Insignia Solutions Reports Fourth Quarter 2004 Financial Results

Insignia Solutions Reports Fourth Quarter 2004 Financial Results

    Business Editors/Technology Editors

    FREMONT, Calif.--(BUSINESS WIRE)--Feb. 10, 2005--Insignia Solutions (Nasdaq:INSG) today reported financial results for the fourth quarter ended December 31, 2004.
    Insignia reported fourth quarter net revenues of $8,000 from the ongoing launch and commercialization of the Company's new technology, Secure System Provisioning (SSPv2) for the comprehensive device management of a growing, complex and diverse array of mobile devices. The net loss in the fourth quarter was $2.1 million, or $0.06 per share. As of December 31, 2004, the Company had cash and cash equivalents of $902,000.
    For the twelve months ended December 31, 2004, Insignia reported net revenues of $541,000. The net loss for 2004 was $7.1 million, or $0.23 per share.

    Recent Highlights:

--	In a separate release today, the Company announced that it has entered into an agreement to acquire mi4e Device Management AB, a private company headquartered in Sweden. The acquisition, which is subject to customary closing conditions, is expected to close by March 1, 2005. Furthermore, the Company has secured new equity financing to fund the combined company's new business pursuits.
--	On December 9, 2004, Insignia announced the appointments of David Lai to Vice President of Field Operations and Mario Cohen Andijar to Director of Southern European and Latin American Sales.
--	In November 2004, the Company announced the deployment of SSP v2 mobile device management platform with the Hong Kong Wireless Development Centre Ltd. (HKWDC) to support the mobile operator community of Hong Kong. The Centre provides a multi-operator and multi-vendor platform with connectivity to the wireless network including GSM, GPRS, 802.11, EDGE and 3G. Insignia SSP v2 has been installed in HKWDC's facility at Cyberport in Hong Kong SAR and is in the process of testing and deployment with operators.

    Conference Call

    Insignia Solutions will host a conference call on Thursday, February 10, 2005 at 2:00 p.m. Pacific Time. A live webcast will be available via a link on the Investor Relations portion of Insignia's website at www.insignia.com A question and answer session will follow immediately. An on-demand archive of the call will be available through the Company's website for a period of two weeks after the event.

    About Insignia Solutions

    Insignia provides an important ingredient to mobile operators and terminal manufacturers by enabling customers to manage a growing, complex and diverse community of mobile devices. Insignia's products and services radically reduce customer care and recall costs, maintain device integrity, and enable a wide range of new mobile services. Founded in 1986, Insignia has a long history of innovation, stewardship of major industry standards, and the trust of dozens of manufacturers around the world. Insignia Solutions is traded on the Nasdaq under the symbol INSG. The company is headquartered in Fremont, California with research and development and European operations based in the United Kingdom. For additional information about Insignia or its products please visit http://www.insignia.com.

    Insignia, Insignia Solutions, and the Insignia Solutions logo are registered trademarks, and Secure System Provisioning, Open Management Client, Dynamic Capabilities and Over-The-Air Repair are trademarks of Insignia Solutions, Inc. All other trademarks are the property of their respective holders.

    Forward-Looking Statements

    The statements in this press release relating to matters that are not historical are forward-looking statements that involve risks and uncertainties. This release includes forward-looking statements that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those referred to in the forward-looking statements. Such factors include, but are not limited to, Insignia's need for additional capital to sustain operations, Insignia's reliance on the successful introduction of its SSP v2 product line, Insignia's need to generate significantly greater revenue to achieve profitability and Insignia's liquidity and capital needs. Further details on these and other risks are set forth in Insignia Solutions' filings with the Securities and Exchange Commission, including its most recent filings on Forms 10-K and 10-Q. These filings are available on a website maintained by the Securities and Exchange Commission at http://www.sec.gov. Insignia Solutions does not undertake an obligation to update forward-looking or other statements in this release.

INSIGNIA SOLUTIONS PLC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (amounts in thousands, except per share amounts) (unaudited)

Three months Twelve months ended ended December 31, December 31, ----------------- ----------------- 2004 2003 2004 2003 -------- -------- -------- -------- Net revenues: License $ - $ 129 $ 521 $ 522 Service 8 1 20 188 -------- -------- -------- --------

Total net revenues 8 130 541 710 -------- -------- -------- --------

Cost of net revenues: License - 67 28 288 Service 14 - 14 52 -------- -------- -------- --------

Total cost of net revenues 14 67 42 340 -------- -------- -------- --------

Gross profit (6) 63 499 370 -------- -------- -------- --------

Operating expenses: Sales and marketing 588 428 2,511 1,757 Research and development 681 678 2,807 3,373 General and administrative 715 481 2,579 2,676 Restructuring - 18 - 498 -------- -------- -------- -------- Total operating expenses 1,984 1,605 7,897 8,304 -------- -------- -------- --------

Operating loss (1,990) (1,542) (7,398) (7,934)

Interest income (expense), net - (13) 6 (40) Other income (expense), net 1 (277) 249 3,141 -------- -------- -------- --------

Loss before income taxes (1,989) (1,832) (7,143) (4,833)

Provision for (benefit from) income taxes 130 (91) (81) (510) -------- -------- -------- --------

Net loss $(2,119) $(1,741) $(7,062) $(4,323) ======== ======== ======== ========

Net loss per share Basic $ (0.06) $ (0.07) $ (0.23) $ (0.20) ======== ======== ======== ======== Diluted $ (0.06) $ (0.07) $ (0.23) $ (0.20) ======== ======== ======== ========

Weighted average shares and share equivalents: Basic 33,495 24,539 30,191 21,231 -------- -------- -------- -------- Diluted 33,495 24,539 30,191 21,231 -------- -------- -------- --------

INSIGNIA SOLUTIONS PLC CONDENSED CONSOLIDATED BALANCE SHEETS (amounts in thousands) (unaudited)

December December 31, 31, 2004 2003 --------- --------- A S S E T S

Current assets: Cash and cash equivalents $ 902 $ 2,212 Restricted cash 50 20 Accounts receivable 175 50 Other receivables 241 1,153 Tax receivable 322 391 Prepaid royalties - 2,185 Prepaid expenses 456 410 --------- --------- Total current assets 2,146 6,421

Property and equipment, net 140 154 Investment in affiliate 68 - Other assets 233 219 --------- --------- $ 2,587 $ 6,794 ========= =========

L I A B I L I T I E S, R E D E E M A B L E W A R R A N T S A N D S H A R E H O L D E R S' E Q U I T Y

Current liabilities: Accounts payable $ 241 $ 468 Accrued liabilities 995 1,239 Note payable - 1,000 Deferred revenue 10 1,460 --------- --------- Total current liabilities 1,246 4,167 --------- ---------

Redeemable warrants - 38 --------- ---------

Shareholders' equity: Ordinary shares 11,940 8,111 Additional paid-in capital 64,458 61,898 Common stock subscription - 575 Accumulated deficit (74,596) (67,534) Other accumulated comprehensive loss (461) (461) --------- --------- Total shareholders' equity 1,341 2,589 --------- ---------

$ 2,587 $ 6,794 ========= =========

--30--EB/sf*

CONTACT: Insignia Solutions Robert Collins, 510-360-3700 or Financial Dynamics Teresa Thuruthiyil, 415-439-4500 (Investors)

KEYWORD: CALIFORNIA INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS TELECOMMUNICATIONS NETWORKING INTERNET E-COMMERCE EARNINGS CONFERENCE CALLS SOURCE: Insignia Solutions

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