HACKENSACK, N.J.--(PRIME NEWSWIRE)--March. 4, 2008
I.D. Systems, Inc.(r) (Nasdaq:IDSY), a leading provider of wireless asset tracking and management solutions, today announced its financial results for the year ended December 31, 2007. Revenues for 2007 were $17.1 million, compared to $24.7 million for 2006. GAAP net loss for 2007 was $7.3
million, or ($0.66) per basic and diluted share, compared to GAAP net
loss of $1.6 million, or ($0.15) per basic and diluted share, for 2006.
Non-GAAP net loss for 2007 was $4.1 million, or ($0.36) per basic and
diluted share, compared to non-GAAP net income of $1.4 million, or
$0.13 per basic share and $0.11 per diluted share, in 2006. Non-GAAP
results are calculated by adjusting GAAP net results for the impact of
stock-based compensation, which was $3.3 million and $3.0 million for
the fiscal years ended December 31, 2007 and 2006, respectively. A
table entitled "Reconciliation of GAAP to Non-GAAP Financial Measures"
is included in this press release.
"While we are not satisfied with our 2007 financial results, we
established goals during the year to increase investment in our sales
and marketing organization, further develop new sales channels,
increase our market penetration, and continue to enhance the market
advantages of our patented wireless technology-all with the intent of
broadening our customer base and diversifying our sources of revenue,"
said Jeffrey Jagid, I.D. Systems' chairman and chief executive officer.
"I believe we made substantive progress toward those goals in 2007,"
continued Mr. Jagid. "We expanded and reorganized our sales and
marketing team, enhanced and added marketing partnerships, won initial
programs with several new customers, and continued to earn repeat
business from core customers. At the same time, we continued to advance
our technology by developing new applications and cultivating new
markets. Our solutions for controlling, tracking and managing physical
assets-such as material handling equipment, airport vehicles and rental
cars-continue to provide significant economic benefits for our
customers.
"In 2008," concluded Mr. Jagid, "we are committed to capitalizing on
our expanded sales organization, continuing to diversify our customer
base, expanding our product offerings, and working toward a more
predictable quarter-to-quarter revenue stream."
For the year ended December 31, 2007, cost of revenues was $8.9
million, resulting in a gross profit margin of 47.7%, up from 44.6% for
the year ending December 31, 2006.
Selling, general and administrative (SG&A) expenses for 2007 were $16.0
million, including $2.5 million in stock-based compensation, compared
to $12.9 million, including $2.2 million in stock-based compensation,
for 2006. The increase was attributable primarily to increased expenses
related to the hiring of additional sales, marketing and customer
support personnel.
Research and development (R&D) expenditures for 2007 were $2.8 million,
including $741,000 in stock-based compensation, compared to $2.6
million, including $723,000 in stock-based compensation, for 2006. This
increase was attributable primarily to development of products for the
European market.
Interest income for 2007 increased to $3.2 million from $2.8 million
for 2006.
As of December 31, 2007, I.D. Systems had $65.0 million in cash, cash
equivalents and marketable securities ($5.90 per share outstanding as
of December 31, 2007), compared to $70.4 million as of December 31,
2006.
In May of 2007, the company's Board of Directors authorized the
repurchase of issued and outstanding shares of I.D. Systems common
stock having an aggregate value of up to $10,000,000 pursuant to a
share repurchase program, funded from working capital. As of December
31, 2007, the company had purchased approximately 483,000 shares in
open market transactions under this program, at an average cost of
$11.55 per share.
Fourth Quarter Results
For the three-month period ended December 31, 2007, revenues were $3.7
million, compared to $3.9 million for the three months ended December
31, 2006. GAAP net loss for the quarter was $2.4 million, or ($0.22)
per basic and diluted share, compared to GAAP net loss of $2.6 million,
or ($0.23) per basic and diluted share, for the fourth quarter of 2006.
Non-GAAP net loss for the quarter was $1.6 million, including $853,000
in stock-based compensation, or ($0.14) per basic and diluted share.
Non-GAAP net loss for the corresponding quarter in 2006 was $1.4
million, including $1.2 million in stock-based compensation, or ($0.12)
per basic and diluted share.
For the three months ended December 31, 2007, SG&A expenses were $4.3
million, including $662,000 in stock-based compensation, compared to
$4.1 million, including $740,000 in stock-based compensation, for the
same period in 2006. R&D expenditures for the period were $721,000,
including $179,000 in stock-based compensation, compared to $913,000,
including $452,000 in stock-based compensation, for the three months
ended December 31, 2006. Interest income for the fourth quarter of 2007
was $894,000, compared to $1.1 million for the same period a year ago.
Gross margin for the three months ended December 31, 2007, was 44.0%,
including a 38.3% gross margin on product revenue, which resulted from
a one-time $342,000 inventory write-off. Excluding the write-off, gross
margin on product revenue was 51.7% and overall gross margin was 53.2%.
2008 Business Outlook
This announcement initiates a new reporting practice by I.D. Systems;
the company is providing anticipated revenues for the upcoming year
ending December 31, 2008. These anticipated results do not include data
related to income and earnings, which will continue to be reported in
quarterly financial results announcements coinciding with the company's
quarterly investor conference calls. The following statement is
forward-looking, based on the company's current expectations, and
actual results may differ materially. Revenue for the fiscal year
ending December 31, 2008, is expected to be approximately $24 million.
2007 Highlights
* I.D. Systems appointed Peter Fausel -- a 25-year veteran of the
wireless technology, enterprise software integration and process
automation industries, with extensive experience building sales
and marketing organizations -- as executive vice president of
sales, marketing and customer support.
