Revenue Climbed 79% to $4.8 Million
SaaS Revenue Grew 32% Reaching $3.2 Million
Intellicheck, Inc. (Nasdaq: IDN), an industry leader in identity
verification and authentication solutions, today announced its
financial results for the third quarter ended September 30, 2021.
Revenue rose 79% to a record $4,831,000 versus $2,699,000 in the
prior year comparable period. SaaS revenue for the third quarter
ended September 30, 2021 increased 32% to $3,245,000 versus
$2,451,000 in the prior year comparable period.
CEO Bryan Lewis pointed to a number of key developments
including the expansion of Company capabilities beyond North
America, the addition of a new product platform, and the addition
of new channel partnerships. “Much of what we have been investing
in and working on this year is focused on transforming the company
to be a Digital Identity company, rather than purely an ID
Validation company. We have expanded our client base far beyond
just credit cards into banking, call centers, gambling, cannabis,
stadiums as well as the digital world, which continues to become an
increasing portion of our business. We believe this transformation
will allow us to move into many more markets and become a
powerhouse within Identity Validation and Digital Identity.”
Gross profit as a percentage of revenues was 68.7% for the three
months ended September 30, 2021, versus 89.1% in the prior year
comparable period. SaaS revenues represented 67.2% of total sales
during the third quarter of 2021, compared to 90.8% of total sales
in the prior year comparable period. The decline in gross margin
reflects a sales mix that included approximately $1.5 million of
hardware sales that carry lower gross margins than SaaS revenues.
Excluding hardware sales and related costs in both periods, gross
profit as a percentage of sales was 93.0% for the three months
ended September 30, 2021, versus 92.6% in the prior year comparable
period.
Net loss for the three months ended September 30, 2021 was
($952,000) or ($0.05) per diluted share versus net income of
$32,000 or $0.00 per diluted share for the comparable prior year
period. Non-cash expenses during the quarter included stock-based
compensation costs that totaled $639,000.
Adjusted EBITDA (earnings before interest and other income
(expense), income taxes, depreciation, amortization, stock-based
compensation expense and certain non-recurring charges) was a loss
of ($271,000) for the third quarter of 2021 as compared to a gain
of $169,000 in the prior year comparable period. A reconciliation
of adjusted EBITDA to net loss is provided elsewhere in this
release.
Cash at September 30, 2021 totaled $13.3 million, and
stockholders’ equity totaled $21.8 million at the end of the
period.
The financial results reported today do not take into account
any adjustments that may be required in connection with the
completion of the Company’s review process and should be considered
preliminary until the Company files its Form 10-Q for the fiscal
period ended September 30, 2021.
Conference Call Information
The Company will hold an earnings conference call on November 10
at 4:30 p.m. ET/1:30 p.m. PT to discuss operating results. To
listen to the earnings conference call, please dial 888-428-7458.
For callers outside the U.S., please dial 862-298-0702.
A replay of the conference call will be available shortly after
completion of the live event. To listen to the replay, please dial
877-660-6853 and use conference identification number 13724569. For
callers outside the U.S., please dial 201-612-7415 and use
conference identification number 13724569. The replay will be
available beginning approximately two hours after the completion of
the live event and will remain available until November 17,
2021.
INTELLICHECK, INC.
BALANCE SHEETS
ASSETS
September 30,
December 31,
2021
2020
(Unaudited)
CURRENT ASSETS:
Cash
$
13,266,031
$
13,121,392
Accounts receivable, net of allowance of
$0 and $42,974 at September 30, 2021 and December 31, 2020,
respectively
2,777,222
2,119,861
Other current assets
869,583
340,718
Total current assets
16,912,836
15,581,971
PROPERTY AND EQUIPMENT, net
430,341
138,870
GOODWILL
8,101,661
8,101,661
INTANGIBLE ASSETS, net
403,856
482,591
OPERATING LEASE RIGHT-OF-USE ASSET
-
31,131
OTHER ASSETS
8,500
4,250
Total assets
$
25,857,194
$
24,340,474
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable
$
231,780
$
46,171
Accrued expenses
2,445,534
1,638,798
Operating lease liability, current
portion
-
32,620
Deferred revenue, current portion
1,372,311
402,782
Total current liabilities
4,049,625
2,120,371
OTHER LIABILITIES:
Deferred revenue, long-term portion
9,737
8,662
Total liabilities
4,059,362
2,129,033
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY:
Common stock - $.001 par value; 40,000,000
shares authorized; 18,735,915 and 18,410,458 shares issued and
outstanding at September 30, 2021 and December 31, 2020,
respectively
18,736
18,410
Additional paid-in capital
140,905,895
138,569,746
Accumulated deficit
(119,126,799)
(116,376,715)
Total stockholders' equity
21,797,832
22,211,441
Total liabilities and stockholders'
equity
$
25,857,194
$
24,340,474
INTELLICHECK, INC.
