Press Release
Fourth Quarter Total Net Bookings of
Fiscal Fourth Quarter 2019 Financial Highlights
-
Record total revenue of
$26.1 million , up 3.2% year over year and 12.8% sequentially -
Total net bookings of
$24.1 million , up 64.2% year over year and 12.5% sequentially -
Transportation Systems revenue of
$12.9 million , down 1.1% year over year and up 14.2% sequentially -
Agriculture and Weather Analytics revenue of
$1.7 million , up 22.9% year over year and 10.0% sequentially -
Roadway Sensors revenue of
$11.4 million , up 6.0% year over year and 11.6% sequentially
Fiscal Full Year 2019 Financial Highlights
-
Total revenue of
$99.1 million , down 4.4% year over year -
Total net bookings of
$107.1 million , up 23.5% year over year -
Transportation Systems revenue of
$49.8 million , down 8.6% year over year -
Agriculture and Weather Analytics revenue of
$5.8 million , up 18.9% year over year -
Roadway Sensors revenue of
$43.5 million , down 2.0% year over year
Management commentary
“We are pleased to resume growth and report record fourth quarter
revenue,” said
“During fiscal year 2019,
GAAP Fiscal Fourth Quarter 2019 Financial Results
Total revenue in the fourth quarter of fiscal 2019 increased 3.2% to
Operating expenses in the fourth quarter were
Operating loss in the fourth quarter was
GAAP Fiscal 2019 Full Year Financial Results
Total revenue in fiscal 2019 decreased 4.4% to
Operating expenses for fiscal year 2019 were
Operating loss in fiscal 2019 was
Non-GAAP Fiscal Q4 2019 Financial Results
In addition to results presented in accordance with generally accepted
accounting principles in
Non-GAAP operating expenses in the fourth quarter was relatively
consistent at
Non-GAAP Fiscal 2019 Full Year Financial Results
Non-GAAP operating expenses in fiscal 2019 were
Earnings Conference Call
Date:
Time:
Toll-free dial-in number: 1-888-204-4368
International
dial-in number: +1 720-543-0214
Conference ID: 5091277
To listen to the live or archived webcast of the earnings call or to
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 growth opportunities, the impact of the impact and success of new product introductions and acquisitions, our future performance, growth and profitability, operating results, financial condition and prospects, and new management team. 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 policy changes, constraints and delays; the timing and amount
of government funds allocated to overall transportation infrastructure
projects and the transportation industry; 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 and
cost-effective 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 availability of components used in the
manufacture of certain of our products; 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 retain, integrate and incentivize our new
management team and their ability to shape the strategic direction of
the company and implement change; risks related to our ability to
recruit and/or retain key talent; the potential impact of product and
service offerings from competitors and such competitors’ patent coverage
and claims; any softness in the markets that we address, 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 related to terrorist activity or
armed conflict in
ITERIS, INC. | ||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
(in thousands) | ||||||
March 31, | March 31, | |||||
2019 | 2018 | |||||
ASSETS: | ||||||
Cash | $ | 7,071 | $ | 10,152 | ||
Short-term investments | 1,935 | 5,319 | ||||
Trade accounts receivable, net | 16,929 | 12,866 | ||||
