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Single Touch Anticipates Reaching Profitability on a Cash Basis Driven by Expected 50% Revenue Growth in Fiscal 2013

On the heels of having achieved a 175% compound annual growth rate (CAGR) for the past two years, Single Touch Systems, Inc. (OTCBB: SITO), a technology based mobile media solutions provider, announced today that the Company anticipates revenue growth of more than 50% in its 2013 fiscal year ending September 30, 2013 as compared to fiscal 2012. Based on this revenue growth rate, the Company further anticipates reaching profitability on cash basis for fiscal 2013.

Single Touch CEO James Orsini stated, “In many ways, in terms of our operating business and our IP activities, the results for our recently announced 2012 fiscal year were our most significant to date, and we are now better-positioned than ever to capitalize on the numerous opportunities available to the Company.”

In Single Touch’s core operating business, the key highlights include:

  • Fiscal 2012 capped a year in which 2-year compound annual revenues grew approximately 175%
  • In fiscal 2013 Single Touch expects revenue growth to exceed 50% driven by a combination of growth through existing clients, a growing pipeline of new clients and an increase in premium sponsored messaging
  • The Company anticipates continued gross margin improvement, targeting 60% in fiscal 2013
  • Single Touch anticipates becoming profitable on a cash basis in the current 2013 fiscal year

Mr. Orsini added, “The strength of our core operating business is based on the strong fundamental value proposition we offer to our clients, which is the key factor that drives our robust organic growth. We are proud to have announced in December that we eclipsed a milestone of having sent out a half-billion mobile messages. From the perspective of our shareholders, our Company’s strong value proposition translates into what we regard as the high quality nature of our revenues, which are recurring and growing at a significant rate. As we add new clients, we anticipate the same dynamic to occur – that revenues will recur and grow commensurately. Adding to this, the fact that we generate substantial gross margins, the Company is now positioned to grow its cash flow in addition to revenues.”

Single Touch also announced that, as a result of the growth of its core messaging solutions, it has now communicated with more than 30 million unique users.

Also, most notably in the past year, Single Touch developed a separate, wholly-owned subsidiary company, Single Tough Interactive R&D IP, to house its portfolio of intellectual property. According to Chairman and Chief Innovation Officer Anthony Macaluso, “We felt the creation of a subsidiary company to house the Company’s IP portfolio was and is an important development in Single Touch’s evolution as it provides us significant flexibility to unlock the value of our portfolio of intellectual property. We are working diligently in this regard and look forward to providing further updates on our efforts as and when appropriate.”

The Company noted the following key highlights with regard to its IP portfolio:

  • Letters of Notification have been sent to 9 companies including Google, Apple, Netflix, Yahoo!, Viacom, Dish Network and Amazon
  • The Company anticipates sending out additional notices in the current fiscal year
  • Single Touch has initiated a patent infringement lawsuit against Zoove, which was previously sent a Letter of Notification.

Mr. Macaluso also stated, “As we enter 2013, we believe our IP portfolio has never been better positioned. In particular, with the fast-paced development of the market for audio and video streaming advertising to mobile and connected devices, we believe Single Touch is poised to capitalize on the value of its streaming patents. We have engaged and will continue to engage a thoughtful dialog with our advisers and I’m confident that we are developing strategies and approaches that will enable the Company and its shareholders to realize significant value from our IP portfolio, which has been methodically developed and assembled over a long period of time.” Mr. Macaluso concluded by saying, “The value we hope to realize could come through various strategies and/or through a variety of options to capitalize on the structure of the company’s wholly-owned IP subsidiary company; we are aggressively exploring all of our options and we look forward to providing updates to the company’s shareholders as soon as possible.”

About Single Touch Systems, Inc.

Single Touch Systems, Inc. is a technology based mobile solutions provider serving businesses, advertisers and brands. Through patented technologies and a modular, adaptable platform, Single Touch’s multi-channel messaging gateway enables marketers to reach consumers on all types of connected devices, with information that engages interest, drives transactions and strengthens relationships and loyalty. For more information about Single Touch Systems, Inc. visit: www.singletouch.net

Forward-Looking Statements

This news release may contain forward-looking statements that involve risks and uncertainties and reflect Single Touch’s judgment as of the date of this release. These statements may include those regarding strategy, growth and future operations. Actual events or results may differ from Single Touch’s expectations. The risks, uncertainties, and other factors that could cause our actual results to differ materially from those expressed or implied in this press release include, our ability to successfully retain and sell additional services to our existing clients and obtain new clients; our reliance on primarily a single client and the continued use by such client of our services with favorable pricing terms; our ability to obtain additional financing at favorable rates to maintain and develop our operations, as well as other risks and uncertainties identified in Single Touch’s filings with the SEC. Single Touch disclaims any intent or obligation to update these forward-looking statements beyond the date of this press release, except as may be required by law.

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