Press Release
Fiscal First Quarter 2019 Financial Summary
-
Total revenue of
$25.5 million , down 6.3% year over year -
Transportation Systems revenue of
$13.2 million , down 10.5% year over year -
Roadway Sensors revenue of
$10.9 million , down 3.7% year over year -
Agriculture and Weather Analytics revenue of
$1.4 million , up 21.7% year over year - Total Gross Margin Rate of 40.0%, up 357 basis points year over year
Management commentary:
“As expected, our first quarter results were down year over year due to
the transition of a large contract with the
“During Q1, our Transportation Systems segment, in particular, secured a
large number of substantial contracts, and while our selling expense
increased this period, the result was a total added segment backlog of
GAAP Fiscal First Quarter 2019 Financial Results
Total revenue in the first quarter of fiscal 2019 decreased 6.3% to
Operating expenses in the first quarter were
Operating loss in the first quarter was
From a balance sheet perspective, cash and short-term investments
decreased
Non-GAAP Fiscal First Quarter 2019 Financial Results
In addition to results presented in accordance with generally accepted
accounting principles in
Non-GAAP operating expenses in the first quarter increased to
Earnings Conference Call
Date:
Time:
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International dial-in number: 1-323-701-0225
Conference
ID: 3805751
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view the press release, please visit the investor
relations section of the
A replay of the conference call will be available after
About
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 potential revenue growth for the upcoming quarters, the events that may have a potential impact on our future results, and our future performance, growth, operating results, 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, the timing and amount of government funds allocated to
overall transportation infrastructure projects and the transportation
industry; our ability to invest in marketing and selling our solution
offerings on a cost-effective and efficient manner; federal, state and
local government regulations, budgetary issues, constraints and delays;
the potential unforeseen impact of product and service offerings from
competitors, increased competition in certain market segments and other
competitive pressures; our ability to secure additional Transportation
Systems consulting contracts and successfully complete such contracts on
a timely basis; our ability to specify, develop, complete, introduce,
market and gain broad acceptance of our new and existing products and
technologies; the timing and successful completion of customer
qualification of our products and the risks of non-qualification; the
effectiveness of efficiency, cost, and expense reduction efforts; our
ability to successfully identify, complete and integrate acquisitions of
products, technologies and companies; our ability to attract, retain,
integrate and incentivize our key employees and our ability to maintain
and expand our ecosystem of customers, technology partners, service
providers, teaming partners and sales channel partners; 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 related to terrorist activity or armed
conflict in
| ITERIS, INC. | ||||||
| UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
| (in thousands) | ||||||
| June 30, | March 31, | |||||
| 2018 | 2018 | |||||
| ASSETS: | ||||||
| Cash | $ | 4,780 | $ | 10,152 | ||
| Short-term investments | 8,667 | 5,319 | ||||
| Trade accounts receivable, net | 16,528 | 12,866 | ||||
| Unbilled accounts receivable | 6,980 | 7,473 | ||||
| Inventories | 2,796 | 2,921 | ||||
| Prepaid expenses and other current assets | 1,397 | 1,165 | ||||
| Total current assets | 41,148 | 39,896 | ||||
| Property and equipment, net | 2,297 | 2,333 | ||||
| Intangible assets, net | 3,568 | 3,751 | ||||
| Goodwill | 15,150 | 15,150 | ||||
| Other assets | 1,756 | 1,756 | ||||
| Total assets | $ | 63,919 | $ | 62,886 | ||
| LIABILITIES AND STOCKHOLDERS’ EQUITY: | ||||||
| Trade accounts payable | $ | 10,418 | $ | 7,838 | ||
| Accrued payroll and related expenses | 8,156 | 7,398 | ||||
| Accrued liabilities | 2,079 | 2,358 | ||||
| Deferred revenue | 3,975 | 4,900 | ||||
| Total current liabilities | 24,628 | 22,494 | ||||
| Long-term liabilities | 829 | 871 | ||||
| Total liabilities | 25,457 | 23,365 | ||||
