EX-99.1 2 f02777exv99w1.htm EXHIBIT 99.1 exv99w1
 

EXHIBIT 99.1

     
CONTACTS:
   
Insignia Solutions
  Financial Dynamics
Robert Collins
  Investors: Quynh Nguyen
Chief Financial Officer
  Financial Dynamics
(510) 360-3700
  (415) 439-4500

INSIGNIA SOLUTIONS REPORTS THIRD QUARTER 2004
FINANCIAL RESULTS

FREMONT, Calif., October 28, 2004 — Insignia Solutions (Nasdaq: INSG) today reported financial results for the third quarter ended September 30, 2004.

Insignia reported third quarter net revenues of $107,000 from the ongoing launch and commercialization of the Company’s new technology, Secure System Provisioning (SSP) for the comprehensive device management of a growing, complex and diverse array of mobile devices. The net loss in the third quarter was $1.7 million, or $0.06 per share. As of September 30, 2004, the Company’s cash and cash equivalents were $477,000.

In the first nine months of 2004, Insignia reported revenue of $533,000. The net loss for the nine months ended September 30, 2004 was $4.9 million, or $0.17 per share.

Mark McMillan, chief executive officer of Insignia Solutions, said, “We are encouraged by the increasing interest in Insignia’s Over-The-Air (OTA) mobile device management technology. Our recently launched Secure System Provisioning v2 (SSP v2) technology has received very positive feedback, and we continue to make progress toward signing new customers. As the mobile device industry continues to adopt interoperability standards, Insignia is aggressively working to establish its position as a leader in standards-based OTA update technology”.

“Our recently completed financing transactions, which raised approximately $2.3 million in working capital, have reinforced our efforts to establish SSP v2 in the mobile operator community. We remain committed to extending our market share in mobile device management and ultimately returning shareholder value,” Mr. McMillan concluded.

Recent Highlights:

  On October 25, 2004, QUALCOMM announced that it is offering Firmware Over-The-Air Update capabilities to its BREW system in conjunction with Insignia Solutions.
 
  On October 18, 2004, Insignia Solutions announced that it had closed two equity financing transactions totaling approximately $2.3 million, net of transaction costs. The Company closed a private placement financing with certain institutional and other accredited investors pursuant to which it sold newly issued American Depositary Shares (ADSs) and warrants to purchase ADSs, for a total purchase price of approximately

 


 

Insignia Solutions Announces Q3 2004 Financial Results

    $1.540 million, or $1.366 million, net of transaction costs. Additionally, pursuant to a letter dated October 7, 2004 and delivered under a previously executed agreement, the Company concurrently sold to Fusion Capital shares of newly issued ADSs, resulting in proceeds of approximately $1.0 million. A pro forma balance sheet as of September 30, 2004, including an adjustment to show the pro forma effect of the net proceeds from the October financings, is attached as Exhibit B.

  On October 6, 2004, Insignia Solutions announced that it extended its interoperability leadership by joining the Open Management Terminal Platform (OMTP) group. The OMTP group aims to establish an open framework for mobile device manufacturers and associated software and hardware suppliers to develop Open Mobile Terminal Platforms. Insignia is the first mobile device management specialist in the organization’s interoperability movement.
 
  On September 28, 2004, Insignia Solutions announced it launched its Device Management Interoperability Lab (DMIL) at Company headquarters. Insignia’s DMIL is now executing Open Mobile Alliance Device Management (OMA-DM) interoperability testing with a wide range of phone manufacturers and other mobile device management technology providers.
 
  On September 16, 2004, Insignia Solutions announced its Secure System Provisioning v2 (SSP v2), a new standards-based infrastructure software product for mobile operators. The Company also announced an agreement with New World Mobility, a Hong Kong mobile operator, to commercially deploy this new software platform for their subscribers, upon successful completion of testing.
 
  On September 15, 2004, Insignia Solutions announced that it joined the OSGi Alliance and became an active participant in its new Mobile Expert Group. The OSGi Alliance was formed by industry leaders to promote a standardized framework and method to dynamically update a range of consumer electronics based devices, ranging from set top boxes to telematics systems and new mobile phones.

