Quarterly revenue of $17.2 million up 8 percent year over year
$20 million facility with Opus Bank enhances liquidity and refinances debt
FREMONT, Calif., May 14, 2014 – Identiv (NASDAQ: INVE) reports its financial results for the first quarter (Q1) of 2014.
“In Q1 2014, we continued cost reductions and focused on growth, seeing early success with increased revenue of 8 percent, compared to Q1 2013,” said Jason Hart, chief executive officer of Identiv. “Our credentials products, used in our trust solutions for everyday items, grew 36 percent compared to Q1 2013, with strong demand from electronic gaming and other Internet of Things applications.”
“We significantly enhanced liquidity with a $20 million term loan and line-of-credit agreement on favorable commercial terms with Opus Bank, allowing retirement of previous expensive debt, increased liquidity and reduced debt service in future quarters,” Hart added.
Q1 Financial Summary
In reviewing the results for the first quarter of fiscal year 2014, compared to the first quarter of fiscal year 2013:
- Total revenues for continuing operations were $17.2 million, compared to $16.0 million, reflecting growth of 8% with significant contribution from sales of credentials products increasing 36% to meet demand for electronic game toys and other Internet of Things applications.
- GAAP gross profit margin was 39%, compared to 42%, primarily due to product mix.
- Base operating expenses, which include research and development, sales and marketing, and general and administrative costs, were $9.6 million, compared to $10.3 million. At the same time, the company was able to increase investment in sales and marketing by 7%, offset by a reduction in general and administrative expenses of 21%.
- Adjusted EBITDA for the quarter was $(2.0) million, compared to $(2.1) million.
- GAAP net loss from continuing operations was $(5.6) million in Q1 2014, which included restructuring costs totaling $0.4 million, or $(0.07) per share, compared with GAAP loss from continuing operations of $(4.0) million, or $(0.07) per share in the comparable prior year period. There were no restructuring costs in Q1 2013.
- Cash and cash equivalents were $12.0 million at March 31, 2014, compared with $5.1 million at December 31, 2013.
- In March 2014, Identiv entered into term loan and line-of-credit agreement with Opus Bank, of which $6.0 million was used to refinance the debt with Hercules.
Note: Financial results contained in this release reflect the continuing operations of Identiv only and exclude discontinued operations of non-core businesses sold in December 2013 and February 2014.
“Our investment in growth is producing results as reflected by our Q1 2014 total revenues. In addition, we continue executing on additional opportunities to streamline the business and improve margins, including consolidation of our factories, which, when complete, will yield a margin improvement in our rapidly growing trust solutions for everyday items,” Hart added.
The company reaffirms guidance for fiscal year 2014 of revenue between $80 million and $90 million and adjusted EBITDA positive on an annual basis.
Webcast and Conference Call Information
Identiv will hold an audio webcast and conference call to discuss the results of its 2014 first quarter today, May 14, 2014, at 5:00 PM (ET). The audio webcast can be accessed by visiting the Investor Relations section of identiv.com and clicking on Presentations & Webcasts. The conference call can be accessed by dialing 888-771-4371 (toll-free within the U.S.) or +1 847-585-4405 (for international callers) using passcode 37284195. For those unable to attend the live webcast, it will be archived following the event for 30 days in the Investor Relations section of identiv.com. A replay of the call will also be available for one week and can be accessed by dialing 888-843-7419 (toll-free within the U.S.) or +1 630-652-3042 (for international callers) using passcode 37284195.
VOTE YOUR SHARES
The Identiv 2014 Annual General Meeting is on Thursday, May 22, 2014. Have your say on important issues that affect the future of the company by voting your eligible shares. Further information is available at 2014agm.identiv.com. Your vote counts!
Identiv is a global security technology company that establishes trust in the connected world, including premises, information and everyday items. CIOs, CSOs and product departments rely upon Identiv’s trust solutions to reduce risk, achieve compliance and protect brand identity. Identiv’s trust solutions are implemented using standards-driven products and technology, such as digital certificates, mobility and cloud services. For more information, visit identiv.com. To learn more about the Identiv 2014 Annual General Meeting, visit 2014agm.identiv.com.
Non-GAAP Financial Measures (Unaudited)
This release includes financial information that has not been prepared in accordance with GAAP, including non-GAAP gross profit margin, non-GAAP operating expenses and adjusted EBITDA,. [A1] Identiv uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance. We believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends. The non-GAAP financial results discussed above exclude items detailed in the reconciliation table and accompanying footnotes contained within this release. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures as detailed in this release.
Note Regarding Forward-Looking Information
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can be identified by words such as “anticipates”, “believes”, “plans”, “will”, “intends”, “expects”, and similar references to the future. Examples of such statements include, without limitation, statements regarding our expectations for additional revenue from new sales partnerships; our ability to establish a stable financial platform on which to execute our strategy to deliver trust solutions; our expectations from increased investments in sales, marketing and engineering; and our ability to achieve the level of revenues and adjusted EBITDA results in 2014 for which we have provided guidance. Readers should not unduly rely on these forward-looking statements, which are not a guarantee of future performance and are subject to a number of risks and uncertainties, many of which are outside our control, which could cause our actual business and operating results to differ. Factors that could cause actual results to differ materially from those in the forward-looking statements include our ability to realize cost savings from the restructuring of our operations; our ability to increase revenues through new sales and marketing programs and sales partnerships; our ability to successfully develop and commercialize new products and solutions that satisfy the evolving and increasingly complex requirements of customers; our ability to finance continued investments in technology, products and manufacturing capacity to develop products and solutions for the market; whether the markets in which we participate or target may grow, converge or standardize at anticipated rates or at all, including the markets that we are targeting; our ability to successfully compete in the markets in which we participate or target; our ability to meet our sales forecasts; our ability to meet financial covenants of our loan agreement; our ability to meet growing demand for our products; and general global political and economic factors which are beyond our control but may unduly impact our markets and our business. For a discussion of further risks and uncertainties related to our business, please refer to our public company reports, including our Annual Report on Form 10-K for the year ended December 31, 2013 and subsequent reports filed with the U.S. Securities and Exchange Commission. All forward-looking statements are based on information available to us on the date hereof, and we assume no obligation to update such statements.
Identiv Media Contacts:
Lesley Sullivan / Joann Wardrip
781-684-0770 / 415-512-0770