Diversinet Reports Second Quarter 2007 Financial Results



    Intersections Wallet/Vault License Agreement Contributes to Q2 Revenue
    Growth

    TORONTO, Aug. 2 /CNW/ - Diversinet Corp. (OTCBB: DVNTF), a leading
provider of wireless data application and security infrastructure products and
services, today announced financial results for the second quarter of 2007.
During the quarter Diversinet's revenues increased and cash used in operations
was reduced over the same quarter last year.
    Revenues for the second quarter were $1,017,000, up 113 percent compared
to $477,000 for the second quarter of 2006 and up 11 percent compared to
$905,000 in Q1 2007. Revenues for the six months ended June 30, 2007 were
$1,923,000, up 102 percent from $950,000 in the same period in 2006. In May
2007 Diversinet entered into a three year license and value added reseller
(VAR) agreement to provide its MobiSecure Wallet and Vault mobile secure
access solution to Intersections Inc. (Nasdaq: INTX), a leading provider of
identity theft protection and credit management solutions for consumers.
Revenues generated from this agreement contributed significantly to second
quarter results. Cash used in operations for the quarter was $653,000 compared
to $726,000 used in Q2 2006 and $920,000 used in Q1 2007. All dollar amounts
are in U.S. dollars.
    The net loss for the second quarter of 2007 was $1,045,000, or $0.03 per
share, compared to a net loss of $747,000 or $0.03 per share in the second
quarter of 2006. The net loss for the six months ended June 30, 2007 was
$1,376,000, or $0.04 per share, compared to a net loss of $1,469,000 or $0.06
per share in the similar six months of 2006. Included in the second quarter
net loss are non-cash stock-based compensation, depreciation and amortization
of $218,000 ($285,000 in Q2 2006) and one time severance costs of $512,000
relating to the departure of the prior CEO, Nagy Moustafa. Cash and cash
equivalents at June 30, 2007 were $3,962,000 and $5,146,000 at December 31,
2006.

    
    Company, customer, and product solution highlights include:

    -   In May 2007 Diversinet entered into a three year license and VAR
        agreement to provide its MobiSecure Wallet and Vault mobile secure
        access solution to Intersections, a leading provider of identity
        theft protection and credit management solutions for consumers. With
        over 5 million customers, this relationship will allow Intersections
        to offer users secure and immediate access to a host of personal,
        financial, and insurance identity information, as well as other
        critical, privileged data. Diversinet's MobiSecure Wallet and Vault
        will provide Intersections with a mobile and desktop security
        platform it can use to extend its core offering to broad user base.

    -   In April 2007 Chairman Albert Wahbe was named the new CEO of
        Diversinet. Mr. Wahbe brings seasoned leadership to Diversinet after
        a distinguished career as a senior executive at both Scotiabank and
        IBM. His primary objective is to turn the company from a product
        development organization into a sales and marketing driven company.
        Additionally, the Board appointed Greg Milavsky, a seasoned
        investment banker and private equity executive, to the board
        completing a full makeover of the board that began when Mr. Wahbe
        became Chairman and Diversinet's largest shareholder approximately a
        year ago.

    -   Diversinet introduced its Provisioning Server for RSA SecurID(R), a
        fast, easy and secure way for enterprises to deploy cost-effective
        RSA SecurID software authenticators. RSA, the Security Division of
        EMC, is teaming with Diversinet to deliver the provisioning server to
        its enterprise customers worldwide, expanding the strategic
        partnership between the two companies.
    

    CEO and Chairman of Diversinet Albert Wahbe stated "We are pleased with
the progress we are making in our ongoing transition from a product
development company to a sales and marketing enterprise. My first priority was
to build a dynamic global sales organization to showcase the technology
leadership we have developed in the wireless application/security space. I
believe with the hiring of an additional eight experienced sales
professionals, a new partnership with IBM and existing relationships with
vertical players like SanDisk, RSA and Blue Cross of Northeastern
Pennsylvania, we now have the team in place to aggressively showcase our
products in the marketplace. We continue to build out our product offering and
distribution network to deliver valuable customer applications in the
marketplace."

    About Diversinet

    Diversinet Corp. (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 OTP (one-time password) solutions
enable cost-effective strong authentication and instant and secure access to
critical personal records, helping businesses reduce identity theft, expand
customer offerings, increase revenues and comply with regulations. Connect
with Diversinet Corp. at www.diversinet.com.

    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 is made
pursuant to the "safe harbor" provisions of the US Private Securities
Litigation Reform Act of 1995 and any applicable Canadian securities
legislation and are subject to important risks, uncertainties and assumptions
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 (including its annual report and financial statements) with
the Securities and Exchange Commission and SEDAR.



