MELBOURNE, Florida,
August 16, 2017 /PRNewswire/ --
NXT-ID, Inc. (NASDAQ:NXTD) ("NXT-ID" or
the "Company"), a security technology company, is pleased to report
its financial and operating results for the six months and quarter
ended June 30, 2017.
Gino Pereira, Chief Executive
Officer of NXT-ID said, "Our second quarter results for 2017 show
continued growth following the significant progress we reported in
Q1 2017. Revenue for the first six months of 2017 was more than
$14 million compared
to just over $80,000 for
the same period last year, so we're making real progress in terms
of revenue.
LogicMark continues to perform strongly. It posted its second
straight quarter of record revenue. Our deliveries of the flye card
to WorldVentures also continued at a strong pace as
WorldVentures has increased its distribution activities.
Our new addition, Fit Pay, is also already adding momentum. We
announced Fit Pay is providing payment capabilities to Token, a new
connected ring developed by Tokenize, Inc. Fit Pay also announced
business milestones with both Visa and Mastercard in the last two
months.
After a successful first half of 2017, we are looking forward to
the rest of the year with continued growth from our existing
business and new capabilities from Fit Pay coming to market."
Second Quarter and Six Month Highlights:
- Revenue for the first six months of 2017 was approximately
$14.3 million compared to
$80,795 for the same period in
previous year.
- Revenue for Q2 2017 was approximately $7.7 million compared to $38,493 for the same period in previous year and
approximately $6.7 million for Q1
2017.
- Gross profit for the first six months of 2017 was approximately
$7.3 million compared to a gross loss
of $(58,374) for the same period in
previous year.
- Gross profit for Q2 2017 was approximately $3.8 million compared to a gross loss of
$(25,521) in Q2 2017 and a gross
profit of $3.5 million for Q1
2017.
- Operating expenses were approximately $5.6 million for the first six months of 2017
compared to $4.6 million for the same
period in previous year.
- Operating expenses were approximately $3.1 million in Q2 2017 compared to $2.3 million in Q2 2016. Operating expenses were
approximately $2.4 million in Q1
2017.
- Operating income for the first six months of 2017 was
approximately $1.7 million compared
to an operating loss of $(4.6)
million for the same period in previous year.
- Operating income for Q2 2017 was approximately $0.7 million compared to an operating loss of
$(2.3) million in Q2 2016. The
operating income in Q1 2017 was approximately $1.1 million.
Results of Operations
Comparison of six and three months ended June 30, 2017 and June 30,
2016
Revenue. Our revenues for the six and three months ended
June 30, 2017 were $14,337,476 and $7,656,179, respectively, compared to
$80,795 and $38,493, respectively, for the six and three
months ended June 30, 2016. The
increase in our revenues for the six and three months ended
June 30, 2017 versus the six and
three months ended June 30, 2016 is
directly related to shipments of the Flye card for WVH and
LogicMark product sales which was acquired on July 25, 2016.
Cost of Revenue and Gross Profit. Our gross profit for
the six and three months ended June 30,
2017 was $7,302,704 and
$3,793,414, respectively, compared to
a gross loss of $58,374 and
$25,521, respectively, for the six
and three months ended June 30, 2016.
The increase in gross profit resulted from the shipments of the
Flye smartcard and strong gross margin contributed by LogicMark,
both of which were not part of our operating results in the six and
three months ended June 30, 2016.
Operating Expenses. Operating expenses for the six months
ended June 30, 2017 totaled
$5,569,401 and consisted of research
and development expenses of $262,622,
selling and marketing expenses of $2,084,421 and general and administrative
expenses of $3,222,358. Our operating
expenses for the six months ended June 30,
2017 were higher by $993,758
as compared to the six months ended June 30,
2016. The primary reason for the increase is the inclusion
of the operating expenses of LogicMark and Fit Pay both of which
were not part of our consolidated operating results for the
comparable 2016 period. The research and development expenses
relate primarily to salaries and consulting services of
$128,136. Selling and marketing
expenses consisted primarily of salaries and consulting services of
$550,426, amortization of intangibles
of $457,152, merchant processing fees
of $210,306, and sales commissions of
$165,158. General and administrative
expenses consisted of salaries and consulting services of
$994,241, accrued management and
employee incentives of $300,000,
legal, audit and accounting fees of $480,191, and fees incurred of $122,817 related to the acquisition of Fit Pay.
Also included in general and administrative expenses is
$204,555 in non-cash stock
compensation to consultants and board members.
Operating expenses for the six months ended June 30, 2016 totaled $4,575,643 and consisted of research and
development expenses of $744,680,
selling and marketing expenses of $1,117,549 and general and administrative
expenses of $2,713,414. The research
and development expenses relate primarily to salaries and
consulting services of $391,276, as
well as expenses of $185,297 related
to the design, development and manufacturing of the Wocket® and the
product for WVH. Selling and marketing expenses consisted primarily
of salaries and consulting services of $313,269 and advertising and promotional
expenses, including trade shows, of $394,297. General and administrative expenses for
the six months ended June 30, 2016
consisted of salaries and consulting services of $459,193, accrued management and employee
incentives of $300,000, legal, audit
and accounting fees of $820,487 and
fees incurred of $333,518 related to
the acquisition of LogicMark. Also included in general and
administrative expenses is $195,272
in non-cash stock compensation to consultants and board
members.
