NEW YORK, Aug. 16, 2010 (GLOBE NEWSWIRE) -- Vringo, Inc., (NYSE Amex:VRNG) a provider of video ringtones and personalization solutions for mobile devices, today announced financial results for the second quarter ended June 30, 2010.

Recent Highlights:
  • Second quarter revenues of $44,000, compared to $0 in the second quarter of 2009
  • Successfully completed U.S. initial public offering raising gross proceeds of $11 million
  • Finished quarter with $9.7 million of cash on hand
  • Number of commercial subscribers increased to 66,000, a 61% increase from the previous quarter
  • Receives first U.S. patent
  • Signs partnership with T-Pain for new app
  • Announces intent to offer Vringo on Verizon V Cast App Store

Jon Medved, Chief Executive Officer, commented, "We are pleased with Vringo's 2010 second quarter results and operational accomplishments. First, we are delighted to have successfully completed the Company's initial public offering during the quarter and have smoothly transitioned to public ownership with a public valuation and a public currency. Operationally, we focused on validating our business model in certain test markets primarily in the developing world. We received data from test markets that we believe is favorable and will help us achieve our ultimate goal of penetrating the lucrative North American and Western European markets. We believe our financial performance for the quarter is consistent with the start-up nature of our business with our technology platform in place and our business model proving out in our initial test markets."

Andrew Perlman, President, said, "We are pleased with the subscriber growth that we have seen in our current service and are looking forward to several important milestones planned for the third and fourth quarters that have the potential to accelerate our business momentum. We believe the strong user behavior that we have seen in current markets has validated our model and will translate well to the bigger and higher spending markets where we intend to launch in the coming months."

Perlman continued, "We are excited about our upcoming launch of an exciting new app for Android and the iPhone with T-Pain, the popular music artist and personality. T-Pain's first application for the iPhone was one of the most successful app launches ever, and we have great hopes for this new joint app launch. We are targeting our first 'for pay' release via a carrier in the U.S. in the Verizon V Cast App Store for the fourth quarter. Both of these events are key milestones for our company."

Revenue for the three months ended June 30, 2010, was $44,000 as compared to zero for the three months ended June 30, 2009, and compared to $30,000 for the three months ended March 31, 2010, a 47 percent sequential increase. Our operating loss for the three months ended June 30, 2010, was $1.7 million, as compared to $1.1 million for the three months ended June 30, 2009. The rise in operating loss was primarily due to an increase in general & administrative expenses related to the initial public offering, and to the recording of approximately $0.4 million of expenses related to the granting of the management options. To a lesser extent, our marketing expenses increased as we raised awareness among end-users of the Vringo service and launched our service in new markets. Net loss for the three months ended June 30, 2010, was $4.6 million, or $5.20 per share, compared to a net loss of $1.3 million, or $3.59 per share, for the three months ended June 30, 2009.

Revenue for the six months ended June 30, 2010, was $74,000, as compared to zero in the year-ago six-month period. Operating loss for the six-month period was $3.0 million compared with $2.5 million during the comparable 2009 six-month period. Net loss for the six-month period 2010 was $6.6 million, or $10.54 per share, compared with net loss of $2.9 million, or $7.78 per share, in the year-ago six-month period.

At June 30, 2010, Vringo had cash and cash equivalents of $9.7 million, working capital of $7.5 million and stockholders' equity of $2.6 million.

Conference Call

Vringo will host a conference call today at 4:30 p.m. ET (Monday, August 16, 2010). During the call, Jon Medved, Chief Executive Officer and Andrew Perlman, President, will discuss the Company's quarterly performance and financial results.

The telephone number for the conference call is +1-877-407-9210 (U.S. callers) or +1-201-689-8049 (international callers). A live webcast of the call will also be available on the Company's website at http://ir.vringo.com and at www.InvestorCalendar.com. To listen to the live call online, please visit the site at least 10 minutes early to register, download and install any necessary audio software.

A webcast archive will be available for 90 days on the Company's website, and a telephone replay of the call will be available beginning approximately one hour following the call through 11:59 p.m. Sunday, November 14, 2010, and can be accessed by calling +1-877-660-6853 (U.S. callers) or +1-201-612-7415 (International callers) and entering account number 286 and conference ID number 354893.

Forward-Looking Statements

This press release includes forward-looking statements that involve risks and uncertainties. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from the forward-looking statements. Vringo expressly disclaims any obligation to publicly update any forward-looking statements contained herein, whether as a results of new information, future events or otherwise, except as required by law.

About Vringo

Founded in 2006, Vringo is bringing about the evolution of ringtones. With its award-winning video ringtone application and Web platform, Vringo transforms the basic act of making and receiving mobile phone calls into a highly visual, social experience. By installing Vringo's application, which is compatible with more than 200 handsets, users can create or take video, images and slideshows from virtually anywhere and make it into their personal call signature. For more information, visit http://www.vringo.com.

