Route1 Reports Continued Subscriber Revenue Growth

TORONTO, ONTARIO--(Marketwired - Aug. 18, 2015) - Route1 Inc. (TSX VENTURE:ROI) (the "Company" or "Route1"), a leading provider of secure access technologies for the mobile workspace that protects businesses and government agencies, and whose customers include the U.S. Department of Defense, the Department of Homeland Security, the Department of Commerce and the Government of Canada, today announced its second quarter (Q2) and year to date (YTD) financial results for the period ended June 30, 2015.

For Q2 2015, total revenue increased to $1.62 million from $1.40 million in Q2 2014. Gross profit also increased during the second quarter of 2015 to $1.33 million or 82% of revenue compared to gross profit of $1.17 million or 84% of revenue in Q2 2014.

Total Revenue in 000s of CAD dollars	Q2 2015	Q2 2014	YTD 2015	YTD 2014
Devices	50	30	105	491
Services	1,569	1,374	3,030	2,655
Other	1	-	23	14
Total Revenue	1,620	1,404	3,158	3,160

During the second quarter of 2015 Route1 realized further growth in revenue from subscribers (recurring revenue), for the fifth consecutive quarter. The net increase in MobiKEY application software users (subscriber revenue being the largest component of Route1's services revenue) continues to come from a variety of new accounts including continued growth from accounts within the U.S. Department of Defense.

Revenue from Subscribers In 000s of CAD dollars	Jun 30 2015	Mar 31 2015	Dec 31 2014	Sep 30 2014	Jun 30 2014
Closing number of subscribers	15,410	15,012	14,792	14,645	14,461
Average number of subscribers	15,278	14,983	14,631	14,588	14,401
Revenue per subscriber	$353	$334	$334	$332	$329
Subscriber Revenue	$1,346	$1,252	$1,221	$1,211	$1,185

Earnings before interest, tax, depreciation, and amortization (Adjusted EBITDA) during the second quarter of 2015 amounted to approximately $226,000 compared to $120,000 in Q2 2014.

Adjusted EBITDA in 000s of CAD dollars	June 30 2015	Mar 31 2015	Dec 31 2014	Sep 30 2014	Jun 30 2014
Revenue	1,620	1,538	1,485	1,432	1,404
Adjusted EBITDA	226	404	107	110	120
Amortization	99	90	87	89	94
Operating profit before stock based compensation	127	314	20	21	26

Route1's second quarter 2015 total comprehensive net loss was $0.34 million compared to a loss of $0.03 million during the same period in 2014. The comprehensive net loss in Q2 2015 was primarily the result of foreign exchange losses. There was volatility and fluctuation of the Canadian dollar against the U.S. dollar during the second quarter of the 2015 and the amount of U.S. dollars in foreign bank accounts was at a seasonal high exacerbating the fluctuation.

Route1 generated cash from operating activities of approximately $2.62 million during Q2 2015 compared with cash generated of $3.28 million in Q2 2014. As at June 30, 2015, the Company had no bank debt and a cash balance of $3,468,306.

Balance Sheet Extracts In 000s of CAD dollars	June 30 2015		Dec 31 2014	June 30 2014
Cash	3,468		1,533	3,595
Total current assets	4,166		2,246	4,367
Total current liabilities	4,351		1,927	3,992
Net working capital	(185	)	319	375
Total assets	5,494		2,976	5,085
Bank debt	0		0	0
Total liabilities	4,453		2,032	4,085

Share Repurchase Program

On September 5, 2014, the Company announced with approval from the TSX Venture Exchange its intention to make a Normal Course Issuer Bid ("NCIB"). The NCIB permits the Company to purchase for cancellation up to 10% of the common shares in the public float. The maximum number of shares allowed for repurchase is 38,200,991. Purchases under the NCIB will be taking place during the 12 month period commencing September 11, 2014 and ending September 10, 2015, or the date upon which the maximum number of common shares have been purchased by the Company.

For the quarter ended June 30, 2015, the Company repurchased for cancellation 5,668,500 of its common shares for total consideration of $270,460, at an approximate average price of $0.048 per share under the NCIB. As of June 30, 2015 the Company has purchased a total of 15,644,500 common shares under the NCIB.

ABOUT ROUTE1, INC.

Route1 enables the mobile workspace without compromising on security. Its flagship technology MobiKEY uniquely combines secure mobile access, with high assurance identity validation and plug-and-play usability. Remote and mobile workers are able to securely and cost effectively access their workspace from any device without exposing the organization to the risk of data spillage or malware propagation. MobiKEY customers include Fortune 500 enterprises as well as the U.S. Department of Defense, the Department of Homeland Security, the Department of Energy and the Government of Canada. Headquartered in Toronto, Canada, Route1 is listed on the TSX Venture Exchange.

This news release, required by applicable Canadian laws, does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

© Route1 Inc., 2015. All rights reserved. Route1, the Route1 and shield design Logo, SECURING THE DIGITAL WORLD, Mobi, MobiSecure, MobiLINK, Route1 MobiKEY, Route1 MobiVDI, MobiKEY, MobiKEY IBAD, DEFIMNET, MobiNET, Route1 MobiNET, TruOFFICE, TruFLASH, TruOFFICE VDI, MobiKEY Fusion, MobiNET Aggregation Gateway, MobiNET Switching Array, MobiNET Secure Gateway, EnterpriseLIVE, EnterpriseLIVE Virtualization Orchestrator, MobiNET Agent, MobiKEY Classic and MobiKEY Classic 2, are either registered trademarks or trademarks of Route1 Inc. in the United States and/or Canada. All other trademarks and trade names are the property of their respective owners.

The DEFIMNET and MobiNET platforms, the MobiKEY, MobiKEY Classic, MobiKEY Classic 2 and MobiKEY Fusion devices, and MobiLINK are protected by U.S. Patents 7,814,216, 7,739,726, 9,059,962 and 9,059,997, Canadian Patent 2,578,053, and other patents pending. The MobiKEY Classic 2 is also protected by U.S. Patents 6,748,541 and 6,763,399, and European Patent 1001329 of Aladdin Knowledge Systems Ltd. and used under license. Other patents are registered or pending in various countries around the world.

Other product and company names mentioned herein may be trademarks of their respective companies.