a2021_0506isigex991
EXHIBIT 99.1
Contact:
Insignia Systems,
Inc.
Kristine Glancy,
CEO
(763)
392-6200
|
FOR IMMEDIATE RELEASE
INSIGNIA SYSTEMS, INC. ANNOUNCES
FIRST
QUARTER 2021 FINANCIAL
RESULTS
MINNEAPOLIS, MN – May
6, 2021 – Insignia
Systems, Inc. (Nasdaq: ISIG) (“Insignia”) today
reported financial results for the first quarter ended March 31,
2021 (“Q1”).
Overview
●
Q1 2021 net sales
increased 15.7% to $5.4 million from $4.7 million in Q1
2020.
●
Q1 2021 operating
loss was $1.7 million compared to operating loss of $1.1 million in
Q1 2020.
●
Q1 2021 net loss
was $0.7 million, or $0.38 per basic and diluted share, compared to
net loss of $0.9 million, or $0.50 per basic and diluted share in
Q1 2020.
Insignia’s
President and CEO, Kristine Glancy, commented, “2021 revenue
is off to a strong start driven by our continued momentum on our
non-POPS portfolio. Our non-POPS revenue increased 97% versus Q1
2020 partially offset by our POPS revenue declining 41%. Our
non-POPS revenue consisting of our display, on-pack and mobile
businesses all experienced growth versus Q1 2020 and contributed
74% of our total Q1 2021 revenue. The team was successful in
growing our non-POPS portfolio with existing and new clients in Q1
2021. Our holistic approach of offering both broader in-store, as
well as out-of-store solutions, has enabled us to reach more brands
and retailers, resulting in increased revenues. We recently hired
several new team members who have strong experience in our non-POPS
solutions and will aid the company in continuing to build a strong
pipeline. POPS will continue to be challenged, driven by continued
competitive pressures, the expiration of our 10 year selling
agreement with News America Marketing and brands spending less on
POPS signage due to COVID.”
Ms.
Glancy continued, “I’m very optimistic on our strong
start to 2021 and encouraged by the continued diversification of
our overall portfolio. While POPS has been our primary solution for
over twenty-years, continuing to compete in a market against one
competitor has put significant pressure on our ability to grow our
revenue. We made the strategic decision to start diversifying our
portfolio two years ago and it has proven to be very beneficial in
our ability to reach new clients, channels and opportunities. While
this means new and additional competitors, we have positioned
ourselves to have a higher likelihood of converting overall revenue
with our broad base of solutions. Our new brand and positioning is
resonating well with the marketplace, showcasing our priority on
both superior customer service and overall relationships backed by
our deep retail and brand expertise. We have completed the
downsizing of our office space reducing our overall footprint by
18,000 square feet. We will have two office locations maintaining a
small warehouse space near our old office as well as our new
headquarter space in Minneapolis, near our clients and partners.
The team put together a strong plan for 2021 and I’m
encouraged with our strong start.”
Q1 2021 Results
Net
sales increased 15.7% to $5,419,000 in Q1 2021, from $4,682,000 in
Q1 2020, primarily due to a 97% increase in non-POPS revenue,
partially offset by a 41% decrease in POPS solutions revenue. Our
non-POPS revenue has increased due to both sales to new CPGs and an
increase in sales to existing CPGs. Our POPS revenue continues to
be negatively impacted by competitive pressures and brands not
spending on syndicated signage due to COVID-19.
Gross
profit in Q1 2021 decreased to $962,000, or 17.8% of net sales,
from $969,000, or 20.7% of net sales, in Q1 2020. The decrease in
gross profit was primarily due to the decrease in POPS solution
sales, as well as the Company’s decision to make an
investment in the execution of a large non-POPS
program.
Selling
expenses in Q1 2021 were $516,000, or 9.5% of net sales, compared
to $720,000, or 15.4% of net sales, in Q1 2020 due to lower staff
related expenses and a software investment in Q1 2020.
Marketing
expenses in Q1 2021 were $235,000, or 4.3% of net sales, compared
to $365,000, or 7.8% of net sales, in Q1 2020. Decreased marketing
expenses were primarily the result of decreased consulting and
staffing expenses.
General
and administrative expenses in Q1 2021 were $1,919,000, or 35.5% of
net sales, compared to $993,000, or 21.2% of net sales, in Q1 2020
due to increased litigation expenses.
Other
income for Q1 2021 was $1,062,000 due to the gain on debt
extinguishments from the SBA forgiving the Company of its loan
entered into pursuant to the Paycheck Protection Program of the
CARES Act.
