One Horizon Group Announces First Quarter 2013 Financial Results

       One Horizon Group Announces First Quarter 2013 Financial Results

- Expects strong growth for 2013 based on existing contracts and a robust
pipeline for its high value-add capabilities

PR Newswire

BAAR, Switzerland, May 21, 2013

BAAR, Switzerland, May 21, 2013 /PRNewswire/ -- One Horizon Group, Inc.
(OTCQB: OHGI) ("One Horizon Group" or the "Company"), which develops software
application platforms that optimize mobile voice, instant messaging and
advertising communications over the Internet, today announced unaudited
financial results for the three months ended March 31, 2013.

Financial Highlights and Recent Events

  oRevenue was $3.0 million for the three months ended March 31, 2013,
    compared to $2.3 million for the same period the previous year.
  oIncome from operations was $1.1 million for the three months ended March
    31, 2013, compared to $0.2 million for the same period the previous year.
  oNet income was $0.9 million for the three months ended March 31, 2013,
    compared to $0.2 million for the same period the previous year.
  oCompleted a $6 million equity financing on February 18, 2013, of which
    $2.79 million has been received to date.
  oThe Company readied for marketing a high-end Microsoft Lync platform as
    part of the Company's enterprise initiative. This rich IP communications
    solution extends the Horizon Mobile app with its bandwidth savings and
    effectively integrates mobile capabilities into users' IT channel.
  oSubsequent to the end of the first quarter, in May 2013, the Company's
    joint venture with ZTESoft Technology Co. LTD, a subsidiary of ZTE Corp.,
    received its formal license signifying that its capital investment has
    been approved, and which enables the joint venture to commence business
    operations in China. The joint venture was formed to sell licenses for
    the Horizon Call platform to international operators and to Chinese
    enterprises, and to roll out a new mobile VoIP platform to the China
    smartphone market.

"We are pleased to announce positive results for three months ended March 31,
2013 reflecting the success of Horizon Call, our mobile VoIP solution for
network operators. We are building momentum for the rest of the year as we
are confident that the extensive roll-out of our revolutionary Horizon Call
will gain continued traction among Tier 1 and Tier 2 carriers," stated Mark
White, Chief Executive Officer of One Horizon Group. "The Horizon Call
platform enables users to make high quality calls over Wi-Fi or data
connections including 4G, 3G, 2G/EDGE or GPRS, thus dramatically reducing the
expense of making overseas calls and providing inexpensive calls while roaming
outside of the home country. Our products directly address network congestion
issues resulting from the explosion of smartphone deployments which are
expected to exceed the sale of feature phones for the first time this year and
stress already congested networks."

"The accelerating growth in smartphones in the years ahead is expected to be
led by the emerging markets which represent a key opportunity for Horizon Call
because of their high population density, high penetration of mobile phones,
congested mobile cellular networks and high growth in smartphone adoption.
These factors will put increased pressure on mobile operators to manage their
network availability. We believe we are the only mobile VoIP platform that
can effectively operate on congested 2G and 3G networks which dominate
wireless infrastructure in very sizable, fast growing Asian markets."

"Our patent-pending Horizon SmartPacket™ technology enables One Horizon Group
to improve the efficiency with which voice calls are transmitted over
wireless, wire-line or satellite communications networks by approximately 10X,
while providing higher service quality and better reach," Mr. White concluded.

Financial Results for the Three Months ended March 31, 2013

Revenue was $3.0 million for the three months ended March 31, 2013, up from
$2.3 million for the three months ended March 31, 2012. The increase in our
revenue was due to the growth in sales of the Horizon Platform following the
development of the GSM application, Horizon Call, which was completed in
November 2011. The Company expects the sales growth to continue to grow as
more companies sign up for the Horizon Platform.

Gross profit was $3.0 million for the three months ended March 31, 2013, up
from $2.2 million for the three months ended March 31, 2012. The main reason
for the increase was the growth in business and smartphone market globally as
well as the Company's ability to capitalize on market opportunities by
entering areas with high population density, high penetration of mobile
phones, congested mobile cellular networks and high growth in the adoption of
smartphones. Gross margin for the three month period was 99.8%.

Operating expenses were $2.0 million, or 66.7% of sales for the three months
ended March 31, 2013; operating expenses were $2.0 million,or 86.9% of sales
for the same period in 2012. The increase was due to costs related to adding
resources to deal with new customers in both data handling and the account
management roles. Going forward, management expects these costs to rise due
to various public company related expenses including share-based compensation,
and various legal and consulting services.

Income from operations was $1.1 million for the three months ended March 31,
2013, compared to $0.2 million for the same period in 2012.

