Xten Networks Announces Record Third Quarter Results SANTA CLARA,
CA, March 18 /PRNewswire-FirstCall/ -- Xten Networks, Inc. (OTCBB:
XNWK), a provider of award-winning VoIP (Voice over Internet
Protocol), Video over IP, Instant Messaging (IM), and Presence SIP
softphones, today reported financial results for the third quarter
ended January 31, 2005. Total revenue for the quarter climbed to a
record $928,608, compared to $677,364 for the quarter ended October
31, 2004, an increase of 37% quarter-over-quarter. This compared to
$10,874 in the year-earlier period ended January 31, 2004. Net loss
for the quarter was $88,827, or ($0.00) per diluted share, compared
to a net loss of $198,275, or ($0.01) per diluted share, in the
previous quarter. This compared to $102,500, or ($0.02) per diluted
share, in the year-earlier period. The diluted weighted average
common shares outstanding for the three months ended January 31,
2005 were 37,638,462 shares compared to 6,226,484 shares in the
year-earlier period. For the first nine months of fiscal 2005,
total revenue climbed to $2,093,123, compared to $345,873 (+505%)
in the corresponding period in fiscal 2004. Net loss for the first
nine months of fiscal 2005 was $478,235, or ($0.01) per diluted
share, compared to a net loss of $143,961, or ($0.03) per diluted
share, in the corresponding period in fiscal 2004. Software sales
for the quarter totaled $838,163 compared to $653,618 for the
quarter ended October 31, 2004, a 28% increase
quarter-over-quarter. This compared to $6,820 in the year-earlier
period ended January 31, 2004. For the nine-month period, software
sales were $1,958,432 compared to $228,281 in the year-earlier
period. Mark Bruk, chief executive officer of Xten Networks, said,
"Our record performance in the third quarter reflects strong growth
in software sales. We significantly strengthened our customer base
in the quarter with new agreements from industry leaders such as
Belkin Corporation, Yak Communications, and others. Our latest
software product, eyeBeam, continues to receive strong acceptance
in the rapidly growing global VoIP marketplace and we expect to
build on our record sales going forward."(x) "With customers in
approximately 30 countries and more than 1,000,000 IP endpoints
deployed worldwide, Xten Networks remains well positioned for
long-term growth and we expect to continue to improve our operating
margins based on growing sales."(x) About Xten Networks, Inc. Xten
Networks is a developer of award-winning, high-quality,
carrier-grade VoIP (Voice over IP) and Video over IP SIP softphones
for service providers, cable operators, Internet telephony service
providers, IP PBX manufacturers and OEMs. Xten's SIP softphones are
available either pre-configured or as a software development kit
(SDK), and provide VoIP (Voice over IP), Video over IP, IM (Instant
Messaging), and Presence functionality. eyeBeam - Xten's
feature-rich SIP Video over IP softphone with IM and Presence -
recently received INTERNET TELEPHONY(R) Magazine's "Product of the
Year" Award for 2004. Through deployments with leading service
providers, Xten has more than 1,000,000 IP endpoints deployed
worldwide. For more information please visit http://www.xten.com/.
Legal Note on Forward-Looking Statements Statements in this news
release, which are not purely historical, are forward-looking
statements, including any statements regarding beliefs, plans,
expectations or intentions regarding the future. Forward-looking
statements in this news release are marked by an asterisk ((x)) and
include statements regarding management's belief that: Xten will
increase sales revenues; Xten remains well positioned for long-term
growth; and, Xten expects to continue to improve its operating
margins based on growing sales. It is important to note that actual
outcomes and Xten's actual results could differ materially from
those in such forward-looking statements. Factors that could cause
actual results to differ materially include risks and uncertainties
such as Xten's ability to remain competitive as other parties
develop and release competitive products, Xten's ability to retain
the employees necessary to continue research and development of
Xten's software products, the success by Xten of the sales of its
products, the impact of competitive products on the sales of Xten's
products, the impact of technology changes on Xten's software
products, the compatibility of Xten's software products with new
computer operating systems, general economic conditions as they
affect Xten's prospective customers, the ability of Xten to control
costs, operating, general administrative and other expenses, and
insufficient investor interest in Xten's securities which may
impact on Xten's ability to raise additional financing as required.
