01 Communique Reports on its 2nd Quarter 2007 Results & Strengthens its Balance Sheet



    TORONTO, June 5 /CNW/ - 01 Communique Laboratory Inc. (TSX:ONE) today
announced results for its second quarter fiscal 2007, which ended April 30th,
2007. Revenue for the quarter was $176,353 with an operating loss of $406,566
compared to revenue of $168,605 with an operating loss of $353,380 for the
second quarter fiscal 2006. On a year to date basis revenue was $260,157 with
an operating loss of $825,604 compared to revenue of $324,961 with an
operating loss of $698,613 for the same period in fiscal 2006.
    "We are focused on building a profitable business from the value of our
patents and the underlying technology," said Andrew Cheung, President and CEO.
"During the quarter we completed a public offering raising gross proceeds of
$4,525,000 which significantly strengthens our Balance Sheet. We feel very
confident that we have sufficient financial resources in place to see our
patent litigation against Citrix Systems Inc. (NSDQ:CTXS) through to a
successful conclusion and continue to support Hitachi Business Solution in
their sales and marketing initiatives of DoMobile in Japan."

    Update on our business:

    Citrix Litigation - We commenced a patent infringement lawsuit against
Citrix Systems Inc. in February 2006. The case is moving forward and we remain
confident in the merits of our case. A synopsis of the timeframes of the
litigation is as follows:
    In a Court Order dated May 30, 2007 the court referred all of the
parties' discovery disputes to the magistrate judge for determination. New
case deadlines were laid out as follows:

    
        Discovery Deadlines:
           Fact Discovery: July 12, 2007
           Citrix's Identification of Prior Art: July 12, 2007
           Initial Expert Reports: August 3, 2007
           Rebuttal Expert Reports: August 24, 2007
           Close of Expert Discovery: September 14, 2007
        Dispositive Motions (Summary Judgment Motions) are due October 19,
        2007 leading up to the trial.
        Trial by Jury is January 28, 2008 in the United States District Court
        Northern District of Ohio Eastern Division.
    

    "We believe that the timelines as laid out by the court provide for
sufficient time to allow the magistrate judge to mediate our differences and
for us to prepare for trial," said Andrew Cheung President and CEO for 01
Communique. "We remain very confident in the merits of our case and will
continue to prepare in earnest for trial."

    Update on Hitachi Business Solution - Hitachi Business Solution is
actively marketing an extremely secure enterprise-level remote access solution
built with our technology, called DoMobile-CSE. It is distributed in Japan by
their parent company's, Hitachi Ltd., sales force. Under the terms of the
agreement between the companies, Hitachi Business Solution has the exclusive
marketing rights to DoMobile-CSE in Japan and pays 01 Communique a royalty on
sales. In addition the companies have made a joint patent application in
Japan. The patent application is a continuation of the U.S. 479 patent, which
is the patent 01 Communique alleges Citrix infringes.
    "DoMobile-CSE satisfies a need in Japan for a robust, enterprise-level
remote access offering that resolves the security issues, encountered by other
remote access products, associated with moving files from the corporate
network during a remote access session," said Andrew Cheung. "Hitachi has
indicated strong interest in DoMobile-CSE from a number of Japanese companies,
including the major telecommunications companies, due to its robust
performance and strong security features. We have a strong partner in Hitachi
who is actively marketing DoMobile-CSE. We continue to provide support as
requested and are waiting for the results from their sales activities."

    Product Awards - I'm InTouch continues to win awards.
    Technology Marketing Corporation's (TMC) Communications Solutions named
I'm InTouch as a recipient of a 2006 Product of the Year Award honoring our
outstanding innovation.

    Financial Highlights - Strengthening our Balance Sheet.
    We completed the quarter with cash of $3,628,688 an increase of
$2,959,134 for the quarter. Financing activities during the quarter
contributed $4,074,784 of cash. The primary use of cash was to redeem the
debenture of $500,000, fund the operating loss of $406,566 and a change in
non-cash working capital of $244,353.
    Operating expenses for the second quarter were $473,595 and are
comparable to expenses of $477,682 for the first quarter 2007 and $501,118 for
the second quarter 2006. Our expenses will be adjusted as required to support
the enforcement of our intellectual property rights and our partnership with
Hitachi Business Solution.

