News Column

AirIQ Announces Positive 4th Quarter EBITDAS; Year End Results for March 31, 2014; and Appointment of New Director

July 15, 2014

TORONTO, ONTARIO--(Marketwired - July 15, 2014) - AirIQ Inc. ("AirIQ") (TSX VENTURE:IQ), a supplier of wireless asset management services, today announced its financial results for the year ended March 31, 2014, and the appointment of Michael Robb to the Board of Directors of the Company.

"The Company is pleased to announce that it achieved positive EBITDAS of $33,651 and break-even net income for the three months ended March 31, 2014, as well as modest improvements in quarterly revenues, gross profit, expenses and net profit as compared to the previous quarter," said Michael Robb, Interim President and Chief Executive Officer of AirIQ.

The Company appointed Michael Robb to the Board of Directors in replacement of George Christopoulos, who resigned from the Board. Mr. Robb has served as Chief Financial Officer of AirIQ since 2010, and recently was appointed Interim President and Chief Executive Officer of the Company.

The main highlights of the year and quarter were as follows:

1. Increase in sequential quarterly revenue of $42,337 from December 31, 2013 to March 31, 2014 2. EBITDAS improvement of $86,888 from December 31, 2013 to March 31, 2014. 3. Improvement in net income quarter over quarter from a $182,907 loss in December 31, 2013 to break even in March 31, 2014. 4. Recurring revenue in the quarter of $470,115. 5. On December 17, 2013, the Company closed a $485,000 financing comprised of a $100,000 loan and a $385,000 non-brokered private placement. 6. The Company's ongoing commitment to reduce expenses resulted in an improvement of $54,870 over the prior fiscal year.



Unless otherwise noted herein, and except share and per share amounts, all references to dollar amounts from this point forward are in thousands of Canadian dollars.

Financial Highlights ------------------------------ Three months Three months Twelve months ended ended ended 31-Mar-2014 31-Dec-2013 31-Mar-2014 --------------------------------------------------------------------------- Total Revenue $643$601$2,456 Gross Margin $418$376$1,578 Gross Margin % 65% 62.6% 64.3% Expenses (1) $384$429$1,706 EBITDAS (2) $34 ($53) ($128) Other expenses $34$130$236 Net Income (loss) $nil ($183) ($364) Net Income (loss) per share, basic and diluted $nil ($0.01) ($0.02) --------------------------------------------------------------------------- (1) Excludes share-based compensation. (2) The Company has included information concerning EBITDAS because it believes that it may be used by certain investors as one measure of the Company's financial performance. EBITDAS is not a measure of financial performance under IFRS and is not necessarily comparable to similarly titled measures used by other companies. EBITDAS should not be construed as an alternative to net income or to cash flows from operating activities (as determined in accordance with IFRS ) or as a measure of liquidity.



Business Review

The Company continues to focus on its key strategy elements to build revenues and reduce costs to achieve sustained profitability and positive cash flow and to seek opportunities to form value creating strategic partnerships.

Overview

The Company's audited consolidated financial statements include the accounts of AirIQ and its subsidiaries, AirIQ U.S. Holdings, Inc., AirIQ U.S., Inc., and AirIQ, LLC. All inter-company balances and transactions have been eliminated on consolidation.

The Company's audited consolidated financial statements as at and for the year ended March 31, 2014, including notes thereto, and Management's Discussion and Analysis for the same period were filed with the Canadian securities regulatory authorities on July 15, 2014, and will be available on the Company's website (www.airiq.com) and on the System for Electronic Document Analysis and Retrieval ("SEDAR") website (www.sedar.com).

Revenues

Revenues for the year ended March 31, 2014, increased 6% to $2,456 from $2,324 for the year ended March 31, 2013. Approximately 73% of the total revenue for the year represents recurring revenue from the Company's airtime customers.

Revenues received from equipment sold in connection with service contracts are recorded as deferred revenue and recognized over the initial term of the service contract.

Sales of hardware units associated with service contracts recorded to deferred revenues were approximately $430, during the year ended March 31, 2014, compared to $654 during the year ended March 31, 2013. Revenues recognized from deferred revenues for the year ended March 31, 2014 were approximately $531 compared to $595 during the year ended March 31, 2013.

Overall, revenues related to service contracts sold in connection with hardware equipment increased by $78 from $1,719, for the year ended March 31, 2013 to $1,797 for the year ended March 31, 2014.