Operating expenses for the three months ended June 30, 2017 totaled $3,127,013 and consisted of research and
development expenses of $177,678,
selling and marketing expenses of $1,087,663 and general and administrative
expenses of $1,861,672. Our operating
expenses for the three months ended June 30,
2017 were higher by $845,800
as compared to the three months ended June
30, 2016. The primary reason for the increase is the
inclusion of the operating expenses of LogicMark and Fit Pay both
of which were not part of our consolidated operating results for
the comparable 2016 period. The research and development expenses
relate primarily to salaries and consulting services of
$110,311. Selling and marketing
expenses consisted primarily of salaries and consulting services of
$288,259, amortization of intangibles
of $269,307, merchant processing fees
of $102,179, and sales commissions of
$92,927. General and administrative
expenses for the three months ended June 30,
2017 consisted of salaries and consulting services of
$542,158, accrued management and
employee incentives of $150,000,
legal, audit and accounting fees of $279,484, and fees incurred of $122,817 related to the acquisition of Fit Pay.
Also included in general and administrative expenses is
$118,415 in non-cash stock
compensation to consultants and board members.
Operating expenses for the three months ended June 30, 2016 totaled $2,281,213 and consisted of research and
development expenses of $383,356,
selling and marketing expenses of $311,031 and general and administrative expenses
of $1,586,826. The research and
development expenses relate primarily to salaries and consulting
services of $189,456, as well as
expenses of $114,321 related to the
design, development and manufacturing of the Wocket® and the
product for WVH. Selling and marketing expenses consisted primarily
of salaries and consulting services of $160,400. General and administrative expenses for
the three months ended June 30, 2016
consisted of salaries and consulting services of $183,740, accrued management and employee
incentives of $150,000, legal, audit
and accounting fees of $482,254 and
fees incurred of $333,518 related to
the acquisition of LogicMark. Also included in general and
administrative expenses is $104,672
in non-cash stock compensation to consultants and board
members.
Operating Income. The operating income for the six and
three months ended June 30, 2017 was
$1,733,303 and $666,401, respectively, compared with an
operating loss of $4,643,017 and
$2,306,734, respectively, for the six
and three months ended June 30, 2016.
The significant favorable change in operating income for the six
and three months ended June 30, 2017
is attributable to the enhanced gross margin discussed above as
well as certain cost containment efforts related to advertising and
trade show expenses and professional fees included in operating
expenses.
Net Loss. The net loss for the six months ended
June 30, 2017, was $1,929,532. The net loss for the six months ended
June 30, 2017 was primarily
attributable to the interest expense incurred of $3,423,012 and an income tax provision of
$186,375 offset in part by operating
income of $1,733,303. The net loss
for the three months ended June 30,
2017 was $1,199,317 and was
primarily attributable to an income tax provision of $93,188 and interest expense of $1,719,082 both of which were offset in part by
operating income of $666,401. The net
loss for the six and three months ended June
30, 2016, was $7,921,272 and
$2,509,576, respectively, and
resulted in part from the operational expenses incurred during the
six and three months ended June 30,
2016. In addition, the net loss was attributable to interest
expense incurred of $715,509 and
$202,842, respectively, unfavorable
changes in fair value of derivative liabilities of $2,299,020 and a loss on extinguishment of debt
of $272,749 resulting from the
accelerated installment payments made during the six months ended
June 30, 2016.
Full financial results and Management's Discussion and Analysis
can be found in the Company's Form 10-Q for the quarterly period
ended June 30, 2017 filed with the
Securities and Exchange Commission ("SEC") on August 14, 2017.
About NXT- ID, Inc.
NXT-ID, Inc. (NASDAQ: NXTD) provides a comprehensive platform of
technology products and services that enable the Internet of Things
(IoT). With extensive experience in access control, biometric and
behavior-metric identity verification, security and privacy,
encryption and data protection, payments, miniaturization and
sensor technologies, NXT-ID develops and markets groundbreaking
solutions for payment and IoT applications. Its industry-leading
technology products and solutions include MobileBio®, a suite of
biometric solutions that secure consumers' mobile platforms, the
Wocket™, a next-generation smart wallet and the Flye, a digital
credit card developed in collaboration with WorldVentures.
NXT-ID includes three mobile and IoT-related subsidiaries:
LogicMark, LLC, a manufacturer and distributor of non-monitored and
monitored personal emergency response systems ("PERS") sold through
dealers/distributors and the United States Department of Veterans
Affairs; Fit Pay, Inc., a proprietary technology platform that
delivers end-to-end solutions to device manufacturers for
contactless payment capabilities, credential management,
authentication and other secure services within the IoT ecosystem,
and 3D-ID LLC, which is engaged in biometric identification and
authentication. Learn more about NXT-ID at www.nxt-id.com.
Forward-Looking Statements for NXT-ID: This press release
contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements reflect management's current expectations, as of the
date of this press release, and involve certain risks and
uncertainties. Forward-looking statements include statements herein
with respect to the successful execution of the Company's business
strategy. The Company's actual results could differ materially from
those anticipated in these forward-looking statements as a result
of various factors. Such risks and uncertainties include, among
other things, our ability to establish and maintain the proprietary
nature of our technology through the patent process, as well as our
ability to possibly license from others patents and patent
applications necessary to develop products; the availability of
financing; the Company's ability to implement its long range
business plan for various applications of its technology; the
Company's ability to enter into agreements with any necessary
marketing and/or distribution partners; the impact of competition,
the obtaining and maintenance of any necessary regulatory
clearances applicable to applications of the Company's technology;
and management of growth and other risks and uncertainties that may
be detailed from time to time in the Company's reports filed with
the Securities and Exchange Commission.
NXT-ID Inc. Contact:
Corporate info: info@nxt-id.com
Media:
Chris Orlando
chris.orlando@nxt-id.com
D. Van Zant
+1-800-665-0411
press@nxt-id.com
SOURCE NXT-ID, Inc.