FREMONT, Calif., March 20, 2014 (GLOBE NEWSWIRE) -- Identive Group, Inc. (Nasdaq:INVE) reports its financial results for the fourth quarter (Q4) and year ended December 31, 2013.
"We have made excellent progress in Q4 to simplify and focus the business as we lay the foundation for growth in 2014," said Jason Hart, chief executive officer of Identiv. "We have transformed from a group of separate businesses to a single, unified company focused on delivering high-growth trust solutions for the Internet of Things. The divestment of underperforming and non-core activities in addition to consolidating the remaining operations has eliminated over $12 million of debt from our balance sheet and reduced headcount by nearly 25 percent."
Quarterly Review (Q4 2013 compared with Q4 2012)
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 January 2014.
Fiscal Year 2013 Highlights
Hart added, "Q4 was the first full quarter for the new management team as we focused on simplifying the business and addressing the cost structure. The significant shift in costs from G&A to sales, marketing and engineering represent an investment in growth. We will soon launch our new corporate vision, which embraces the strengths of our people and technology as we align to the high growth trust solutions for the rapidly expanding connected world."
Guidance
The company is providing guidance for fiscal year 2014 of revenue between $80 million and $90 million and adjusted EBITDA positive on an annual basis.
Conference Call and Webcast Information
Identiv will host a conference call and audio webcast today at 5:00 PM Eastern time, which can be accessed by dialing 888.771.4371 (toll free within the U.S.) or +1 847.585.4405 (for international callers) and using passcode 36855924. A webcast of the call can be accessed by visiting the investor relations section of the company's website at www.identiv.com, and by clicking on "Presentations & Webcasts," where it also will be archived for 30 days. An audio replay of the call also will 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) and using passcode 36855924.
About Identiv
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 Trust Solutions are implemented using standards-driven products and technology, such as digital certificates, mobility and cloud services. For more information, visit www.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, adjusted EBITDA and non-GAAP net income (loss) and net income (loss) per share. Identiv uses these non-GAAP financial measures internally in analyzing our 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, 2012 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.
Note: Identiv and the Identiv logo are trademarks of Identive Group, Inc., registered in many jurisdictions worldwide. All other company, product or service names may be trademarks or registered trademarks of others and are the property of their respective owners.
IDENTIVE GROUP, INC. | |||||
Consolidated Statements of Operations | |||||
(In thousands, except per share data) | |||||
(Unaudited) | |||||
Three Months Ended | Twelve Months Ended | ||||
December 31, 2013 |
September 30, 2013 |
December 31, 2012 |
December 31, 2013 |
December 31, 2012 |
|
Net revenue | $ 19,912 | $ 21,203 | $ 21,043 | $ 75,610 | $ 72,361 |
Cost of revenue | 11,162 | 11,189 | 12,203 | 41,970 | 40,358 |
Gross profit | 8,750 | 10,014 | 8,840 | 33,640 | 32,003 |
Operating expenses: | |||||
Research and development | 1,071 | 1,642 | 1,515 | 6,277 | 6,965 |