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

                                                        June 30  December 31
                                                           2007         2006
                                                              $            $
    -------------------------------------------------------------------------
                                                     (Unaudited)    (Audited)

    ASSETS
    Current assets
      Cash and cash equivalents                       3,961,633    5,146,315
      Accounts receivable, net (note 3)                  76,075      154,109
      Prepaid expenses                                   36,407      141,081
    -------------------------------------------------------------------------
      Total current assets                            4,074,115    5,441,505

    Capital assets, net (note 4)                        410,391      388,723

    -------------------------------------------------------------------------
    Total assets                                      4,484,506    5,830,228
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current liabilities
      Accounts payable                                  265,327      172,291
      Accrued liabilities (note 5)                      521,688      633,661
      Deferred revenue                                  117,131      938,550
    -------------------------------------------------------------------------
    Total current liabilities                           904,146    1,744,502

    Commitments and contingencies (note 10)

    Shareholders' equity
      Share capital (note 6)                         59,337,200   58,414,036
      Contributed surplus                             5,213,645    3,646,283
      Share purchase warrants (note 6)                1,672,162    3,291,832

      Deficit                                       (61,121,926) (59,745,704)
      Accumulated other comprehensive income:
        Cumulative translation adjustment            (1,520,721)  (1,520,721)
    -------------------------------------------------------------------------
    Total shareholders' equity                        3,580,360    4,085,726
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Total liabilities and shareholders' equity        4,484,506    5,830,228
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    See accompanying notes to interim consolidated financial statements.



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

                        Three months ended June 30  Six months ended June 30
                                 2007         2006         2007         2006
                                    $            $            $            $
    -------------------------------------------------------------------------

    Revenues                1,017,466      476,862    1,922,844      949,848
    Cost of revenues           16,435      395,787       52,896      745,559
    -------------------------------------------------------------------------
    Gross margin            1,001,031       81,075    1,869,948      204,289

    Expenses
      Research and
       development            615,848      140,090    1,155,065      172,807
      Sales and marketing     370,845      169,208      559,499      399,616
      General and
       administrative       1,044,686      482,031    1,501,683    1,032,656
      Depreciation and
       amortization            29,294       39,495       56,674       78,773
    -------------------------------------------------------------------------
                            2,060,673      830,824    3,272,921    1,683,852
    -------------------------------------------------------------------------
    Loss before the
     undernoted            (1,059,642)    (749,749)  (1,402,973)  (1,479,563)
    Foreign exchange loss      32,234        3,500       47,500        7,610
    Interest income           (46,917)      (6,254)     (74,251)     (18,259)
    -------------------------------------------------------------------------
    Loss for the period
     and comprehensive
     income (loss)         (1,044,959)    (746,995)  (1,376,222)  (1,468,914)
    -------------------------------------------------------------------------

    Deficit, beginning
     of period            (60,076,967) (57,016,906) (59,745,704) (56,294,987)
    Loss for the period    (1,044,959)    (746,995)  (1,376,222)  (1,468,914)
    -------------------------------------------------------------------------
    Deficit, end of
     period               (61,121,926) (57,763,901) (61,121,926) (57,763,901)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic and diluted
     loss per share
     (note 8)                   (0.03)       (0.03)       (0.04)       (0.06)
    Weighted average
     common shares
     outstanding           34,434,969   24,394,530   34,116,744   24,361,009

    See accompanying notes to interim consolidated financial statements.



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

                        Three months ended June 30  Six months ended June 30
                                 2007         2006         2007         2006
                                    $            $            $            $
    -------------------------------------------------------------------------

    OPERATING ACTIVITIES
    Loss for the period    (1,044,959)    (746,995)  (1,376,222)  (1,468,914)
    Items not involving
     cash:
      Depreciation and
       amortization            29,294       39,495       56,674       78,773
      Stock-based
       compensation
       expense (note 7)       188,516      246,128      311,587      476,126
    Changes in non-cash
     operating working
     capital:
      Accounts receivable       8,908        1,985       78,034      (11,998)
      Prepaid expenses         18,270       10,852      104,674       42,475
      Work in progress              -     (227,477)           -     (249,905)
      Accounts payable         46,038       18,321       93,036       48,487
      Accrued liabilities      91,450      (44,972)     (18,874)      11,003
      Deferred revenue          9,856      (23,000)    (821,419)     (58,000)
    -------------------------------------------------------------------------
    Cash used in operating
     activities              (652,627)    (725,663)  (1,572,510)  (1,131,953)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    FINANCING ACTIVITIES
      Issue of common
       shares, compensation
       options, warrants      199,270    3,990,650      466,170    3,993,950
    -------------------------------------------------------------------------
    Cash provided by
     financing activities     199,270    3,990,650      466,170    3,993,950
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    INVESTING ACTIVITIES
      Purchase of capital
       assets                 (72,384)      (2,896)     (78,342)     (4,642)
    -------------------------------------------------------------------------
    Cash used in investing
     activities               (72,384)      (2,896)     (78,342)     (4,642)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net increase (decrease)
     in cash and cash
     equivalents during
     the period              (525,741)   3,262,091   (1,184,682)   2,857,355

    Cash and cash
     equivalents, beginning
     of the period          4,487,374      950,826    5,146,315    1,355,562

    -------------------------------------------------------------------------
    Cash and cash
     equivalents, end of
     the period             3,961,633    4,212,917    3,961,633    4,212,917
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Supplementary non-cash
     transaction
      Issuance of shares
       to employees
       (note 6(a)(iii))        37,921            -      131,020            -
      Issuance of shares
       for public
       relations services
       (note 6(a)(iv))         16,650            -       34,650            -
    -------------------------------------------------------------------------

    Cash and cash equivalents include cash on account and short-term
    investments in money market instruments with original maturities of 90
    days or less when acquired.

    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; Investor Relations,
Erin Hegarty, The Equity Performance Group, (617) 723-2225,
erin@equitypergp.com

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