SOURCE: Internet Patents Corporation

July 30, 2012 16:15 ET

Internet Patents Corporation Reports Second Quarter 2012 Results

SACRAMENTO, CA--(Marketwire - Jul 30, 2012) - Internet Patents Corporation (NASDAQ: PTNT) today reported financial results for the second quarter ended June 30, 2012. 

"As part of our efforts to license our strong portfolio of e-commerce patents, during the second quarter we initiated our first lawsuits against eBags, Inc. and TellApart, Inc. alleging infringement of U.S. Patent No. 6,898,587 entitled 'Event Log Information in Client-Server Computer System.' We are preparing to file additional lawsuits against other parties for infringing the Event Log and other patents in the near future," said Hussein Enan, Chairman and CEO of Internet Patents Corporation. "We are also pleased that our Board of Directors recently named Steve Yasuda as chief financial officer. Steve has been a key member of the management team for over 12 years, and we look forward to his continued contributions to the company in this role."

Operating Highlights
As of the quarter ended June 30, 2012:

  • In its second quarter of operating a patent licensing business, the Company reported a net loss for the quarter of $911,000, or $0.12 per share.
  • Total operating expenses of $979,000 were higher than the previous quarter due to severance and retention payments. Operating expenses are expected to return to the Company's target range of $0.6 to $0.7 million in the third quarter.
  • Cash and cash equivalents and short-term investments were $34.6 million, which includes $1.0 million in restricted short-term investments. 
  • The number of shares of Internet Patents Corporation common stock issued and outstanding was 7,751,952. Options representing a total of 232,666 shares of common stock remain outstanding and exercisable as of that same date.
  • Net operating loss (NOL) carry forwards were approximately $139.2 million and $83.8 million for federal income tax and state income tax purposes, respectively. Included in these amounts are unrealized federal and state net operating loss deductions resulting from stock option exercises of approximately $6.7 million each. The benefit of these unrealized stock option-related deductions has not been included in deferred tax assets and will be recognized as a credit to additional paid-in capital when realized. Federal and state net operating loss carry forwards begin expiring in 2012.

About Internet Patents Corporation
Headquartered in Sacramento, CA, Internet Patents Corporation (NASDAQ: PTNT) operates a patent licensing business focused on its e-commerce technologies. www.internetpatentscorporation.net

Forward-Looking Statements

This news release contains forward-looking statements, which include statements expressing the intent, belief or current expectations of Internet Patents Corporation that are subject to significant risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. The words "may," "could," "should," "would," "believe," "anticipate," "estimate," "expect," "intend," "plan," "target," "goal," and similar expressions are intended to identify forward-looking statements. Actual results might differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with Internet Patent Corporation's business, which include, but are not limited to: the unpredictable nature of patent licensing and patent litigation; potential changes in the laws and regulations relating to patents and patent litigation; the risk that we are not currently engaged in the patent licensing business, and our patent portfolio has never generated revenues; future changes we may make in our patent licensing strategy; and changes in the taxation of income due to the disallowance or expiration of the Company's net operating losses. Unless legally required, Internet Patents Corporation undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements should be considered in the context of these and other risk factors disclosed in the Company's filings with the Securities and Exchange Commission.

   
INTERNET PATENTS CORPORATION  
   
CONDENSED CONSOLIDATED BALANCE SHEETS  
   
(in thousands)  
(unaudited)  
   
    June 30,
2012
    December 31, 2011  
Assets                
Current assets:                
  Cash and cash equivalents   $ 33,102     $ 70,326  
  Short-term investments     491       1,225  
  Restricted short-term investments     1,000       -  
  Prepaid expenses and other current assets     300       1,374  
    Total current assets     34,893       72,925  
Property and equipment, net     44       42  
Other assets     27       1,027  
    Total assets   $ 34,964     $ 73,994  
                 
Liabilities and stockholders' equity                
Current liabilities:                
  Accounts payable   $ 426     $ 3,385  
  Accrued expenses and other current liabilities     247       541  
  Income tax payable     -       644  
    Total current liabilities     673       4,570  
                 
Income tax liability and other non-current liabilities     101       101  
Total liabilities     774       4,671  
                 
Commitments and contingencies                
                 
Stockholders' equity:                
  Common stock     11       10  
  Paid-in capital     221,726       216,401  
  Treasury stock     (6,788 )     (6,589 )
  Accumulated deficit     (180,759 )     (140,499 )
                 
    Total stockholders' equity     34,190       69,323  
    Total liabilities and stockholders' equity   $ 34,964     $ 73,994  
                     
                     
                     
INTERNET PATENTS CORPORATION  
   
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  
   
(in thousands, except per share amounts)  
(unaudited)  
   
    Three Months 
Ended June 30,
    Six Months 
Ended June 30,
 
    2012     2011     2012     2011  
                                 
Total revenues   $ -     $ -     $ -     $ -  
                                 
Operating expenses:                                
  Sales and marketing     -       -       -       -  
  Technology     -       24       -       48  
  General and administrative     979       826       1,816       1,714  
    Total operating expenses     979       850       1,816       1,762  
      Loss from operations     (979 )     (850 )     (1,816 )     (1,762 )
Other income     68       5       168       10  
Loss from continuing operations     (911 )     (845 )     (1,648 )     (1,752 )
Discontinued operations, net of tax                                
  Income from discontinued operations     -       1,824       -       3,029  
Total discontinued operations     -       1,824       -       3,029  
                                 
Net income (loss)   $ (911 )   $ 979     $ (1,648 )   $ 1,277  
                                 
Net income (loss) per share:                                
  Basic and diluted                                
      Loss from continuing operations   $ (0.12 )   $ (0.15 )   $ (0.22 )   $ (0.31 )
      Discontinued operations, net of tax   $ -     $ 0.32     $ -     $ 0.54  
Net income (loss) per basic common share   $ (0.12 )   $ 0.17     $ (0.22 )   $ 0.23  
                                 
Shares used in computing per share amounts                                
      Basic and diluted     7,752       5,687       7,566       5,605  
                                 

Contact Information

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