    Forward-looking Statements.
    Certain statements in this news release may constitute "forward-looking"
statements which involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or achievements of the
company, or industry results, to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. When used in this news release, such statements
use such words as "may", "will", "expect", "believe", "plan", "intend", "are
confident" and other similar terminology. These statements reflect current
expectations regarding future events and operating performance and speak only
as of the date of this news release. Forward-looking statements involve
significant risks and uncertainties, should not be read as guarantees of
future performance or results, and will not necessarily be accurate
indications of whether or not such results will be achieved. A number of
factors could cause actual results to differ materially from the results
discussed in the forward-looking statements, including, but not limited to,
the factors discussed under "Risk Factors" in the company's Annual Information
Form filed on SEDAR. Although the forward-looking statements contained in this
news release are based upon what management of the Company believes are
reasonable assumptions, the company cannot assure investors that actual
results will be consistent with these forward looking statements. These
forward-looking statements are made as of the date of this news release, and
the company assumes no obligation to update or revise them to reflect new
events or circumstances.
    For further information on the Company's financial results please go to
www.sedar.com and view the Company's regulatory filings.


    
                       SELECTED FINANCIAL INFORMATION
                         Consolidated Balance Sheets
                     April 30, 2007 and October 31, 2006

                                                        As at          As at
                                                Apr. 30, 2007  Oct. 31, 2006
                                                -------------  -------------
    Assets
    Current assets
      Cash and cash equivalents                  $  3,628,688   $    559,558
      Accounts receivable                             210,052        154,146
      Inventory                                        10,900         15,109
      Prepaid expenses and deposits                    48,390         15,793
                                                 -------------  -------------
                                                    3,898,030        744,606

    Capital assets                                     23,308         37,110
                                                 -------------  -------------
                                                 $  3,921,338   $    781,716
                                                 -------------  -------------
                                                 -------------  -------------

    Liabilities & Shareholders' Equity

    Current liabilities
      Accounts payable & accruals                $    275,394   $    290,697
      Deferred revenue                                116,674        106,302
                                                 -------------  -------------
                                                      392,068        396,999

    Liability portion of debenture                          -        450,111

    Shareholders' equity
      Share capital                                30,167,275     26,068,445
      Contributed surplus                             410,931        343,734
      Equity portion of debenture                           -         69,089
      Share purchase warrants                          30,995         20,195
      Agents' options                                 339,674         27,144
      Deficit                                     (27,419,605)   (26,594,001)
                                                 -------------  -------------
                                                    3,529,270        (65,394)
                                                 -------------  -------------
                                                 $  3,921,338   $    781,716
                                                 -------------  -------------
                                                 -------------  -------------



                       SELECTED FINANCIAL INFORMATION
             Consolidated Statements of - Operations and Deficit
         For the 3 and 6 month periods ended April 30, 2007 and 2006

                       Q.2 2007      Q.2  2006       YTD 2007       YTD 2006
                   -------------  -------------  -------------  -------------
    Revenue        $    176,353   $    168,605   $    260,157   $    324,961
    Cost of
     revenue             24,445          1,821         25,974          3,851
                   -------------  -------------  -------------  -------------
                        151,908        166,784        234,183        321,110

    Expenses
    Selling,
     general and
     administrative     302,269        305,342        609,939        618,018
    Research and
     development        171,653        191,335        339,732        364,378
    Interest
     expense
     (income)            (7,541)        (2,524)       (12,892)        (4,909)
    Depreciation
     and
     amortization         7,214          6,963         14,498         13,926
                   -------------  -------------  -------------  -------------
                        473,595        501,116        951,277        991,413
                   -------------  -------------  -------------  -------------

    Loss before
     interest &
     accretion on
     liability
     component of
     debenture         (321,687)      (334,332)      (717,094)      (670,303)