Selling and marketing | 4,951 | 4,541 | 4,170 | 18,969 | 19,124 |
General and administrative | 3,154 | 3,856 | 2,946 | 14,189 | 14,880 |
Re-measurement of contingent consideration | -- | -- | -- | -- | (5,463) |
Impairment of long-lived assets | -- | 178 | -- | 178 | 13,410 |
Impairment of goodwill | 4,637 | 10,935 | 17 | 15,572 | 17,027 |
Restructuring and severance | 518 | 1,252 | 47 | 1,770 | 325 |
Total operating expenses | 14,331 | 22,404 | 8,695 | 56,955 | 66,268 |
Gain (loss) from operations | (5,581) | (12,390) | 145 | (23,315) | (34,265) |
Other income (expense) | -- | -- | 28 | -- | (108) |
Interest expense, net | (566) | (387) | (485) | (2,169) | (1,077) |
Foreign currency gain, net | 249 | 283 | 393 | 710 | 296 |
Gain (loss) from continuing operations before income taxes and non-controlling interest | (5,898) | (12,494) | 81 | (24,774) | (35,154) |
Income tax (provision) benefit | 209 | (363) | 1,099 | (47) | 5,755 |
Gain (loss) from continuing operations | (5,689) | (12,857) | 1,180 | (24,821) | (29,399) |
Gain (loss) from discontinued operations, net of income taxes | 3,488 | (12,678) | (711) | (10,977) | (24,169) |
Consolidated net gain (loss) | (2,201) | (25,535) | 469 | (35,798) | (53,568) |
Less: Net gain (loss) attributable to noncontrolling interest | (775) | 1,322 | (292) | 933 | 3,232 |
Net gain (loss) attributable to Identive Group, Inc.stockholders' equity | $ (2,976) | $ (24,213) | $ 177 | $ (34,865) | $ (50,336) |
Basic and diluted loss per share attributable to Identive Group, Inc. stockholders' equity: | |||||
Gain (loss) per share from continuing operations | $ (0.09) | $ (0.18) | $ 0.01 | $ (0.36) | $ (0.44) |
Gain (loss) per share from discontinued operations | $ 0.05 | $ (0.19) | $ (0.01) | $ (0.17) | $ (0.40) |
Net loss per share | $ (0.04) | $ (0.37) | $ 0.00 | $ (0.53) | $ (0.84) |
Weighted average shares used to compute basic and diluted loss per share | 74,132 | 65,518 | 60,165 | 66,327 | 59,623 |
IDENTIVE GROUP, INC. | ||
Consolidated Balance Sheets | ||
(In thousands; unaudited) | ||
December 31, 2013 |
December 31, 2012 |
|
ASSETS | ||
Current assets: | ||
Cash and cash equivalents | $ 5,095 | $ 6,109 |
Accounts receivable, net of allowances | 13,289 | 13,842 |
Inventories | 9,098 | 7,609 |
Prepaid expenses | 957 | 976 |
Other current assets | 1,766 | 2,064 |
Current assets of discontinued operations | 2,624 | 6,590 |
Total current assets | 32,829 | 37,190 |
Property and equipment, net | 5,876 | 5,889 |
Goodwill | 8,991 | 24,664 |
Intangible assets, net | 10,196 | 11,676 |
Other assets | 867 | 1,671 |
Long-term assets of discontinued operations | --- | 23,815 |
Total Assets | $ 58,759 | $ 104,905 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Current liabilities: | ||
Accounts payable | $ 9,353 | $ 9,805 |
Liability to related party | 1,073 | 1,098 |
Financial liabilities | 2,971 | 2,842 |
Deferred revenue | 729 | 641 |
Accrued compensation and related benefits | 3,383 | 2,503 |
Other accrued expenses and liabilities | 5,239 | 3,948 |
Current liabilities of discontinued operations | 1,630 | 16,481 |
Total current liabilities | 24,378 | 37,318 |
Long-term liability to related party | 5,648 | 6,177 |
Long-term financial liabilities | 3,051 | 6,167 |
Other long-term liabilities | 938 | 721 |
Long-term liabilities of discontinued operations | --- | 4,932 |
Total liabilities | 34,015 | 55,315 |
Total stockholders' equity | 24,744 | 49,590 |
Total liabilities and stockholders' equity | $ 58,759 | $ 104,905 |
