SAINT PAUL, Minn., May 2, 2012 /PRNewswire/ -- Image Sensing
Systems, Inc. (NASDAQ: ISNS), announced today the results for its
first quarter ended March 31,
2012.
Revenue for the 2012 first quarter was $5.3 million compared to $6.1 million for the same period a year
ago. Revenue from royalties was $2.3
million in the first quarter of 2012 compared to
$2.7 million in the same period of
2011. Product sales were $2.9
million in the first quarter compared to $3.4 million in the same period of 2011.
World-wide, in the first quarter of 2012, CitySync product sales
were $1.6 million and RTMS® product
sales and royalties were $658,000 and
$125,000, respectively. The
March 31, 2012 quarter was the first
quarter of Econolite distribution of RTMS in North America.
Net loss for the first quarter of 2012 was $(668,000) or $(0.14) per share compared to a net loss of
$(808,000) or $(0.17) per share for the same period in
2011. On a non-GAAP basis, excluding intangible asset
amortization and restructuring expense net of tax, net loss for the
first quarter of 2012 was $(327,000)
or $(0.07) per share compared to
$(536,000) or $(0.11) in the same period a year ago.
Ken Aubrey, CEO, said, "Even
though our revenue model has changed from product sale to royalty
for RTMS, the results indicate an overall decrease in revenue from
last year's first quarter on a like comparison. Although we
typically experience downward first quarter seasonality, demand in
our domestic royalty businesses was below our expectations and we
believe this trend may continue in the near-term. Despite the
equivalent revenue shortfall, our non-GAAP operating loss was
improved when compared to the 2011 first quarter owing primarily to
expense reductions realized through our previously disclosed
restructuring initiatives."
The Company also announced the following significant new sales
or distribution agreements:
- An order in excess of $2.0
million in Eastern Europe
of Autoscope® product for an urban traffic control (UTC) system.
The order is expected to be substantially delivered in Q2 and
Q3.
- An original equipment manufacturer (OEM) agreement with Siemens
A.G. that allows Siemens to offer Autoscope technology on a
non-exclusive basis in the European market.
- An exclusive agreement with Beijing Univaid Technology Co.,
Ltd. for the distribution of RTMS products in the People's Republic of China. Under the
agreement, Univaid has made commitments to certain minimum purchase
levels for the first year in excess of $1.0
million.
"These agreements give us confidence for continuing improved
results internationally for the remainder of 2012. We are active in
the final transition of domestic RTMS manufacturing and
distribution to Econolite and Q1 showed related balance sheet
improvements with cash and investments increasing by $1.2 million and inventories decreasing by
$625,000 compared to December 31, 2011 levels. Also, as we
indicated in our previous quarter's release, we continue to be
mindful of keeping operating expenses at a level commensurate to
revenue achieved to improve profitability," said Aubrey.
Non-GAAP Information
We provide certain non-GAAP financial information as supplemental
information to GAAP amounts. This non-GAAP information excludes the
impact, net of tax, of amortizing the intangible assets from the
2007 EIS asset acquisition and the 2010 CitySync acquisition and
may exclude other non-recurring items. Management believes
that this presentation facilitates the comparison of our current
operating results to historical operating results. Management uses
this non-GAAP information to evaluate short-term and long-term
operating trends in our core operations. Non-GAAP information is
not prepared in accordance with GAAP and should not be considered a
substitute for or an alternative to GAAP financial measures and
may not be computed the same as similarly titled measures used
by other companies.
About Image Sensing
Image Sensing Systems, Inc. is a provider of software-based
detection solutions for the Intelligent Transportation Systems
(ITS) sector and adjacent markets including security, police and
parking. We have sold more than 125,000 units of our industry
leading Autoscope® machine-vision, RTMS® radar and CitySync
automatic number plate recognition (ANPR) products in over 60
countries worldwide. This depth of our experience coupled with the
breadth of our product portfolio uniquely positions us to provide
powerful hybrid technology solutions and to exploit the convergence
of the traffic, security and environmental management markets. We
are headquartered in St. Paul,
Minnesota. Visit us on the web at imagesensing.com.
Safe Harbor Statement: Statements
made in this release concerning the Company's or management's
intentions, expectations, or predictions about future results or
events are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements
reflect management's current expectations or beliefs, and are
subject to risks and uncertainties that could cause actual results
or events to vary from stated expectations, which variations could
be material and adverse. Factors that could produce such a
variation include, but are not limited to, the following: the
inherent unreliability of earnings, revenue and cash flow
predictions due to numerous factors, many of which are beyond the
Company's control; developments in the demand for the Company's
products and services; relationships with the Company's major
customers and suppliers; the mix of and margins on the products we
sell; unanticipated delays, costs and expenses inherent in the
development and marketing of new products and services, including
ANPR products; adverse weather conditions in our markets; the
impact of governmental laws and regulations; increased
international presence; our success in integrating acquisitions;
and competitive factors. Our forward-looking statements speak only
as of the time made, and we assume no obligation to publicly update
any such statements. Additional information concerning these and
other factors that could cause actual results and events to differ
materially from the Company's current expectations are contained in
the Company's reports and other documents filed with the Securities
and Exchange Commission, including its Annual Report on Form 10-K
for the year ended December 31, 2011
filed in March 2012.
Image
Sensing Systems, Inc.
