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Route1 Reports 2018 Second Quarter Financial Results

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TORONTO, Aug. 16, 2018 (GLOBE NEWSWIRE) -- Route1 Inc. (OTCQB:ROIUF, TSXV:ROI) (the "Company" or "Route1"), North America's most advanced provider of industrial-grade data intelligence, user authentication, and ultra-secure mobile workforce solutions, today announced its second quarter (Q2) financial results for the three and six months ended June 30, 2018.

Statement of operations
In 000s of CAD dollars
Q2
 2018
  Q1
 2018
  Q4
2017
  Q3
 2017
  Q2
 2017
 
Revenue          
  Subscription revenue and services 1,633   1,264   1,263   1,177   1,347  
  Devices and appliances 3,936   388   109   159   24  
  Other 7   32   48   2   -  
Total revenue 5,577   1,684   1,420   1,338   1,371  
Cost of revenue 3,620   585   331   362   298  
Gross profit 1,957   1,100   1,089   976   1,073  
Operating expenses 1,891   1,136   1,164   1,131   1,151  
Operating profit (loss) 1 65   (36 ) (75 ) (155 ) (78 )
Total other expenses 2 (144 ) 114   170   183   157  
Net income gain (loss) 209   (150 ) (245 ) (338 ) (235 )

1 Before stock based compensation and patent litigation
2 Includes stock based compensation, AirWatch litigation, gain on acquisition and foreign exchange

Subscription revenue and services by quarter
in 000s of CAD dollars
Q2
 2018
Q1
 2018
Q4
 2017
Q3
2017
Q2
 2017
Application software 1,181 1,260 1,263 1,177 1,347
Technology as a service (TaaS)   266   -   -   -   - 
Other services   186   4  -   -   - 
Total 1,633 1,264 1,263 1,177 1,347


Adjusted EBITDA
in 000s of CAD dollars
Q2
2018
Q1
2018
  Q4
2017
  Q3
2017
  Q2
2017
 
Gross Profit 1,957 1,100   1,089   976   1,073  
Adjusted EBITDA 3 272 46   24   (46 ) 16  
Amortization 207 82   99   109   94  
Operating profit (loss) 65 (36 ) (75 ) (155 ) (78 )

3 Adjusted EBITDA is defined as earnings before interest, income taxes, depreciation and amortization, stock-based compensation, patent litigation, restructuring and other costs. Adjusted EBITDA does not have any standardized meaning prescribed under IFRS and is therefore unlikely to be comparable to similar measures presented by other companies.  Adjusted EBITDA allows Route1 to compare its operating performance over time on a consistent basis.

Route1 generated cash from operating activities of approximately $0.4 million during Q2 2018 compared with cash used in operating activities of $0.1 million in Q2 2017.  Non-cash working capital of $0.3 million was generated in Q2 2018 compared to $1.6 million generated in the same period a year earlier.  Net cash generated from the day–to-day operations for the three months ended June 30, 2018 was $0.8 million compared to $1.6 million in Q2 2017.

Balance sheet extracts
In 000s of CAD dollars
Jun 30
2018
Mar 31
2018
Dec 31
2017
Sep 30
2017
Jun 30
2017
Cash 1,084 600 1,037 1,408 2,080
Total current assets 4,989 6,292 2,035 2,856 2,924
Total current liabilities 4,863 6,292 1,829 2,534 2,396
Net working capital 126 - 206 322 528
Total assets 7,356 8,646 3,171 4,081 4,213
Bank debt - - - - -
Total shareholders' equity 2,322 2,256 1,236 1,432 1,720

Acquisition of Group Mobile Int'l, LLC

On March 22, 2018, Route1 completed the acquisition of 100% of the membership interest of Group Mobile Int'l, LLC ("Group Mobile").  During the second quarter of 2018, the Company revised the net purchase gain on acquisition to reflect changes in the balance of certain accounts based on information that was not readily available at the time of the acquisition; these adjustments are now reflected in the balances as at March 22, 2018.  The net purchase gain on acquisition is now $3,667 versus $106,692 as presented in the Company's Q1 2018 financial statements.  For additional information, see the "BUSINESS COMBINATION" section of Route1's Q2 2018 Management Discussion and Analysis ("MD&A").

Investor Conference Call and Webcast

Route1 will hold a conference call and web cast to discuss the Company's financial results and provide a business update on Thursday, August 16, 2018 at 9 a.m. eastern.  Participants should dial Toll-Free: 1-866-548-4713 or Toll/International: 1-323-794-2093 at least 10 minutes prior to the conference, pass code 3698568.  For those unable to attend the call, a replay will be available on August 16, 2018  after 12: 00 p.m. at Toll-Free 1-844-512-2921 or Toll/International 1-412-317-6671, pass code 3698568 until 11:59 pm on August 30,  2018. 

The webcast will be presented live at http://public.viavid.com/index.php?id=130852.

About Route1 Inc.
Route1, operating under the tradename GroupMobile, is North America's most advanced provider of industrial-grade data intelligence, user authentication, and ultra-secure mobile workforce solutions. The Company helps all manner of organizations, from government and military to private sector, to make intelligent use of devices and data for immediate process improvements while maintaining the highest level of cyber security.  Route1 is listed on the OTCQB in the United States under the symbol ROIUF and in Canada on the TSX Venture Exchange under the symbol ROI.  For more information, visit: www.route1.com.

For More Information, Contact:
Tony Busseri
CEO, Route1 Inc.
+1 416 814-2635
tony.busseri@route1.com

This news release, required by applicable Canadian laws, does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

© 2018 Route1 Inc. All rights reserved. No part of this document may be reproduced, transmitted or otherwise used in whole or in part or by any means without prior written consent of Route1 Inc.  See https://www.route1.com/terms-of-use/ for notice of Route1's intellectual property.

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