| Stockholders’ equity | 38,462 | 39,521 | ||||
| Total liabilities and stockholders’ equity | $ | 63,919 | $ | 62,886 | ||
| ITERIS, INC. | ||||||||
| UNAUDITED CONSOLIDATED | ||||||||
| STATEMENTS OF OPERATIONS | ||||||||
| (in thousands, except per share amounts) | ||||||||
| Three Months Ended | ||||||||
| June 30, | ||||||||
| 2018 | 2017 | |||||||
| Product revenues | $ | 11,918 | $ | 11,923 | ||||
| Service revenues | 13,557 | 15,260 | ||||||
| Total revenues | 25,475 | 27,183 | ||||||
| Cost of product revenues | 6,494 | 6,863 | ||||||
| Cost of service revenues | 8,789 | 10,415 | ||||||
| Total cost of revenues | 15,283 | 17,278 | ||||||
| Gross profit | 10,192 | 9,905 | ||||||
| Operating expenses: | ||||||||
| Selling, general and administrative | 9,630 | 8,697 | ||||||
| Research and development | 2,089 | 1,727 | ||||||
| Amortization of intangible assets | 65 | 33 | ||||||
| Total operating expenses | 11,784 | 10,457 | ||||||
| Operating loss | (1,592 | ) | (552 | ) | ||||
| Non-operating income (expense): | ||||||||
| Other income (expense), net | 15 | (7 | ) | |||||
| Interest income, net | 39 | 2 | ||||||
| Loss from continuing operations before income taxes | (1,538 | ) | (557 | ) | ||||
| (Provision) benefit for income taxes | (41 | ) | 1 | |||||
| Loss from continuing operations | (1,579 | ) | (556 | ) | ||||
| Gain on sale of discontinued operation, net of tax |
- |
86 | ||||||
| Net loss | $ | (1,579 | ) | $ | (470 | ) | ||
|
Loss per share from continuing operations – basic and diluted |
$ |
(0.05 |
) |
(0.02 |
) |
|||
|
Gain per share from sale of discontinued operation – basic and diluted |
$ |
- |
$ |
0.01 |
||||
| Net loss per share - basic and diluted | $ | (0.05 | ) |
$ |
(0.01 |
) |
||
| Shares used in basic per share calculations | 33,201 | 32,506 | ||||||
| Shares used in diluted per share calculations | 33,201 | 32,506 | ||||||
| ITERIS, INC. | ||||||||||||||
| UNAUDITED SEGMENT REPORTING DETAILS | ||||||||||||||
| (in thousands) | ||||||||||||||
| Roadway | Transportation | Ag & Weather | ||||||||||||
| Sensors | Systems | Analytics | Iteris, Inc. | |||||||||||
| Three Months Ended June 30, 2018 | ||||||||||||||
| Product revenues | $ | 10,801 | $ | 1,117 | $ | - | $ | 11,918 | ||||||
| Service revenues | 59 | 12,067 | 1,431 | 13,557 | ||||||||||
| Total revenues | $ | 10,860 | $ | 13,184 | $ | 1,431 | $ | 25,475 | ||||||
| Segment operating income (loss) | $ | 1,833 | $ | 1,358 | $ | (1,142 | ) | $ | 2,049 | |||||
| Corporate and other income (expense), net | (3,522 | ) | ||||||||||||
| Amortization of intangible assets | (65 | ) | ||||||||||||
| Loss from continuing operations before income taxes | $ | (1,538 | ) | |||||||||||
| Roadway | Transportation | Ag & Weather | ||||||||||||
| Sensors | Systems | Analytics | Iteris, Inc. | |||||||||||
| Three Months Ended June 30, 2017 | ||||||||||||||
| Product revenues | $ | 11,280 | $ | 643 | $ | - | $ | 11,923 | ||||||
| Service revenues | - | 14,084 | 1,176 | 15,260 | ||||||||||
| Total revenues | $ | 11,280 | $ | 14,727 | $ | 1,176 | $ | 27,183 | ||||||
| Segment operating income (loss) | $ | 2,547 | $ | 2,332 | $ | (1,832 | ) | $ | 3,047 | |||||
| Corporate and other income (expense), net | (3,571 | ) | ||||||||||||
| Amortization of intangible assets | (33 | ) | ||||||||||||
| Loss from continuing operations before income taxes | $ | (557 | ) | |||||||||||
Non-GAAP Financial Measures and
Reconciliation
In addition to results presented in accordance with GAAP, the Company has included the following non-GAAP financial measures in this release: non-GAAP operating expenses, non-GAAP operating (loss) income, non-GAAP net income and non-GAAP basic and diluted earnings per share from continuing operations. These non-GAAP financial measures exclude the following items: (a) stock-based compensation; (b) depreciation; (c) amortization; and (d) the estimated tax effect of the foregoing non-GAAP adjustments.
Management uses certain non-GAAP financial measures internally for strategic decision making, forecasting future results and evaluating current performance. Non-GAAP financial measures are not prepared in accordance with GAAP; therefore, the information is not necessarily comparable to other companies' financial information and should be considered as a supplement to, not a substitute for, or superior to, the corresponding financial measures calculated in accordance with GAAP.