Condensed
Consolidated Statements of Operations
(in
thousands, except per share information)
(unaudited)
|
|
|
Three-Month Period Ended March 31,
|
|
|
2012
|
|
2011
|
Revenue
|
|
|
|
|
Royalties
|
|
$2,348
|
|
$2,698
|
Product sales
|
|
2,909
|
|
3,447
|
|
|
5,257
|
|
6,145
|
Cost of
revenue
|
|
1,314
|
|
1,664
|
Gross
profit
|
|
3,943
|
|
4,481
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
Selling, marketing and product support
|
|
1,849
|
|
2,620
|
General and administrative
|
|
1,231
|
|
1,472
|
Research and development
|
|
1,270
|
|
1,029
|
Restructuring
|
|
76
|
|
-
|
Amortization of intangible assets
|
|
408
|
|
412
|
|
|
4,834
|
|
5,533
|
Loss from
operations
|
|
(891)
|
|
(1,052)
|
Other
income
|
|
5
|
|
4
|
Loss
before income taxes
|
|
(886)
|
|
(1,048)
|
Income tax
benefit
|
|
(218)
|
|
(240)
|
Net
loss
|
|
$(668)
|
|
$(808)
|
|
|
|
|
|
Basic net loss per share
|
|
$(0.14)
|
|
$(0.17)
|
|
|
|
|
|
Weighted shares – basic
|
|
4,854
|
|
4,824
|
|
|
|
|
|
Reconciliation of GAAP to non-GAAP
basis
|
|
|
|
|
Non-GAAP
operating expenses (1)
|
|
4,350
|
|
5,121
|
Non-GAAP
loss from operations
|
|
(407)
|
|
(640)
|
Other
income
|
|
5
|
|
4
|
Non-GAAP
loss before income taxes
|
|
(402)
|
|
(636)
|
Non-GAAP
income tax benefit (2)
|
|
(75)
|
|
(100)
|
Non-GAAP
net loss
|
|
$(327)
|
|
$(536)
|
|
|
|
|
|
Non-GAAP basic net loss per share
|
|
$(0.07)
|
|
$(0.11)
|
|
|
|
|
|
Notes to
non-GAAP adjustments
|
|
|
|
|
(1) Amortization of intangible assets and
restructuring for period as shown above is removed
|
(2) Income tax benefit is increased by
impact of (1) at ISS' marginal tax rates
|
Image
Sensing Systems, Inc.
Condensed
Consolidated Balance Sheet
(in
thousands)
(unaudited)
|
|
March
31,
2012
|
|
December
31,
2011
|
Assets
|
|
|
|
Current assets
|
|
|
|
Cash and cash equivalents
|
$
5,734
|
|
$
5,224
|
Investments
|
2,811
|
|
2,093
|
Receivables, net
|
7,976
|
|
10,148
|
Inventories
|
5,517
|
|
6,142
|
Prepaid expenses and deferred taxes
|
2,053
|
|
2,073
|
|
24,091
|
|
25,680
|
Property and equipment, net
|
1,574
|
|
1,435
|
Deferred taxes, goodwill and intangible assets,
net
|
14,045
|
|
14,139
|
|
$39,710
|
|
$41,254
|
Liabilities and Shareholders' Equity
|
|
|
|
Current liabilities
|
|
|
|
Accounts payable and accrued expenses
|
$
3,084
|
|
$
4,545
|
Income taxes payable
|
30
|
|
67
|
|
3,114
|
|
4,612
|
Income taxes payable
|
316
|
|
316
|
Shareholders' equity
|
36,280
|
|
36,326
|
|
$39,710
|
|
$41,254
|
|
|
|
|
Image
Sensing Systems, Inc.
Condensed
Consolidated Statement of Cash Flows
(in
thousands)
(unaudited)
|
|
Three-Month Period Ended
March
31,
|
|
2012
|
|
2011
|
Operating
activities
|
|
|
|
Net
loss
|
$(668)
|
|
$(808)
|
Adjustments to reconcile net loss to net cash
provided by (used in) operations
|
|
|
|
|
|
|
Depreciation and amortization
|
550
|
|
537
|
Stock option expense
|
97
|
|
94
|
Changes in operating assets and
liabilities
|
1,321
|
|
(1,887)
|
Net cash
provided by (used in) operating activities
|
1,300
|
|
(2,064)
|
|
|
|
|
Investing
activities
|
|
|
|
Purchases of property and equipment, net of
disposals
|
(281)
|
|
(158)
|
Payments of earn-outs
|
-
|
|
(2,361)
|
Sales (purchases) of investments
|
(718)
|
|
313
|
Net cash
used in investing activities
|
(999)
|
|
(2,206)
|
|
|
|
|
Financing
activities
|
|
|
|
Proceeds from exercise of stock options
|
3
|
|
35
|
Net cash
provided by financing activities
|
3
|
|
35
|
|
|
|
|
Effect of
exchange rate changes on cash
|
206
|
|
315
|
|
|
|
|
Increase
(decrease) in cash and cash equivalents
|
510
|
|
(3,920)
|
Cash and
cash equivalents, beginning of period
|
5,224
|
|
8,021
|
Cash and
cash equivalents, end of period
|
$5,734
|
|
$4,101
|
SOURCE Image Sensing Systems, Inc.