Readers should also refer to the risk disclosures outlined in
Xten's quarterly reports on Form 10-QSB, annual reports on Form
10-KSB and Xten's other disclosure documents filed from
time-to-time with the Securities and Exchange Commission. Tables
follow: XTEN NETWORKS, INC. INTERIM CONSOLIDATED BALANCE SHEETS
January 31, 2005 and April 30, 2004 (Stated in US Dollars)
(Unaudited) ----------- January 31, April 30, ASSETS 2005 2004
------ ---- ---- Current Cash $ 1,587,150 $ 944,285 Accounts
receivable 178,524 100,361 Prepaid expenses 54,663 13,671 Current
assets of discontinued operations - 8,115 -------------
------------ 1,820,337 1,066,432 Capital assets 259,036 64,786
Trademarks 670 335 Long-term assets of discontinued operations -
4,000 ------------- ------------ $ 2,080,043 $ 1,135,553
------------- ------------ ------------- ------------ LIABILITIES
----------- Current Accounts payable and accrued liabilities $
288,659 $ 31,156 Advances payable 228,892 226,727 Due to a related
party 72,684 125,250 Unearned revenue and deposits 149,170 -
Warranty payable 43,793 - Liabilities of discontinued operations -
18,915 ------------- ------------ 783,198 402,048 -------------
------------ STOCKHOLDERS' EQUITY -------------------- Common
stock, $0.001 par value 415,384,500 shares authorized 37,638,462
shares issued (April 30, 2004: 37,138,462) 37,638 37,138 Additional
paid-in capital 1,951,395 951,895 Contributed surplus 77,967 -
Deficit (733,763) (255,528) Accumulated other comprehensive loss
(36,392) - ------------- ------------ 1,296,845 733,505
------------- ------------ $ 2,080,043 $ 1,135,553 -------------
------------ ------------- ------------ XTEN NETWORKS, INC. INTERIM
CONSOLIDATED STATEMENTS OF OPERATIONS for the three and nine months
ended January 31, 2005 and 2004 (Stated in US Dollars) (Unaudited)
----------- Three months Three months Nine months Nine months ended
ended ended ended January 31, January 31, January 31, January 31,
2005 2004 2005 2004 ---- ---- ---- ---- Revenues Software sales $
838,163 $ 6,820 $ 1,958,432 $ 228,281 Consulting fees 90,445 4,017
134,691 117,592 ------------ ------------ ------------ ------------
928,608 10,874 2,093,123 345,873 ------------ ------------
------------ ------------ Expenses Amortization 30,425 2,423 71,363
7,269 Bad debts (recovery) (6,140) 30,125 1,660 30,125 Computer
expenses 2,792 3,634 5,079 3,634 Consulting fees 126,880 27,817
272,521 372,570 Foreign exchange loss 14,391 - 2,201 - Gain on
forgiveness of debt (10,895) - (10,895) - Gain on disposal of
capital assets - (17,461) - (17,461) Licenses and permits 657 9,816
85,712 10,731 Loss on write-off of investment - 5,000 - 5,000
Office and miscellaneous 35,545 9,450 87,873 13,186 Professional
fees 14,810 6,547 64,559 8,422 Public relations 35,616 24,940
74,570 24,940 Rent 33,726 5,047 69,657 15,140 Stock-based
compensation 25,100 - 77,967 - Telephone and internet 24,359 -
34,963 - Travel and promotion 46,526 6,036 198,432 16,278 Wages,
commissions and benefits 620,661 - 1,500,427 - Warranty expense
22,982 - 43,793 - ------------ ------------ ------------
------------ 1,017,435 113,374 2,579,882 489,834 ------------
------------ ------------ ------------ Loss from continuing
operations (88,827) (102,500) (486,759) (143,961) Income from
discontinued Operations Gain on disposal of subsidiary - - 8,524 -
------------ ------------ ------------ ------------ Net loss for
the period (88,827) (102,500) (478,235) (143,961) Other
comprehensive loss: Foreign currency adjustments (16,650) -
(36,392) - ------------ ------------ ------------ ------------
Comprehensive loss $ (105,477) $ (102,536) $ (514,627) $ (143,961)
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ Basic and diluted loss per
share - continuing Operations $ (0.00) $ (0.02) $ (0.01) $ (0.03)
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ Basic and diluted income per
share - discontinued operations $ 0.00 $ 0.00 $ 0.00 $ 0.00
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ Weighted average number of
shares outstanding 37,638,462 6,226,484 37,330,491 4,483,079
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ Contacts: Todd Fromer /
Michael Cimini (212) 896-1215 / (212) 896-1233 / DATASOURCE: Xten
Networks Inc. CONTACT: Todd Fromer / Michael Cimini, (212) 896-1215
/ (212) 896-1233, /
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