Diversinet Reports Second Quarter 2008 Financial Results



    Two Customers Launch Wallet and Vault Solution During Quarter

    TORONTO, Aug. 1 /CNW/ - Diversinet Corp. (TSX Venture: DIV, OTCBB:
DVNTF), a leading provider of wireless data application and security
infrastructure products and services, today announced financial results for
the second quarter of 2008.
    Revenues for the second quarter were $565,000, up 65 percent compared to
$342,000 in Q1 2008 and down from $1,017,000 for the second quarter of 2007.
Revenues for the six months ended June 30, 2008 were $906,000, down from
$1,923,000 in the same period in 2007. During the second quarter of 2008 two
of the Company's customers successfully launched their applications using
Diversinet's Wallet and Vault technology. All dollar amounts are in U.S.
dollars.
    The net loss for the second quarter of 2008 was $1,205,000 or $0.03 per
share compared to $1,045,000, or $0.03 per share in the second quarter of
2007. The net loss for the six months ended June 30, 2008 was $2,363,000, or
$0.05 per share, compared to a net loss of $1,376,000 or $0.04 per share in
the similar six months of 2007. Included in the second quarter net loss are
non-cash stock-based compensation, depreciation and amortization of $304,000
($218,000 in Q2 2007). Cash and cash equivalents at June 30, 2008 were
$7,864,000 and $8,394,000 at December 31, 2007.
    As stated in our 2007 annual results press release, Diversinet now has
two live customer launches of its Wallet and Vault platform licensed in 2007
and expects to have additional customer wins in the second half of 2008.
    Company, customer, and product solution highlights include:

    
    -   In June, Intersections launched Mobile Lockbox, a major enhancement
        to the Identity Guard(R) Total Protection service. MobiSecure(TM)
        Wallet and Vault mobile secure encrypted access solution is at the
        heart of the offering. MobiSecure Wallet and Vault provides
        Intersections with a mobile security platform to extend its core
        Identity Guard offering by creating a host of new services that build
        closer, more personal and "sticky" relationships with new and
        existing customers.

    -   In April, AllOne launched its mobile application that uses
        Diversinet's secure MobiSecure Wallet and Vault product line to place
        personal health records (PHR) at consumers' fingertips through their
        mobile phones. AllOne Mobile accesses an individual's PHR in a secure
        environment and links to the users' mobile phones, giving them well-
        organized, easy-to-use, 24/7 mobile access. Users can manage and
        share their PHRs with physicians, hospitals, clinics and emergency
        personnel helping to improve medical outcomes. AllOne data is stored
        behind a password-protected encrypted channel through a partnership
        with Diversinet. The application is downloaded wirelessly to phones
        and is automatically updated with the most current security and
        features available. This level of security and control gives users
        the confidence and comfort to create, manage and enhance their PHRs
        using the mobile phone or the Web.

    -   In April Diversinet launched the MobiSecure(TM) USBToken. The
        MobiSecure USBToken is a One Time Password (OTP) authentication
        technology contained within a durable, portable USB device which is
        driverless and leaves no residual footprint on the user's computer.

    -   In June CEO and Chairman Albert Wahbe exercised 2,300,000 share
        purchase warrants for gross proceeds of US$1,725,000. The share
        purchase warrants had an exercise price of US$0.75 per common share.
        Diversinet intends to use the new funds to continue its research and
        development programs and expand our sales and service activities.
    

    Mr. Wahbe stated "We are delighted that AllOne and Intersections were
able to successfully launch their product offering during the second quarter.
With the launch of the Wallet and Vault product and the introduction of the
MobiSecure USBToken we continue to build our product offering to increase
revenue opportunities and enhance our long term shareholder value."

    About Diversinet

    Diversinet Corp. (TSX Venture: DIV, OTCBB: DVNTF) is a leading provider
of wireless authentication and access solutions that secure the personal
identity, transactions and data of consumers over almost any mobile phone or
handheld device. Diversinet's reliable; end-to-end MobiSecure Wallet and Vault
products provide global, secure and cost effective solutions to mobilize
personal health records, financial services transactions and identity
protection management. Connect with Diversinet Corp. at www.diversinet.com.

