Snipp Interactive Inc.
TSX VENTURE : SPN

Snipp Interactive Inc.

September 03, 2013 09:15 ET

Snipp Interactive Inc. Reports Record Second Quarter Revenue Growth and Net Income

WASHINGTON, DISTRICT OF COLUMBIA--(Marketwired - Sept. 3, 2013) - Snipp Interactive Inc. ("Snipp"), an international provider of mobile marketing solutions listed on the TSX Venture Exchange (TSX VENTURE:SPN), is pleased to announce its financial results for the quarter ended June 30, 2013. A copy of the complete unaudited financial statements and management's discussion and analysis are available on SEDAR at www.sedar.com.

The total sales revenues for the 2nd quarter of 2013 grew 95% from the prior year.

Revenue for the quarter was $207,196 compared to $106,321 from the prior year quarter. The increase in revenue is attributable to a multitude of factors including the creation of new sales channels, additional sales contracts from existing customers, the acquisition of new customers and the launch of innovative new products as part of Snipp's Mobilize Me platform.

Net income for the period was $31,692 compared to a net loss of $169,357 for the same period last year.

The positive net income for the 2nd quarter of 2013 was mainly due to the decrease in fair value of our derivative liabilities resulting in a non-cash gain. The net loss before other non-operating items was $232,493 in Q2 compared with $330,380 the year prior. The decrease in net loss (before other non-operating items) is mainly due to increased sales revenue as a result of the continued acquisition of new clients and new mobile solutions within Snipp's portfolio (e.g. SnippAR, SnippCheck, SnippWine, SnippShip and other similar products).

At the end of the period, current assets were $432,495 and current liabilities $199,828.

Atul Sabharwal, CEO and Founder of Snipp commented, "We are pleased to announce our sixth consecutive quarter of revenue growth. Snipp has now established and carried out successful campaigns for clients in the US, Canada, Middle East and Mexico. With the recent strategic investment by our partners in Brazil, we will be shortly launching the platform in South America that will further enhance the top and bottom lines for the company. In addition to new markets, we also successfully launched our cloud based QR code creation service for clients to efficiently incorporate highly customized QR codes into their mobile marketing mix. Along with the other cloud based solutions that make up our Mobilize Me platform such as SnippCheck, an industry leading solution for mobile receipt and image processing, companies across the globe and in any industry can work with Snipp to rapidly and cost effectively integrate mobile not only into their marketing mix but into the core operations of their business."

Outlook:

The company has set the foundation to continue to grow the company operationally profitable this year. Several key initiatives are expected to bear fruit for the company, any one of which can drive significant revenue and profitability gains for the company. (More details can be found in the Management Discussion and Analysis section of the quarterly filings at www.sedar.com.)

Roll out of SnippCheck

In November 2012, Snipp launched its SnippCheck mobile receipt processing solution (www.snippcheck.com) that allows customers to simply take a picture of their receipt to get back coupons, acquire points in a loyalty program, claim a rebate or participate in any kind of purchase related marketing program offered by brands. SnippCheck is an industry leading mobile receipt processing solution that large consumer brands can avail of to create and launch new purchase related programs. By focusing on store receipts, the solution offers brands the ability to create truly national campaigns with great ease and flexibility, and without the need for expensive and cumbersome integrations with a limited set of retail POS systems. SnippCheck is built using Snipp's Image Recognition and MMS solutions, and includes sophisticated Optical Character Recognition (OCR) and Fraud Detection algorithms. SnippCheck brings a new revenue model to Snipp by allowing for "Pay Per Snipp" transactions. By allowing clients to pay based on success rates of campaigns, Snipp enjoys in the upside of these campaigns while reducing a clients costs of running such campaigns by over 50% in some cases.

Launch of SnippAR

In July of 2013, Snipp launched SnippAR,its augmented reality solution for brands. SnippAR (http://ar.snipp.com) allows marketers to deliver seamless and immersive augmented reality experiences for their customers. Users can unlock interactive content by simply holding the opened app in front of an augmented reality trigger. A trigger can be an image, physical object or certain geographic locations. There are many useful applications for augmented reality including virtual visits, 360º tours, store & location finders, training & education programs, interactive maps, print-to-mobile activations, product catalog activations and virtual gaming. The product debuted in the Middle East market under the brand SnippKhayal with Lexus as its first client. SnippKhayal is available for download on iTunes and Google Play.Snipp has received vast interest in the technology from leading brands, both regionally and globally. They will soon be launching a specific AR solution for the North American market.

