TEL AVIV, Israel, May 27, 2021 /PRNewswire/
-- SuperCom (NASDAQ: SPCB), a global
provider of secured solutions for the e-Government, IoT and
Cybersecurity sectors, today reported results for the three
months ended March 31,
2021.
Three-Months Ended March 31,
2021 Financial Highlights
- Cash and cash equivalents and restricted cash at the end of
Q1-21 increased to $9 million from
$4m at end of 2020.
- Working Capital increased to $12.7
million at end of Q1-21 from $5.3
million at end of 2020.
- Revenue in Q1-2021 was $3.0
million.
- Gross margin in Q1-2021 increased to 55.3% from 47.5% in
2020.
- EBITDA in the first quarter of $652,000.
Recent Business Highlights:
- Company won new project in California valued at up to $4 million, highlighting continued growth in
demand for the offerings in our IoT Tracking segment.
- Company won a tender with the Israeli government for its
PureHealth Coronavirus (COVID-19) Quarantine Compliance Solution.
This was won following a successful pilot of the solution in
Israel.
- In response to the Covid-19 pandemic, the company underwent
significant cost optimizations leading to improvement in margins
and profitability in parallel to Covid-19 related revenue
declines.
- In response to the Covid-19 pandemic, the company launched a
new solution, PureHealth for quarantine compliance, to help fight
the spread of infectious diseases. Pilots have been initiated in
various regions around the world, with global demand for additional
evaluations continuing into 2021.
- The company has adjusted its manufacturing capacity to enable
more flexibility and to scale production capacity in response to
increased demand for its IoT products. The company has also
made its global supply chain more resilient by reducing
dependencies on specific suppliers and geographies.
- Maintained strong relationships with existing customers across
all 3 business segments reflecting high customer retention and
demand for company solutions even during unexpected environments
such as the global Covid-19 pandemic.
"Following my February appointment to CEO, one of my first
priorities was to improve our reporting capabilities and enable us
to report financial results on a quarterly basis. I am
pleased to announce our first quarter earnings results, which is
the first time that we have reported financial results on a
quarterly basis since the first half of 2019," stated Ordan Trabelsi, CEO of SuperCom. "We have
worked hard to improve our financial processes to enable us to
report on a timely basis. Our work is ongoing, and we plan to
continue improving the quality of our financial reporting
capabilities."
"We continue to work hard also to capitalize on the trend that
we are seeing with correctional institutions increasingly shifting
their policy to enable more inmates to serve time under home
confinement and utilizing GPS monitoring solutions. Given the
strong fundamental drivers behind this industry growth,
including prison overcrowding, advancements in the underlying
mobile and location-based technologies and the clear financial
benefits of reducing facility populations, we believe this is just
a small part of a longer-term trend," added Ordan.
"With this attractive market opportunity and our
standing in the competitive landscape, another priority of ours in
the upcoming years is to increase our investments in sales and
marketing to drive revenue growth, while maintaining our
investments in research and development to stay ahead of our
competition with our proprietary technology offerings. We have won
many new projects in recent years and plan to continue to expand
our global footprint," concluded Ordan.
Conference Call
The company will hold a conference call today (May 27, 2021) at 8:30 a.m.
Eastern time (3:30 p.m.
Israel time) to discuss these
results and financial outlook.
SuperCom management will host the call, followed by a questions
and answers period.
Date: Thursday, May 27,
2021
Time: 8:30 a.m. Eastern time
(5:30 a.m. Pacific time)
U.S. toll-free: 877-407-8133
Israel toll-free:
1-809-406-247
International: 201-689-8040
Please call the conference telephone number 5-10 minutes prior
to the start time. An operator will register your name and
organization.
SuperCom Investor Relations:
ir@supercom.com
About SuperCom
Since 1988, SuperCom has been a global provider of traditional
and digital identity solutions, providing advanced safety,
identification and security solutions to governments and
organizations, both private and public, throughout the world.
Through its proprietary e-government platforms and innovative
solutions for traditional and biometrics enrollment,
personalization, issuance and border control services, SuperCom has
inspired governments and national agencies to design and issue
secure Multi-ID documents and robust digital identity solutions to
its citizens and visitors. SuperCom offers a unique all-in-one
field-proven RFID & mobile technology and product suite,
accompanied by advanced complementary services for various
industries including healthcare and homecare, security and safety,
community public safety, law enforcement, electronic monitoring,
livestock monitoring, and building and access automation. For more
information, visit www.supercom.com.
