EX-99.1 2 d30293dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

IDENTIV REPORTS THIRD QUARTER 2015 RESULTS

Third Quarter Revenue of $17.2 Million and Adjusted EBITDA of $(3.3) Million

FREMONT, Calif., November 12, 2015Identiv, Inc. (NASDAQ: INVE) today announced financial results for its fiscal 2015 third quarter ended September 30, 2015. For the third quarter, total revenues were $17.2 million, GAAP gross profit margin was 44%, and adjusted EBITDA was $(3.3) million.

“We are pleased with the growth in our premises business with new demand from our government and commercial customers, as well as launching our ICPAM solution in support of our new partnership with Cisco” said Steven Humphreys, Identiv CEO. “Throughout the quarter, we have implemented activities to strengthen the focus of resources on these key areas. As an organization, we will exit the year streamlined to support our focus in existing markets and partnerships, which we believe will allow us to grow the business with a path to profitability in 2016.”

Third Quarter Financial Highlights Review

 

    Total revenues were $17.2 million in the third quarter of fiscal year 2015 compared to $15.6 million in the second quarter of 2015 and $22.7 million in the third quarter of 2014, reflecting a sequential growth of 10% and a decline of 24% from the third quarter of 2014. The sequential growth was mainly driven by stronger sales of physical access products in our premises segment, which grew over 20%. The decline from the third quarter of 2014 is primarily a result of 39% lower revenues in our credential segment.

 

    GAAP gross profit margin increased to 44% in the third quarter of fiscal year 2015, compared to 43% in the second quarter of 2015 and 43% in the third quarter of 2014. This was primarily driven by our product mix, reflecting a higher portion of revenues in our premises segment and a lower portion of sales in our credentials segment.

 

    GAAP operating expenses, including research and development, sales and marketing, and general and administrative costs, but excluding restructuring charges and goodwill impairment, were $13.0 million in the third quarter of fiscal year 2015, compared to $12.9 million in the second quarter of 2015 and $10.6 million in the third quarter of 2014. This reflects a sequential increase of 1% and a year over year increase of 23%, both primarily the result of the continued expenditures related to legal and accounting professional fees associated with non-core business activities.

 

    Adjusted EBITDA for the third quarter of fiscal year 2015 was $(3.3) million, compared to $(4.2) million in the second quarter of 2015 and $1.0 million in the third quarter of 2014, predominantly reflecting the continuing legal and accounting professional fees since the second quarter of 2015.

 

    GAAP net loss was $(6.2) million in the third quarter of 2015, or $(0.57) per share, compared to a GAAP net loss of $(7.4) million, or $(0.67) per share in the second quarter of fiscal year 2015 and GAAP net loss of $(3.8) million, or $(0.46) per share in the third quarter of 2014. The third quarter of 2015 included restructuring costs of $0.2 million compared to restructuring costs of $0.02 million in the second quarter of 2015 and restructuring costs of $2.1 million in the third quarter of 2014.

Revenue Guidance

The Company is providing guidance for fiscal year 2015 of revenue between $62 million and $64 million.


Webcast and Conference Call Information

Identiv will hold an audio webcast and conference call to discuss its third quarter 2015 results today, November 12, 2015, at 2:00 PM PT (5:00 PM ET). The audio webcast can be accessed at identiv.com/investors/ir-events. The conference call can be accessed by dialing 888-771-4371 (toll-free within the U.S.) or +1 847-585-4405 (for international callers) using passcode 41176647. For those unable to attend the live webcast, it will be archived following the event for 30 days at identiv.com/investors/ir-events. A replay of the call will also 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) using passcode 41176647#.

About Identiv

Identiv is a global security technology company that establishes identity in the connected world, including premises, information, and everyday items. CIOs, CSOs, and product departments rely upon Identiv’s trusted identity solutions to reduce risk, achieve compliance, and protect brand identity. Identiv’s trust solutions are implemented using standards-driven products and technology, such as digital certificates, trusted authentication, mobility, and cloud services. For more information, visit identiv.com.