* The company established a new Performance Services Group and
customer support program, called Advantage(tm) Support, to help
customers target and quantify specific benefits to be realized
by deploying I.D. Systems' Wireless Asset Net(r) industrial
vehicle management system and to help ensure those benefits are
quickly achieved and sustained following system deployment.
* The company developed and expanded key strategic alliances,
including:
-- Executing a new partnership agreement with RedPrairie
Corporation, a leading supply chain software provider, to
integrate I.D. Systems' real-time wireless asset monitoring
capabilities with RedPrairie's supply chain management tools
and market a unique workforce optimization solution to
manufacturing and distribution enterprises across North
America.
-- Strengthening an existing partnership with leading forklift
manufacturer NACCO Materials Handling Group, which
distributes and supports I.D. Systems' products through its
Hyster(r) and Yale(r) brand dealer networks and which
deployed the Wireless Asset Net system at its primary U.S.
parts distribution center to optimize its own forklift fleet
operations.
* I.D. Systems expanded business with core customers, including:
-- A new Wireless Asset Net system deployment for Chrysler,
which was facilitated by one of NACCO Materials Handling
Group's Yale(r) brand forklift dealers and which
incorporated I.D. Systems' new Opti-Kan(tm) system for
automating task allocation and optimizing material
replenishment in manufacturing processes.
-- Continuing deployment of the company's wireless industrial
vehicle management technology for the United States Postal
Service (USPS), where it continues to generate significant
economic benefits, bringing the total number of USPS
facilities implementing I.D. Systems' products and services
to 80.
-- Continuing expansion of Wireless Asset Net deployments for
the world's largest retailer, where 21 distribution centers
are now equipped with the system.
-- A new Wireless Asset Net system deployment for Alcoa at its
state-of-the-art manufacturing complex in Iceland-the sixth
major Alcoa facility to deploy the system-which represents
I.D. Systems' first system implementation in Europe.
-- New system deployments for a leading U.S. defense contractor,
which implemented wireless industrial equipment monitoring
and RFID-based gate access control in its shipyards.
* I.D. Systems added several new customers, including:
-- Kellogg Company, the world's leading producer of cereal and a
leading producer of convenience foods with 2006 sales of
almost $11 billion, which ordered I.D. Systems' Wireless
Asset Net industrial vehicle management system and a five-
year Advantage(tm) Support program for a fleet of material
handling equipment at a major manufacturing facility.
-- Deere & Company, the world's leading manufacturer of farm and
forestry equipment and a Fortune 100 company with 2006
revenues of approximately $22 billion, which acquired the
Wireless Asset Net system through MH Equipment Company, a
Hyster(r) brand forklift dealer that is part of the NACCO
Materials Handling Group distribution network.
-- The National Center for Manufacturing Sciences, a U.S.
Government-funded organization that helps the Department of
Defense implement innovative commercial technologies for
operational benefits and cost savings, which facilitated the
deployment of the Wireless Asset Net system on a fleet of
material handling equipment at the Sierra Army Depot, a
Center of Industrial Technical Excellence focused on "lean
manufacturing" process improvements.
-- Nucor Corporation, a steel products manufacturer with more
than 30 operating facilities in the U.S., which deployed an
initial Wireless Asset Net pilot program to monitor and
improve safety for its industrial truck fleet.
-- San Francisco International Airport, which launched an
initial pilot of I.D. Systems' AvRamp(tm) system, acquired
through Quatrotec, Inc., a leading integrator of
transportation security solutions, to control, track and
manage aircraft ground support equipment, such as fuel
trucks, under a Transportation Security Administration (TSA)
program.
* The company further developed new applications and markets for
its technology, including:
-- Launch of the AvRamp(tm) system, a TSA-funded and tested
version of the Wireless Asset Net system branded for the
airport ground support equipment market, designed to improve
ground handling operations, ramp safety and airport security
through a unique combination of intelligent vehicle control,
real-time asset visibility, directed workforce management
and cost-free wireless communications.
-- Initial deployment of the Opti-Kan(tm) application, an
optimized, wireless, electronic "kanban" system that
automatically signals material handling operators with task
assignments, enabling "just in time" material replenishment
in manufacturing operations and generating significant labor
cost reductions.
-- Introduction of new productivity analysis tools for the
Wireless Asset Net system, to simplify tracking the time
industrial vehicles spend loaded vs. unloaded, which were
developed and deployed under a contract awarded to I.D.
Systems by the U.S. Postal Service.
-- Continued development and refinement of I.D. Systems'
automated rental car management system for several leading
U.S.-based car rental companies.
-- Adaptation of Wireless Asset Net system hardware for
compliance with European regulatory requirements, in
anticipation of expanding opportunities in Europe in 2008.
Investor Conference Call
I.D. Systems will host a conference call for investors and analysts at
4:45 p.m. Eastern Standard Time on March 4, 2008. Jeffrey Jagid, I.D.
Systems' chairman and CEO, will lead a discussion on the year's results
and highlights. After opening remarks, there will be a question and
answer period. The conference call will be broadcast live over the
Internet via the Investors section of I.D. Systems' web site at
www.id-systems.com. To listen to the live call, go to the website at
least 10 minutes early to download and install any necessary audio
software.
Non-GAAP Measures
To supplement its consolidated financial statements presented in
accordance with GAAP, I.D. Systems provides certain non-GAAP measures
of financial performance. These non-GAAP measures include non-GAAP net
income/loss and non-GAAP net income/loss per basic and diluted share.
Reference to these non-GAAP measures should be considered in addition
to results prepared under current accounting standards but are not a
substitute for, or superior to, GAAP results. These non-GAAP measures
are provided to enhance investors' overall understanding of I.D.
