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Network-1 reports first quarter 2024 results

NEW CANAAN, CT / ACCESS WIRE / May 10, 2024 / Network-1 Technologies, Inc. (NYSE American:NTIP), an intellectual property acquisition, development, licensing and monetization company, today announced financial results for the quarter ended March 31, 2024.

Network-1 had no revenue for the three months ended March 31, 2024, compared to $537,000 of revenue for the three months ended March 31, 2023. The $537,000 of revenue for the three months ended March 31, 2023 was from the settlement of several patent infringement lawsuits involving Network-1’s Remote Power Patent.

Network-1 reported a net loss of $920,000 or $0.04 per common share and diluted for the three months ended March 31, 2024, compared to a net loss of $623,000 or $0.03 per common share and diluted for the three months ended March 31 2023. Excluding Of its share of the losses of its investment company ILiAD Biotechnologies, LLC of $628,000, Network-1 suffered a loss of $292,000 for the three months ended March 31, 2024, compared to an income of $51,000 for the three months ended March 31 March 2023.

As of March 31, 2024, Network-1’s principal sources of liquidity consisted of cash and cash equivalents and marketable securities of $43,394,000 and working capital of $43,067,000. Network-1 believes, based on its current cash position, that it will have sufficient cash to finance its operations for the foreseeable future.

Since the inception of Network-1’s share repurchase program through March 31, 2024, Network-1 has repurchased a total of 9,724,540 shares of its common stock at an aggregate cost of $18,894,986 (excluding commissions) or an average price per share of $1.97 . Network-1 repurchased 83,744 shares of its common stock during the three months ended March 31, 2024 at a total cost of $182,070, or an average price per share of $2.17. As of March 31, 2024, the dollar value of the remaining shares redeemable under the Share Repurchase Program was $4,190,635.

Network-1 continues to pay dividends in accordance with its dividend policy, which consists of semi-annual cash dividends of $0.05 per share ($0.10 per share per year), expected to be paid in March and September each year. On February 23, 2024, Network-1’s Board of Directors declared a semi-annual cash dividend of $0.05 per share, which was payable on March 29, 2024 to all shareholders of record as of March 15, 2024. Network-1’s dividend policy is undergoing a revision. periodic review by the Board of Directors and may be changed at any time depending on Network-1’s revenues, financial requirements and other factors existing at the time.

ABOUT NETWORK-1 TECHNOLOGIES, INC.

Network-1 Technologies, Inc. engages in the development, licensing and protection of its intellectual property and proprietary technologies. Network-1 partners with inventors and patent owners to help develop and monetize their patented technologies. Network-1 currently holds one hundred and two (102) U.S. patents and fifteen (15) foreign patents covering various telecommunications and data networking technologies, as well as technologies related to document flow control systems and media content identification. Network-1’s current strategy includes efforts to monetize five patent portfolios (the Cox, M2M/IoT, HFT, Mirror Worlds, and Remote Power Patent portfolios). Network-1’s strategy is to focus on acquiring and investing in high quality patents that management believes have the potential to generate significant licensing opportunities, as Network-1 has achieved with respect to its Remote Power Patent and Mirror Worlds Patent Portfolio. Network-1’s Remote Power Patent generated licensing revenues of more than $188,000,000 from May 2007 through March 31, 2024. Network-1 has earned licensing and other revenues of $47,150,000 through March 31, 2024 related to its Mirror Worlds Patent Portfolio.

This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements relate to future events and circumstances relating to Network-1’s business plans. Such statements are subject to a number of risk factors and uncertainties as disclosed in Network-1’s Annual Report on Form 10-K for the year ended December 31, 2023 and Quarterly Report on Form 10-Q for the quarterly period ended March 31. , 2024 filed with the Securities and Exchange Commission, including, among other things, Network-1’s uncertain revenue from licensing its intellectual property, uncertainty about the outcome of pending litigation involving Network-1’s Remote Power Patent, or Network- 1 in its Cox patent litigation against Google and YouTube will be successful in the expected appeal of the judgment of the US District Court for the Southern District of New York dismissing all of Network-1’s claims in the case, or Network-1 will be successful in its appeal to the Federal Public Service District Court ruling for non-infringement, dismissing Network-1’s lawsuit against Facebook (now Meta Platforms, Inc.) and Network-1’s ability to successfully execute its strategy to acquire or invest in high quality patents with significant licensing opportunities, Network-1’s ability to generate revenues and profits from its Cox Patent Portfolio, M2M/IoT Patent Portfolio, HFT Patent Portfolio and additional revenues and profits from its Mirror Worlds Patent Portfolio and Remote Power Patent, as well as a return on its investment in ILiAD Biotechnology, LLC or other intellectual property it may acquire or finance in the future, Network-1’s ability to enter into additional licensing agreements uncertainty as to whether cash dividends will be paid, Network-1’s ability to enter into strategic relationships with third parties to license or otherwise monetize their intellectual property, the risk that Network-1 the future will be classified as a personal holding company, which may result in Network-1 paying a special cash dividend to its shareholders, future economic conditions and technological changes and legislative, regulatory and competitive developments. Unless otherwise required in periodic reports, Network-1 expressly disclaims any obligation or undertaking to update or revise any forward-looking statement contained herein.