Non-GAAP Financial Measures (Unaudited)

This press release includes financial information that has not been prepared in accordance with GAAP, including non-GAAP gross profit margin, non-GAAP operating expenses and adjusted EBITDA. Identiv uses these non-GAAP financial measures internally in analyzing its 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 contained within this press 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 press 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, including but not limited to sales under our agreement with Cisco; our ability to establish a stable financial platform on which to execute our strategy to deliver trust solutions; our expectations with respect to sales to government and multinational customers; our belief that we will exit 2015 streamlined which will allow us to grow our business with a path to profitability in 2016; our expectations from increased investments in sales, marketing and engineering; and our ability to achieve the level of revenues 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 develop successfully 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 in order to develop products and solutions for our markets; whether the markets in which we participate or target grow, converge or standardize at anticipated rates or at all, including the markets that we are targeting; our ability to compete successfully 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 that 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, 2014 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.

Investor Relations Contact:

IR@identiv.com

Media Contact:

press@identiv.com

— Financials Follow —


IDENTIV, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

 

     Three Months Ended     Nine Months Ended  
     September 30,     June 30,     September 30,     September 30,  
     2015     2015     2014     2015     2014  

Net revenue

   $ 17,196      $ 15,587      $ 22,712      $ 47,717      $ 61,867   

Cost of revenue

     9,565        8,941        12,840        27,356        36,463   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     7,631        6,646        9,872        20,361        25,404   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

          

Research and development

     2,205        2,240        1,813        6,437        5,046   

Selling and marketing

     5,266        5,467        5,078        15,728        15,844   

General and administrative

     5,550        5,208        3,685        13,823        9,595   

Impairment of goodwill

     —          988        —          988        —     

Restructuring and severance

     216        21        1,825        408        2,874   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     13,237        13,924        12,401        37,384        33,359   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Loss from operations

     (5,606     (7,278     (2,529     (17,023     (7,955

Non-operating income (expense):

          

Interest expense, net

     (478     (465     (564     (1,367     (3,154

Foreign currency gain (loss), net

     (78     438        (700     (916     (952
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Loss from continuing operations before income taxes and noncontrolling interest

     (6,162     (7,305     (3,793     (19,306     (12,061

Income tax provision

     (59     (63     (94     (141     (149
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Loss from continuing operations before noncontrolling interest

     (6,221     (7,368     (3,887     (19,447     (12,210

Income from discontinued operations, net of income taxes

     —          —          2        —          546   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated net loss

     (6,221     (7,368     (3,885     (19,447     (11,664

Less: Loss attributable to noncontrolling interest

     6        (1     38        72        73   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Identiv, Inc. stockholders’ equity

   $ (6,215   $ (7,369   $ (3,847   $ (19,375   $ (11,591
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic and diluted net loss per share attributable to Identiv, Inc. stockholders’ equity:

          

Loss from continuing operations

   $ (0.57   $ (0.67   $ (0.46   $ (1.80   $ (1.52

Income from discontinued operations

     —          —          —          —          0.07   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

   $ (0.57   $ (0.67   $ (0.46   $ (1.80   $ (1.45
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares used to compute basic and diluted loss per share

     10,895        10,962        8,423        10,747        7,971   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


IDENTIV, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

 

     September 30,      December 31,  
     2015      2014  
     (unaudited)         
ASSETS      

Current assets:

     

Cash

   $ 21,416       $ 36,547   

Accounts receivable, net of allowances

     10,464         13,612   

Inventories

     15,238         9,254   

Prepaid expenses

     1,181         1,002   

Other current assets

     1,667         1,200   
  

 

 

    

 

 

 

Total current assets

     49,966         61,615   

Property and equipment, net

     4,729         5,311   

Goodwill

     7,783         8,853   

Intangible assets, net

     7,639         8,730   

Other assets

     892         1,371   
  

 