Net income was $0.9 million for the three months ended March 31, 2013,
compared to $0.2 million for the same period in 2012. The increase in net
income reflected the growth in the business and in the smartphone market
globally.

Financial Condition

As of March 31, 2013, the Company had $0.5 million in cash and cash
equivalents and its working capital, excluding the current portion of deferred
revenue (attributable to licensing fees to be realized over time), was
approximately $2.4 million. As of March 31, 2013, the Company had $0.2
million in long term debt, $28.1 million in deferred revenue and stockholders'
equity was $17.6 million. During the three months ended March 31, 2013, the
Company used cash of approximately $0.5  million for operating activities,
while investing activities used approximately $0.3 million and financing
activities provided approximately $0.5 million in net cash.

Private Equity Financing

On February 18, 2013, the Company entered into an agreement with a shareholder
to whom it sold 483,870,968 shares of common stock for an aggregate
consideration of $6,000,000, or $0.0124 per share. The Company also issued a
common stock purchase warrant to this shareholder exercisable for three years
to purchase 241,935,483 shares of Common Stock at an exercise price of $0.0124
per share. Pursuant to the Subscription Agreement, the initial installment of
the investment of $2,790,000 was paid in April 2013, with the two additional
installments totaling $3,210,000 expected to be received in June and September
2013.

Business Update and 2013 Outlook

In the first quarter of 2013, the Company readied the launch of its developed
end-to-end rich IP communications solution designed to easily interconnect
with Microsoft Lync services, turning smartphones into enterprise mobile
endpoints enabled for inbound and outbound calls. The Company's SmartPacket™
technology optimizes mobile voice for the Microsoft Lync enterprise user as it
manages silence and packet flow enabling mobile VoIP at only 5.7 kbps compared
to 237 kbps for Lync Mobile. This results in reduced latency and minimized
call dropping rates. The Company's technology also enable significant cost
savings where Horizon app users get up to 32 minutes of call for 1 MB of data
usage compared to 0.5 minutes when using Lync Mobile. This efficiency
translates into a significant mobile data cost reduction compared to using
Lync Mobile.

As previously indicated, during 2012 the Company entered into a number of new
agreements with mobile carriers, including Smart Communications, the number
one mobile carrier in the Philippines, bringing the total number of first- and
second-tier carriers that have adopted the Horizon Call platform to 14. In
addition, the Company entered into a joint venture with ZTESoft Technology Co.
LTD, a subsidiary of ZTE Corp., the fourth largest mobile phone manufacturer
in the world and the fifth largest telecommunications equipment provider, to
sell licenses for the Horizon platform to international operators and to
Chinese enterprises and to roll out the mobile VoIP platform in China using
Horizon Call technology. 

The Company anticipates further revenue growth in 2013 and is exploring
several regions and markets where its software application will have the most
value-added impact on present business, including India and China. Asia
represents a key opportunity for the Company's Horizon Call platform due to
increased pressures on mobile operators to manage their network availability
and provide cost and efficiency advantages relative to current technologies.
The Company foresees its Horizon SmartPacket™ as being especially competitive
in this region since it is the world's lowest bandwidth voice compression and
transmission protocol and no other software companies offer a solution in such
a complete and integrated fashion.

About One Horizon Group, Inc.

One Horizon Group Inc.'s business is to optimize communications over the
Internet through its wholly owned subsidiary, Horizon Globex, which develops
and markets one of the world's most bandwidth-efficient mobile voice over
Internet Protocol ("VoIP") platform for smartphones, and also offers a range
of other optimized data applications including messaging and mobile
advertising. It is an ISO 9001 and ISO 20000-1 certified company. The
Company has operations in Switzerland, the United Kingdom, China, India,
Singapore and Hong Kong. For more information on the Company, its products
and services, please visit http://www.onehorizongroup.com.

Safe Harbor Statement

This news release may contain "forward-looking" statements. These
forward-looking statements are only predictions and are subject to certain
risks, uncertainties and assumptions that could cause actual results to differ
from those in the forward looking-statements. Potential risks and
uncertainties include such factors as uncertainty of consumer demand for
Company's products, as well as additional risks and uncertainties that are
identified and described in Company's SEC reports. Actual results may differ
materially from the forward-looking statements in this press release.
Statements made herein are as of the date of this press release and should not
be relied upon as of any subsequent date. The Company does not undertake, and
it specifically disclaims, any obligation to update any forward-looking
statements to reflect occurrences, developments, events or circumstances after
the date of such statement.