The unaudited condensed consolidated statements of operations and the unaudited condensed consolidated balance sheets are attached.

Corey M. Horowitz, Chairman and CEO

Network-1 Technologies, Inc.

203-920-1055

CONDENSED CONSOLIDATED BALANCE SHEET
(NOT AUDITED)

March 31st,
2024

December 31,
2023

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$ 18,105,000 $ 16,896,000

Marketable securities, at fair value

25,289,000 28,571,000

Other current assets

218,000 206,000

TOTAL CURRENT ASSETS

43,612,000 45,673,000

OTHER ASSETS:

Patents, net of accumulated depreciation

1,296,000 1,326,000

Investment in shares

4,621,000 5,249,000

Operating leases of right-of-use assets

75,000 16,000

Deposit

13,000 13,000

Completely different assets

6,005,000 6,604,000

TOTAL ASSETS

$ 49,617,000 $ 52,277,000

LIABILITIES AND EQUITY:

CURRENT OBLIGATIONS:

Debts

$ 306,000 $ 125,000

Accrued payroll

378,000

Other allocated costs

182,000 297,000

Operating lease obligation, current

57,000 23,000

Total current liabilities

545,000 823,000

LONG-TERM DEBT:

Deferred tax liability

615,000 762,000

Operating lease obligation, long-term

24,000

TOTAL LIABILITIES

$ 1,184,000 $ 1,585,000

COMMITMENTS AND CONDITIONS (note G)

EQUITY

Preferred stock, $0.01 par value, authorized 10,000,000 shares;
none issued and outstanding as of March 31, 2024 and December 31, 2023

Common stock, $0.01 par value; authorized 50,000,000 shares; 23,552,561 and 23,553,908 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

235,000 235,000

Additional paid-in capital

67,560,000 67,446,000

Accumulated deficit

(19,362,000 ) (16,989,000 )

TOTAL EQUITY

48,433,000 50,692,000

TOTAL LIABILITIES AND EQUITY

$ 49,617,000 $ 52,277,000

CONDENSED CONSOLIDATED STATEMENTS OF ACTIVITIES
(NOT AUDITED)

Three months ended
March 31st,

GAIN $ $ 537,000
OPERATING COSTS:

Cost of income

151,000

Professional fees and related costs

219,000 298,000

General and administrative

669,000 781,000

Amortization of patents

30,000 83,000
TOTAL OPERATING COSTS 918,000 1,313,000
LOSS OF BUSINESS (918,000 ) (776,000 )

OTHER INCOME:

Interest and dividend income, net

431,000 310,000

Net realized and unrealized gains on marketable securities

48,000 364,000

Total other income, net

479,000 674,000
LOSS FOR INCOME TAXES AND EQUITY IN NET LOSSES ON INVESTOR’S CAPITAL METHOD (439,000 ) (102,000 )

INCOME TAX PROVISION:

Current

Deferred taxes

(147,000 ) (153,000 )

Total income tax benefit

(147,000 ) (153,000 )
(LOSS) INCOME FOR SHARE OF NET LOSSES ON INVESTOR’S CAPITAL METHOD (292,000 ) 51,000
SHARE OF NET LOSS OF THE MONEY METHOD INVESTOR (628,000 ) (674,000 )
NET LOSS $ (920,000 ) $ (623,000 )
Net loss per share:

Base

$ (0.04 ) $ (0.03 )

Diluted

$ (0.04 ) $ (0.03 )
Weighted average outstanding common shares:

Base

23,540,468 23,866,821

Diluted

23,540,468 23,866,821

SOURCE: Network-1 Technologies, Inc.