STATEMENTS OF
OPERATIONS
(Unaudited)
Three
months ended September 30,
Nine months
ended September 30,
2021
2020
2021
2020
REVENUES
$
4,831,229
$
2,698,975
$
12,490,911
$
7,656,442
COST OF REVENUES
(1,510,590)
(293,699)
(3,199,834)
(1,196,528)
Gross profit
3,320,639
2,405,276
9,291,077
6,459,914
OPERATING EXPENSES
Selling, general and administrative
2,856,794
1,472,094
7,951,970
4,341,985
Research and development
1,415,666
907,763
4,104,531
2,837,374
Total operating expenses
4,272,460
2,379,857
12,056,501
7,179,359
(Loss) Income from operations
(951,821)
25,419
(2,765,424)
(719,445)
OTHER INCOME (EXPENSE)
Gain on forgiveness of unsecured
promissory note
-
-
10,000
-
Interest and other income (expense),
net
(412)
6,993
5,340
18,186
Total other income (expense)
(412)
6,993
15,340
18,186
Net (loss) income
$
(952,233)
$
32,412
$
(2,750,084)
$
(701,259)
PER SHARE INFORMATION
(Loss) Income per common share -
Basic
$
(0.05)
$
0.00
$
(0.15)
$
(0.04)
Diluted
$
(0.05)
$
0.00
$
(0.15)
$
(0.04)
Weighted average common shares used in
computing per share amounts
Basic
18,735,097
18,336,107
18,653,823
16,960,770
Diluted
18,735,097
18,764,994
18,653,823
16,960,770
INTELLICHECK, INC.
STATEMENTS OF STOCKHOLDERS’
EQUITY
(Unaudited)
Three months ended September 30,
2021
Additional
Total
Common
Stock
Paid-in
Accumulated
Stockholders’
Shares
Amount
Capital
Deficit
Equity
BALANCE, June 30, 2021
18,727,552
$
18,728
$
140,267,314
$
(118,174,566)
$
22,111,476
Stock-based compensation expense
-
-
638,589
-
638,589
Issuance of shares for restricted stock
grants
8,363
8
(8)
-
-
Net loss
-
-
-
(952,233)
(952,233)
BALANCE, September 30, 2021
18,735,915
$
18,736
$
140,905,895
$
(119,126,799)
$
21,797,832
Three months ended September 30,
2020
Additional
Total
Common
Stock
Paid-in
Accumulated
Stockholders’
Shares
Amount
Capital
Deficit
Equity
BALANCE, June 30, 2020
18,028,282
$
18,028
$
139,715,197
$
(117,668,783)
$
22,064,442
Stock-based compensation expense
-
-
97,157
-
97,157
Exercise of stock options, net of cashless
exercise of 82,161 shares
527,214
527
28,823
-
29,350
Exercise of warrants
750
1
1,649
-
1,650
Issuance of shares for restricted stock
grants
7,284
7
(7)
-
-
Settlement of executive bonuses with
issuance of restricted stock units
5,531
6
31,245
-
31,251
Shares forfeited in exchange for
withholding taxes
(178,832)
(179)
(1,462,415)
-
(1,462,594)
Net income
-
-
-
32,412
32,412
BALANCE, September 30, 2020
18,390,229
$
18,390
$
138,411,649
$
(117,636,371)
$
20,793,668
INTELLICHECK, INC.
