IQ AirIQ Inc

AirIQ Inc. ("AirIQ") (TSX VENTURE:IQ), a supplier of wireless asset management
services, today announced its financial results for the three months ended June
30, 2013.


"Q1 is a good start to the fiscal year ending March 31, 2014," said Donald
Gibbs, President and Chief Executive Officer of AirIQ. "We achieved sequential
growth for a fifth consecutive quarter and signed a two year contract with a
major North American rental company for a potential of over 30,000 units. Our
continued IFRS revenue growth is even more notable because we did so while also
increasing the size of our deferred revenue pools during the last two quarters,"
continued Mr. Gibbs.


The highlights of the quarter were as follows.



--  On May 21, 2013 the Company announced the signing of a blanket contract
    with a major North American rental company with a two-year term. 
--  Recurring revenue of $449K represents 74% of total revenue. 
--  EBITDAS of ($65) for the three months ended June 30, 2013 improved over
    the prior quarter ended March 31, 2013. 
--  Revenue of $604 for the quarter ended June 30, 2013 was improved from
    the prior quarter. 
--  Gross profit of 65.3% for the three months ended June 30, 2013 was
    reduced from the prior quarter. 
--  Expenses (excluding stock based compensation) of $459 for the three
    months ended June 30, 2013 were approximately that of the prior quarter
    ended March 31, 2013. 
--  Net loss in the first quarter was lower than that of the prior quarter. 
--  On June 14, 2013 shareholder loans of $150 were repaid in a shares for
    debt transaction. 

                                                                           
Financial Highlights                                                       
                                  Three months ended    Three months ended 
                                           30-Jun-13             30-Jun-12 
---------------------------------------------------------------------------
Total Revenue                         $          604     $             577 
Gross Margin                          $          394     $             389 
Gross Margin %                                  65.3%                 67.4%
Net Income (loss)                     $         (107)    $            (111)
Net Income (loss) per share,                                               
 basic and diluted                    $         0.01     $           (0.00)
EBITDAS(i)                            $          (65)    $             (67)
---------------------------------------------------------------------------



(i)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 manage costs to achieve sustained profitability and positive cash flow and
to seek opportunities to form value creating strategic partnerships.


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


Overview

The Company's consolidated condensed interim 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, 2013, including notes thereto, and Management's Discussion and
Analysis for the same period were filed with the Canadian securities regulatory
authorities on July 29, 2013, 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 three months ended June 30, 2013, increased 5% to $604 from
$577 for the three months ended June 30, 2012. Approximately 74% 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 $155, during the three months ended June 30, 2013,
compared to $242 during the three months ended June 30, 2012. Revenues
recognized from deferred revenues for the three months ended June 30, 2013 were
approximately $141 compared to $148 during the three months ended June 30, 2012.


Overall, revenues related to service contracts sold in connection with hardware
equipment increased by $24 from $425, for the three months ended June 30, 2012
to $449 for the three months ended June 30, 2013.


Included in the Company's reported revenues are miscellaneous parts, repair,
warranty and lost unit sales of approximately $14, during the three months ended
June 30, 2013, compared to $4, for the three months ended June 30, 2012.


Gross Profit

Overall, gross profit increased by 1% to $394 for the three months ended June
30, 2013 compared to $389 for the three months ended June 30, 2012.


Equipment gross profits decreased by approximately 26% to $58 during the three
months ended June 30, 2013 from $78 for the three months ended June 30, 2012,
due to increased hardware, repair and installation costs.


Service contract gross profits increased by approximately 8% to $336 for the
three months ended June 30, 2013 from $311 for the three months ended June 30,
2012.


Expenses and Other Items

Sales and marketing, research and development and general and administrative
expenses totalled $463 for the three months ended June 30, 2013 compared to $474
for the three months ended June 30, 2012.


Overall these expenses were reduced by $11 for the three months ended June 30,
2013 when compared to the three months ended June 30, 2012.


Expense reductions for the three months ended June 30, 2013 when compared to the
three months ended June 30, 2012 were achieved in the following areas; a)
insurance premium reductions of approximately $3, b) computer operating expense
savings of approximately $12 due to the reduction of co-location costs, (c)
consulting fee costs were reduced by $14 and (d) other cost reductions of
approximately $39 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 increase of approximately $27 due to
additional personnel, b) general costs of $23, and c) director fee expense of
$7.


Net loss

The Company's net loss for the three months ended June 30, 2013 was $107 as
compared to a net loss of $111 for the three months ended June 30, 2012 a
decrease of $4.


The decrease in net loss for the three months ended June 30, 2013 when compared
to the three months ended June 30, 2012 can be attributed to improvement in the
following areas; a) expense reductions of approximately $11, b) increased gross
profits of $5. These improvements were offset by decreases in the following
areas; a) increase in amortization of approximately $2, b) increased interest
expense of $5, and, c) the increase in foreign exchange of approximately $5.


No Conference Call

AirIQ will not be holding a conference call to discuss results. The Company's
financial report, 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 August 27, 2013.


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.
Donald Gibbs
President and Chief Executive Officer
(905) 831-6444, Ext. 4255
dgibbs@airiq.com
www.airiq.com

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