NEW YORK and LONDON, July 17 /PRNewswire-FirstCall/ --
Narrowstep(TM) Inc. (OTC:NRWS) (BULLETIN BOARD: NRWS) , the TV on
the Internet Company, announced results for the first quarter of
fiscal year 2008, ended May 31, 2007. Revenue for the quarter was
$1.6 million with a loss of $3.3 million or $0.07 loss per share,
compared to revenue for the comparable quarter of the previous year
of $1.1 million with a loss of $1.2 million or $0.03 loss per
share. At quarter's end the company had $4.3 million in cash. "The
future of television is largely dependent on the Internet, and
television on the Internet is an area where Narrowstep has a
distinct advantage," said David C. McCourt, Chairman and CEO. "We
continue to see tremendous demand for Narrowstep's technology and
tools for monetizing video content. During the first quarter, we
launched a number of exciting channels for industry leaders such as
Virgin Media, the Sci Fi Channel and award- winning film company,
BreakThru Films. We also entered into exclusive partnerships with
the William Morris Agency, the world's largest talent and literary
agency, as well as with Telefonica, the third largest
telecommunications company in the world." Overall revenue increased
by 39% year over year, the increase in narrowcasting sales was 69%
year over year ($1.4 million compared to $0.8 million). "As we
discussed last quarter, Narrowstep is focused on capitalizing on
the high growth, high margin narrowcasting segment of our business.
As such, we have moved away from the lower margin production
business in order to focus on the higher margin channel building
and channel development segment which plays to the strength of our
telvOS(TM) platform, and where I believe we have a real advantage
both in the U.S. and abroad," added McCourt. At this time,
Narrowstep will not be conducting an investor call. For additional
information please contact, Jesse Case at (609) 951-2221 or . PART
1 - FINANCIAL INFORMATION Item 1 - Financial Statements NARROWSTEP
INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) Three Months Ended
May 31, 2007 May 31, 2006 $ $ Revenue Narrowcasting and other
1,415,160 836,513 Production services 175,633 308,010 Total revenue
1,590,793 1,144,523 Costs and Expenses Operating 1,225,791 422,218
Selling, general and administrative 2,645,624 1,680,563 Research
& development 798,750 255,057 Total operating expenses
4,670,165 2,357,838 Operating Loss (3,079,372) (1,213,315) Interest
income (expense), net (179,643) 44,099 Currency exchange income
(loss) (1,903) (589) (3,260,91 Net Loss 8) (1,169,805) Foreign
currency translation adjustment 17,472 36,764 Comprehensive Loss
(3,243,446) (1,133,041) Net Loss per Common Share - Basic and
Diluted (0.07) (0.03) Weighted-Average Number of Shares
Outstanding, Basic and Diluted 45,348,974 43,730,360 See Notes to
Condensed Consolidated Financial Statements. NARROWSTEP INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS May 31, 2007
Feb. 28, 2007 (Unaudited) $ $ Assets ` Current assets: Cash and
cash equivalents 4,328,212 466,870 Accounts receivable, net of
allowance for doubtful accounts of $1,522,139 and $940,534 at May
31, 2007 (unaudited) and February 28, 2007, respectively 1,415,949
1,403,779 Prepaid expenses and other current assets 298,942 332,192
Total current assets 6,043,103 2,202,841 Property and equipment,
net 1,610,274 1,234,557 Software development costs, net 125,006
149,080 Debt issuance costs, net 157,191 - Total Assets 7,935,574
3,586,478 Liabilities and Stockholders' Equity (Deficit)
Liabilities Current liabilities: Unearned revenue 461,190 384,295
Accounts payable 994,621 960,580 Net obligations under capital
leases, current 90,666 88,110 Accrued expenses and other current
liabilities 979,523 977,948 Total current liabilities 2,526,000
2,410,933 Net obligations under capital leases - long-term 113,032
135,470 Convertible notes and interest payable, net of debt
discount of $920,034 6,402,682 - Other long term liabilities 56,158
- Total Liabilities 9,097,872 2,546,403 Commitments and
Contingencies Stockholder's Equity (Deficit) Common stock,
$0.000001 par value 450,000,000 shares authorized, 45,348,974
issued and outstanding at May 31, 2007 (unaudited) and February 28,
2007, respectively 45 45 Additional paid-in capital 21,584,762
20,543,688 Accumulated deficit (22,816,451) (19,555,533)
Accumulated other comprehensive income (loss) 69,347 51,875 Total
Stockholders' Equity (Deficit) (1,162,297) (1,040,075 Total
Liabilities and Stockholders' Equity (Deficit) 7,935,574 3,586,478
See Notes to Condensed Consolidated Financial Statements. About
Narrowstep Narrowstep(TM) Inc. (OTC:NRWS) (BULLETIN BOARD: NRWS) ,
the TV on the Internet company, is a leading provider of Internet
TV services to 100+ companies worldwide. Narrowstep's propriety
technology, the Television Operating System(TM) or telvOS(TM)
delivers the most television-like and true community building
Internet TV experience available. A pioneer in the IPTV spectrum,
Narrowstep offers the expertise to build channels, as well as
state-of-the-art technology that can send video to multiple
platforms. For more information about telvOS(TM), please visit
http://www.narrowstep.com/technology/internet-tv-software-platform.aspx
and for more information about Narrowstep, please visit
http://narrowstep.com/ or call 609-951-2221. Forward-looking
Statement: Certain statements in this news release constitute
'forward-looking statements' within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known or unknown risks, including those detailed
in the Company's filings with the Securities and Exchange
Commission, 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. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak
only as of the date hereof. DATASOURCE: Narrowstep Inc. CONTACT:
Jesse Case, Narrowstep(TM) Inc., Public Relations Coordinator,
+1-609-951-2221, or Web site: http://www.narrowstep.com/
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