Systems' current financial performance and provide further information
for comparative information due to the adoption of the new accounting
standard SFAS 123R. Specifically, I.D. Systems believes the non-GAAP
measures provide useful information to both management and investors by
excluding certain expenses, gains and losses that may not be indicative
of its core operating results and business outlook. In addition, I.D.
Systems believes the non-GAAP measures that exclude stock-based
compensation enhance the comparability of results against prior
periods. Reconciliation to the nearest GAAP measure of all non-GAAP
measures included in this press release can be found in the financial
tables included in this press release.
About I.D. Systems(r)
Based in Hackensack, NJ, I.D. Systems, Inc. is a leading provider of
wireless solutions for managing and securing high-value enterprise
assets. These assets include industrial vehicles, such as forklifts and
airport ground support equipment, and rental vehicles. The company's
patented Wireless Asset Net system, which utilizes radio frequency
identification, or RFID, technology, addresses the needs of
organizations to control track, monitor and analyze their assets. For
more information, visit www.id-systems.com.
About The Wireless Asset Net(r) System
I.D. Systems' Wireless Asset Net improves productivity in manufacturing
and distribution environments by establishing accountability for use of
equipment, ensuring equipment is in the proper place at the right time,
streamlining work flow through automated messaging, and providing
management with unique metrics on-and controls over-equipment
utilization. The system also improves safety and security by
restricting vehicle access to trained, authorized operators and
providing electronic vehicle inspection checklists. In addition, the
system reduces maintenance expenses by automatically uploading vehicle
data, reporting problems identified on checklists in real time,
scheduling maintenance according to actual vehicle usage rather than on
a calendar basis, and helping management determine the optimal economic
time to replace equipment.
Trademarks
I.D. Systems, Inc.(r), Wireless Asset Net(r) and OptiKan(tm) are
registered or pending trademarks of I.D. Systems, Inc. Hyster(r) and
Yale(r) are registered trademarks of NACCO Materials Handling Group,
Inc.
"Safe Harbor" Statement Under the Private Securities Litigation Reform
Act of 1995
The 2007 financial results contained in this press release are subject
to finalization of the Company's audit in connection with the Company's
annual report on Form 10-K for the fiscal year ended December 31, 2007.
This press release contains forward looking statements, such as the
Company's outlook for 2008 financial results, that are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Forward-looking statements include statements with respect
to our beliefs, plans, objectives, goals, expectations, anticipations,
assumptions, estimates, intentions, and future performance, and involve
known and unknown risks, uncertainties and other factors, which may be
beyond our control, and which may cause our actual results, performance
or achievements to be materially different from future results,
performance or achievements expressed or implied by such
forward-looking statements. All statements other than statements of
historical fact are statements that could be forward-looking
statements. These forward-looking statements are subject to risk and
uncertainties, including, but not limited to, future economic and
business conditions, the loss of any of the Company's key customers or
reduction in the purchase of its products by any such customers, the
failure of the market for the Company's products to continue to
develop, the inability to protect the Company's intellectual property,
the inability to manage the Company's growth, the effects of
competition from a wide variety of local, regional, national and other
providers of wireless solutions and other risks detailed from time to
time in the Company's filings with the Securities and Exchange
Commission, including the Company's annual report on Form 10-K for the
year ended December 31, 2006. These risks could cause actual results to
differ materially from those expressed in any forward looking
statements made by, or on behalf of, the Company. The Company assumes
no obligation to update the information contained in this press
release.
I.D. Systems, Inc.
Statements of Operations
(Unaudited)
Three months ended Twelve months ended
December 31, December 31,
2006 2007 2006 2007
------------ ------------ ------------ ------------
Revenue:
Products $ 1,740,000 $ 2,556,000 $ 16,205,000 $ 11,037,000
Services 2,173,000 1,165,000 8,535,000 6,046,000
------------ ------------ ------------ ------------
3,913,000 3,721,000 24,740,000 17,083,000
Cost of
Revenue:
Cost of
products 984,000 1,577,000 8,229,000 5,859,000
Cost of
services 1,542,000 506,000 5,472,000 3,070,000
------------ ------------ ------------ ------------
2,526,000 2,083,000 13,701,000 8,929,000
Gross Profit 1,387,000 1,638,000 11,039,000 8,154,000
Selling,
general and
administrative
expenses 4,123,000 4,255,000 12,943,000 15,963,000
Research and
development
expenses 913,000 721,000 2,639,000 2,849,000
------------ ------------ ------------ ------------
Loss from
operations (3,649,000) (3,338,000) (4,543,000) (10,658,000)
Interest
income 1,061,000 894,000 2,801,000 3,238,000
Interest
expense (6,000) (1,000) (29,000) (10,000)
Other income 40,000 -- 155,000 89,000
------------ ------------ ------------ ------------
Net loss $ (2,554,000) $ (2,445,000) $ (1,616,000) $ (7,341,000)
============ ============ ============ ============
Net loss per
share -
basic and
diluted $ (0.23) $ (0.22) $ (0.15) $ (0.66)
============ ============ ============ ============
Weighted
average
common shares
outstanding
- basic and
diluted 11,281,000 11,027,000 10,501,000 11,205,000
============ ============ ============ ============
I.D. Systems, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)
Three Months Three Months Twelve Twelve
Ended Ended Months Ended Months Ended
December 31, December 31, December 31, December 31,
2006 2007 2006 2007
Net loss
attributable to
common
stockholders $(2,554,000) $(2,445,000) $(1,616,000) $(7,341,000)
Stock-based
compensation 1,192,000 853,000 2,975,000 3,288,000
Non-GAAP net
income (loss) $(1,362,000) $(1,592,000) $ 1,359,000 $(4,053,000)
Non-GAAP net
income (loss)
per share
- basic $ (0.12) $ (0.14) $ 0.13 $ (0.36)
Non-GAAP net
income (loss)
per share -
diluted $ (0.12) $ (0.14) $ 0.11 $ (0.36)
I.D. Systems, Inc.