Unbilled accounts receivable | 6,487 | 7,473 | ||||
Inventories | 2,916 | 2,921 | ||||
Prepaid expenses and other current assets | 1,367 | 1,165 | ||||
Total current assets | 36,705 | 39,896 | ||||
Property and equipment, net | 1,965 | 2,333 | ||||
Intangible assets, net | 3,286 | 3,751 | ||||
Goodwill | 15,150 | 15,150 | ||||
Other assets | 849 | 1,756 | ||||
Total assets | $ | 57,955 | $ | 62,886 | ||
LIABILITIES AND STOCKHOLDERS’ EQUITY: | ||||||
Trade accounts payable | $ | 9,441 | $ | 7,838 | ||
Accrued payroll and related expenses | 6,536 | 7,398 | ||||
Accrued liabilities | 2,370 | 2,358 | ||||
Deferred revenue | 4,883 | 4,900 | ||||
Total current liabilities | 23,230 | 22,494 | ||||
Long-term liabilities | 670 | 871 | ||||
Total liabilities | 23,900 | 23,365 | ||||
Stockholders’ equity | 34,055 | 39,521 | ||||
Total liabilities and stockholders’ equity | $ | 57,955 | $ | 62,886 | ||
ITERIS, INC. | ||||||||||||||||
UNAUDITED CONSOLIDATED | ||||||||||||||||
STATEMENTS OF OPERATIONS | ||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Product revenues | $ | 12,809 | $ | 10,844 | $ | 48,227 | $ | 46,464 | ||||||||
Service revenues | 13,282 | 14,429 | 50,896 | 57,265 | ||||||||||||
Total revenues | 26,091 | 25,273 | 99,123 | 103,729 | ||||||||||||
Cost of product revenues | 8,224 | 6,195 | 28,434 | 26,633 | ||||||||||||
Cost of service revenues | 8,006 | 9,062 | 32,083 | 37,265 | ||||||||||||
Total cost of revenues | 16,230 | 15,257 | 60,517 | 63,898 | ||||||||||||
Gross profit | 9,861 | 10,016 | 38,606 | 39,831 | ||||||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative | 10,311 | 10,452 | 38,471 | 37,400 | ||||||||||||
Research and development | 1,931 | 2,391 | 7,819 | 7,945 | ||||||||||||
Amortization of intangible assets |
84 | 4 | 275 | 88 | ||||||||||||
Total operating expenses | 12,326 | 12,847 | 46,565 | 45,433 | ||||||||||||
Operating loss | (2,465 | ) | (2,831 | ) | (7,959 | ) | (5,602 | ) | ||||||||
Non-operating income (expense): | ||||||||||||||||
Other income (expense), net | 9 | (3 | ) | 50 | (16 | ) | ||||||||||
Interest income, net | 39 | 23 | 129 | 32 | ||||||||||||
Loss from continuing operations before income taxes | (2,417 | ) | (2,811 | ) | (7,780 | ) | (5,586 | ) | ||||||||
Benefit for income taxes | (15 | ) | 411 | (36 | ) | 1,818 | ||||||||||
Loss from continuing operations | (2,432 | ) | (2,400 | ) | (7,816 | ) | (3,768 | ) | ||||||||
Gain on sale of discontinued operation, net of tax | - | (16 | ) | - | 242 | |||||||||||
Net loss | $ | (2,432 | ) | $ | (2,416 | ) | $ | (7,816 | ) | $ | (3,526 | ) | ||||
Loss per share from continuing operations – |
||||||||||||||||
basic and diluted |
|
$ |
(0.07 |
) | $ |
(0.07 |
) |
|
$ |
(0.23 |
) |
|
$ |
(0.12 |
) | |
Gain per share from sale of discontinued operation – |
||||||||||||||||
basic and diluted |
$ |
- | $ | (0.00 | ) | $ | - | $ | 0.01 | |||||||
Net loss per share - basic and diluted | (0.07 | ) | (0.07 | ) | (0.23 | ) | (0.11 | ) | ||||||||
Shares used in basic per share calculations | 33,358 | 33,093 | 33,266 | 32,776 | ||||||||||||
Shares used in diluted per share calculations | 33,358 | 33,093 | 33,266 | 32,776 | ||||||||||||
ITERIS, INC. | ||||||||||||||
UNAUDITED SEGMENT REPORTING DETAILS | ||||||||||||||
(in thousands) | ||||||||||||||
Roadway | Transportation | Ag & Weather | ||||||||||||
Sensors | Systems | Analytics | Iteris, Inc. | |||||||||||
Three Months Ended March 31, 2019 | ||||||||||||||
Product revenues | $ | 11,327 | $ | 1,482 | $ | - | $ | 12,809 | ||||||
Service revenues | 94 | 11,457 | 1,731 | 13,282 | ||||||||||
