SOURCE: e.Digital Corporation

e.Digital Corporation

February 12, 2015 16:30 ET

e.Digital Reports Third Quarter Results

SAN DIEGO, CA--(Marketwired - February 12, 2015) - e.Digital Corporation (OTCQB: EDIG), a long standing source of innovation and future-defining patented technologies, today announced results for the third quarter of fiscal 2015, ended December 31, 2014.

Recent Highlights:

  • Flash-R Technology Enforcement and Licensing Progress - During the third fiscal quarter the Company entered into multiple Flash-R licensing agreements. To date, 69 companies have licensed the Company's Flash-R patent portfolio. Ten Flash-R license enforcement legal actions are currently pending. The Company believes responsible manufacturers and suppliers of flash memory storage devices license its portfolio in recognition of its proven intellectual property rights.

    In November 2014, the Company's appeal to the Federal Circuit Court of Appeals regarding application of the doctrine of collateral estoppel to U.S. Patent No. 5,839,108 ("the '108 patent") was successful. In December 2014, the U.S. District court for the Southern District of California also ruled favorably regarding the Company's claim construction of its '108 patent. The Company continues to defend its rights under its Flash-R patent portfolio with cases pending against notable companies including SanDisk, GoPro, Micron, and Lenovo.
  • Nunchi® Technology Enforcement - The Company's Nunchi® portfolio consists of six U.S. patents and four pending continuation applications. Continuing efforts to license this unique and ground breaking technology, the Company has filed infringement lawsuits against Dropcam, Inc. and Arcsoft, Inc. dba simplicam over their systems for using various devices to communicate with and monitor remote locations. The Company has identified other potential infringers in the "connected" home security space and other areas of the industry and is evaluating enforcement options.
  • microSignet Technology - The Company is pursuing development of applications for its microSignet™ technology, which involves creating a heightened layer of security for electronic devices. The Company believes significant opportunities exist in the rapidly developing and changing data security market. The Company is seeking licensing arrangements or other partnerships with semiconductor companies and established online security providers to monetize microSignet™.
  • Other New Technologies - The Company's intellectual properties and engineering teams are developing and patenting other technologies to enhance privacy in communications and data exchange between users of connected communication devices over public networks.

Third Quarter Fiscal 2015 Financial Summary:
The Company reported net income of $275,741 or $0.00 per share, for the third quarter of fiscal 2015 compared to a net income of $698,794 or $0.00 per share for the prior year's third quarter. For the third quarter of fiscal 2015 revenues totaled $1,121,495 compared to $1,286,367 for the third quarter of the prior year. The most recent quarter included $1,078,500 of patent license revenues compared to $1,227,500 for the third quarter of the prior year. Operating expenses increased to $814,404 from $572,573 for the prior year's comparable quarter primarily due to increased patent-related legal costs.

For the nine months ended December 31, 2014 the Company reported net income of $133,324 or $0.00 per share on revenues of $2,198,745. For the comparable nine months of the prior year the Company reported a net income of $217,244 or $0.00 per share on revenues of $1,837,554. The Company's results are impacted by the timing and amount of license fees.

About e.Digital Corporation: For more than 25 years, e.Digital's ideas and inventions have impacted the evolution of consumer products. Today, e.Digital innovations, including its Flash-R™ portfolio of flash memory-related patents, and Nunchi® portfolio, are essential to many portable consumer electronic products. For more information about e.Digital, please visit: www.edigital.com.

Safe Harbor statement under the Private Securities Litigation Reform of 1995: This press release includes forward-looking information and statements. Except for historical information contained in this release, statements in this release may constitute forward-looking statements regarding assumptions, projections, expectations, targets, intentions or beliefs about future events that are based on management's belief, as well as assumptions made by, and information currently available to, management. While the Company believes that expectations are based upon reasonable assumptions, there can be no assurances that goals and strategy will be realized. Numerous factors, including risks and uncertainties, may affect actual results and may cause results to differ materially from those expressed in forward-looking statements made by the Company or on its behalf. Some of these factors include the substantial uncertainties inherent in pursuing patent enforcement activities including, but not limited to the risks and costs of litigation and support activities, the timing and amount of settlements/licenses if any, the acceptance of existing and future products and technologies, the difficulty of commercializing and protecting new technology such as the Company's Nunchi, microSignet and other technologies, the impact of competitive products, technologies and pricing, general business and economic conditions, and other factors detailed in the Company's Annual Report on Form 10-K and other periodic reports filed with the SEC. Except as required by law, the Company specifically disclaims any obligation to update or revise any forward-looking statement whether as a result of new information, future developments or otherwise.

 
e.Digital Corporation and subsidiary
Condensed Consolidated Balance Sheet
(000's omitted except per share amount)
(unaudited)
 
   December 31,  March 31,
   2014  2014
   $  $
ASSETS      
 Current      
  Cash  2,244  1,788
  Accounts receivable  76  239
  Inventory  -  14
  Deposits and prepaid expenses  45  65
 Total current assets  2,365  2,106
  Property and equipment, net  10  14
  Inventory, long-term  -  40
 Total assets  2,375  2,160
       
LIABILITIES AND STOCKHOLDERS' EQUITY     
 Current      
  Accounts payable  206  66
  Accrued and other  135  231
 Total current liabilities  341  297
 Stockholders' equity  2,034  1,863
 Total liabilities and stockholders' equity  2,375  2,160
       

 

                  
e.Digital Corporation and subsidiary          
Condensed Consolidated Statement of Operations          
(000's omitted except per share amount)          
(unaudited)          
        
   For the three months   For the nine months  
   ended December 31,   ended December 31,  
   2014   2013   2014   2013  
   $   $   $   $  
Revenues  1,121   1,286   2,199   1,838  
Cost of revenues                 
Operating expenses:                 
 Products and services  79   84   239   255  
 Patent licensing and litigation costs  117   113   343   338  
 Contingent legal fees and expenses  339   119   642   149  
Selling and administrative  184   180   549   626  
Research and related expenditures  94   77   262   238  
Total operating expenses  813   573   2,035   1,606  
Operating income before income taxes  308   713   164   232  
Provision for income taxes  (31 ) (15 ) (31 ) (15 )
Income for the period  277   698   133   217  
Income per common share - basic  0.00   0.00   0.00   0.00  
Income per common share - diluted    0.00    0.00    0.00    0.00  
Weighted average common shares outstanding                
 Basic  293,328   293,187   293,328   293,187  
 Diluted  294,164   294,281   294,135   294,841