BakBone Software Reports Third Quarter Fiscal 2009 Financial Results.

Bookings Increase 11% Sequentially to $15.5 Million, Company Generates EPS of $0.01 Per Share

SAN DIEGO -- BakBone Software, Incorporated (Pink Sheets: BKBO), a global provider of heterogeneous integrated data protection solutions, today announced its financial results for the third quarter ended December 31, 2008.

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"During the fiscal third quarter, the BakBone team executed our strategy of delivering to customers cost efficient data protection solutions that are mission-critical in good and bad economic times," said Jim Johnson, President and CEO, BakBone. "As a result, we generated sequential bookings growth of 11% and year over year revenue growth of 10%. Our bookings were flat with the third quarter of fiscal 2008, although last year's quarter was favorably impacted by a transaction with a single customer valued at approximately $1.9 million. In addition, we lowered our operating costs."

For the quarter ended December 31, 2008, total revenue, which consists of software revenue and maintenance and professional services revenue, increased 10% to $14.3 million from $13.0 million in the third quarter of fiscal year 2008 and 5.6% from $13.6 million in the second quarter of fiscal 2009. The operating loss was $1.0 million in the third quarter of fiscal year 2009 compared to $1.3 million in the third quarter of fiscal year 2008. Net income totaled $0.7 million, or $0.01 per diluted share, in the third quarter of fiscal year 2009 compared with a net loss of $0.6 million or ($0.01) per diluted share, in the third quarter of fiscal year 2008. The difference in the operating loss and net income was primarily due to foreign exchange gains.

Cash used in operating activities was $0.4 million in the nine months ended December 31, 2008, an improvement of $2.2 million from the comparable nine month period of fiscal 2008. Total cash at December 31, 2008 totaled $7.8 million, a decrease of approximately $0.7 million from September 30, 2008 related primarily to the timing of customer collections as well as professional fees associated with the Company's past due financial filings.

For the nine months ended December 31, 2008, revenue totaled $41.6 million as compared with $37.1 million for the nine months ended December 31, 2007. Net loss totaled $4.3 million, or ($0.07) per share, for the nine months of fiscal year 2009 compared with a net loss of $6.6 million or ($0.10) per share, for the nine months of fiscal year 2008.

"Last week, we completed the filing of our 2007 and 2008 audited financial results along with the first two quarters of fiscal 2009, which were important milestones for our Company," said Steve Martin, senior vice president and chief financial officer, BakBone. "Today's on-time reporting of third quarter financial results, as well as our filing of the application to revoke cease trade orders in Canada, illustrates progress toward our goal of implementing best practice shareholder communications and reporting."

Conference Call Information

The company has scheduled a conference call for February 9, 2009 at 2:00 p.m. PST to discuss the results for the quarter ended December 31, 2008. The call will be hosted by Jim Johnson, CEO of BakBone Software and Steve Martin, CFO of BakBone Software.

This call will be webcast and can be accessed at www.bakbone.com by clicking on "Company Info" and then "Investor Relations." The webcast is also being distributed through the Thomson StreetEvents Network. Individual investors can listen to the call at www.earnings.com, Thomson's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson StreetEvents (www.streetevents.com), a password-protected event management site.

About BakBone Software

BakBone is committed to making data protection a simple, straightforward process while delivering its Integrated Data Protection (IDP) strategy through an award-winning product suite. This suite provides unprecedented capabilities not only to protect critical data - but more importantly, to ensure the availability of that data as well. BakBone's products offer a single point of control for managing resources across all platforms, providing improved operational efficiency, reduced system downtime, improved availability and enhanced security to support the business growth of enterprise environments. Thousands of users worldwide leverage BakBone's IDP approach to simplify the management of multi-platform environments with a portfolio of backup, disaster recovery, replication and storage reporting solutions for Linux, Windows, Unix and Mac OS environments. These scalable data protection solutions address the demands of Global 5000 organizations and are distributed through a worldwide network of select OEM partners, strategic partners, resellers and solution providers. BakBone is headquartered in San Diego, Calif. For more information about BakBone, visit www.bakbone.com or email [e-mail].

Safe Harbor 

This press release contains forward-looking statements that involve risks, uncertainties, assumptions and other factors, which, if they do not materialize or prove correct, could cause BakBone's results to differ materially from historical results, or those expressed or implied by such forward-looking statements. The potential risks and uncertainties may include, but are not limited to: BakBone's ongoing review of its financial statements and efforts to become current in its reporting with the Securities and Exchange Commission and the Canadian Securities Commissions; the deteriorating economic and market conditions that could lead to reduced spending on information technology products; competition in our target markets; potential capital needs; management of future growth and expansion; the development, implementation and execution of the Company's Integrated Data Protection (IDP) strategic vision; risk of third-party claims of infringement; protection of proprietary information; customer acceptance of the Company's existing and newly introduced products and fee structures; and the success of BakBone's brand development efforts; risks associated with strategic alliances; reliance on distribution channels; product concentration; need to develop new and enhanced products; potential product defects; our ability to hire and retain qualified employees and key management personnel; and risks associated with changes in domestic and international market conditions and the entry into and development of international markets for the Company's products. Our forward-looking statements should be considered in the context of these and other risk factors disclosed in our most recent report filed with the Securities and Exchange Commission, which may be found at www.sec.gov, as well as those risk factors disclosed in our current report filed with the Canadian Securities Commissions, which is available on SEDAR at www.sedar.com. All future written and oral forward-looking statements made by us or on our behalf are also subject to these factors. BakBone assumes no obligation to update any forward-looking statement to reflect events or circumstances arising after the date on which it was made, other than as required under applicable securities laws.

The common shares of BakBone Software are currently subject to cease trade orders in the Canadian jurisdictions of Alberta, British Columbia and Ontario due to delays in the filing of the Company's financial statements. Although these cease trade orders do not prevent investors, who are not resident in or otherwise subject to the laws of Alberta, British Columbia or Ontario, from trading the common shares of BakBone on the Pink Sheets in the United States, investors are encouraged to obtain legal advice to ensure that these trades are not violating the cease trade orders. BakBone continues to work to resolve all outstanding issues which have prevented filing of its financial statements, however an exact date for filing of these financial statements cannot be determined at this time.

BakBone[R], BakBone Software[R], NetVault[R], Application Plugin Module[TM], BakBone logo[R], Integrated Data Protection[TM], Redefining Data Protection[TM], Constant Data[TM], Constant Data logo[TM], Constant Replicator[TM], OnDemand Replicator[TM], and Constant HA Cluster[TM], are all trademarks or registered trademarks of BakBone Software, Inc., in the United States and/or in other countries. All other brands, products or service names are or may be trademarks, registered trademarks or service marks of, and used to identify, products or services of their respective owners.

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