EX-99.1 2 iti-20210630x8xkex991.htm EX-99.1 Document

Exhibit 99.1
itia02a.jpg
Iteris Reports Record 22% Revenue Growth Year Over Year
Significant Increases in GAAP Net Income and Adjusted EBITDA for Fiscal First Quarter
SANTA ANA, Calif. – August 5, 2021 – Iteris, Inc. (NASDAQ: ITI), the global leader in smart mobility infrastructure management, today reported financial results for its fiscal first quarter 2022 ended June 30, 2021. During the first quarter of fiscal 2021, the company completed the sale of its Agriculture and Weather Analytics segment to DTN, LLC. The results of the Agriculture and Weather Analytics segment are reported as discontinued operations for all periods presented in this release.

Fiscal First Quarter 2022 Financial Highlights

•Record total revenue of $34.1 million, up 22% year over year
•Record total ending backlog of $79.9 million, up 18% year over year
•GAAP net income from continuing operations of $0.6 million, or $0.01 per diluted share, a $0.2 million improvement to net income year over year
•Record adjusted EBITDA of $2.5 million, an 11% or $0.3 million improvement year over year

Fiscal Full-Year 2022 Outlook

•Raises the midpoint of total revenue guidance range by moving the range to $134.0 million to $142.0 million, which would represent year-over-year growth of 15% at the low-end and 21% at the high-end
•Maintains adjusted EBITDA guidance range of 7% to 8% of fiscal full year 2022 revenue, which would represent year-over-year growth of 10% at the low-end and 27% at the high-end

Management Commentary:

“We are pleased with our strong financial results for the period ending June 30, 2021 and excited about the market’s response to our ClearMobility Platform,” said Joe Bergera, president and CEO of Iteris. “Our end market is vibrant due to the need for cities and states to modernize their aging mobility infrastructure and for various industries to better understand the infrastructure they use. Given we enter the second quarter of fiscal 2022 with record total ending backlog and a robust product roadmap, we expect to continue to gain share in the highly fragmented smart mobility infrastructure management market.”

GAAP Fiscal First Quarter 2022 Financial Results

Total revenue in the first quarter of fiscal 2022 increased 22% to $34.1 million, compared with $28.0 million in the same quarter a year ago primarily driven by the addition of revenues from TrafficCast, and continued strong demand for both hardware and software solutions.

Operating expenses in the first quarter increased 28% to $13.4 million compared with $10.5 million the same quarter a year ago. The increase was a result of the TrafficCast acquisition and continued investment in research and development and sales and marketing.

Operating income from continuing operations in the first quarter was approximately $0.7 million, compared with an operating income of approximately $0.4 million in the same quarter a year ago. Net income from continuing operations in the first quarter was approximately $0.6 million, or $0.01 per diluted share, compared with net income from continuing operations of approximately $0.4 million, or $0.01 per diluted share, in the same quarter a year ago.

Non-GAAP Fiscal First Quarter 2022 Financial Results

In addition to results presented in accordance with generally accepted accounting principles in the United States (“GAAP”), the company has included the following non-GAAP financial measure: Adjusted income from continuing operations before interest, taxes, depreciation, amortization, stock-based compensation expense, and restructuring charges (“Adjusted EBITDA”). A discussion of the company’s use of this non-GAAP financial measure is set forth below in the financial statements portion of this release under the heading “Non-GAAP Financial Measures and Reconciliation.”

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Adjusted EBITDA in the first quarter was approximately $2.5 million, or 7.4% of total revenues, compared with approximately $2.3 million, or 8.2% of total revenues, in the same quarter a year ago.




Earnings Conference Call

Iteris will conduct a conference call today to discuss its fiscal first quarter results.

Date: Thursday, August 5, 2021
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)
Toll-free dial-in number: +1-800-367-2403
International dial-in number: +1 334-777-6978
Conference ID: 1268914

To listen to the live webcast or view the press release, please visit the investor relations section of the Iteris website at www.iteris.com.

A replay of the conference call will be available after 7:30 p.m. Eastern time on the same day through August 12, 2021. To access the replay dial information, please click here.

About Iteris, Inc.

Iteris is the global leader in smart mobility infrastructure management – the foundation for a new era of mobility. We apply cloud computing, artificial intelligence, advanced sensors, advisory services and managed services to achieve safe, efficient and sustainable mobility. Our end-to-end solutions monitor, visualize and optimize mobility infrastructure around the world to help ensure that roads are safe, travel is efficient, and communities thrive. Visit www.iteris.com for more information, and join the conversation on Twitter, LinkedIn and Facebook.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:

This release may contain forward-looking statements, which speak only as of the date hereof and are based upon our current expectations and the information available to us at this time. Words such as "believes," "anticipates," "expects," "intends," "plans," "seeks," "estimates," "may," "will," "can," and variations of these words or similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to, statements about the Company’s anticipated demand and growth opportunities, conversion of bookings to revenue, the impact and success of new solution offerings, the Company’s recent acquisition, our future performance, growth and profitability, operating results, and financial condition and prospects. Such statements are subject to certain risks, uncertainties, and assumptions that are difficult to predict and actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors.

