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This release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements address future events and conditions concerning Network-1's business plans. Such statements are subject to a number of risk factors and uncertainties as disclosed in the Network-1's Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission, including, among others, the continued material adverse effect on Network-1's business, results of operation and cash-flow if the District Court order confirming the HP jury verdict finding of non-infringement is not reversed by the Federal Circuit Court of Appeals, the risk that Network-1 will not receive material royalty revenue from licensees of its Remote Power Patent, the uncertainty of Network-1's revenue stream, the ability of Network-1 to successfully execute its strategy to acquire or make investments in high quality patents with significant licensing opportunities, Network-1's ability to achieve revenue and profits from its Cox Patent Portfolio, its M2M/IoT Patent Portfolio and additional revenue and profit from its Mirror Worlds Patent Portfolio as well as a return on its investment in ILiAD Biotechnologies, LLC or other intellectual property it may acquire or finance in the future, the ability of Network-1 to enter into additional license agreements, uncertainty as to whether cash dividends will continue be paid, the uncertainty of patent litigation and proceedings at the United States Patent and Trademark Office, the difficulty in Network-1 verifying royalty amounts owed to it by its licensees, Network-1's ability to enter into strategic relationships with third parties to license or otherwise monetize their intellectual property, the risk in the future of Network-1 being classified as a Personal Holding Company, future economic conditions and technology changes and legislative, regulatory and competitive developments. Except as otherwise required to be disclosed in periodic reports, Network-1 expressly disclaims any future obligation or undertaking to update or revise any forward-looking statement contained herein.

 

 

Network-1's condensed statements of income and comprehensive income and condensed balance sheet are attached.

 

 

 

		Years Ended December 31,
		2018				2017
REVENUE		$	22,106,000			$	16,451,000
OPERATING EXPENSES:
Costs of revenue			8,072,000				4,970,000
Professional fees and related costs			1,635,000				2,057,000
General and administrative			2,255,000				2,255,000
Amortization of patents			290,000				206,000
Stock-based compensation			687,000				949,000
TOTAL OPERATING EXPENSES			12,939,000				10,437,000
OPERATING INCOME			9,167,000				6,014,000
OTHER INCOME:
Interest income, net			876,000				215,000
Net realized and unrealized loss from investments			(29,000)
Total other income			847,000				215,000
INCOME BEFORE INCOME TAXES			10,014,000				6,229,000

INCOME TAXES:
Current			2,308,000				2,057,000
Deferred taxes, net			—				39,000
Total income taxes			2,308,000				2,096,000
NET INCOME		$	7,706,000			$	4,133,000
Net Income Per Share:
Basic		$	0.32			$	0.17
Diluted		$	0.30			$	0.16
Weighted average common shares outstanding:
Basic			23,763,785				24,147,908
Diluted			25,354,978				26,396,160
Cash dividends declared per share		$	0.10			$	0.10
NET INCOME		$	7,706,000			$	4,133,000
OTHER COMPREHENSIVE INCOME (LOSS):
Net unrealized holding loss on corporate bonds and notes arising during the year, net of tax			(39,000)				(11,000)
COMPREHENSIVE INCOME		$	7,667,000			$	4,122,000

Cash and cash equivalents		$	18,680,000
Marketable securities		$	36,311,000
Total current assets		$	55,547,000
Total assets		$	60,266,000
Total current liabilities		$	2,061,000
Total long term liabilities		$	-0-
Total stockholders' equity		$	58,205,000