Included in the Company's revenues are sales of units that were sold without a fixed term service contract of approximately $114 and $nil respectively, during the twelve months March 31, 2014 and March 31, 2013 respectively.

Included in the Company's reported revenues are miscellaneous parts, repair, warranty and lost unit sales of approximately $14, during the year ended March 31, 2014, compared to $10, for the year ended March 31, 2013.

Gross Profit

Overall, gross profit increased by $7 to $1,578 for the year ended March 31, 2014 compared to $1,571 for the year ended March 31, 2013.

Equipment gross profits decreased by approximately 12% to $247 during the year ended March 31, 2014 from $281 for the year ended March 31, 2013, due increased hardware, repair and installation costs.

Service contract gross profits increased by approximately 3% to $1,331 for the year ended March 31, 2014 from $1,290 for the year ended March 31, 2013.

Expenses and Other Items

Sales and marketing, research and development and general and administrative expenses totalled $1,822 for the year ended March 31, 2014 compared to $1,877 for the year ended March 31, 2013.

Overall these expenses were reduced by $55 for the year ended March 31, 2014 when compared to the year ended March 31, 2013.

Expense reductions for the year ended March 31, 2014 when compared to the year ended March 31, 2013 were achieved in the following areas; (a) insurance premium reductions of approximately $10, (b) computer operating expense savings of approximately $38 due to the reduction of co-location costs, (c) consulting fee costs were reduced by $54 and, (d) other cost reductions of approximately $33 related primarily to legal fees, communication costs and public reporting fees. These savings were offset by increases in the following areas; a) wages and related expense of approximately $9, b) stock based compensation expense of $71.

Net loss

The Company's net loss for the year ended March 31, 2014 was $364 or $0.02 as compared to a net loss of $437 or $0.03 for the year ended March 31, 2013 an improvement of $73.

The decrease in net loss for the year ended March 31, 2014 when compared to the year ended March 31, 2013 can be attributed to improvement in the following areas; a) expense reductions of approximately $55, b) decrease in amortization of approximately $10, c) the decrease in impairment of long-lived assets of approximately $8, and, d) increased gross profits of $7. These improvements were offset by an increase in interest expense of $7.

No Conference Call

AirIQ will not be holding a conference call to discuss results. The Company's financial statements, including complete financial statements and Management's Discussion and Analysis will be available on the Company's website www.airiq.com and at www.sedar.com on July 15, 2014.

About AirIQ

AirIQ currently trades on the TSX Venture Exchange under the symbol IQ. AirIQ's office is located in Pickering, Ontario, Canada. The Company offers a suite of asset management services that generate recurring revenues from each device deployed. AirIQ delivers services to two primary markets: Commercial Fleets and dealers that service Consumer segments. AirIQ provides vehicle owners with the ability to monitor, manage and protect their mobile assets. Services include: instant vehicle locating, boundary notification, automated inventory reports, maintenance reminders, security alerts and vehicle disabling and unauthorized movement alerts. For additional information on AirIQ or its products and services, please visit the Company's website at www.airiq.com.

Forward-looking Statements

This news release contains forward-looking information based on management's best estimates and the current operating environment. These forward-looking statements are related to, but not limited to, AirIQ's operations, anticipated financial performance, business prospects and strategies. Forward-looking information typically contains statements with words such as "hope", "goal", "anticipate", "believe", "expect", "plan" or similar words suggesting future outcomes. These statements are based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking statements, including AirIQ's perception of historical trends, current conditions and expected future developments as well as other factors management believes are appropriate in the circumstances. Such forward-looking statements are as of the date which such statement is made and are subject to a number of known and unknown risks, uncertainties and other factors, which could cause actual results or events to differ materially from future results expressed, anticipated or implied by such forward-looking statements. Such factors include, but are not limited to, changes in market and competition, technological and competitive developments and potential downturns in economic conditions generally. Therefore, actual outcomes may differ materially from those expressed in such forward-looking statements. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes. Other than as may be required by law, AirIQ disclaims any intention or obligation to update or revise any such forward-looking statements, whether as a result of such information, future events or otherwise.

Neither 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.

FOR FURTHER INFORMATION PLEASE CONTACT: AirIQ Inc.Michael Robb - Interim President and Chief Executive Officer (905) 831-6444, Ext. 4371 mrobb@airiq.comwww.airiq.com Source: AirIQ Inc.


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Source: Marketwire (Canada)


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