Important factors that may cause such a difference include, but are not limited to, federal, state and local government budgetary issues, spending and scheduling changes, funding constraints and delays, including in light of the COVID-19 pandemic; the timing and amount of government funds allocated to overall transportation infrastructure projects and the transportation industry; our ability to replace large contracts once they have been completed; the effectiveness of efficiency, cost, and expense reduction efforts; our ability to achieve anticipated benefits from our sale of our Agriculture and Weather Analytics segment; our ability to successfully complete and integrate acquired assets and companies; our ability to specify, develop, complete, introduce, market and gain broad acceptance of our new and existing product and service offerings; risks related to our ability to recruit and/or retain key talent; the potential unforeseen impact of product and service offerings from competitors, increased competition in certain market segments, and such competitors’ patent coverage and claims; any softness in the markets that we address; adverse effects of the COVID-19 pandemic on our vendors and our employees; and the impact of general economic and political conditions and specific conditions in the markets we address, and the possible disruption in government spending and commercial activities, such as the COVID-19 pandemic, import/export tariffs, terrorist activities or armed conflicts in the United States and internationally. Further information on Iteris, Inc., including additional risk factors that may affect our forward-looking statements, as contained in our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K, and our other SEC filings that are available through the SEC's website (www.sec.gov).

Iteris Contact
Douglas Groves
Senior Vice President and Chief Financial Officer
Tel: (949) 270-9643
Email: dgroves@iteris.com

Investor Relations
MKR Investor Relations, Inc.
Todd Kehrli
Tel: (213) 277-5550
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Email: iti@mkr-group.com
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ITERIS, INC.
UNAUDITED CONDENSED CONSOLIDATED
BALANCE SHEETS
(in thousands)
June 30,
2021		March 31,
2021
Assets
Current assets:
Cash and cash equivalents$31,111 $25,205 
Restricted cash263 263 
Short-term investments— 3,100 
Trade accounts receivable, net22,826 19,020 
Unbilled accounts receivable10,390 11,541 
Inventories5,181 5,066 
Prepaid expenses and other current assets4,048 5,445 
Total current assets73,819 69,640 
Property and equipment, net1,751 1,923 
Right-of-use assets11,346 11,353 
Intangible assets, net14,570 14,297 
Goodwill28,340 28,340 
Other assets1,370 1,238 
Assets held for sale, noncurrent portion60 78 
Total assets$131,256 $126,869 
Liabilities and stockholders’ equity
Current liabilities:
Trade accounts payable$9,386 $8,935 
Accrued payroll and related expenses13,692 11,734 
Accrued liabilities4,129 4,921 
Deferred revenue7,156 7,349 
Liabilities held for sale, current portion2 94 
Total current liabilities34,365 33,033 
Long-term liabilities14,879 14,596 
Liabilities held for sale, noncurrent portion253261 
Total liabilities49,497 47,890 
Stockholders’ equity81,759 78,979 
Total liabilities and stockholders’ equity$131,256 $126,869 
















ITERIS, INC.
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UNAUDITED CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
(in thousands, except per share amounts)

Three Months Ended
June 30,
20212020
Product revenues$18,026 $14,394 
Service revenues16,059 13,606 
Total revenues34,085 28,000 
Cost of product revenues9,557 8,081 
Cost of service revenues10,435 9,051 
Cost of revenues19,992 17,132 
Gross profit14,093 10,868 
Operating expenses:
General and administrative6,390 5,368 
Sales and Marketing4,587 3,355 
Research and development1,765 914 
Amortization of intangible assets668 230 
Restructuring charges— 619 
Total operating expenses13,410 10,486 
Operating income683 382 
Non-operating income:
Other income, net18 16 
Interest income, net3 54 
Income from continuing operations before income taxes704 452 
Provision for income taxes(75)(34)
Net income from continuing operations629 418 
Loss from discontinued operations before gain on sale, net of tax(18)(1,358)
Gain on sale of discontinued operations, net of tax— 11,288 
Net income (loss) from discontinued operations, net of tax(18)9,930 
Net income$611 $10,348 
Income per share - basic:
Income per share from continuing operations$0.02 $0.01 
Income per share from discontinued operations$0.00 $0.24 
Net income per share$0.02 $0.25 
Income per share - diluted:
Income per share from continuing operations$0.01 $0.01 
Income per share from discontinued operations$0.00 $0.24 
Net income per share$0.01 $0.25 
Shares used in basic per share calculations41,875 40,732 
Shares used in diluted per share calculations43,380 41,507 







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ITERIS, INC.
Non-GAAP Financial Measures and Reconciliation

In addition to results presented in accordance with GAAP, the company has included the following non-GAAP financial measure in this release: Adjusted income (loss) from continuing operations before interest, taxes, depreciation, amortization, stock-based compensation expense, and restructuring charges (“Adjusted EBITDA”).