Total revenues | $ | 11,421 | $ | 12,939 | $ | 1,731 | $ | 26,091 | ||||||
Segment operating income (loss) | $ | 1,548 | $ | 1,631 | $ | (1,155 | ) | $ | 2,024 | |||||
Corporate and other income (expense), net | (4,357 | ) | ||||||||||||
Amortization of intangible assets | (84 | ) | ||||||||||||
Loss from continuing operations
before income taxes |
$ | (2,417 | ) | |||||||||||
Roadway | Transportation | Ag & Weather | ||||||||||||
Sensors | Systems | Analytics | Iteris, Inc. | |||||||||||
Three Months Ended March 31, 2018 | ||||||||||||||
Product revenues | $ | 10,725 | $ | 119 | $ | - | $ | 10,884 | ||||||
Service revenues | 49 | 12,971 | 1,409 | 14,429 | ||||||||||
Total revenues | $ | 10,774 | $ | 13,090 | $ | 1,409 | $ | 25,273 | ||||||
Segment operating income (loss) | $ | 1,442 | $ | 2,169 | $ | (2,165 | ) | $ | 1,447 | |||||
Corporate and other income (expense), net | (4,254 | ) | ||||||||||||
Amortization of intangible assets | (4 | ) | ||||||||||||
Loss from continuing operations
before income taxes |
$ | (2,811 | ) | |||||||||||
Roadway | Transportation | Ag & Weather | ||||||||||||
Sensors | Systems | Analytics | Iteris, Inc. | |||||||||||
Twelve Months Ended March 31, 2019 | ||||||||||||||
Product revenues | $ | 43,253 | $ | 4,974 | $ | - | $ | 48,227 | ||||||
Service revenues | 239 | 44,841 | 5,816 | 50,896 | ||||||||||
Total revenues | $ | 43,492 | $ | 49,815 | $ | 5,816 | $ | 99,123 | ||||||
Segment operating income (loss) | $ | 7,011 | $ | 5,907 | $ | (5,024 | ) | $ | 7,894 | |||||
Corporate and other income (expense), net | (15,399 | ) | ||||||||||||
Amortization of intangible assets | (275 | ) | ||||||||||||
Loss from continuing operations
before income taxes |
$ | (7,780 | ) | |||||||||||
Roadway | Transportation | Ag & Weather | ||||||||||||
Sensors | Systems | Analytics | Iteris, Inc. | |||||||||||
Twelve Months Ended March 31, 2018 | ||||||||||||||
Product revenues | $ | 44,163 | $ | 2,301 | $ | - | $ | 46,464 | ||||||
Service revenues | 194 | 52,180 | 4,891 | 57,265 | ||||||||||
Total revenues | $ | 44,357 | $ | 54,481 | $ | 4,891 | $ | 103,729 | ||||||
Segment operating income (loss) | $ | 8,825 | $ | 8,639 | $ | (8,048 | ) | $ | 9,416 | |||||
Corporate and other income (expense), net | (14,914 | ) | ||||||||||||
Amortization of intangible assets | (88 | ) | ||||||||||||
Loss from continuing operations before income taxes |
$ | (5,586 | ) | |||||||||||
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; (d) Agriculture and Weather Analytics segment realignment; (e) loss on impairment of goodwill; (f) the estimated tax effect of the foregoing non-GAAP adjustments; and (g) the impact of the Tax Act .
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) | These expenses are associated with realigning our business strategies related to our Agriculture and Weather Analytics segment based on current economic conditions. In connection with these realignment actions, Iteris recognizes costs primarily related to termination benefits for former employees whose positions were eliminated. Iteris excludes these charges because these expenses are not reflective of ongoing business and operating results. Iteris believes it is useful for investors to understand the effects of these items on our total operating expenses. | |
e) | As a result of the company’s annual goodwill impairment test for Fiscal 2017, management concluded that the carrying value of goodwill related to legacy acquisitions by our Agriculture and Weather Analytic reporting unit exceeded its fair value. This resulted in an approximately $2.2 million impairment charge in the fourth quarter of Fiscal 2017. | |