 

    

 

 

 

Total assets

   $ 71,009       $ 85,880   
  

 

 

    

 

 

 
LIABILITIES AND STOCKHOLDERS’ EQUITY      

Current liabilities:

     

Accounts payable

   $ 5,529       $ 8,372   

Earn-out liability

     —           3,510   

Current portion - payment obligation

     373         635   

Deferred revenue

     1,423         508   

Accrued compensation and related benefits

     2,441         2,139   

Other accrued expenses and liabilities

     4,759         4,471   
  

 

 

    

 

 

 

Total current liabilities

     14,525         19,635   

Long-term payment obligation

     5,349         5,545   

Long-term financial liabilities

     18,058         13,938   

Other long-term liabilities

     352         630   
  

 

 

    

 

 

 

Total liabilities

     38,284         39,748   
  

 

 

    

 

 

 

Stockholders’ equity

     32,725         46,132   
  

 

 

    

 

 

 

Total liabilities and stockholders’ equity

   $ 71,009       $ 85,880   
  

 

 

    

 

 

 


IDENTIV, INC.

RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL INFORMATION

(in thousands)

(unaudited)

 

     Three Months Ended     Nine Months Ended  
     September 30,     June 30,     September 30,     September 30,  
     2015     2015     2014     2015     2014  

Reconciliation of GAAP gross profit margin and non-GAAP gross profit margin

          

GAAP cost of revenue

   $ 9,565      $ 8,941      $ 12,840      $ 27,356      $ 36,463   

Reconciling items included in GAAP cost of revenue:

          

Stock-based compensation

     (34     (35     (12     (98     (23

Amortization and depreciation

     (355     (345     (376     (1,027     (1,103
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total reconciling items included in GAAP cost of revenue

     (389     (380     (388     (1,125     (1,126
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP cost of revenue

     9,176        8,561        12,452        26,231        35,337   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP gross profit margin

     47     45     45     45     43
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation of GAAP operating expenses and overhead costs

          

GAAP operating expenses

   $ 13,237      $ 13,924      $ 12,401      $ 37,384      $ 33,359   

Reconciling items included in GAAP operating expenses:

          

Impairment of goodwill

     —          (988     —          (988     —     

Stock-based compensation

     (1,046     (1,295     (609     (3,018     (1,055

(Loss) gain on disposal of fixed assets

     (17     —          —          (17     1   

Amortization and depreciation

     (395     (395     (386     (1,024     (1,152

Restructuring and severance

     (215     (21     (2,134     (433     (3,183
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total reconciling items included in GAAP operating expenses

     (1,673     (2,699     (3,129     (5,480     (5,389
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Overhead costs

   $ 11,564      $ 11,225      $ 9,272      $ 31,904      $ 27,970   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation of GAAP net loss to adjusted EBITDA loss

          

Net loss attributable to Identiv, Inc.

   $ (6,215   $ (7,369   $ (3,847   $ (19,375   $ (11,591

Reconciling items included in GAAP net loss:

          

Provision for income taxes

     59        63        94        141        149   

Net (loss) gain attributable to noncontrolling interest

     (6     1        (38     (72     (73

Income from discontinued operations, net of income taxes

     —          —          (2     —          (546

Interest expense, net

     478        465        564        1,367        3,154   

Foreign currency losses (gains), net

     78        (438     700        916        952   

Impairment of goodwill and long lived assets

     —          988        —          988        —     

Stock-based compensation

     1,222        1,330        621        3,795        1,078   

Amortization and depreciation

     812        740        762        2,280        2,255   

Loss (gain) on disposal of fixed assets

     17        —          —          17        (1

Restructuring and severance

     216        21        2,134        408        3,183   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total reconciling items included in GAAP net loss

     2,876        3,170        4,835        9,840        10,151   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA gain ( loss)

   $ (3,339   $ (4,199   $ 988      $ (9,535   $ (1,440