Cautionary Note Regarding Forward-Looking
Statements
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. Statements preceded or followed by or that otherwise
include the words "believes", "expects", "anticipates", "intends",
"projects", "estimates", "plans", and similar expressions or
future or conditional verbs such as "will", "should", "would",
"may" and "could" are generally forward-looking in nature
and not historical or current facts. These forward-looking
statements are subject to risks and uncertainties that could cause
our actual results to differ materially from the statements
made. Examples of these statements include, but are not
limited to, statements regarding business and economic trends, the
anticipated effects of the COVID-19 outbreak on travel and physical
locations, the levels of consumer, business and economic
confidence generally, the duration of the COVID-19 outbreak and
severity of such outbreak, the pace of recovery following the
COVID-19 outbreak, the effect on our supply chain, our ability to
implement cost containment and business recovery
strategies and resulting anticipated impact of such outbreak
on our business, financial condition and results of
operations; the adverse effects of the COVID-19 outbreak on
our business or the market price of our ordinary shares, and other
risks and uncertainties described in the forward looking
statements and in the section captioned "Risk Factors" in our
Annual Report on Form 20-F for the year ended December 31, 2020, filed with the U.S.
Securities and Exchange Commission (the "SEC") on April 30, 2021, our reports on Form 6-K filed
from time to time with the SEC and our other filings with the SEC.
Except as required by law, we not undertake any obligation to
update or revise these forward-looking statements, whether as a
result of new information, future events or otherwise, after the
date of this press release
Use of Non-GAAP Financial Information
In addition to disclosing financial results calculated in
accordance with United States
generally accepted accounting principles (GAAP), this release of
operating results also contains non-GAAP financial measures, which
SuperCom believes are the principal indicators of the operating and
financial performance of its business. Management believes the
non-GAAP financial measures provided are useful to investors'
understanding and assessment of the Company's on-going core
operations and prospects for the future, as the charges eliminated
are not part of the day-to-day business or reflective of the core
operational activities of the Company. Management uses these
non-GAAP financial measures as a basis for strategic decisions,
forecasting future results and evaluating the Company's current
performance. However, such measures should not be considered
in isolation or as substitutes for results prepared in accordance
with GAAP. Reconciliation of the non-GAAP measures to the most
comparable GAAP measures are provided in the schedules attached to
this release.
[Tables to follow]
SUPERCOM
LTD.
|
CONSOLIDATED
BALANCE SHEETS
|
(U.S. dollars in
thousands)
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2021
|
|
2020
|
|
|
Unaudited
|
|
Audited
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
Cash and
cash equivalents
|
|
7,513
|
|
3,137
|
Restricted bank
deposits
|
|
1,477
|
|
815
|
Trade receivable,
net
|
|
13,402
|
|
12,427
|
Patents
|
|
5,283
|
|
5,283
|
Other accounts
receivable and prepaid expenses
|
|
1,062
|
|
876
|
Inventories,
net
|
|
2,988
|
|
2,404
|
|
|
|
|
|
Total current
assets
|
|
31,725
|
|
24,942
|
|
|
|
|
|
LONG-TERM
ASSETS
|
|
|
|
|
Severance pay
funds
|
|
453
|
|
531
|
Deferred tax long
term
|
|
205
|
|
204
|
Customer
Contracts
|
|
1,172
|
|
1,250
|
Software and other
