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The Company had a net loss of $0.3 million or $0.02 per common share, basic and diluted, for the first quarter of 2009, compared to net income of $1.8 million or $0.08 per common share, basic and diluted, for the first quarter of 2008.
During the first quarter of 2009 the Company had no revenue from continuing operations, compared to $6.2 million for the first quarter of 2008. The 2008 revenue was from settlement and license agreements with respect to the Company's intellectual property. The Company is continuing to pursue licenses from entities that are using the Company's patented technology.
During the first quarter of 2009, the Company established Counsel RB Capital LLC ("Counsel RB"), in which it holds a 75% interest. Counsel RB specializes in the acquisition and disposition of distressed and surplus assets throughout the United States and Canada, including industrial machinery and equipment, real estate, inventories, accounts receivables and distressed debt. In addition to purchasing various types of assets, Counsel RB also arranges traditional asset disposition services such as on-site and webcast auctions, liquidations and negotiated sales.
On May 7, 2009, C2 invested approximately $2.6 million to acquire an approximately 5% interest in the brand, inventory, intellectual property and other assets of Polaroid Corporation, pursuant to a Chapter 11 reorganization in a U.S. bankruptcy court. C2's interest will be managed by Knight's Bridge Capital Management L.P., an affiliate of the Company's parent, Counsel Corporation.
"We are very excited about our new initiative, Counsel RB. We believe that the business of Counsel RB is not only timely, because of the current state of the economy throughout North America, but also opportunistic in that it supports C2's long-term growth and value creation strategy", said Allan Silber, Chairman and CEO of C2. He added, "We are also extremely pleased to have the opportunity to be a part of the iconic Polaroid brand. We expect it to provide strong earnings and cash flow as it pursues a global licensing strategy based on its brand, its existing portfolio of innovative and patented technologies, and its potential to be a platform for new products and product categories".
Please see the Company's Annual Report on Form 10-K for the year ended December 31, 2008, filed with the SEC on March 18, 2009, and the Company's Quarterly Report on Form 10-Q for the three months ended March 31, 2009, filed with the SEC on May 11, 2009, for further information.
About C2 Global Technologies Inc.
C2's business is focused on licensing its patents, which include two foundational patents in VoIP technology. C2 realizes value from its intellectual property by offering licenses to service providers, equipment companies and end-users that are deploying VoIP networks for phone-to-phone communications. C2 also invests in Internet-based e-commerce businesses. For further information, please visit C2's website at www.c-2technologies.com.
Forward-Looking Statements
This release contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, as amended, that are based on management's exercise of business judgment as well as assumptions made by, and information currently available to, management. When used in this document, the words "may", "will", "anticipate", "believe", "estimate", "expect", "intend", and words of similar import, are intended to identify any forward-looking statements. You should not place undue reliance on these forward-looking statements. These statements reflect our current view of future events and are subject to certain risks and uncertainties as noted in our securities and other regulatory filings. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results could differ materially from those anticipated in these forward-looking statements. We undertake no obligation, and do not intend, to update, revise or otherwise publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of any unanticipated events. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance that our expectations will materialize. Many factors could cause actual results to differ materially from our forward-looking statements.
C2 GLOBAL TECHNOLOGIES INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, December 31,
(In thousands, except share and per share amounts) 2009 2008
-------------------------------------------------- ----------- ------------
(unaudited)
ASSETS
Current assets:
Cash $ 3,425 $ 4,076
Deferred income tax assets 974 875
Other current assets 92 77
----------- ------------
Total current assets 4,491 5,028
Other assets:
Goodwill 173 173
Investments 242 242
----------- ------------
Total assets $ 4,906 $ 5,443
----------- ------------
----------- ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 438 $ 472
----------- ------------
Total liabilities 438 472
----------- ------------
Stockholders' equity (deficit):
Preferred stock, $10.00 par value,
convertible, non-redeemable, authorized
10,000,000 shares; issued and outstanding
594 Class N shares at March 31, 2009 and
December 31, 2008; liquidation preference
of $594 at March 31, 2009 and
December 31, 2008 6 6
Common stock, $0.01 par value, authorized
300,000,000 shares; issued and outstanding
22,718,309 shares at March 31, 2009 and
22,745,530 shares at December 31, 2008 227 227
Additional paid-in capital 274,654 274,761
Accumulated deficit (270,365) (270,023)
----------- ------------
Stockholders' equity before non-controlling
interest 4,522 4,971
Non-controlling interest in subsidiary (54) -
----------- ------------
Total equity 4,468 4,971
----------- ------------
Total liabilities and stockholders' equity $ 4,906 $ 5,443
----------- ------------
----------- ------------
The notes contained in our Quarterly Report on Form 10-Q are an integral
part of these condensed consolidated financial statements
C2 GLOBAL TECHNOLOGIES INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended
March 31,
-------------------
(In thousands, except per share amounts) 2009 2008
---------------------------------------- -------- --------
Revenue:
Patent licensing $ - $ 6,225
-------- --------
Operating costs and expenses:
Patent licensing 1 3,184
Selling, general and administrative 387 276
Depreciation and amortization - 5
-------- --------
Total operating costs and expenses 388 3,465
-------- --------
Operating income (loss) (388) 2,760
-------- --------
Other income (expense):
Other income 1 -
Interest expense - (43)
-------- --------
Total other income (expense) 1 (43)
-------- --------
Income (loss) before the undernoted (387) 2,717
Income tax expense (recovery) (7) 921Earnings (loss) of equity accounted investments
(net of $0 tax) 1 (1)
-------- --------
Income (loss) before non-controlling interest (379) 1,795
Net (income) loss attributable to non-controlling
interest 37 -
-------- --------
Net income (loss) $ (342) $ 1,795
-------- --------
-------- --------
Weighted average common shares outstanding 22,739 23,095
Weighted average preferred shares outstanding 1 1
Net income (loss) per share:
Common shares $ (0.02) $ 0.08
Preferred shares $ N/A $ 3.11
The notes contained in our Quarterly Report on Form 10-Q are an integral
part of these condensed consolidated financial statements
Contacts: C2 Global Technologies Inc. Stephen A. Weintraub Executive Vice President, Secretary & CFO (416) 866-3058 sweintraub@c-2technologies.com www.c-2technologies.com
SOURCE: C2 Global Technologies Inc.
mailto:sweintraub@c-2technologies.com http://www.c-2technologies.com
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