Balance Sheets
(Unaudited)
As of December 31,
ASSETS 2006 2007
------------ ------------
Current assets:
Cash and cash equivalents $ 9,644,000 $ 5,103,000
Marketable securities - short-term 60,716,000 21,385,000
Accounts receivable, net 5,101,000 2,875,000
Unbilled receivables 1,042,000 580,000
Inventory 6,430,000 4,420,000
Interest receivable 179,000 142,000
Officer loan 8,000 --
Prepaid expenses and other current
assets 271,000 291,000
------------ ------------
Total current assets 83,391,000 34,796,000
Marketable securities - long-term -- 38,515,000
Fixed assets, net 1,394,000 1,398,000
Deferred contract costs 33,000 --
Other assets 87,000 87,000
------------ ------------
$ 84,905,000 $ 74,796,000
============ ============
LIABILITIES
Current liabilities:
Accounts payable and accrued expenses $ 2,950,000 $ 2,594,000
Current portion of long term debt 221,000 19,000
Deferred revenue 221,000 291,000
------------ ------------
Total current liabilities 3,392,000 2,904,000
Long term debt 19,000 --
Deferred revenue 133,000 167,000
Deferred rent 77,000 55,000
------------ ------------
3,621,000 3,126,000
------------ ------------
Commitments and Contingencies (Note J)
STOCKHOLDERS' EQUITY
Preferred stock; authorized 5,000,000
shares, $0.01 par value; none issued -- --
Common stock; authorized 50,000,000
shares, $.01 par value; 11,337,000 and
11,561,000 shares issued at December
31, 2006 and 2007, respectively, shares
outstanding, 11,297,000 and 11,015,000
at December 31, 2006 and 2007,
respectively 113,000 115,000
Additional paid-in capital 93,423,000 97,076,000
Accumulated deficit (12,151,000) (19,492,000)
Comprehensive income 12,000 11,000
------------ ------------
81,397,000 77,710,000
Treasury stock; 40,000 shares and
546,000 shares at cost at December 31,
2006 and 2007, respectively (113,000) (6,040,000)
------------ ------------
Total stockholders' equity 81,284,000 71,670,000
------------ ------------
Total liabilities and stockholders'
equity $ 84,905,000 $ 74,796,000
============ ============
I.D. Systems, Inc.
Statements of Cash Flows
(Unaudited)
Year Ended December 31,
----------------------------------------
2005 2006 2007
------------ ------------ ------------
Cash flows from operating
activities:
Net income (loss) $ 851,000 $ (1,616,000) $ (7,341,000)
Adjustments to reconcile net
income (loss) to cash (used
in) provided by operating
activities:
Inventory reserve 105,000 100,000 517,000
Accrued interest income 42,000 (153,000) 20,000
Stock based compensation -- 2,975,000 3,288,000
Depreciation and amortization 362,000 468,000 544,000
Deferred rent expense (13,000) (22,000) (22,000)
Deferred revenue (41,000) 109,000 104,000
Provision for uncollectible
accounts 20,000 211,000 --
Deferred contract costs 423,000 20,000 33,000
Changes in:
Accounts receivable (4,656,000) 756,000 2,226,000
Unbilled receivables (891,000) 251,000 462,000
Inventory (1,318,000) (3,578,000) 1,493,000
Prepaid expenses and other
assets 85,000 (130,000) (20,000)
Investment in sales type
leases (394,000) 467,000 --
Accounts payable and
accrued expenses 1,340,000 (931,000) (700,000)
------------ ------------ ------------
Net cash (used in)
provided by operating
activities (4,085,000) (1,073,000) 604,000
------------ ------------ ------------
Cash flows from investing
activities:
Purchase of fixed assets (512,000) (703,000) (548,000)
Purchase of investments (5,963,000) (68,481,000) (15,691,000)
Maturities of investments 3,703,000 13,214,000 16,523,000
------------ ------------ ------------
Net cash (used in)
provided by investing
activities (2,772,000) (55,970,000) 284,000
------------ ------------ ------------
Cash flows from financing
activities:
Repayment of term loan (199,000) (209,000) (221,000)
Proceeds from exercise of
stock options 743,000 786,000 367,000
Net proceeds from public
offering -- 63,961,000 --
Collection of officer loan 11,000 11,000 8,000
Purchase of treasury shares -- -- (5,583,000)
------------ ------------ ------------
Net cash provided by (used
in) financing activities 555,000 64,549,000 (5,429,000)
------------ ------------ ------------
Net (decrease) increase in
cash and cash equivalents (6,302,000) 7,506,000 (4,541,000)
Cash and cash equivalents -
beginning of period 8,440,000 2,138,000 9,644,000
------------ ------------ ------------
Cash and cash equivalents -
end of period $ 2,138,000 $ 9,644,000 $ 5,103,000
============ ============ ============
Supplemental disclosure of
cash flow information:
Cash paid for:
Interest $ 53,000 $ 29,000 $ 10,000
CONTACT: I.D. Systems
For Financial Press:
Ned Mavrommatis, Chief Financial Officer
ned@id-systems.com
For Trade Press:
Greg Smith, Vice President Marketing
gsmith@id-systems.com
201-996-9000
Fax: 201-996-9144
I.D. Systems, Inc.(r) (Nasdaq:IDSY), a leading provider of wireless asset tracking and management solutions, today announced its financial results for the year ended December 31, 2007. Revenues for 2007 were $17.1 million, compared to $24.7 million for 2006. GAAP net loss for 2007 was $7.3
million, or ($0.66) per basic and diluted share, compared to GAAP net
loss of $1.6 million, or ($0.15) per basic and diluted share, for 2006.