When viewed with our financial results prepared in accordance with GAAP and accompanying reconciliations, we believe Adjusted EBITDA provides additional useful information to clarify and enhance the understanding of the factors and trends affecting our past performance and future prospects. We define this measure, explain how it is calculated and provide reconciliations of this measure to the most comparable GAAP measure in the table below. Adjusted EBITDA is a supplemental measure of our performance that is not required by, or presented in accordance with, GAAP. This is not a measurement of our financial performance under GAAP and should not be considered as alternatives to net income or any other performance measures derived in accordance with GAAP, or as an alternative to net cash provided by operating activities as measures of our liquidity. The presentation of this measure should not be interpreted to mean that our future results will be unaffected by unusual or nonrecurring items.

We use the Adjusted EBITDA non-GAAP operating performance measure internally as a complementary financial measure to evaluate the performance and trends of our businesses. We present Adjusted EBITDA and the related financial ratios, as applicable, because we believe that measures such as these provide useful information with respect to our ability to meet our operating commitments.

Adjusted EBITDA and the related financial ratios have limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations include:
•They do not reflect our cash expenditures, future requirements for capital expenditures or contractual commitments;
•They do not reflect changes in, or cash requirements for, our working capital needs;
•Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements;
•They are not adjusted for all non-cash income or expense items that are reflected in our statements of cash flows;
•They do not reflect the impact on earnings of charges resulting from matters unrelated to our ongoing operations; and
•Other companies in our industry may calculate Adjusted EBITDA differently from us, limiting their usefulness as comparative measures.

Because of these limitations, Adjusted EBITDA and the related financial ratios should not be considered as measures of discretionary cash available to us to invest in the growth of our business or as a measure of cash that will be available to us to meet our obligations. You should compensate for these limitations by relying primarily on our GAAP results and using Adjusted EBITDA only as supplemental information. See our Condensed Consolidated Financial Statements contained in this Press Release. However, in spite of the above limitations, we believe that Adjusted EBITDA and the related financial ratios are useful to an investor in evaluating our results of operations because these measures:
•Are widely used by investors to measure a company’s operating performance without regard to items excluded from the calculation of such terms, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired, among other factors;
•Help investors to evaluate and compare the results of our operations from period to period by removing the effect of our capital structure from our operating performance; and
•Are used by our management team for various other purposes in presentations to our Board of Directors as a basis for strategic planning and forecasting.

The following financial items have been added back to or subtracted from our net income when calculating Adjusted EBITDA:
•Interest expense. Iteris excludes interest expense because it does not believe this item is reflective of ongoing business and operating results. This amount may be useful to investors for determining current cash flow.
•Income tax. This amount may be useful to investors because it represents the taxes which may be payable for the period and the change in deferred taxes during the period, and may reduce cash flow available for use in our business.
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•Depreciation. Iteris excludes depreciation expense primarily because it is a non-cash expense. These amounts may be useful to investors because it generally represents the wear and tear on our property and equipment used in our operations.
•Amortization. Iteris incurs amortization of intangible assets in connection with acquisitions. Iteris also incurs amortization related to capitalized software development costs. Iteris excludes these items because it does not believe that these expenses are reflective of ongoing operating results in the period incurred. These amounts may be useful to investors because it represents the estimated attrition of our acquired customer base and the diminishing value of product rights.
•Stock-based compensation. These expenses consist primarily of expenses from employee and director equity based compensation plans Iteris excludes stock-based compensation primarily because they are non-cash expenses and Iteris believes that it is useful to investors to understand the impact of stock-based compensation to its results of operations and current cash flow.
•Restructuring charges. These expenses consist primarily of employee separation expenses, facility termination costs, and other expenses associated with Company restructuring activities. Iteris excludes these expenses as it does not believe that these expenses are reflective of ongoing operating results in the period incurred. These amounts may be useful to our investors in evaluating our core operating performance.

Reconciliations of net income (loss) from continuing operations to Adjusted EBITDA and the presentation of Adjusted EBITDA as a percentage of net revenues were as follows:

Three Months Ended
June 30,
20212020
(In Thousands)
Net income from continuing operations$629$418
Income tax expense7534
Depreciation expense232185
Amortization expense803361
Stock-based compensation794664
Other adjustments:
Restructuring charges—619
Total adjustments1,9041,863
Adjusted EBITDA$2,533$2,281
Percentage of total revenues7.4 %8.2 %
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