Conference Call

Insignia Solutions will host a conference call on Thursday, October 28, 2004 at 2:00 p.m. Pacific Time. A live webcast will be available via a link on the Investor Relations portion of Insignia’s website at www.insignia.com. An on-demand archive of the call will be available through the Company’s website for a period of two weeks after the event.

About Insignia Solutions

Insignia provides an essential ingredient to mobile operators and terminal manufacturers by enabling customers to manage a growing, complex and diverse community of mobile devices. Insignia’s products and services radically reduce customer care and recall costs, maintain device integrity, and enable a wide range of new mobile services. Founded in 1986, Insignia has a long history of innovation, stewardship of major industry standards, and the trust of dozens of manufacturers around the world. Insignia Solutions is traded on NASDAQ under the symbol INSG. The company is headquartered in Fremont, California with research and development and

 


 

Insignia Solutions Announces Q3 2004 Financial Results

European operations based in the United Kingdom. For additional information about Insignia or its products please visit http://www.insignia.com.

Insignia, Insignia Solutions, and the Insignia Solutions logo are registered trademarks, and Secure System Provisioning, Open Management Client, Dynamic Capabilities and Over-The-Air Repair are trademarks of Insignia Solutions, Inc. All other trademarks are the property of their respective holders.

Forward-Looking Statements

The statements in this press release relating to matters that are not historical are forward-looking statements that involve risks and uncertainties. This release includes forward-looking statements that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those referred to in the forward-looking statements. Such factors include, but are not limited to, Insignia’s need for additional capital to sustain operations, Insignia’s reliance on the successful introduction of its Secure System Provisioning (“SSP”) product line, Insignia’s need to generate significantly greater revenue to achieve profitability and Insignia’s liquidity and capital needs. Further details on these and other risks are set forth in Insignia Solutions’ filings with the Securities and Exchange Commission, including its most recent filings on Forms 10-K and 10-Q. These filings are available on a website maintained by the Securities and Exchange Commission at <http://www.sec.gov>. Insignia Solutions does not undertake an obligation to update forward-looking or other statements in this release.

 


 

EXHIBIT A

INSIGNIA SOLUTIONS PLC
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
(unaudited)

                 
    September 30,   December 31,
    2004
  2003
ASSETS
               
Current assets:
               
Cash and cash equivalents
  $ 477     $ 2,212  
Restricted cash
    50       20  
Accounts receivable, net
    489       50  
Other receivables
    33       1,153  
Tax receivable
    429       391  
Prepaid royalties
          2,185  
Prepaid expenses
    258       410  
 
   
 
     
 
 
Total current assets
    1,736       6,421  
Property and equipment, net
    144       154  
Investment in affiliate
    35        
Other assets
    222       219  
 
   
 
     
 
 
 
  $ 2,137     $ 6,794  
 
   
 
     
 
 
LIABILITIES,
               
REDEEMABLE WARRANTS
               
AND SHAREHOLDERS’ EQUITY
               
Current liabilities:
               
Accounts payable
  $ 357     $ 468  
Accrued liabilities
    784       1,239  
Note payable
          1,000  
Deferred revenue
    238       1,460  
 
   
 
     
 
 
Total current liabilities
    1,379       4,167  
 
   
 
     
 
 
Redeemable warrants
    38       38  
 
   
 
     
 
 
Shareholders’ equity:
               
Ordinary shares
    9,656       8,111  
Additional paid-in capital
    64,002       61,898  
Common stock subscription
          575  
Accumulated deficit
    (72,477 )     (67,534 )
Other accumulated comprehensive loss
    (461 )     (461 )
 
   
 
     
 
 
Total shareholders’ equity
    720       2,589  
 
   
 
     
 
 
 
  $ 2,137     $ 6,794  
 
   
 
     
 
 

 


 

INSIGNIA SOLUTIONS PLC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share amounts)
(unaudited)

                                 
    Three months ended   Nine months ended
    September 30,
  September 30,
    2004
  2003
  2004
  2003
Net revenues:
                               