f) | The amount represents the estimated income tax effect of the non-GAAP adjustments. The tax effect of non-GAAP adjustments for the three and nine months ended December 31, 2018 and 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. | |
g) | The Tax Act was enacted on December 22, 2017 and resulted in a tax benefit of approximately $1.7 million, primarily due to the refund of Alternative Minimum Tax credit carryforwards, as well as a reduction of the U.S. corporate income tax rates to 21.0% as of January 1, 2018, which reduced our valuation allowance. | |
Iteris, Inc. | ||||||||||||
Schedule Reconciling GAAP Net Loss to Non-GAAP Net Loss | ||||||||||||
($ in thousands, except per share amounts) | ||||||||||||
(unaudited) | ||||||||||||
For the Three Months Ended | ||||||||||||
March 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
GAAP net loss | $ | (2,432 | ) | $ | (2,416 | ) | $ | (3,368 | ) | |||
GAAP net loss per share - basic and diluted | $ | (0.07 | ) | $ | (0.07 | ) | $ | (0.10 | ) | |||
The non-GAAP amounts have been adjusted to exclude the following items: | ||||||||||||
Excluded from cost of revenues: | ||||||||||||
Amortization (c) | $ | 218 | $ | 197 | $ | 77 | ||||||
Excluded from operating expenses: | ||||||||||||
Stock based compensation (a) | $ | 601 | $ | 457 | $ | 258 | ||||||
Depreciation (b) | 192 | 226 | 185 | |||||||||
Amortization (c) | 84 | 4 | 33 | |||||||||
Agriculture and Weather Analytics segment realignment (d) | - | 547 | - | |||||||||
Loss on impairment of Goodwill (e) | - | - | 2,168 | |||||||||
Total excluded from operating expenses | $ | 877 | $ | 1,234 | $ | 2,644 | ||||||
Total excluded operating loss | $ | 1,095 | $ | 1,431 | $ | 2,721 | ||||||
Income tax effect on non-GAAP adjustments (f) | (11 | ) | (14 | ) | (27 | ) | ||||||
Total excluded from operating loss after income tax effect | $ | 1,084 | $ | 1,417 | $ | 2,694 | ||||||
Excluded from income tax benefit | ||||||||||||
Impact of Tax Act (g) | - | (383 | ) | - | ||||||||
Non-GAAP net loss | $ | (1,348 | ) | $ | (1,382 | ) | $ | (674 | ) | |||
Non-GAAP net loss per share - basic and diluted | $ | (0.04 | ) | $ | (0.04 | ) | $ | (0.02 | ) | |||
(a) - (g) See corresponding footnotes above. |
Iteris, Inc. |
||||||||||||
Schedule Reconciling GAAP Net Loss to Non-GAAP Net (Loss) Income | ||||||||||||
($ in thousands, except per share amounts) | ||||||||||||
(unaudited) | ||||||||||||
For the Twelve Months Ended |
||||||||||||
March 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
GAAP net loss | $ | (7,816 | ) | $ | (3,526 | ) | $ | (4,826 | ) | |||
GAAP net loss per share - basic and diluted | $ | (0.23 | ) | $ | (0.11 | ) | $ | (0.15 | ) | |||
The non-GAAP amounts have been adjusted to exclude the following items: | ||||||||||||
Excluded from cost of revenues: | ||||||||||||
Amortization (c) | $ | 850 | $ | 638 | $ | 341 | ||||||
Excluded from operating expenses | ||||||||||||
Stock based compensation (a) | $ | 2,156 | $ | 1,781 | $ | 975 | ||||||
Depreciation (b) | 851 | 819 | 729 | |||||||||
Amortization (c) | 275 | 88 | 282 | |||||||||
Agriculture and Weather Analytics segment realignment (d) | - | 547 | - | |||||||||
Loss on impairment of Goodwill (e) | - | - | 2,168 | |||||||||
Total excluded from operating expenses | $ | 3,282 | $ | 3,235 | $ | 4,154 | ||||||
Total excluded operating loss | $ | 4,132 | $ | 3,873 | $ | 4,495 | ||||||
Income tax effect on non-GAAP adjustments (f) | (41 | ) | (39 | ) | (45 | ) | ||||||