    The Private Securities Litigation Reform Act of 1995 and Canadian
securities laws provide a "safe harbour" for forward-looking statements.
Certain information included in this press release (as well as information
included in oral statements or other written statements made or to be made by
the company) contains statements that are forward-looking, such as statements
relating to anticipated future revenues of the company and success of current
product offerings. Such forward-looking information involves important risks
and uncertainties that could significantly affect anticipated results in the
future and, accordingly, such results may differ materially from those
expressed in any forward-looking statements made by or on behalf of the
company. For a description of additional risks and uncertainties, please refer
to the company's filings with the Securities and Exchange Commission available
at www.sec.gov and Canadian securities regulatory authorities available at
www.sedar.com.



    
    Diversinet Corp.
    CONSOLIDATED BALANCE SHEETS
    (in United States dollars)
    (Unaudited)

                                                       June 30   December 31
                                                          2008          2007
                                                             $             $
    -------------------------------------------------------------------------

    ASSETS
    Current assets
    Cash and cash equivalents                        7,863,914     8,394,286
    Accounts receivable                                      -       122,687
    Prepaid expenses                                    42,786        63,105
    -------------------------------------------------------------------------
    Total current assets                             7,906,700     8,580,078
    -------------------------------------------------------------------------
    Property and equipment, net (note 4)               341,867       379,993
    -------------------------------------------------------------------------
    Total assets                                     8,248,567     8,960,071
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current liabilities
    Accounts payable                                   279,445       249,502
    Accrued liabilities (note 5)                       207,726       731,461
    Deferred revenue                                    71,934       130,961
    -------------------------------------------------------------------------
    Total current liabilities                          559,105     1,111,924
    -------------------------------------------------------------------------

    Commitments and contingencies (note 10)

    Shareholders' equity
    Share capital (note 6)                          67,458,247    65,370,707
    Contributed surplus                              6,895,998     5,621,383
    Share purchase warrants (note 6)                   397,766     1,555,453
    Deficit                                        (65,541,828)  (63,178,675)
    Accumulated other comprehensive income:
      Cumulative translation adjustment             (1,520,721)   (1,520,721)
    -------------------------------------------------------------------------
    Total shareholders' equity                       7,689,462     7,848,147
    -------------------------------------------------------------------------
    Total liabilities and shareholders' equity       8,248,567     8,960,071
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    See accompanying notes to interim consolidated financial statements.



    Diversinet Corp.
    CONSOLIDATED STATEMENTS OF LOSS AND DEFICIT AND COMPREHENSIVE LOSS
    (in United States dollars)
    (Unaudited)

                      Three months ended June 30    Six months ended June 30
                              2008          2007          2008          2007
                                 $             $             $             $
    -------------------------------------------------------------------------

    Revenues               564,709     1,017,466       906,304     1,922,844
    Cost of revenues        68,760        16,435       150,823        52,896
    -------------------------------------------------------------------------
    Gross margin           495,949     1,001,031       755,481     1,869,948

    Expenses
      Research and
       development         715,048       615,848     1,343,071     1,155,065
      Sales and
       marketing           486,344       370,845       896,301       559,499
      General and
       administrative      525,411     1,044,686       971,866     1,501,683
      Depreciation and
       amortization         26,494        29,294        52,040        56,674
    -------------------------------------------------------------------------
                         1,753,297     2,060,673     3,263,278     3,272,921
    -------------------------------------------------------------------------
    Loss before the
     following          (1,257,348)   (1,059,642)   (2,507,797)   (1,402,973)
    Foreign exchange
     (gain) loss           (15,101)       32,234       (36,502)       47,500
    Interest income        (37,735)      (46,917)     (108,142)      (74,251)
    -------------------------------------------------------------------------
    Loss for the period
     and comprehensive
     loss               (1,204,512)   (1,044,959)   (2,363,153)   (1,376,222)
    -------------------------------------------------------------------------

