Peak Positioning Technologies Inc.
TSX VENTURE : PKK

Peak Positioning Technologies Inc.

May 31, 2013 17:01 ET

Peak Positioning Files 2012 Year End Results and Operating Highlights

MONTREAL, CANADA--(Marketwired - May 31, 2013) - Peak Positioning Technologies Inc. ("Peak") (TSX VENTURE:PKK) today announced its financial results and reviewed highlights for the year ended December 31, 2012.

Financial Highlights:

  • Gross royalties of $275,020 derived from Chinese market.

  • R&D expenditures, net of tax credits, of $519,126.

  • Net loss of $2,465,362 for the year.

Operating Highlights:

  • Completion of AiNiä Mobile Cloud Platform for smartphones and other mobile devices.

  • Revision of LongKey agreement to provide increased royalty stream.

  • Contacts signed by LongKey with China Unicom and Industrial and Commercial Bank of China.

  • Agreement for acquisition of LongKey and up to $6 million of new financing.

Peak pursued its business plan in 2012 along both its Chinese and North American growth paths. Good progress was made towards achieving the plan objectives through the first three quarters of the year. However, unexpected additional investment in China and less than anticipated cash flows resulted in a liquidity issues in the fourth quarter of the year. The Company responded by devoting a large part of its efforts to arranging for short and longer-term financing. Four short-term financings were completed in the first five months of fiscal 2013. Additional short-term financing and a longer-term financing of up to US $6 million are in the process of being completed as of the date of this earnings release.

"China Unicom's selection of the AiNi™ Mobile Cloud Platform for its proprietary mobile apps offering provides us with a unique opportunity to grow our future revenue streams", said Johnson Joseph, Peak's President and Chief Executive Officer. "The China Unicom deal also led us to the proposed acquisition of LongKey. Peak and LongKey have recognized that it is in their mutual best interests to solidify their relationship in order to more easily attract the investment needed to expand the Chinese operations and meet the demands of being a national China Unicom partner" he explained.

"Peak's main focus in 2013 will be to complete the acquisition of LongKey and close the announced US$6 million financing", Mr. Joseph continued. "Peak and LongKey will then be in a position to open sales support offices in several provinces and expand the rollout of AiNi™ on China Unicom 3G devices. All of this in turn, is expected to have a significant positive impact on the Company's revenues in 2013", he added.

Cease Trade Order

Due to a delay in filing the 2012 Annual Disclosure Documents, on May1, 2013 the Autorité des marchés financiers, the Company's primary regulator, imposed a cease trade order on the Company's management and directors prohibiting trading of the Company's securities. With the filing today of the 2012 Audited Financial Statements and MD&A, it is expected that the cease trade order will now be lifted.

Fiscal 2012 financial results

The Company generated $275,020 in gross royalty revenues for the year ended December 31, 2012, which was reduced to net revenue from royalties of $163,884 after amortization of other assets. In the prior year period, net revenues from royalties were ($1,998). Expenses for fiscal 2012 amounted to $2,629,246, compared to $2,339,906 in the prior year. The most notable difference was in Chinese operating cost and shared costs which amounted to $1,180,382 in 2012 compared to $270,000 in the prior year. 2012 can be summarized as another year of investment and foundation building for the Company's operations in China. The net loss for the year was $2,465,362 compared to $2,341,904 in 2011. Full details of the Company's 2012 financial results can be found in the Audited Consolidated Financial Statements and Management's Discussion and Analysis (MD&A) for the years ended December 31, 2012 and 2011, which are available at www.sedar.com.

About Peak Positioning Technologies Inc.:

Peak Positioning Technologies Inc. (TSX VENTURE:PKK) is a Canadian software developer for smartphones and other mobile computing devices, conducting business primarily in China and North America. In association with its partner, LongKey-Hong Kong Ltd (LongKey), the Company has developed a suite of applications for mobile devices that includes: cloud-based e-mail, calendar and contacts synchronization, automated device configuration, and HomeWaveä mobility security. LongKey markets the applications in China through its partnerships with major Chinese telecommunication companies and banks. Peak plans to similarly market the applications for its own account in North America.

Forward-Looking Statements / Information

This news release may include certain forward-looking information, including statements relating to business and operating strategies, plans and prospects for revenue growth, using words including "anticipate", "believe", "could", "expect", "intend", "may", "plan", "potential", "project", "seek", "should", "will", "would" and similar expressions, which are intended to identify a number of these forward-looking statements. Forward-looking information reflects current views with respect to current events and is not a guarantee of future performance and is subject to risks, uncertainties and assumptions. The Company undertakes no obligation to publicly update or review any forward-looking information contained in this news release, except as may be required by applicable laws, rules and regulations. Readers are urged to consider these factors carefully in evaluating any forward-looking information.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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