    Debenture
     settlement
     expense             72,069              -         72,069              -
    Accretion on
     liability
     component of
     debenture            3,425          6,953          8,306         11,215
    Interest expense      9,385         12,095         28,135         17,095

    Loss before
     non-controlling
     interest          (406,566)      (353,380)      (825,604)      (698,613)

    Non-controlling
     interest                 -              -              -        171,591

    Transfer of CSE
     from limited
     partnership              -     (1,155,000)             -     (1,155,000)

                   -------------  -------------  -------------  -------------
    Loss for
     the period        (406,566)    (1,508,380)      (825,604)    (1,682,022)
                   -------------  -------------  -------------  -------------

    Deficit,
     beginning
     of period      (27,013,039)   (24,227,973)   (26,594,001)   (24,054,331)

                   -------------  -------------  -------------  -------------
    Deficit,
     end of
     period        $(27,419,605)  $(25,736,353)  $(27,419,605)  $(25,736,353)
                   -------------  -------------  -------------  -------------
                   -------------  -------------  -------------  -------------

    Loss per
     common share
      Basic        $      (0.01)  $      (0.04)  $      (0.02)  $      (0.05)
      Diluted      $      (0.01)  $      (0.04)  $      (0.02)  $      (0.05)

    Weighted ave.
     number of
     common shares
     outstanding
      Basic          43,308,874     36,496,498     43,069,707     35,387,290
      Diluted        48,837,707     39,703,965     48,271,040     39,048,524



                       SELECTED FINANCIAL INFORMATION
                    Consolidated Statements of Cash Flows
         For the 3 and 6 month periods ended April 30, 2007 and 2006

                       Q.2 2007       Q.2 2006       YTD 2007       YTD 2006
                   -------------  -------------  -------------  -------------
    Cash provided
     by (used in):

    Operating
     activities:
      Loss for
       the period  $   (406,566)  $ (1,508,380)  $   (816,035)  $ (1,682,022)
      Items not
       involving
       cash:
        Non-
         controlling
         interest             -              -              -       (171,591)
        Depreciation
         and
         amortization     7,214          6,963         14,498         13,926
        Accretion on
         liability
         component of
         debenture        3,425          6,953          8,306         11,215
        Non-cash
         portion of
         debenture
         settlement
         expense          9,569              -          9,569              -
        Stock-based
         compensation    15,061         15,500         30,122         29,900
      Transfer of CSE
       from limited
       partner                -      1,155,000              -      1,155,000
      Change in
       non-cash
       working
       capital         (244,353)        (5,268)       (89,224)       (31,739)
                   -------------  -------------  -------------  -------------
                       (615,650)      (329,232)      (852,333)      (675,311)

    Financing
     activities:
      Issue of
       common
       shares         4,074,784              -      4,422,160          2,700
      Issue of
       debenture              -              -              -        500,000
                   -------------  -------------  -------------  -------------
                      4,074,784              -      4,422,160        502,700

    Investing
     activities:
      Purchase of
       capital assets         -              -           (697)             -
      Redemption
       of debenture    (500,000)             -       (500,000)             -

    Increase
     (decrease)
     in cash          2,959,134       (329,232)     3,069,130       (172,611)

    Cash,
     beginning
     of period          669,554   $    808,614        559,558        651,993
                   -------------  -------------  -------------  -------------
    Cash, end
     of period     $  3,628,688   $    479,382   $  3,628,688  $     479,382
                   -------------  -------------  -------------  -------------
                   -------------  -------------  -------------  -------------
    


    About 01 Communique

    Established in 1992, 01 Communique (TSX: ONE) is an innovative force in
the development and delivery of remote access and support products and
integrated communications software. 01's suite of products includes its remote
access product line I'm InTouch (www.imintouch.net) and its remote support
product I'm OnCall (www.imoncall.com). For more information on its products,
visit www.01com.com or call (905) 795-2888 or (800) 668-2185 (North America
only).

    %SEDAR: 00010658E




For further information:

For further information: INVESTOR CONTACT: Brian Stringer, Chief
Financial Officer, 01 Communique, (905) 795-2888 x204,
brian.stringer@01com.com


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