    Deficit, beginning
     of period         (64,337,316)  (60,076,967)  (63,178,675)  (59,745,704)
    Loss for the
     period             (1,204,512)   (1,044,959)   (2,363,153)   (1,376,222)
    -------------------------------------------------------------------------
    Deficit, end of
     period            (65,541,828)  (61,121,926)  (65,541,828)  (61,121,926)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic and diluted
     loss per share
     (note 8)                (0.03)        (0.03)        (0.05)        (0.04)
    Weighted average
     common shares
     outstanding        43,242,783    34,434,969    43,205,283    34,116,744

    See accompanying notes to interim consolidated financial statements.



    Diversinet Corp.
    CONSOLIDATED STATEMENTS OF CASH FLOWS
    (in United States dollars)
    (Unaudited)

                      Three months ended June 30    Six months ended June 30
                              2008          2007          2008          2007
                                 $             $             $             $
    -------------------------------------------------------------------------

    OPERATING ACTIVITIES
    Loss from
     continuing
     operations for
     the period         (1,204,512)   (1,044,959)   (2,363,153)   (1,376,222)
    Add (deduct) items
     not requiring an
     outlay of cash:
      Depreciation and
       amortization         26,494        29,294        52,040        56,674
      Stock-based
       compensation
       expense (note 7)    277,815       188,516       479,469       311,587
    -------------------------------------------------------------------------
                          (900,203)     (827,149)   (1,831,644)   (1,007,961)
      Changes in non-cash
       operating working
       capital items
       related to
       operations:
      Accounts
       receivable
       and other
       receivables               -         8,908       122,687        78,034
      Prepaid expenses      11,306        18,270        20,319       104,674
      Accounts payable      83,099        46,038        29,943        93,036
      Accrued
       liabilities          68,080        91,450      (523,735)      (18,874)
      Deferred revenue      34,942         9,856       (59,027)     (821,419)
    -------------------------------------------------------------------------
    Cash used in
     operations           (702,776)     (652,627)   (2,241,457)   (1,572,510)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    FINANCING ACTIVITIES
      Issue of
       common shares,
       compensation
       options, warrants
       for cash          1,725,000       199,270     1,725,000       466,170
    -------------------------------------------------------------------------
    Cash provided by
     financing
     activities          1,725,000       199,270     1,725,000       466,170
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    INVESTING ACTIVITIES
    Purchase of
     property and
     equipment             (12,631)      (72,384)      (13,915)      (78,342)
    -------------------------------------------------------------------------
    Cash used in
     investing
     activities            (12,631)      (72,384)      (13,915)      (78,342)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net change in cash
     and cash
     equivalents during
     the period          1,009,593      (525,741)     (530,372)   (1,184,682)

    Cash and cash
     equivalents,
     beginning of the
     period              6,854,321     4,487,374     8,394,286     5,146,315

    -------------------------------------------------------------------------
    Cash and cash
     equivalents, end
     of the period       7,863,914     3,961,633     7,863,914     3,961,633
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Supplementary
     non-cash
     transaction
      Issuance of
       shares to
       employees
       (note 6(a))          42,000        37,921        71,499       131,020

      Issuance of shares
       for public
       relations
       services                  -        16,650             -        34,650
    -------------------------------------------------------------------------

    Cash and cash
     equivalents is
     comprised of:
      Cash                                           2,356,432       563,928
      Cash equivalents                               5,507,482     3,397,705
    -------------------------------------------------------------------------
                                                     7,863,914     3,961,633
    -------------------------------------------------------------------------

    See accompanying notes to interim consolidated financial statements.
    





For further information:

For further information: Diversinet, David Hackett, Chief Financial
Officer, (416) 756-2324 ext. 275, dhackett@diversinet.com

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