Route1 Reports 2014 Fourth Quarter and Full Year Financial Results

TORONTO, ONTARIO--(Marketwired - April 1, 2015) - Route1 Inc. (TSX VENTURE:ROI) (the "Company"), 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 Energy and the Government of Canada, today announced its fourth quarter (Q4) and fiscal year (FY) financial results for the period ended December 31, 2014.

Fourth Quarter Financial Results

For the fourth quarter of 2014, total revenue was $1.49 million compared with $1.53 million in Q4 2013.

Total Revenue In 000s of CAD dollars	Q4 2014	Q4 2013	FY 2014	FY 2013
Devices	12	207	536	447
Services	1,416	1,275	5,470	4,948
Other	58	43	71	38
Total Revenue	1,485	1,525	6,078	5,433

During the fourth quarter of 2014 Route1 realized further growth in revenue from subscribers (recurring revenue), for the third consecutive quarter. The net increase in MobiKEY application software users (subscriber revenue being the largest component of Route1's services revenue) is largely a result of continued growth from accounts within the U.S. Department of Defense.

Total revenue decreased in the fourth quarter of 2014 compared to 2013 as a result of a large MobiKEY device order that wasn't repeated in the current quarter.

Revenue from Subscribers In 000s of CAD dollars	Dec 31 2014		Sep 30 2014		Jun 30 2014		Mar 31 2014		Dec 31 2013
Closing number of subscribers		14,792		14,645		14,461		14,240		14,602
Average number of subscribers		14,631		14,588		14,401		14,198		14,600
Revenue per subscriber	$	334	$	332	$	329	$	312	$	301
Subscriber Revenue	$	1,221	$	1,211	$	1,185	$	1,108	$	1,100

Gross profit increased during the fourth quarter of 2014 to $1.243 million or 84% of revenue, compared to gross profit of $1.182 million or 78% of revenue in Q4 2013.

Gross Profit In 000s of CAD dollars	Dec 31 2014		Sep 30 2014		Jun 30 2014		Mar 31 2014		Dec 31 2013
Subscriber Revenue	$	1,243	$	1,110	$	1,174	$	1,406	$	1,182

Route1's Q4 2014 total comprehensive net income was $21,355 compared to a comprehensive net loss of $0.1 million during the same period in 2013.

Fiscal Year Financial Results

The Company's operating results in fiscal year 2014 with comparatives are as follows:

In 000s of CAD dollars		Audited FY 2014		Audited FY 2013		Audited FY 2012		FY 2012 without Award
Revenue
	Device	536		447		1,825		753
	Services	5,470		4,948		7,225		4,861
	Other	71		38		-		-
Total Revenue		6,078		5,433		9,050		5,614
Cost of revenue		1,145		1,137		1,562		1,031
Gross profit		4,932		4,296		7,488		4,583
Operating expenses		4,398		4,485		4,751		4,751
Operating profit (1)		535		(189	)	2,737		(168	)
Total other expenses		(102	)	154		(579	)	579
Comprehensive net income		637		(343	)	2,158		(747	)

(1) Note: Before stock-based compensation

During FY 2014, Route1 had cash generated from operating activities of $1.31 million compared with cash generated $0.4 million in FY 2013.

Balance Sheet Extracts In 000s of CAD dollars	Dec 31 2014	Dec 31 2013		Dec 31 2012
Cash	1,533	700		755
Total current assets	2,246	1,588		1,928
Total current liabilities	1,927	1,715		1,739
Net working capital	319	(127	)	189
Total assets	2,976	2,387		2,503
Bank debt	0	0		0
Total liabilities	2,032	1,854		1,886

Route1's cash position is at its highest level during the second quarter of the fiscal year as a direct result of the timing of annual enterprise user subscription renewal payments.

Investor Conference Call and Webcast

On Wednesday, April 1, 2015 at 4:15 pm eastern the Company will hold a conference call and web cast to discuss the financial results and provide an update on Route1's business development activities. Participants should dial 1-888-505-4369 or 1-719-325-2308 at least 10 minutes prior to the conference time of 4:15 pm eastern. For those unable to attend the call, a replay will be available after 7:15 p.m. at 1-877-870-5176 or 1-858-384-5517, pass code 9980838 until midnight on April 15, 2015. The webcast will be presented live at http://public.viavid.com/index.php?id=113765.

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.

For more information, visit our website at: www.route1.com.

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, and the MobiKEY, MobiKEY Classic, MobiKEY Classic 2 and MobiKEY Fusion devices are protected by copyright, international treaties, and various patents, including Route1's U.S. Patents 7,814,216 and 7,739,726, 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.