Ramp of International Sales

1. Brazil

As announced on August 21, 2013, an investment was made in Snipp by FTC Cards Inc., a strategic partner from Brazil. The proceeds of the Private Placement will be used to launch Snipp's mobile solutions into the Brazilian market in conjunction with its new strategic partner. Snipp's mobile solutions include SnippCheck (mobile receipt processing), SnippAR (augmented reality), SnippWin (mobile promotions) and more. FTC Cards Inc. controls and manages FTC Cards Processamento e Serviços de Fidelização Ltda. ("FTC Cards Brazil") which is in the business of providing data processing to support a program of promotions, awards, loyalty and credit card processing servicing the gas stations of Petrobras Distribuidora S.A., Brazil's largest oil company. The two companies have been working closely on the launch of solutions for the Brazilian market and plan to be revenue generating by Q1 of 2014.

2. Mexico

Snipp recently delivered to VirKet S.A. de C.V. ("Virket"), a QR Code and an Augmented Reality application based on SnippAR for its clients that include Anuncios en Directorios, S.A. de C.V, (SA) the largest yellow pages publisher in Mexico with whom Virket had in the past engaged with to sub-license the Snipp Platform. Anuncios en Directorios, S.A. de C.V. is a company controlled by Grupo Carso, the parent of Anuncios en Directorios that also controls such leading brands internationally such as Telmex, Sanbornes, America Movil. Anuncios en Directorios S.A. de C.V. is present in Mexico, United States, El Salvador, Peru and Columbia. Management has worked with Virket on various prototype solutions for the Grupo Carso over the last year and believes it will result in multiple revenue opportunities for the Company should Snipp be successful in licensing these solutions to Anuncios en Directorios either directly or via a sub-license through VirKet.

3. Middle East

Snipp has made in-roads into the Middle East market through the launch of the SnippKhayal app based on Snipp's Augmented Reality solution. Clients that have executed programs include Lexus, National Bank of Kuwait and Student Talk. Management believes that the region presents significant revenue opportunities to monetize this application and is focusing on selling and licensing the entire Mobilize Me solution suite in the region.

eWinery integration

In November 2012, eWinery and Snipp signed a joint marketing agreement to target eWinery's clients with a Mobile shipping module. Earlier this year eWinery Solutions and Napa Valley POS merged operations to offer superior, end-to-end Direct to Consumer solutions for the wine industry. As a result of this merger, more than 600 customers representing over 70% of the $600MM direct to consumer wine business in the USA in 2012 are clients of eWinery Solutions or Napa Valley POS. The merged company announced a partnership with Netsuite (NYSE: N), a leading cloud based enterprise solution and the launch of VinSuite, a fully integrated winery solution. Management believes that Snipp stands to benefit from this relationship. eWinery has completed integration with Snipp's platform and the two companies are deploying a joint marketing plan beginning September 2013.

About Snipp Interactive Inc.

Snipp Interactive Inc. (www.snipp.com) builds mobile solutions for brands to engage and interact with their customers. Snipp provides print publishers, advertising agencies and corporate/consumer brands, including Fortune 500 companies, with three main solution sets:

  • Response: Mobile activations that make offline campaigns more interactive.
  • Infrastructure: Tools to create scalable mobile destinations and experiences.
  • Validation: Mobile workflows to validate purchases and other customer actions.

Snipp generates revenue by designing, constructing, implementing and managing these mobile solutions for its customers. Snipp is headquartered in Washington, D.C. with international operations in Canada, Mexico and India.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions are intended to identify forward-looking statements. Such statements reflect our current views with respect to future events and are subject to such risks and uncertainties. Many factors could cause our actual results to differ materially from the statements made, including those factors discussed in filings made by us with the Canadian securities regulatory authorities. Should one or more of these risks and uncertainties, such as changes in demand for and prices for the products of the company or the materials required to produce those products, labour relations problems, currency and interest rate fluctuations, increased competition and general economic and market factors, occur or should assumptions underlying the forward looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, or expected. We do not intend and do not assume any obligation to update these forward-looking statements, except as required by law. The reader is cautioned not to put undue reliance on such forward-looking statements.

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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