Narrowstep Announces Year-End Results

Narrowstep Announces Year-End Results

LONDON and NEW YORK, May 31 /PRNewswire-FirstCall/ -- Narrowstep(TM) Inc. (BULLETIN BOARD: NRWS) , the TV on the Internet Company, announced its financial results for the fiscal year ended February 28, 2007. Revenue for the year was a record $6,008,835, an increase of 122% compared to $2,706,262 for fiscal year ended February 28, 2006. The increase in revenue was primarily driven by an increase in customers.

Net loss for year ended February 28, 2007 was $7,061,474, or a loss of $0.16 per common share, versus a net loss of $4,289,777, or a loss of $0.13 per common share, for the prior year.

David C. McCourt, Chairman and interim CEO of Narrowstep, commented on the earnings release, saying, "This was a great year for Narrowstep. Although we spent more time than expected cleaning up old issues, we still grew revenue by 122%, and took out over 30% of non-sales SG&A headcount and increased the sales force by over 85%. Going forward, Narrowstep should maintain its position as the premier choice for a company looking to monetize its content online."

Narrowstep expects to attain profitability by streamlining existing costs, growing revenue and investing in technology. Management believes that these efforts will allow the company to continue to provide what they believe is the best opportunity for customers to monetize their content, while offering a superior end-viewer experience.

Commenting on the growth of the business, David McCourt said, "We are continuing to build a world-class team experienced in scaling operations. We will continue to execute on our vision to provide the most flexible service offering to content owners for monetizing their assets."

Narrowstep management will host a conference call to discuss the results on Friday, June 1, 2007 at 11:00AM EDT, and it will be broadcast live over the Internet. Those interested in listening to the live webcast may do so by going to the Company's website at http://www.narrowstep.com/ or to http://www.vcall.com/.

Web participants are encouraged to go to either website at least 15 minutes prior to the start of the call to register, download, and install any necessary audio software. The audio and online archives will be available shortly after the conclusion of the call and continue to be available for seven days.

   NARROWSTEP INC. AND SUBSIDIARIES   CONSOLIDATED STATEMENTS OF OPERATIONS   AND COMPREHENSIVE LOSS                                                        Year Ended                                                       February 28,                                                 2007                2006                                                   $                   $   Revenue     Narrowcasting and other                   4,369,117           1,499,633     Production services                       1,639,718           1,206,629    Total revenue                               6,008,835           2,706,262    Costs and Expenses     Operating                                 2,655,395           1,804,879     Selling, general and administrative       8,206,223           4,779,764     Research & development                    1,088,723             390,606     Impairment charge on long-lived assets    1,228,437                   -    Total operating expenses                   13,178,778           6,975,249    Operating Loss                             (7,169,943)         (4,268,987)     Other income (expense), net                 118,814             (14,641)     Currency exchange income (loss)             (10,345)             (6,149)    Net Loss                                   (7,061,474)         (4,289,777)      Foreign currency translation adjustment      74,135             (36,669)    Comprehensive Loss                         (6,987,339)         (4,326,446)    Net Loss per Common Share    - Basic and Diluted                            (0.16)              (0.13)   Weighted-Average Number of Shares    Outstanding, Basic and Diluted            45,240,652          32,190,594    See Notes to Consolidated Financial Statements.      NARROWSTEP INC. AND SUBSIDIARIES   CONSOLIDATED BALANCE SHEET                                                             February 28,                                                                 2007                                                                   $   Assets     Current assets:     Cash and cash equivalents                                  466,870     Accounts receivable, net of allowance      for doubtful accounts of $940,534                       1,403,779     Prepaid expenses and other current assets                  332,192   Total current assets                                       2,202,841     Property and equipment, net                              1,234,557     Software development costs, net                            149,080   Total Assets                                               3,586,478    Liabilities and Stockholders' Equity   Liabilities     Current liabilities:       Unearned revenue                                         384,295       Accounts payable                                         960,580       Net obligations under capital leases, current             88,110       Accrued expenses and other current liabilities           977,948     Total current liabilities                                2,410,933       Net obligations under capital leases - long-term         135,470   Total Liabilities                                          2,546,403    Commitments and Contingencies   Stockholders' Equity     Common stock, $0.000001 par value 450,000,000 shares      authorized, 45,348,974 issued and outstanding                  45     Additional paid-in capital                              20,543,688     Accumulated deficit                                    (19,555,533)     Accumulated other comprehensive income (loss)               51,875    Total Stockholders' Equity                                 1,040,075    Total Liabilities and Stockholders' Equity                 3,586,478    See Notes to Consolidated Financial Statements.     About Narrowstep(TM) Inc.  

Narrowstep(TM) Inc. (BULLETIN BOARD: NRWS) , the TV on the Internet Company, is a leading global provider of broadband television services. Narrowstep's proprietary technologies and customer-focused services enable TV channels to be delivered over the Internet. 100+ companies worldwide have chosen Narrowstep because it offers the most television-like and true community building broadband experience. The Company's telvOS(TM) (Television Operating System(TM)) and nBed(TM) technologies enable the most comprehensive delivery of video to mobile, wireless, Internet, broadband, video-over-IP and entirely new IP-delivered broadcast services. For more information, visit http://www.narrowstep.com/ or call 212-404-1400.

Forward-looking Statement

Certain statements in this news release constitute 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known or unknown risks, including those detailed in the Company's filings with the Securities and Exchange Commission, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.

First Call Analyst:
FCMN Contact: mmarich@narrowstep.com

Source: Narrowstep(TM) Inc.

CONTACT: Investors, Jesse Deal of Allen & Caron, +1-212-691-8087,
jesse@allencaron.com

Web site: http://www.narrowstep.com/

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Profile: International Entertainment