Non-GAAP net loss for 2007 was $4.1 million, or ($0.36) per basic and
diluted share, compared to non-GAAP net income of $1.4 million, or
$0.13 per basic share and $0.11 per diluted share, in 2006. Non-GAAP
results are calculated by adjusting GAAP net results for the impact of
stock-based compensation, which was $3.3 million and $3.0 million for
the fiscal years ended December 31, 2007 and 2006, respectively. A
table entitled "Reconciliation of GAAP to Non-GAAP Financial Measures"
is included in this press release.
"While we are not satisfied with our 2007 financial results, we
established goals during the year to increase investment in our sales
and marketing organization, further develop new sales channels,
increase our market penetration, and continue to enhance the market
advantages of our patented wireless technology-all with the intent of
broadening our customer base and diversifying our sources of revenue,"
said Jeffrey Jagid, I.D. Systems' chairman and chief executive officer.
"I believe we made substantive progress toward those goals in 2007,"
continued Mr. Jagid. "We expanded and reorganized our sales and
marketing team, enhanced and added marketing partnerships, won initial
programs with several new customers, and continued to earn repeat
business from core customers. At the same time, we continued to advance
our technology by developing new applications and cultivating new
markets. Our solutions for controlling, tracking and managing physical
assets-such as material handling equipment, airport vehicles and rental
cars-continue to provide significant economic benefits for our
customers.
"In 2008," concluded Mr. Jagid, "we are committed to capitalizing on
our expanded sales organization, continuing to diversify our customer
base, expanding our product offerings, and working toward a more
predictable quarter-to-quarter revenue stream."
For the year ended December 31, 2007, cost of revenues was $8.9
million, resulting in a gross profit margin of 47.7%, up from 44.6% for
the year ending December 31, 2006.
Selling, general and administrative (SG&A) expenses for 2007 were $16.0
million, including $2.5 million in stock-based compensation, compared
to $12.9 million, including $2.2 million in stock-based compensation,
for 2006. The increase was attributable primarily to increased expenses
related to the hiring of additional sales, marketing and customer
support personnel.
Research and development (R&D) expenditures for 2007 were $2.8 million,
including $741,000 in stock-based compensation, compared to $2.6
million, including $723,000 in stock-based compensation, for 2006. This
increase was attributable primarily to development of products for the
European market.
Interest income for 2007 increased to $3.2 million from $2.8 million
for 2006.
As of December 31, 2007, I.D. Systems had $65.0 million in cash, cash
equivalents and marketable securities ($5.90 per share outstanding as
of December 31, 2007), compared to $70.4 million as of December 31,
2006.
In May of 2007, the company's Board of Directors authorized the
repurchase of issued and outstanding shares of I.D. Systems common
stock having an aggregate value of up to $10,000,000 pursuant to a
share repurchase program, funded from working capital. As of December
31, 2007, the company had purchased approximately 483,000 shares in
open market transactions under this program, at an average cost of
$11.55 per share.
Fourth Quarter Results
For the three-month period ended December 31, 2007, revenues were $3.7
million, compared to $3.9 million for the three months ended December
31, 2006. GAAP net loss for the quarter was $2.4 million, or ($0.22)
per basic and diluted share, compared to GAAP net loss of $2.6 million,
or ($0.23) per basic and diluted share, for the fourth quarter of 2006.
Non-GAAP net loss for the quarter was $1.6 million, including $853,000
in stock-based compensation, or ($0.14) per basic and diluted share.
Non-GAAP net loss for the corresponding quarter in 2006 was $1.4
million, including $1.2 million in stock-based compensation, or ($0.12)
per basic and diluted share.
For the three months ended December 31, 2007, SG&A expenses were $4.3
million, including $662,000 in stock-based compensation, compared to
$4.1 million, including $740,000 in stock-based compensation, for the
same period in 2006. R&D expenditures for the period were $721,000,
including $179,000 in stock-based compensation, compared to $913,000,
including $452,000 in stock-based compensation, for the three months
ended December 31, 2006. Interest income for the fourth quarter of 2007
was $894,000, compared to $1.1 million for the same period a year ago.
Gross margin for the three months ended December 31, 2007, was 44.0%,
including a 38.3% gross margin on product revenue, which resulted from
a one-time $342,000 inventory write-off. Excluding the write-off, gross
margin on product revenue was 51.7% and overall gross margin was 53.2%.
2008 Business Outlook
This announcement initiates a new reporting practice by I.D. Systems;
the company is providing anticipated revenues for the upcoming year
ending December 31, 2008. These anticipated results do not include data
related to income and earnings, which will continue to be reported in
quarterly financial results announcements coinciding with the company's
quarterly investor conference calls. The following statement is
forward-looking, based on the company's current expectations, and
actual results may differ materially. Revenue for the fiscal year
ending December 31, 2008, is expected to be approximately $24 million.
2007 Highlights
* I.D. Systems appointed Peter Fausel -- a 25-year veteran of the
wireless technology, enterprise software integration and process
automation industries, with extensive experience building sales
and marketing organizations -- as executive vice president of
sales, marketing and customer support.