License
  $ 100     $ 201     $ 521     $ 393  
Service
    7             12       187  
 
   
 
     
 
     
 
     
 
 
Total net revenues
    107       201       533       580  
 
   
 
     
 
     
 
     
 
 
Cost of net revenues:
                               
License
          70       28       221  
Service
                      52  
 
   
 
     
 
     
 
     
 
 
Total cost of net revenues
          70       28       273  
 
   
 
     
 
     
 
     
 
 
Gross profit
    107       131       505       307  
 
   
 
     
 
     
 
     
 
 
Operating expenses:
                               
Sales and marketing
    578       423       1,923       1,329  
Research and development
    654       670       2,126       2,695  
General and administrative
    603       665       1,864       2,195  
Restructuring
          (19 )           480  
 
   
 
     
 
     
 
     
 
 
Total operating expenses
    1,835       1,739       5,913       6,699  
 
   
 
     
 
     
 
     
 
 
Operating loss
    (1,728 )     (1,608 )     (5,408 )     (6,392 )
Interest income (expense), net
    4       (14 )     6       (27 )
Other income (expense), net
    (3 )     (124 )     248       3,418  
 
   
 
     
 
     
 
     
 
 
Loss before income taxes
    (1,727 )     (1,746 )     (5,154 )     (3,001 )
Provision for (benefit from) income taxes
    2       (90 )     (211 )     (419 )
 
   
 
     
 
     
 
     
 
 
Net loss
  $ (1,729 )   $ (1,656 )   $ (4,943 )   $ (2,582 )
 
   
 
     
 
     
 
     
 
 
Loss per share:
                               
Basic and diluted
  $ (0.06 )   $ (0.08 )   $ (0.17 )   $ (0.13 )
 
   
 
     
 
     
 
     
 
 
Weighted average shares and share equivalents:
                               
Basic and diluted
    29,384       20,634       29,081       20,272  
 
   
 
     
 
     
 
     
 
 

 


 

EXHIBIT B

INSIGNIA SOLUTIONS PLC
CONDENSED CONSOLIDATED BALANCE SHEET
(amounts in thousands)
(unaudited)

                         
                    Pro forma
    September 30,   Pro forma   September 30,
    2004
  Adjustments
  2004
ASSETS
                       
Current assets:
                       
Cash and cash equivalents
  $ 477     $ 2,366       $2,843  
Restricted cash
    50             50  
Accounts receivable, net
    489             489  
Other receivables
    33             33  
Tax receivable
    429             429  
Prepaid royalties
                 
Prepaid expenses
    258             258  
Investment in affiliates
                 
 
   
 
     
 
     
 
 
Total current assets
    1,736       2,366       4,102  
Property and equipment, net
    144             144  
Investment in affiliate
    35             35  
Other assets
    222             222  
 
   
 
     
 
     
 
 
 
  $ 2,137     $ 2,366     $ 4,503  
 
   
 
     
 
     
 
 
LIABILITIES,
                       
REDEEMABLE WARRANTS
                       
AND SHAREHOLDERS’ EQUITY
                       
Current liabilities:
                       
Accounts payable
  $ 357     $     $ 357  
Accrued liabilities
    784             784  
Accrued severance
                 
Note payable
                 
Deferred revenue
    238             238  
Accrued royalties
                 
 
   
 
     
 
     
 
 
Total current liabilities
    1,379             1,379  
 
   
 
     
 
     
 
 
Redeemable warrants
    38             38  
 
   
 
     
 
     
 
 
Shareholders’ equity:
                       
Ordinary shares
    9,656       2,055       11,711  
Additional paid-in capital
    64,002       311       64,313  
Common stock subscription
                 
Accumulated deficit
    (72,477 )           (72,477 )
Other accumulated comprehensive loss
    (461 )           (461 )
 
   
 
     
 
     
 
 
Total shareholders’ equity
    720       2,366       3,086  
 
   
 
     
 
     
 
 
 
  $ 2,137     $ 2,366     $ 4,503