STATEMENTS OF STOCKHOLDERS’
EQUITY
(Unaudited)
Nine months ended September 30,
2021
Additional
Total
Common
Stock
Paid-in
Accumulated
Stockholders’
Shares
Amount
Capital
Deficit
Equity
BALANCE, January 1, 2021
18,410,458
$
18,410
$
138,569,746
$
(116,376,715)
$
22,211,441
Stock-based compensation expense
-
-
2,270,205
-
2,270,205
Exercise of stock options, net of cashless
exercise of 58,122 shares
299,179
299
46,171
-
46,470
Exercise of warrants
9,000
9
19,791
-
19,800
Issuance of shares for restricted stock
grants
17,278
18
(18)
-
-
Net loss
-
-
-
(2,750,084)
(2,750,084)
BALANCE, September 30, 2021
18,735,915
$
18,736
$
140,905,895
$
(119,126,799)
$
21,797,832
Nine months ended September 30,
2020
Additional
Total
Common
Stock
Paid-in
Accumulated
Stockholders’
Shares
Amount
Capital
Deficit
Equity
BALANCE, January 1, 2020
16,041,650
$
16,042
$
128,668,583
$
(116,935,112)
$
11,749,513
Stock-based compensation expense
-
-
286,909
-
286,909
Issuance of common stock, net of costs
1,769,230
1,769
10,567,698
-
10,569,467
Exercise of stock options, net of cashless
exercise of 93,570 shares
674,171
674
167,934
-
168,608
Exercise of warrants
50,750
51
111,599
-
111,650
Issuance of shares for restricted stock
grants
20,279
20
(20)
-
-
Settlement of executive bonuses with
issuance of restricted stock units
14,993
15
84,696
-
84,711
Shares forfeited in exchange for
withholding taxes
(180,844)
(181)
(1,475,750)
-
(1,475,931)
Net loss
-
-
-
(701,259)
(701,259)
BALANCE, September 30, 2020
18,390,229
$
18,390
$
138,411,649
$
(117,636,371)
$
20,793,668
INTELLICHECK, INC.
STATEMENTS OF CASH
FLOWS
(Unaudited)
Nine months
ended September 30,
2021
2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss
$
(2,750,084)
$
(701,259)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Depreciation and amortization
126,226
127,143
Stock-based compensation expense
2,270,205
286,909
Forgiveness of unsecured promissory
note
(10,000)
-
Changes in assets and liabilities:
(Increase) in accounts receivable
(657,361)
(64,228)
(Increase) in other current assets
(528,865)
(192,103)
(Increase) in other assets
(4,250)
-
Increase in accounts payable and accrued
expenses
990,856
361,395
Increase (decrease) in deferred
revenue
970,604
(128,779)
Net cash provided by (used in) operating
activities
407,331
(310,922)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of software license
-
(400,000)
Capital expenditures
(338,962)
(36,520)
Collection of note receivable
-
29,017
Net cash used in investing activities
(338,962)
(407,503)
CASH FLOWS FROM FINANCING ACTIVITIES:
Return of repayment on unsecured
promissory note
10,000
-
Net proceeds from issuance of common
stock
-
10,569,467
Loan proceeds on unsecured promissory
note
-
806,100
Net proceeds from issuance of common stock
from exercise of stock options
46,470
168,608
Proceeds from issuance of common stock
from exercise of warrants
19,800
111,650
Withholding taxes paid on exercise of
stock options and vesting of restricted stock units
-
(1,475,931)
Net cash provided by financing
activities
76,270
10,179,894
Net increase in cash
144,639
9,461,469
CASH, beginning of period
13,121,392
3,350,853
CASH, end of period
$
13,266,031
$
12,812,322
Supplemental disclosure of noncash
investing and financing activities:
Settlement of executive bonuses with
restricted stock units
$
-
$
84,710
Adjusted EBITDA
We use Adjusted EBITDA as a non-GAAP financial performance
measurement. Adjusted EBITDA is calculated by adjusting net (loss)
income for certain reductions such gains on debt forgiveness and
interest and other income (expense) and certain addbacks such as
income taxes, impairments of long-lived assets and goodwill,
depreciation, amortization, and stock-based compensation expense.
Adjusted EBITDA is provided to investors to supplement the results
of operations reported in accordance with GAAP. Management believes
that Adjusted EBITDA provides an additional tool for investors to
use in comparing our financial results with other companies that
also use Adjusted EBITDA in their communications to investors. By
excluding non-cash charges such as impairments of long-lived assets
and goodwill, amortization, depreciation, and stock-based
compensation, as well as non-operating charges for interest and
income taxes, investors can evaluate our operations and can compare
the results on a more consistent basis to the results of other
companies. In addition, Adjusted EBITDA is one of the primary
measures management uses to monitor and evaluate financial and
operating results.
