,280       2,886,286  
Deposits   27,450       623,000  
TOTAL ASSETS $ 18,335,840     $ 5,669,662  
               
               
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)  
    2010       2009  
Current Liabilities              
  Accounts payable $ 711,280     $ 1,070,645  
  Accrued liabilities   254,072       564,155  
  Deferred revenue, current   93,614       760,468  
    Total current liabilities   1,058,966       2,395,268  
               
Long-term deferred revenue   12,930       -0-  
    Total liabilities   1,071,896       2,395,268  
               
Stockholders' Equity (Deficit)              
Common stock, $.0001 par value; 100,000,000 shares authorized, 57,456,977 and 57,256,750 shares issued and outstanding, respectively   5,746       4,682  
Additional paid-in capital   46,469,276       22,993,387  
Accumulated deficit   (29,211,078 )     (19,723,675 )
Total Stockholders' Equity   17,263,944       3,274,394  
               
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 18,335,840     $ 5,669,662  
   
   
AUGME TECHNOLOGIES, INC.  
CONSOLIDATED STATEMENTS OF OPERATIONS  
(Unaudited)  
           
  For the Three Months Ended May 31, 2010     For the Three Months Ended May 31, 2009  
               
REVENUE $ 296,323     $ 521,325  
               
COST OF REVENUES (Excluding depreciation):              
Production and service delivery costs   233,327       186,028  
               
Gross Profit   62,996       335,297  
               
OPERATING EXPENSES:              
Selling, general and administrative   1,542,057       1,357,105  
Depreciation and amortization   247,459       237,126  
               
Total Operating Expenses   1,789,516       1,780,259  
LOSS FROM OPERATIONS   (1,736,520 )     (1,258,934 )
OTHER INCOME:              
Interest income/(expense), net   10       184  
LOSS FROM CONTINUING OPERATIONS   (1,736,510 )     (1,258,750 )
Loss from discontinued operations   -0-       -0-  
Loss on sale of discontinued operations   -0-       -0-  
LOSS FROM DISCONTINUED OPERATIONS   -0-        -0-  
NET LOSS $ (1,736,510 )   $ (1,258,750 )
               
BASIC AND DILUTED NET LOSS PER SHARE:              
  Loss from continuing operations $ -0-     $ -0-  
  Loss from discontinued operations   -0-       -0-  
NET LOSS PER SHARE - basic and diluted: $ (0.03 )   $ (0.03 )
WEIGHTED AVERAGE SHARES OUTSTANDING              
Basic and diluted   57,281,982       45,799,634  
               

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