* The company established a new Performance Services Group and
customer support program, called Advantage(tm) Support, to help
customers target and quantify specific benefits to be realized
by deploying I.D. Systems' Wireless Asset Net(r) industrial
vehicle management system and to help ensure those benefits are
quickly achieved and sustained following system deployment.
* The company developed and expanded key strategic alliances,
including:
-- Executing a new partnership agreement with RedPrairie
Corporation, a leading supply chain software provider, to
integrate I.D. Systems' real-time wireless asset monitoring
capabilities with RedPrairie's supply chain management tools
and market a unique workforce optimization solution to
manufacturing and distribution enterprises across North
America.
-- Strengthening an existing partnership with leading forklift
manufacturer NACCO Materials Handling Group, which
distributes and supports I.D. Systems' products through its
Hyster(r) and Yale(r) brand dealer networks and which
deployed the Wireless Asset Net system at its primary U.S.
parts distribution center to optimize its own forklift fleet
operations.
* I.D. Systems expanded business with core customers, including:
-- A new Wireless Asset Net system deployment for Chrysler,
which was facilitated by one of NACCO Materials Handling
Group's Yale(r) brand forklift dealers and which
incorporated I.D. Systems' new Opti-Kan(tm) system for
automating task allocation and optimizing material
replenishment in manufacturing processes.
-- Continuing deployment of the company's wireless industrial
vehicle management technology for the United States Postal
Service (USPS), where it continues to generate significant
economic benefits, bringing the total number of USPS
facilities implementing I.D. Systems' products and services
to 80.
-- Continuing expansion of Wireless Asset Net deployments for
the world's largest retailer, where 21 distribution centers
are now equipped with the system.
-- A new Wireless Asset Net system deployment for Alcoa at its
state-of-the-art manufacturing complex in Iceland-the sixth
major Alcoa facility to deploy the system-which represents
I.D. Systems' first system implementation in Europe.
-- New system deployments for a leading U.S. defense contractor,
which implemented wireless industrial equipment monitoring
and RFID-based gate access control in its shipyards.
* I.D. Systems added several new customers, including:
-- Kellogg Company, the world's leading producer of cereal and a
leading producer of convenience foods with 2006 sales of
almost $11 billion, which ordered I.D. Systems' Wireless
Asset Net industrial vehicle management system and a five-
year Advantage(tm) Support program for a fleet of material
handling equipment at a major manufacturing facility.
-- Deere & Company, the world's leading manufacturer of farm and
forestry equipment and a Fortune 100 company with 2006
revenues of approximately $22 billion, which acquired the
Wireless Asset Net system through MH Equipment Company, a
Hyster(r) brand forklift dealer that is part of the NACCO
Materials Handling Group distribution network.
-- The National Center for Manufacturing Sciences, a U.S.
Government-funded organization that helps the Department of
Defense implement innovative commercial technologies for
operational benefits and cost savings, which facilitated the
deployment of the Wireless Asset Net system on a fleet of
material handling equipment at the Sierra Army Depot, a
Center of Industrial Technical Excellence focused on "lean
manufacturing" process improvements.
-- Nucor Corporation, a steel products manufacturer with more
than 30 operating facilities in the U.S., which deployed an
initial Wireless Asset Net pilot program to monitor and
improve safety for its industrial truck fleet.
-- San Francisco International Airport, which launched an
initial pilot of I.D. Systems' AvRamp(tm) system, acquired
through Quatrotec, Inc., a leading integrator of
transportation security solutions, to control, track and
manage aircraft ground support equipment, such as fuel
trucks, under a Transportation Security Administration (TSA)
program.
* The company further developed new applications and markets for
its technology, including:
-- Launch of the AvRamp(tm) system, a TSA-funded and tested
version of the Wireless Asset Net system branded for the
airport ground support equipment market, designed to improve
ground handling operations, ramp safety and airport security
through a unique combination of intelligent vehicle control,
real-time asset visibility, directed workforce management
and cost-free wireless communications.
-- Initial deployment of the Opti-Kan(tm) application, an
optimized, wireless, electronic "kanban" system that
automatically signals material handling operators with task
assignments, enabling "just in time" material replenishment
in manufacturing operations and generating significant labor
cost reductions.
-- Introduction of new productivity analysis tools for the
Wireless Asset Net system, to simplify tracking the time
industrial vehicles spend loaded vs. unloaded, which were
developed and deployed under a contract awarded to I.D.
Systems by the U.S. Postal Service.
-- Continued development and refinement of I.D. Systems'
automated rental car management system for several leading
U.S.-based car rental companies.
-- Adaptation of Wireless Asset Net system hardware for
compliance with European regulatory requirements, in
anticipation of expanding opportunities in Europe in 2008.
Investor Conference Call
I.D. Systems will host a conference call for investors and analysts at
4:45 p.m. Eastern Standard Time on March 4, 2008. Jeffrey Jagid, I.D.
Systems' chairman and CEO, will lead a discussion on the year's results
and highlights. After opening remarks, there will be a question and
answer period. The conference call will be broadcast live over the
Internet via the Investors section of I.D. Systems' web site at
www.id-systems.com. To listen to the live call, go to the website at
least 10 minutes early to download and install any necessary audio
software.
Non-GAAP Measures
To supplement its consolidated financial statements presented in
accordance with GAAP, I.D. Systems provides certain non-GAAP measures
of financial performance. These non-GAAP measures include non-GAAP net
income/loss and non-GAAP net income/loss per basic and diluted share.
Reference to these non-GAAP measures should be considered in addition
to results prepared under current accounting standards but are not a
substitute for, or superior to, GAAP results. These non-GAAP measures
are provided to enhance investors' overall understanding of I.D.