Income
tax expense for Q1 2021 was 2.0% of pretax loss, or an expense of
$13,000, compared to income tax benefit of 20.5% of pretax loss, or
$222,000, in Q1 2020.
As a
result of the items above, the net loss for Q1 2021 was $659,000,
or $0.38 per basic and diluted share, compared to a net loss of
$863,000, or $0.50 per basic and diluted share, in Q1
2020.
As of
March 31, 2021, cash and cash equivalents totaled $6,838,000,
compared to $7,128,000 as of December 31, 2020.
About Insignia Systems, Inc.
Insignia
Systems, Inc. sells product solutions ranging from in-store to
digital advertising. Consumer-packaged goods (CPG) manufacturers
and retailers across the country rely on our deep expertise in the
dynamic retail environment to provide a full suite of shopper
engagement solutions.
For
additional information, contact (800) 874-4648, or visit the
Insignia website at www.insigniasystems.com
Investor inquiries can be submitted to investorrelations@insigniasystems.com.
Cautionary Statement for the Purpose of Safe Harbor Provisions of
the Private Securities Litigation Reform Act of 1995
Statements in this press release that are not statements of
historical or current facts are considered forward-looking
statements within the meaning of the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, as amended. The
words “anticipate,” “continue,”
“expect,” “intend,” “remain,”
“seek,” “will” and similar expressions
identify forward-looking statements. Readers are cautioned not to
place undue reliance on these or any forward-looking statements,
which speak only as of the date of this press release. Statements
made in this press release regarding, for instance, anticipated
future profitability, future service revenues, innovation and
transformation of Insignia’s business, allocations of
resources, benefits of new relationships, and the impacts of the
COVID-19 pandemic and efforts to mitigate the same are
forward-looking statements. These forward-looking statements are
based on current information, which we have assessed and which by
its nature is dynamic and subject to rapid and even abrupt changes.
As such, actual results may differ materially from the results or
performance expressed or implied by such forward-looking
statements. Forward-looking statements involve known and unknown
risks, uncertainties and other factors, including those set forth
in our Annual Report on Form 10-K for the year ended December 31,
2020 and additional risks, if any, identified in our Quarterly
Reports on Form 10-Q and our Current Reports on Forms 8-K filed
with the SEC. Such forward-looking statements should be read in
conjunction with Insignia's filings with the SEC. Insignia assumes
no responsibility to update the forward-looking statements
contained in this press release or the reasons why actual results
would differ from those anticipated in any such forward-looking
statement, other than as required by law.
Insignia Systems, Inc.
|
STATEMENTS OF OPERATIONS
|
(Unaudited)
|
|
|
|
|
|
Three Months Ended
|
|
March 31,
|
|
2021
|
|
2020
|
|
|
|
|
Net sales
|
$5,419,000
|
|
$4,682,000
|
Cost of sales
|
4,457,000
|
|
3,713,000
|
Gross profit
|
962,000
|
|
969,000
|
Operating expenses:
|
|
|
|
Selling
|
516,000
|
|
720,000
|
Marketing
|
235,000
|
|
365,000
|
General
and administrative
|
1,919,000
|
|
993,000
|
|
|
|
|
Operating loss
|
( 1,708,000)
|
|
( 1,109,000)
|
Other income, net
|
1,062,000
|
|
24,000
|
|
|
|
|
Loss before taxes
|
( 646,000)
|
|
( 1,085,000)
|
Income tax expense (benefit)
|
13,000
|
|
( 222,000)
|
|
|
|
|
Net loss
|
$(659,000)
|
|
$(863,000)
|
|
|
|
|
|
|
|
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Net loss per share:
|
|
|
|
Basic
|
$(0.38)
|
|
$(0.50)
|
Diluted
|
$(0.38)
|
|
$(0.50)
|
|
|
|
|
Shares used in calculation of net loss per share:
|
|
|
|
Basic
|
1,751,000
|
|
1,724,000
|
Diluted
|
1,751,000
|
|
1,724,000
|
SELECTED BALANCE SHEET DATA
|
(Unaudited)
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
2021
|
|
2020
|
|
|
|
|
Cash and cash equivalents
|
$6,838,000
|
|
$7,128,000
|
Working capital
|
7,582,000
|
|
8,694,000
|
Total assets
|
12,769,000
|
|
14,060,000
|
Total liabilities
|
5,652,000
|
|
6,366,000
|
Shareholders' equity
|
7,117,000
|
|
7,694,000
|
|
|
|
|
Working capital represents current assets less current
liabilities.
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