IDENTIVE GROUP, INC. | |||||
Reconciliation of GAAP and Non-GAAP Financial Information | |||||
(In thousands) | |||||
(unaudited) | |||||
Three months ended | Twelve months ended | ||||
December 31, 2013 |
September 30, 2013 |
December 31, 2012 |
December 31, 2013 |
December 31, 2012 |
|
Reconciliation of GAAP and non-GAAP gross profit margin | |||||
GAAP cost of revenue | $ 11,162 | $ 11,189 | $ 12,203 | $ 41,971 | $ 40,358 |
Reconciling items included in GAAP cost of revenue: | |||||
Stock-based compensation | (12) | (18) | (11) | (68) | (47) |
Transition and integration costs | -- | -- | (1) | -- | (168) |
Amortization and depreciation | (359) | (332) | (281) | (1,371) | (1,601) |
Total reconciling items included in GAAP cost of revenue | (371) | (350) | (293) | (1,439) | (1,816) |
Non-GAAP cost of revenue | $ 10,791 | $ 10,839 | $ 11,910 | $ 40,532 | $ 38,542 |
Non-GAAP gross profit margin | 46% | 49% | 43% | 46% | 47% |
Reconciliation of GAAP and non-GAAP operating expenses | |||||
GAAP operating expenses | $ 14,331 | $ 22,404 | $ 8,695 | $ 56,955 | $ 66,268 |
Reconciling items included in GAAP operating expenses: | |||||
Impairment of long-lived assets | -- | (178) | -- | (178) | (13,410) |
Impairment of goodwill | (4,637) | (10,935) | (17) | (15,572) | (17,027) |
Stock-based compensation | (313) | (236) | (336) | (1,352) | (1,275) |
Re-measurement of contingent consideration | -- | -- | -- | -- | 5,463 |
Pension expenses | 143 | (25) | (17) | 68 | (17) |
Gain/Loss on disposal of fixed assets | (28) | 1 | (59) | (27) | (74) |
Amortization and depreciation | (365) | (338) | (463) | (1,625) | (2,101) |
Acquisition costs | -- | -- | -- | (13) | (240) |
Transition and integration costs | 77 | (72) | 470 | (267) | (579) |
Restructuring and severance | (518) | (1,252) | (47) | (1,770) | (325) |
Total reconciling items included in GAAP operating expenses | (5,641) | (13,035) | (469) | (20,736) | (29,585) |
Non-GAAP operating expenses | $ 8,690 | $ 9,369 | $ 8,226 | $ 36,219 | $ 36,683 |
Reconciliation of GAAP net loss to Adjusted EBITDA | |||||
Net loss attributable to Identive Group, Inc. | $ (2,976) | $ (24,213) | $ 177 | $ (34,865) | $ (50,336) |
Reconciling items included in GAAP net loss: | |||||
Provision (benefit) for income taxes | (209) | 363 | (1,099) | 47 | (5,755) |
Net loss attributable to noncontrolling interest | 775 | (1,322) | 292 | (933) | (3,232) |
Gain (loss) from discontinued operations, net of income taxes | (3,488) | 12,678 | 711 | 10,976 | 24,169 |
Foreign currency losses (gains), net | (249) | (283) | (393) | (710) | (296) |
Interest expense (income), net | 566 | 387 | 485 | 2,169 | 1,077 |
Other expense (income), net | -- | -- | (28) | -- | 108 |
Impairment of long-lived assets | -- | 178 | -- | 178 | 13,410 |
Impairment of goodwill | 4,637 | 10,935 | 17 | 15,572 | 17,027 |
Stock-based compensation | 325 | 254 | 347 | 1,420 | 1,322 |
Re-measurement of contingent consideration | -- | -- | -- | -- | (5,463) |
Pension expenses | (143) | 25 | 17 | (68) | 17 |
Amortization and depreciation | 724 | 670 | 744 | 2,996 | 3,702 |
Acquisition costs | -- | -- | -- | 13 | 240 |
Transition and integration costs | (77) | 72 | (469) | 267 | 747 |
Gain/loss on disposal of fixed assets | 28 | (1) | 59 | 27 | 74 |
Restructuring and severance | 518 | 1,252 | 47 | 1,770 | 325 |
Total reconciling items included in GAAP net loss | 3,407 | 25,208 | 730 | 33,724 | 47,472 |
Adjusted EBITDA | $ 431 | $ 995 | $ 907 | $ (1,141) | $ (2,864) |