Systems' current financial performance and provide further information
for comparative information due to the adoption of the new accounting
standard SFAS 123R. Specifically, I.D. Systems believes the non-GAAP
measures provide useful information to both management and investors by
excluding certain expenses, gains and losses that may not be indicative
of its core operating results and business outlook. In addition, I.D.
Systems believes the non-GAAP measures that exclude stock-based
compensation enhance the comparability of results against prior
periods. Reconciliation to the nearest GAAP measure of all non-GAAP
measures included in this press release can be found in the financial
tables included in this press release.
About I.D. Systems(r)
Based in Hackensack, NJ, I.D. Systems, Inc. is a leading provider of
wireless solutions for managing and securing high-value enterprise
assets. These assets include industrial vehicles, such as forklifts and
airport ground support equipment, and rental vehicles. The company's
patented Wireless Asset Net system, which utilizes radio frequency
identification, or RFID, technology, addresses the needs of
organizations to control track, monitor and analyze their assets. For
more information, visit www.id-systems.com.
About The Wireless Asset Net(r) System
I.D. Systems' Wireless Asset Net improves productivity in manufacturing
and distribution environments by establishing accountability for use of
equipment, ensuring equipment is in the proper place at the right time,
streamlining work flow through automated messaging, and providing
management with unique metrics on-and controls over-equipment
utilization. The system also improves safety and security by
restricting vehicle access to trained, authorized operators and
providing electronic vehicle inspection checklists. In addition, the
system reduces maintenance expenses by automatically uploading vehicle
data, reporting problems identified on checklists in real time,
scheduling maintenance according to actual vehicle usage rather than on
a calendar basis, and helping management determine the optimal economic
time to replace equipment.
Trademarks
I.D. Systems, Inc.(r), Wireless Asset Net(r) and OptiKan(tm) are
registered or pending trademarks of I.D. Systems, Inc. Hyster(r) and
Yale(r) are registered trademarks of NACCO Materials Handling Group,
Inc.
"Safe Harbor" Statement Under the Private Securities Litigation Reform
Act of 1995
The 2007 financial results contained in this press release are subject
to finalization of the Company's audit in connection with the Company's
annual report on Form 10-K for the fiscal year ended December 31, 2007.
This press release contains forward looking statements, such as the
Company's outlook for 2008 financial results, that are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Forward-looking statements include statements with respect
to our beliefs, plans, objectives, goals, expectations, anticipations,
assumptions, estimates, intentions, and future performance, and involve
known and unknown risks, uncertainties and other factors, which may be
beyond our control, and which may cause our actual results, performance
or achievements to be materially different from future results,
performance or achievements expressed or implied by such
forward-looking statements. All statements other than statements of
historical fact are statements that could be forward-looking
statements. These forward-looking statements are subject to risk and
uncertainties, including, but not limited to, future economic and
business conditions, the loss of any of the Company's key customers or
reduction in the purchase of its products by any such customers, the
failure of the market for the Company's products to continue to
develop, the inability to protect the Company's intellectual property,
the inability to manage the Company's growth, the effects of
competition from a wide variety of local, regional, national and other
providers of wireless solutions and other risks detailed from time to
time in the Company's filings with the Securities and Exchange
Commission, including the Company's annual report on Form 10-K for the
year ended December 31, 2006. These risks could cause actual results to
differ materially from those expressed in any forward looking
statements made by, or on behalf of, the Company. The Company assumes
no obligation to update the information contained in this press
release.
I.D. Systems, Inc.
Statements of Operations
(Unaudited)
Three months ended Twelve months ended
December 31, December 31,
2006 2007 2006 2007
------------ ------------ ------------ ------------
Revenue:
Products $ 1,740,000 $ 2,556,000 $ 16,205,000 $ 11,037,000
Services 2,173,000 1,165,000 8,535,000 6,046,000
------------ ------------ ------------ ------------
3,913,000 3,721,000 24,740,000 17,083,000
Cost of
Revenue:
Cost of
products 984,000 1,577,000 8,229,000 5,859,000
Cost of
services 1,542,000 506,000 5,472,000 3,070,000
------------ ------------ ------------ ------------
2,526,000 2,083,000 13,701,000 8,929,000
Gross Profit 1,387,000 1,638,000 11,039,000 8,154,000
Selling,
general and
administrative
expenses 4,123,000 4,255,000 12,943,000 15,963,000
Research and
development
expenses 913,000 721,000 2,639,000 2,849,000
------------ ------------ ------------ ------------
Loss from
operations (3,649,000) (3,338,000) (4,543,000) (10,658,000)
Interest
income 1,061,000 894,000 2,801,000 3,238,000
Interest
expense (6,000) (1,000) (29,000) (10,000)
Other income 40,000 -- 155,000 89,000
------------ ------------ ------------ ------------
Net loss $ (2,554,000) $ (2,445,000) $ (1,616,000) $ (7,341,000)
============ ============ ============ ============
Net loss per
share -
basic and
diluted $ (0.23) $ (0.22) $ (0.15) $ (0.66)
============ ============ ============ ============
Weighted
average
common shares
outstanding
- basic and
diluted 11,281,000 11,027,000 10,501,000 11,205,000
============ ============ ============ ============
I.D. Systems, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)
Three Months Three Months Twelve Twelve
Ended Ended Months Ended Months Ended
December 31, December 31, December 31, December 31,
2006 2007 2006 2007
Net loss
attributable to
common
stockholders $(2,554,000) $(2,445,000) $(1,616,000) $(7,341,000)
Stock-based
compensation 1,192,000 853,000 2,975,000 3,288,000
Non-GAAP net
income (loss) $(1,362,000) $(1,592,000) $ 1,359,000 $(4,053,000)
Non-GAAP net
income (loss)
per share
- basic $ (0.12) $ (0.14) $ 0.13 $ (0.36)
Non-GAAP net
income (loss)
per share -
diluted $ (0.12) $ (0.14) $ 0.11 $ (0.36)
I.D. Systems, Inc.
