EANS-News: Identive Group Inc.
Identive Group announces fourth quarter and
fiscal 2010 results
105% sales growth and significant cost reductions drive turnaround in profitability; Adjusted EBITDA of $1.1 million in 2010
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quarterly report
Subtitle: 105% sales growth and significant cost reductions drive turnaround in profitability; Adjusted EBITDA of $1.1 million in 2010
Santa Ana, Calif., and Ismaning, Germany, March 2, 2011 (euro adhoc) - Identive Group, Inc. (NASDAQ: INVE; Frankfurt: INV), a provider of products, services and solutions for the security, identification and RFID industries, today announced results for the fiscal fourth quarter (Q4) and full year 2010, ended December 31, 2010.
Ayman S. Ashour, chairman and chief executive officer, commented, "2010 was a year of transformation for Identive. We completed the combination with Bluehill ID and the acquisitions of RockWest and Smartag and put in place a management team with significant experience in the secure identification and identity management market. We more than doubled sales and achieved significant wins for security-related projects with the Internal Revenue Service and the Department of Justice in the U.S., the German electronic ID program, the Critical National Infrastructure Authority in Abu Dhabi and China Unicom. And we exceeded our goal of cutting out $4.5 million in overheads. In our first year as Identive Group, we have established the Company as an innovative leader in secure identification technologies, with a demonstrated focus on growth and profitability."
Identive´s Q4 and fiscal year 2010 results include the operating results of acquired companies since the dates of their respective acquisitions. These include Hirsch Electronics Corporation, acquired April 30, 2009; Bluehill ID AG, acquired January 4, 2010; Multicard U.S., acquired April 14, 2010; and Smartag, acquired November 19, 2010. All results are reported in U.S. GAAP, except as noted. A discussion of non-GAAP measures and reconciliation to the applicable GAAP measures is included below.
Full Year 2010 Results Revenue for the full year 2010 was $84.8 million, up 105% from $41.3 million in 2009 and reflecting organic growth as well as growth from strategic acquisitions. In contrast, total base operating expenses in 2010, including $16.2 million of additional costs from acquired businesses, grew only 44% from 2009 levels as a result of cost reduction measures implemented at the beginning of 2010.
Net loss decreased to $(9.5) million, or $(0.22) per share in 2010, compared with net loss of $(14.2) million, or $(0.64) per share in 2009. On a non-GAAP basis, adjusted EBITDA (EBITDA before equity-based compensation, acquisition, transition and integration costs) was $1.1 million in 2010, compared with negative adjusted EBITDA of ($7.5) million in 2009.
Cash and cash equivalents at December 31, 2010 were $10.8 million, up from $6.2 million at September 30, 2010, reflecting funds received from Identive´s private placement of shares in November 2010, offset by cash associated with the acquisition of Smartag in Q4 and funding of working capital.
Q4 2010 Results Revenue in Q4 2010 was $27.8 million, up 134% from $11.9 million in Q4 2009 and up 36% from restated revenue of $20.5 million in the third quarter (Q3) of 2010. The year-over-year increase was primarily due to the inclusion of revenue from the acquired businesses, while organic growth accounted for 39% of the increase, as the Company´s SCM, Multicard and Hirsch businesses benefited from demand for ID security solutions for U.S. and German government applications.
On a GAAP basis, Identive recorded net loss of $(0.8) million, or $(0.02) per share in Q4 2010. This compares to net loss of $(8.4) million, or $(0.34) per share in Q4 2009 and net loss of $(2.0) million, or $(0.05) per share in Q3 2010 (as restated). Non-GAAP adjusted EBITDA was $2.9 million in Q4 2010, compared with $(3.7) million in Q4 2009 and $(16) thousand in Q3 2010.
GAAP gross profit margin was 43% in Q4 2010, compared with 40% in Q4 2009 and 44% in Q3, 2010 (as restated). Non-GAAP gross profit margin (excluding amortization and overhead allocations) was 46% in Q4 2010, compared with 46% in Q4 2009 and 48% in Q3 2010 (as restated).
GAAP operating expenses were $12.3 million in Q4 2010, including $2.3 million of primarily non-cash costs. This compares with operating expenses of $11.6 million in Q4 2009, which included $2.5 million of primarily non-cash and acquisition-related costs; and $11.2 million in Q3 2010 (as restated), which included $1.4 million of primarily non-cash costs. GAAP operating loss fell to $(0.5) million in Q4 2010, compared with operating loss of $(6.9) million in Q4 2009 and operating loss of $(2.3) million in Q3 2010 (as restated).
Highlights in Q4 2010 included:
Significant growth in Identive´s RFID transponder business, fueled by increased demand for RFID inlays and components for applications ranging from payments to transportation to high-value asset tracking. The addition of Smartag production capacity in late November further boosted RFID transponder sales to record levels.
Strong sales of SCM readers and other ID infrastructure products, including the partial fulfillment of orders for secure IT kits related to the German government´s implementation of a new electronic citizen ID card. Identive´s Multicard business in Germany, which was selected by the German government to provide application software and related services for the kits and to act as a project manager for their distribution, delivered nearly 100,000 secure IT kits while SCM delivered 215,000 kits to Multicard as well as to partners in the insurance and media industries for distribution to citizens.
Continued strong orders from U.S. government agencies for Hirsch security and identity management systems as a result of continued high activity in the sector around compliance with security mandates under programs such as Homeland Security Presidential Directive 12.
Sequential growth in Identive´s Multicard Netherlands business from sales of additional solutions and services for payment applications.
Important new contract wins for Multicard U.S. in the healthcare and education markets, for patient and student ID projects.
"In 2010 we saw the acceleration of secure ID programs in many areas of the world, as government security mandates and the convenience of RFID technology drove projects from access control at U.S. federal facilities to national ID cards to mass transit ticketing," continued Mr. Ashour. "While development of the secure ID market remains fragmented geographically, some clear trends are emerging in 2011. These include mobile payments, the deployment of personal identity credentials for local government employees, and ticketing for mass transit. Identive has unique competence across the RFID and secure ID value chains and is well positioned to participate in all of these trends."
Conference Call and Webcast Information Identive Group will host a conference call and webcast today at 10:00 AM Eastern Time, which can be accessed by dialing 800.638.4817 (toll free within the U.S.) or +1 617.614.3943 (for international callers) and using pass code 52067596. A webcast of the call that includes presentation slides can be accessed by visiting the investor relations section of the Company´s website at www.identive-group.com, and by clicking on "Presentations, Reports & Webcasts," where it also will be archived for those unable to listen to the live webcast. An audio replay of the call also will be available for one week and can be accessed by dialing 888.286.8010 (toll free within the U.S.) or +1 617.801.6888 (for international callers) and using pass code 16582818.
About Identive Group Identive Group, Inc. (NASDAQ: INVE; Frankfurt Stock Exchange: INV) is an international technology company focused on building the world´s signature group in secure identification-based technologies. The businesses within Identive Group have deep industry expertise and are well-known global brands in their individual markets, providing leading-edge products and solutions in the areas of physical and logical access control, identity management and RFID systems to governments, commercial and industrial enterprises and consumers. Identive´s growth model is based on a combination of strong technology-driven organic growth from the businesses within the group and disciplined acquisitive development. For additional info visit: www.identive-group.com.
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Contact:
Herr Fabien B. Nestmann
Tel.: +49 89 9595-5544
E-Mail: investorrelations@identive-group.com
Branche: Computing & Information Technology
ISIN: US45170X1063
WKN: A1C0ZG
Index: NASDAQ
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