UNAUDITED FINANCIAL TABLES FOLLOW



ONE HORIZON GROUP, INC.
(formerly Intelligent Communication Enterprise
Corporation)
Consolidated Balance Sheets
March 31, 2013 and December 31, 2012
(in thousands, except share data)
(unaudited)
                                                      March 31,   December 31,
                                                      2013        2012
Assets
Current assets:
 Cash                                               $ 460       $ 699
 Accounts receivable, current portion                 8,752       5,899
 Other assets                                         130         136
 Total current assets                                 9,342       6,734
Accounts receivable, net of current portion           31,512      26,263
Property and equipment, net                           324         350
Intangible assets, net                                12,073      12,329
Other assets                                          126         -
Total assets                                        $ 53,377    $ 45,676
Liabilities and Stockholders' Equity
Current liabilities:
 Accounts payable                                   $ 925       $ 750
 Accrued expenses                                     463         435
 Accrued compensation                                 36          38
 Income taxes                                         1,411       1,332
 Amounts due to related parties                       4,000       3,500
 Current portion of deferred revenue                  7,600       6,000
 Current portion of long-term debt                    59          59
 Total current liabilities                            14,494      12,114
Long-term liabilities
 Deferred revenue                                     20,500      16,000
 Long term debt                                       207         219
 Deferred income taxes                                445         445
 Mandatorily redeemable preferred shares              90          90
Total liabilities                                     35,736      28,868
Stockholders' Equity
Preferred stock:
 $0.0001 par value, authorized 150,000,000;
 no shares issued or outstanding                                 -
Common stock:
 $0.0001 par value, authorized 250,000,000,000
 shares
 issued and outstanding 18,991,377,645 shares         1,900       1,852
 (December 2012 18,507,506,667)
Additional paid-in capital                            25,733      19,781
Stock subscriptions receivable                        (6,500)     (500)
Retained Earnings (Deficit)                           (3,884)     (4,780)
Accumulated other comprehensive income                392         455
 Total stockholders' equity                           17,641      16,808
Total liabilities and stockholders' equity          $ 53,377    $ 45,676

ONE HORIZON GROUP, INC.
(formerly Intelligent Communication Enterprise
Corporation)
Consolidated Statements of Operations
For the three months ended March 31, 2013 and 2012
(in thousands)
(unaudited)
                                                       March 31,
                                                       2013         2012
Revenue                                              $ 3,013      $ 2,292
Cost of revenue                                        7            51
Gross Profit                                           3,006        2,241
Expenses:
            General and administrative                 1,473        1,693
            Depreciation                               36           97
            Amortization of intangibles                446          202
                                                       1,955        1,992
Income from operations                                 1,051        249
Other income and expense:
            Interest expense                           (5)          (11)
            Interest expense - related parties         (50)         (50)
                                                       (55)         (61)
Income before income taxes                            996          188
Income taxes                                           100          16
Net Income for the period                            $ 896        $ 172
Earnings per share
            Basic net income per share               $ 0.00       $ 0.00
            Diluted net income per share             $ 0.00       $ 0.00
Weighted average number of shares outstanding
             Basic                                18,727,937   13,328,442
             Diluted                              20,058,670   14,247,178

Consolidated Statements of Cash Flows
For the three months ended March 31, 2013 and 2012
(in thousands)
(unaudited)
                                                            March 31
                                                            2013      2012
Cash provided by (used in) operating activities:
Operating activities:
 Net income (loss) for the period                         $ 896     $ 172
 Adjustment to reconcile net income (loss) for the period
 to
 net cash provided by (used in) operating activities:
    Depreciation of property and equipment                  36        97
    Amortization of intangible assets                       446       202
    Changes in operating assets and liabilities net of
    effects of acquisitions:
     Accounts receivable                                  (8,102)   (11,709)
     Other assets                                         (120)     (6)
     Accounts payable and accrued expenses                195       2,140
     Deferred revenue                                     6,100     10,300
     Income taxes                                         79        16
 Net cash provided by (used in) operating activities        (470)     1,212
Cash used in investing activities:
 Acquisition of intangible assets                           (245)     (822)
 Acquisition of property and equipment                      (12)      -
 Net cash (used in) investing activities                   (257)     (822)
Cash flow from financing activities:
 Increase (decrease) in long-term borrowing, net            (12)      (400)
 Advances from related parties, net of repayment            500       -
 Net checks issued in excess of funds                       -         (361)
 Net cash provided by (used in) financing activities       488       (761)
Increase (decrease) in cash during the period               (239)     (371)
Cash at beginning of the period                             699       371
Cash at end of the period                                 $ 460     $ -



Contact:
CCG Investor Relations
Crocker Coulson, President
Phone: + (1) 646-213-1915
Email: Crocker.Coulson@ccgir.com

SOURCE One Horizon Group, Inc.

Website: http://www.onehorizongroup.com
 
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