For more information about how video ringtones work, visit www.vringo.com/p_video_ringtones.html.
Vringo, Inc. and Subsidiary
(a Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands except share and per share data)
 
  Three months ended June 30, Six months ended June 30, Cumulative from inception to June 30,
  2010 2009 2010 2009 2010
  U.S.$ U.S.$ U.S.$ U.S.$ U.S.$
Revenue  44   --   74   --   94 
           
Costs and Expenses*          
Cost of revenue  34   --   67   --   98 
Research and development  566   467   1,106   1,038   9,490 
Marketing 600   404  1,040   896   7,564 
General and administrative  573   276   855   574   5,285 
           
Total operating expenses 1,773  1,147  3,068  2,508  22,437
           
Operating loss  1,729  1,147  2,994  2,508  22,343
           
Non-operating income (490) (8) (447) (15) (912)
Interest and amortization of           
 debt discount expense 3,355  155  4,009  320   4,837 
Non-operating expenses  -- -- 15  --  113 
Loss on extinguishment of debt -- --  --   --  321 
           
Loss before taxes on income 4,594  1,294   6,571   2,813   26,702 
           
Income tax expense  18   21   38   40   32 
           
Net loss for the period  4,612  1,315   6,609   2,853  26,734 
           
Basic and diluted net loss          
 per common share (5.20) (3.59) (10.54) (7.78) (67.56)
           
Weighted average number          
 of shares used in          
 computing basic and          
 dilutive net loss per          
 common share 887,567  366,782  627,174  366,782  395,714
           
* The amount recorded for the three and six months ending June 30, 2010, and 2009, and the cumulative period from inception include $73, $150, $74, $45 and $696, respectively, to related parties.
           
The notes in the Company's Form 10-Q filed with the U.S. Securities and Exchange Commission form an integral part of these consolidated financial statements.
 
Vringo, Inc. and Subsidiary
(a Development Stage Company)
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands except share and per share data)
     
  June 30, December 31,
  2010 2009
  U.S.$ U.S.$
Current assets    
Cash and cash equivalents  9,692   744 
Prepaid expenses and other current assets  53   46 
Accounts receivable   51   2 
Deferred stock issuance costs  --   100 
Short-term deposit (restricted)  20   2,602 
Deferred tax assets – short-term  31   24 
     
Total current assets  9,847   3,518 
     
Long-term deposit  12   12 
     
Property and equipment, at cost, net of $351 and     
 $306 accumulated depreciation as of June 30, 2010,    
 and December 31, 2009, respectively  168   179 
     
Deferred tax assets – long-term  78   80 
     
Total assets  10,105   3,789 
     
Current liabilities    
Accounts payable and accrued expenses*  805   876 
Accrued compensation  355   304 
Current maturities of venture loan  1,160   557 
Bridge notes  --   1,912 
     
Total current liabilities  2,320   3,649 
     
Long-term liabilities    
Accrued severance pay  325   334 
Venture loan  2,569   3,146 
Derivative liabilities on account of warrants  2,274   1,070 
     
Total long-term liabilities  5,168   4,550 
     
     
 Vringo, Inc. and Subsidiary
(a Development Stage Company)
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands except share and per share data)
     
  June 30, December 31,
  2010 2009
  U.S.$ U.S.$
Commitments and contingencies    
     
Temporary equity    
Series B convertible and redeemable preferred stock, $0.01     
 par value per share; 4,900,000 authorized; 765,465 shares     
 issued and outstanding as of December 31, 2009    
 (liquidation preference of, and redeemable at, the greater of    
 fair value or $15.831 per share, or $12.1 million, plus     
 declared but unpaid dividends, if any)  --   11,968 
     
Stockholders' equity (deficit)    
     
Common stock, $0.01 par value per share 28,000,000 and     
 14,000,000 authorized; 5,098,364 and 366,782 issued and    
 outstanding as of June 30, 2010, and December 31, 2009,    
 respectively  51   22 
     
Series A convertible preferred stock, $0.01 par value per     
 share; 2,353,887 authorized; 392,314 issued and     
 outstanding as of December 31, 2009, (liquidation preference    
 of $6.00 per share, or $2.35 million, plus declared but unpaid    
 dividends, if any)  --   24 
     
Additional paid-in capital 29,300  3,701 
     
Deficit accumulated during development stage (26,734) (20,125)
     
Total stockholders' equity (deficit)  2,617  (16,378)
     
Total liabilities and stockholders' equity  10,105   3,789 
     
* The amounts recorded as of June 30, 2010, and December 31, 2009, include $38 and $46 to a related party, respectively.
     
The notes in the Company's Form 10-Q filed with the U.S. Securities and Exchange Commission form an integral part of these consolidated financial statements.
CONTACT:  Vringo, Inc.          Jonathan Medved, CEO          +1 646-525-4319 x 2501          jon@vringo.com          Crescendo Communications, LLC          Investor Relations Firm          John J. Quirk          David K. Waldman          +1 212-671-1020          vrng@crescendo-ir.com