IP
|
|
2,741
|
|
2,677
|
Other Asset,
net
|
|
2,257
|
|
2,343
|
Goodwill
|
|
7,026
|
|
7,026
|
Property &
equipment, net
|
|
1,450
|
|
1,371
|
Total long-term
assets:
|
|
15,304
|
|
15,402
|
|
|
|
|
|
Total
Assets
|
|
47,029
|
|
40,344
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
Short-term loans and other
|
|
9,136
|
|
7,204
|
Trade
payables
|
|
2,855
|
|
2,860
|
Employees and payroll
accruals
|
|
2,613
|
|
2,627
|
Related
parties
|
|
377
|
|
1,749
|
Accrued expenses and
other liabilities
|
|
3,415
|
|
4,393
|
Deferred revenues
ST
|
|
607
|
|
766
|
Short-term liability
for future earn-out
|
|
-
|
|
-
|
|
|
|
|
|
Total current
liabilities
|
|
19,003
|
|
19,599
|
|
|
|
|
|
LONG-TERM
LIABILITIES
|
|
|
|
|
|
|
|
|
|
Long-term bank loan
|
|
16,210
|
|
14,952
|
Accrued
severance pay
|
|
578
|
|
656
|
Related
Parties
|
|
-
|
|
-
|
Deferred tax
liability
|
|
170
|
|
170
|
Deferred
revenues
|
|
49
|
|
49
|
|
|
|
|
|
Total long-term
liabilities
|
|
17,007
|
|
15,827
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
|
Ordinary
shares
|
|
1,844
|
|
1,397
|
Additional paid-in
capital
|
|
95,802
|
|
88,853
|
Accumulated
deficit
|
|
(86,627)
|
|
(85,331)
|
|
|
|
|
|
Total shareholders'
equity
|
|
11,019
|
|
4,919
|
|
|
|
|
|
Total liabilities and
equity
|
|
47,029
|
|
40,004
|
|
|
|
SUPERCOM
LTD.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(U.S. dollars in
thousands)
|
|
|
Three months
ended
March
31,
|
|
|
2021
|
|
|
Unaudited
|
|
|
|
|
|
REVENUES
|
|
|
3,032
|
|
COST OF
REVENUES
|
|
|
(1,356)
|
|
|
|
|
|
|
GROSS
PROFIT
|
|
|
1,676
|
|
|
|
|
|
|
OPERATING
EXPENSES:
|
|
|
|
|
Research
and development
|
|
|
657
|
|
Selling
and marketing
|
|
|
370
|
|
General
and administrative
|
|
|
830
|
|
Other
expense (income), net
|
|
|
-
|
|
|
|
|
|
|
Total operating
expenses
|
|
|
1,857
|
|
|
|
|
|
|
OPERATING
LOSS
|
|
|
(182)
|
|
FINANCIAL
EXPENSES, NET
|
|
|
(1,122)
|
|
|
|
|
|
|
LOSS BEFORE INCOME
TAX
|
|
|
(1,303)
|
|
INCOME TAX
EXPENSE
|
|
|
-
|
|
|
|
|
|
|
NET LOSS FOR THE
PERIOD
|
|
|
(1,303)
|
|
SUPERCOM
LTD.
|
Reconciliation
Table of GAAP to Non-GAAP Figures and EBITDA to Net
Income
|
(U.S. dollars in
thousands)
|
|
|
Three months
ended
March
31,
|
|
|
2021
|
|
|
Unaudited
|
|
|
|
|
|
GAAP gross
profit
|
|
|
1,676
|
|
Amortization of
Software and IP
|
|
|
88
|
|
Stock-based
compensation expenses
|
|
|
-
|
|
Non-GAAP gross
profit
|
|
|
1,764
|
|
|
|
|
|
|
GAAP Operating
Loss
|
|
|
(182)
|
|
Amortization
of Software and IP, Customer Contracts and Brand
|
|
|
377
|
|
Stock-based
compensation expenses
|
|
|
-
|
|
One time
inventory write off
|
|
|
34
|
|
Foreign
Currency Loss
|
|
|
315
|
|
Allowance for
doubtful debt
|
|
|
-
|
|
|
|
|
|
|
Non-GAAP operating
profit(loss)
|
|
|
544
|
|
|
|
|
|
|
GAAP net
Loss
|
|
|
(1,303)
|
|
Amortization
of Software and IP, Customer Contracts and Brand
|
|
|
377
|
|
Stock-based
compensation expenses
|
|
|
-
|
|
One time
inventory write off
|
|
|
34
|
|
Foreign
Currency Loss
|
|
|
315
|
|
Income tax
expense(benefit)
|
|
|
-
|
|
Allowance for
doubtful debt
|
|
|
-
|
|
|
|
|
|
|
Non-GAAP net
Loss
|
|
|
(578)
|
|
|
|
|
|
|
NET LOSS FOR THE
PERIOD
|
|
|
(1,303)
|
|
Income tax expense (benefit)
|
|
|
-
|
|
Financial expenses (income), net
|
|
|
1,122
|
|
Depreciation and Amortization
|
|
|
485
|
|
One time inventory write off
|
|
|
34
|
|
Stock-based compensation expenses
|
|
|
-
|
|
Foreign Currency Loss
|
|
|
315
|
|
Allowance for doubtful debt
|
|
|
-
|
|
EBITDA
*
|
|
|
652
|
|
*
EBITDA is a non-GAAP financial measure generally
defined as earnings before interest, taxes, depreciation and
amortization.
|
View original
content:http://www.prnewswire.com/news-releases/supercom-reports-first-quarter-2021-financial-results-301300818.html
SOURCE SuperCom Ltd