Details of the items excluded from GAAP financial results in calculating non-GAAP financial measures and explanatory footnotes are as follows:
| a) | Iteris excludes stock-based compensation expenses from its non-GAAP financial measures primarily because they are non-cash expenses and management finds it useful to exclude certain non-cash charges to assess the appropriate level of various operating expenses to assist in budgeting, planning and forecasting future periods. Moreover, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use under FASB ASC Topic 718, Iteris believes excluding stock-based compensation expenses allows investors to make meaningful comparisons between our recurring core business operating results and those of other companies. | |||||
| b) | Iteris excludes depreciation expenses from its non-GAAP financial measures. Management finds it useful to exclude these charges to assess the appropriate level of various operating expenses to assist in budgeting, planning and forecasting future periods. | |||||
| c) | Iteris incurs amortization of developed technology and purchased intangibles in connection with acquisitions of certain businesses and technologies. Amortization of developed technologies and purchased intangibles is inconsistent in amount and frequency, and is significantly affected by the timing and size of our developments and acquisitions. Management finds it useful to exclude these variable charges from our cost of revenues and operating expenses to assist in budgeting, planning and forecasting future periods. Investors should note that the use of intangible assets contributed to our revenues earned during the periods presented and will contribute to our future period revenues as well. Amortization of developed technologies and purchased intangible assets will recur in future periods. | |||||
| d) | The amount represents the estimated income tax effect of the non-GAAP adjustments. The tax effect of non-GAAP adjustments for the first quarters of Fiscal 2019, Fiscal 2018 and Fiscal 2017, were calculated by applying an estimated tax rate of 1% to each specific non-GAAP item, due to the impact of the valuation allowance on our effective tax rate in those years. |
|
Iteris, Inc. |
||||||||
| Schedule Reconciling GAAP Net Loss to Non-GAAP Net (Loss) Income | ||||||||
| ($ in thousands, except per share amounts) | ||||||||
| (unaudited) | ||||||||
| For the Three Months Ended | ||||||||
| June 30, | ||||||||
| 2018 | 2017 | |||||||
| GAAP net loss | $ | (1,579 | ) | $ | (470 | ) | ||
| GAAP net loss per share - basic and diluted | $ | (0.05 | ) | $ | (0.01 | ) | ||
| The non-GAAP amounts have been adjusted to exclude the following items: | ||||||||
| Excluded from cost of revenues: | ||||||||
| Amortization (c) | $ | 200 | $ | 104 | ||||
| Excluded from operating expenses: | ||||||||
| Stock based compensation (a) | $ | 522 | $ | 449 | ||||
| Depreciation (b) | 265 | 184 | ||||||
| Amortization (c) | 65 | 33 | ||||||
| Total excluded from operating expenses | $ | 852 | $ | 666 | ||||
| Total excluded operating loss | $ | 1,052 | $ | 770 | ||||
| Income tax effect on non-GAAP adjustments (d) | (11 | ) | (8 | ) | ||||
| Total excluded from operating loss after income tax effect | $ | 1,041 | $ | 762 | ||||
| Non-GAAP net (loss) income | $ | (538 | ) | $ | 292 | |||
| Non-GAAP net (loss) income per share - basic and diluted | $ | (0.02 | ) | $ | 0.01 | |||
| (a) - (d) See corresponding footnotes above. | ||||||||
| Iteris, Inc. | ||||||||
| Schedule Reconciling GAAP Operating (Loss) to Non-GAAP Operating (Loss) Income | ||||||||
| ($ in thousands) | ||||||||
| (unaudited) | ||||||||
| For the Three Months Ended | ||||||||
| June 30, | ||||||||
| 2018 | 2017 | |||||||
| GAAP cost of revenues | $ | 15,283 | $ | 17,728 | ||||
| Amortization (c) | (200 | ) | (104 | ) | ||||
| Non-GAAP cost of revenues | $ | 15,083 | $ | 17,624 | ||||
| GAAP operating expenses | $ | 11,784 | $ | 10,457 | ||||
| Stock based compensation (a) | (522 | ) | (449 | ) | ||||
| Depreciation (b) | (265 | ) | (184 | ) | ||||
| Amortization (c) | (65 | ) | (33 | ) | ||||
| Non-GAAP operating expenses | $ | 10,932 | $ | 9,791 | ||||
| GAAP operating loss | $ | (1,592 | ) | $ | (552 | ) | ||
| Stock based compensation (a) | (522 | ) | (449 | ) | ||||
| Depreciation (b) | (265 | ) | (184 | ) | ||||
| Amortization (c) | (265 | ) | (137 | ) | ||||
| Non-GAAP operating (loss) income | $ | (540 | ) | $ | 218 | |||
View source version on businesswire.com: https://www.businesswire.com/news/home/20180807005642/en/
Source:
Investor Relations
MKR Group, Inc.
Todd Kehrli
323-468-2300
iti@mkr-group.com