Balance Sheets
(Unaudited)
As of December 31,
ASSETS 2006 2007
------------ ------------
Current assets:
Cash and cash equivalents $ 9,644,000 $ 5,103,000
Marketable securities - short-term 60,716,000 21,385,000
Accounts receivable, net 5,101,000 2,875,000
Unbilled receivables 1,042,000 580,000
Inventory 6,430,000 4,420,000
Interest receivable 179,000 142,000
Officer loan 8,000 --
Prepaid expenses and other current
assets 271,000 291,000
------------ ------------
Total current assets 83,391,000 34,796,000
Marketable securities - long-term -- 38,515,000
Fixed assets, net 1,394,000 1,398,000
Deferred contract costs 33,000 --
Other assets 87,000 87,000
------------ ------------
$ 84,905,000 $ 74,796,000
============ ============
LIABILITIES
Current liabilities:
Accounts payable and accrued expenses $ 2,950,000 $ 2,594,000
Current portion of long term debt 221,000 19,000
Deferred revenue 221,000 291,000
------------ ------------
Total current liabilities 3,392,000 2,904,000
Long term debt 19,000 --
Deferred revenue 133,000 167,000
Deferred rent 77,000 55,000
------------ ------------
3,621,000 3,126,000
------------ ------------
Commitments and Contingencies (Note J)
STOCKHOLDERS' EQUITY
Preferred stock; authorized 5,000,000
shares, $0.01 par value; none issued -- --
Common stock; authorized 50,000,000
shares, $.01 par value; 11,337,000 and
11,561,000 shares issued at December
31, 2006 and 2007, respectively, shares
outstanding, 11,297,000 and 11,015,000
at December 31, 2006 and 2007,
respectively 113,000 115,000
Additional paid-in capital 93,423,000 97,076,000
Accumulated deficit (12,151,000) (19,492,000)
Comprehensive income 12,000 11,000
------------ ------------
81,397,000 77,710,000
Treasury stock; 40,000 shares and
546,000 shares at cost at December 31,
2006 and 2007, respectively (113,000) (6,040,000)
------------ ------------
Total stockholders' equity 81,284,000 71,670,000
------------ ------------
Total liabilities and stockholders'
equity $ 84,905,000 $ 74,796,000
============ ============
I.D. Systems, Inc.
Statements of Cash Flows
(Unaudited)
Year Ended December 31,
----------------------------------------
2005 2006 2007
------------ ------------ ------------
Cash flows from operating
activities:
Net income (loss) $ 851,000 $ (1,616,000) $ (7,341,000)
Adjustments to reconcile net
income (loss) to cash (used
in) provided by operating
activities:
Inventory reserve 105,000 100,000 517,000
Accrued interest income 42,000 (153,000) 20,000
Stock based compensation -- 2,975,000 3,288,000
Depreciation and amortization 362,000 468,000 544,000
Deferred rent expense (13,000) (22,000) (22,000)
Deferred revenue (41,000) 109,000 104,000
Provision for uncollectible
accounts 20,000 211,000 --
Deferred contract costs 423,000 20,000 33,000
Changes in:
Accounts receivable (4,656,000) 756,000 2,226,000
Unbilled receivables (891,000) 251,000 462,000
Inventory (1,318,000) (3,578,000) 1,493,000
Prepaid expenses and other
assets 85,000 (130,000) (20,000)
Investment in sales type
leases (394,000) 467,000 --
Accounts payable and
accrued expenses 1,340,000 (931,000) (700,000)
------------ ------------ ------------
Net cash (used in)
provided by operating
activities (4,085,000) (1,073,000) 604,000
------------ ------------ ------------
Cash flows from investing
activities:
Purchase of fixed assets (512,000) (703,000) (548,000)
Purchase of investments (5,963,000) (68,481,000) (15,691,000)
Maturities of investments 3,703,000 13,214,000 16,523,000
------------ ------------ ------------
Net cash (used in)
provided by investing
activities (2,772,000) (55,970,000) 284,000
------------ ------------ ------------
Cash flows from financing
activities:
Repayment of term loan (199,000) (209,000) (221,000)
Proceeds from exercise of
stock options 743,000 786,000 367,000
Net proceeds from public
offering -- 63,961,000 --
Collection of officer loan 11,000 11,000 8,000
Purchase of treasury shares -- -- (5,583,000)
------------ ------------ ------------
Net cash provided by (used
in) financing activities 555,000 64,549,000 (5,429,000)
------------ ------------ ------------
Net (decrease) increase in
cash and cash equivalents (6,302,000) 7,506,000 (4,541,000)
Cash and cash equivalents -
beginning of period 8,440,000 2,138,000 9,644,000
------------ ------------ ------------
Cash and cash equivalents -
end of period $ 2,138,000 $ 9,644,000 $ 5,103,000
============ ============ ============
Supplemental disclosure of
cash flow information:
Cash paid for:
Interest $ 53,000 $ 29,000 $ 10,000
CONTACT: I.D. Systems
For Financial Press:
Ned Mavrommatis, Chief Financial Officer
ned@id-systems.com
For Trade Press:
Greg Smith, Vice President Marketing
gsmith@id-systems.com
201-996-9000
Fax: 201-996-9144