We consider Adjusted EBITDA to be an important indicator of our
operational strength and performance of our business and a useful
measure of our historical operating trends. However, there are
significant limitations to the use of Adjusted EBITDA since it
excludes gains on debt forgiveness, interest and other income
(expense), impairments of long-lived assets and goodwill,
stock-based compensation expense, all of which impact our
profitability, as well as depreciation and amortization related to
the use of long-term assets which benefit multiple periods. We
believe that these limitations are compensated by providing
Adjusted EBITDA only with GAAP net (loss) income and clearly
identifying the difference between the two measures. Consequently,
Adjusted EBITDA should not be considered in isolation or as a
substitute for net (loss) income presented in accordance with GAAP.
Adjusted EBITDA as defined by us may not be comparable with
similarly named measures provided by other entities.
A reconciliation of GAAP net (loss) income to Non-GAAP Adjusted
EBITDA follows:
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2021
2020
2021
2020
Net (loss) income
$
(952,233)
$
32,412
$
(2,750,084)
$
(701,259)
Reconciling items:
Gain on forgiveness of unsecured
promissory note
-
-
(10,000)
-
Interest and other income
(expense), net
412
(6,993)
(5,340)
(18,186)
Depreciation and amortization
42,237
46,387
126,226
127,143
Stock-based compensation
expense
638,589
97,157
2,270,205
286,909
Adjusted EBITDA
$
(270,995)
$
168,963
$
(368,993)
$
(305,393)
About Intellicheck Nasdaq: IDN
Intellicheck (Nasdaq: IDN) is a trusted industry leader in
technology solutions that stop identity theft and fraud with
real-time identification authentication and age verification. We
make it possible for our clients to increase revenues, improve
customer service, and increase operational efficiencies. The
company is focused on partnering with banks, credit card issuers
and retailers to prevent fraud. Intellicheck also serves law
enforcement agencies, national defense clients and diverse state
and federal government agencies. For more information on
Intellicheck, visit us on the web and follow us on follow us on
LinkedIn, Twitter, Facebook, and YouTube.
Safe Harbor Statement
Statements in this news release about Intellicheck’s future
expectations, including: the advantages of our products, future
demand for Intellicheck’s existing and future products, whether
revenue and other financial metrics will improve in future periods,
whether Intellicheck will be able to execute its turn-around plan
or whether successful execution of the plan will result in
increased revenues, whether sales of our products will continue at
historic levels or increase, whether brand value and market
awareness will grow, whether the Company can leverage existing
partnerships or enter into new ones, whether there will be any
impact on sales and revenues due to an epidemic, pandemic or other
public health issue and all other statements in this release, other
than historical facts, are “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995
(PSLRA). These statements, which express management’s current views
concerning future events, trends, contingencies or results, appear
at various places in this release and use words like “anticipate,”
“assume,” “believe,” “continue,” “estimate,” “expect,” “forecast,”
“future,” “intend,” “plan,” “potential,” “predict,” “project,”
“sense”, “strategy,” “target” and similar terms, and future or
conditional tense verbs like “could,” “may,” “might,” “should,”
“will” and “would” are forward-looking statements within the
meaning of the PSLRA. This statement is included for the express
purpose of availing Intellicheck, Inc. of the protections of the
safe harbor provisions of the PSLRA. It is important to note that
actual results and ultimate corporate actions could differ
materially from those in such forward-looking statements based on
such factors as: market acceptance of our products and the
presently anticipated growth in the commercial adoption of our
products and services; our ability to successfully transition pilot
programs into formal commercial scale programs; continued adoption
of our SaaS product offerings; changing levels of demand for our
current and future products; our ability to reduce or maintain
expenses while increasing sales; our ability to successfully expand
the sales of our products and services into new areas including
health care and auto dealerships; customer results achieved using
our products in both the short and long term; success of future
research and development activities; uncertainties around the
duration and severity of the COVID-19 outbreak and its ultimate
impact on our business and results of operations; our ability to
successfully market and sell our products, any delays or
difficulties in our supply chain coupled with the typically long
sales and implementation cycle for our products; our ability to
enforce our intellectual property rights; changes in laws and
regulations applicable to the our products; our continued ability
to access government-provided data; the risks inherent in doing
business with the government including audits and contract
cancellations; liability resulting from any security breaches or
product failure, together with other risks detailed from time to
time in our reports filed with the SEC. We do not assume any
obligation to update the forward-looking information.
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version on businesswire.com: https://www.businesswire.com/news/home/20211110005459/en/
Investor Relations: Gar Jackson (949) 873-2789 Media and Public
Relations: Sharon Schultz (302) 539-3747
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