Total excluded from operating loss after income tax effect | $ | 4,091 | $ | 3,834 | $ | 4,450 | ||||||
Excluded from income tax expenses | ||||||||||||
Impact of Tax Act (g) | - | (1,742 | ) | - | ||||||||
Non-GAAP net loss | $ | (3,725 | ) | $ | (1,434 | ) | $ | (376 | ) | |||
Non-GAAP net loss per share - basic and diluted | $ | (0.11 | ) | $ | (0.04 | ) | $ | (0.01 | ) | |||
(a) - (g) See corresponding footnotes above. |
Iteris, Inc. | ||||||||||||
Schedule Reconciling GAAP Operating (Loss) to Non-GAAP Operating (Loss) Income | ||||||||||||
($ in thousands, except per share amounts) | ||||||||||||
(unaudited) | ||||||||||||
For the Three Months Ended | ||||||||||||
March 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
GAAP cost of revenues | $ | 16,230 | $ | 15,257 | $ | 15,386 | ||||||
Amortization (c) | (218 | ) | (197 | ) | (77 | ) | ||||||
Non-GAAP cost of revenues | $ | 16,012 | $ | 15,060 | $ | 15,309 | ||||||
GAAP operating expenses | $ | 12,326 | $ | 12,847 | $ | 13,406 | ||||||
Stock based compensation (a) | (601 | ) | (457 | ) | (258 | ) | ||||||
Depreciation (b) | (192 | ) | (226 | ) | (185 | ) | ||||||
Amortization (c) | (84 | ) | (4 | ) | (33 | ) | ||||||
Agriculture and Weather Analytics segment realignment (d) | - | (547 | ) | - | ||||||||
Loss on impairment of Goodwill (e) | - | - | (2,168 | ) | ||||||||
Non-GAAP operating expenses | $ | 11,449 | $ | 11,613 | $ | 10,762 | ||||||
GAAP operating loss | $ | (2,465 | ) | $ | (2,831 | ) | $ | (3,488 | ) | |||
Stock based compensation (a) | (601 | ) | (457 | ) | (258 | ) | ||||||
Depreciation (b) | (192 | ) | (226 | ) | (185 | ) | ||||||
Amortization (c) | (302 | ) | (201 | ) | (110 | ) | ||||||
Agriculture and Weather Analytics segment realignment (d) | - | (547 | ) | - | ||||||||
Loss on impairment of Goodwill (e) | - | - | (2,168 | ) | ||||||||
Non-GAAP operating loss | $ | (1,370 | ) | $ | (1,400 | ) | $ | (767 | ) | |||
Iteris, Inc. | ||||||||||||
Schedule Reconciling GAAP Operating (Loss) to Non-GAAP Operating (Loss) Income | ||||||||||||
($ in thousands, except per share amounts) | ||||||||||||
(unaudited) | ||||||||||||
For the Twelve Months Ended | ||||||||||||
March 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
GAAP cost of revenues | $ | 60,517 | $ | 63,898 | $ | 58,580 | ||||||
Amortization (c) | (850 | ) | (638 | ) | (341 | ) | ||||||
Non-GAAP cost of revenues | $ | 59,667 | $ | 63,260 | $ | 58,239 | ||||||
GAAP operating expenses | $ | 46,565 | $ | 45,433 | $ | 42,638 | ||||||
Stock based compensation (a) | (2,156 | ) | (1,781 | ) | (975 | ) | ||||||
Depreciation (b) | (851 | ) | (819 | ) | (729 | ) | ||||||
Amortization (c) | (275 | ) | (88 | ) | (282 | ) | ||||||
Agriculture and Weather Analytics segment realignment (d) | - | (547 | ) | - | ||||||||
Loss on impairment of Goodwill (e) | - | - | (2,168 | ) | ||||||||
Non-GAAP operating expenses | $ | 43,283 | $ | 42,198 | $ | 38,484 | ||||||
GAAP operating loss | $ | (7,959 | ) | $ | (5,602 | ) | $ | (5,236 | ) | |||
Stock based compensation (a) | (2,156 | ) | (1,781 | ) | (975 | ) | ||||||
Depreciation (b) | (851 | ) | (819 | ) | (729 | ) | ||||||
Amortization (c) | (1,125 | ) | (726 | ) | (623 | ) | ||||||
Agriculture and Weather Analytics segment realignment (d) | - | (547 | ) | - | ||||||||
Loss on impairment of Goodwill (e) | - | - | (2,168 | ) | ||||||||
Non-GAAP operating loss | $ | (3,827 | ) | $ | (1,729 | ) | $ | (741 | ) | |||
View source version on businesswire.com: https://www.businesswire.com/news/home/20190603005189/en/
Source:
Investor Relations
MKR Investor Relations, Inc.
Todd
Kehrli
323-468-2300
iti@mkr-group.com