C2 Global Technologies Inc. Reports 2009 Second Quarter Results

TORONTO, ONTARIO--(Marketwire - Aug. 10, 2009) - C2 Global Technologies Inc. ("C2" or the "Company") COBT today reported its financial results for the second quarter ended June 30, 2009. All amounts are stated in US dollars. The Company had net income of $0.1 million or $0.01 per common share, basic and diluted, for the second quarter of 2009, compared to net income of $0.3 million or $0.01 per common share, basic and diluted, for the second quarter of 2008. For the second quarter of 2009 the Company's revenue from continuing operations was $4.1 million, compared to $1.9 million for the second quarter of 2008. $3.1 million of the revenue was earned by the Company's 75%-owned subsidiary, Counsel RB Capital, LLC ("Counsel RB"), which commenced operations in the second quarter of 2009. The remaining $1.0 million is from a license agreement that the Company entered into in June 2009 with respect to C2's patents in the Republic of Korea. The 2008 revenue was from a settlement and license agreement that the Company entered into in May 2008 with a US telecommunications carrier. For the six months ended June 30, 2009, the Company had a net loss of $0.2 million compared to net income of $2.1 million for the six months ended June 30, 2008. The net loss per common share for the six months ended June 30, 2009 was $0.01, basic and diluted, compared to net income of $0.09, basic and diluted, for the six months ended June 30, 2008. The Company's operating revenue from continuing operations for the six months ended June 30, 2009 was $4.1 million, as detailed above, as compared to $8.1 million for the six months ended June 30, 2008. All of the 2008 revenue was from three settlement and license agreements with US telecommunications carriers. In May 2009, C2 invested $2.6 million to indirectly acquire an approximate 5% interest in Polaroid Corporation, pursuant to a Chapter 11 reorganization in a U.S. bankruptcy court. C2's interest will be managed by Knight's Bridge Capital Management L.P., an affiliate of C2's parent, Counsel Corporation. "We are pleased with the progress made by C2 in the second quarter of 2009", said Allan Silber, Chairman and CEO of C2. He added, "The Korean license agreement, C2's first license of its international patents, Counsel RB's first quarter of operations, and the Polaroid investment, are very positive developments". Please see the Company's Annual Report on Form 10-K for the year ended December 31, 2008, filed with the SEC on March 18, 2009, and the Company's Quarterly Report on Form 10-Q for the three months ended June 30, 2009, filed with the SEC on August 7, 2009, for further information. About C2 Global Technologies Inc. C2's primary business is the development and licensing of its patents, which include two foundational patents in VoIP technology. C2 is also involved in the acquisition and disposition of distressed and surplus assets through its interest in Counsel RB Capital. For further information, please visit C2's website at www.c-2technologies.com. Forward-Looking Statements This release contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, as amended, that are based on management's exercise of business judgment as well as assumptions made by, and information currently available to, management. When used in this document, the words "may", "will", "anticipate", "believe", "estimate", "expect", "intend", and words of similar import, are intended to identify any forward-looking statements. You should not place undue reliance on these forward-looking statements. These statements reflect our current view of future events and are subject to certain risks and uncertainties as noted in our securities and other regulatory filings. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results could differ materially from those anticipated in these forward-looking statements. We undertake no obligation, and do not intend, to update, revise or otherwise publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of any unanticipated events. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance that our expectations will materialize. Many factors could cause actual results to differ materially from our forward-looking statements. /T/ C2 GLOBAL TECHNOLOGIES INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share June 30, December 31, and per share amounts) 2009 2008 ----------- ---------- (unaudited) ASSETS Current assets: Cash $ 226 $ 4,076 Accounts receivable 1,977 - Other current assets 47 77 Inventory 4,009 - Deferred income tax assets - 875 ----------- ---------- Total current assets 6,259 5,028 Other assets: Goodwill 173 173 Investments 2,780 242 Deferred income tax assets 1,021 - ----------- ---------- Total assets $ 10,233 $ 5,443 ----------- ---------- ----------- ---------- LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued liabilities $ 1,376 $ 472 Debt payable to third parties 2,569 - Debt payable to a related party 1,435 - ----------- ---------- Total liabilities 5,380 472 ----------- ---------- Stockholders' equity: Preferred stock, $10.00 par value, convertible, non-redeemable, authorized 10,000,000 shares; issued and outstanding 594 Class N shares at June 30, 2009 and December 31, 2008; liquidation preference of $594 at June 30, 2009 and December 31, 2008 6 6 Common stock, $0.01 par value, authorized 300,000,000 shares; issued and outstanding 22,718,309 shares at June 30, 2009 and 22,745,530 shares at December 31, 2008 227 227 Additional paid-in capital 274,672 274,761 Accumulated deficit (270,253) (270,023) ----------- ---------- Stockholders' equity before non-controlling interest 4,652 4,971 Non-controlling interest in subsidiary 201 - ----------- ---------- Total equity 4,853 4,971 ----------- ---------- Total liabilities and stockholders' equity $ 10,233 $ 5,443 ----------- ---------- ----------- ---------- The notes contained in our Quarterly Report on Form 10-Q are an integral part of these condensed consolidated financial statements C2 GLOBAL TECHNOLOGIES INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Three Months Ended Six Months Ended June 30, June 30, ------------------- ------------------ (In thousands, except per share amounts) 2009 2008 2009 2008 -------- -------- -------- -------- Revenue: Patent licensing $ 950 $ 1,900 $ 950 $ 8,125 Asset trading 3,102 - 3,102 - -------- -------- -------- -------- Total revenue 4,052 1,900 4,052 8,125 -------- -------- -------- -------- Operating costs and expenses: Patent licensing 586 1,308 587 4,492 Asset trading 2,675 - 2,675 - Selling, general and administrative 708 280 1,095 556 Depreciation and amortization - 5 - 10 -------- -------- -------- -------- Total operating costs and expenses 3,969 1,593 4,357 5,058 -------- -------- -------- -------- Operating income (loss) 83 307 (305) 3,067 -------- -------- -------- -------- Other income (expense): Other income 21 5 22 5 Interest expense (63) - (63) (43) -------- -------- -------- -------- Total other income (expense) (42) 5 (41) (38) -------- -------- -------- -------- Income (loss) from continuing operations before the undernoted 41 312 (346) 3,029 Income tax expense (recovery) (46) 9 (53) 930 Earnings of equity accounted investments (net of $0 tax) 19 8 20 7 -------- -------- -------- -------- Income (loss) from continuing operations 106 311 (273) 2,106 Loss from discontinued operations (net of $0 tax) - (6) - (6) -------- -------- -------- -------- Net income (loss) before non-controlling interest 106 305 (273) 2,100 Net (income) loss attributable to non-controlling interest 6 - 43 - -------- -------- -------- -------- Net income (loss) $ 112 $ 305 $ (230) $ 2,100 -------- -------- -------- -------- -------- -------- -------- -------- Weighted average common shares outstanding 22,718 23,045 22,729 23,070 Weighted average preferred shares outstanding 1 1 1 1 Net income(loss) per share: Common shares $ 0.01 $ 0.01 $ (0.01) $ 0.09 Preferred shares $ 0.20 $ 0.54 $ N/A $ 3.65 The notes contained in our Quarterly Report on Form 10-Q are an integral part of these condensed consolidated financial statements /T/