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Intrinsyc Reports Quarterly Revenue Growth of 4% over Prior Year and Net income of US$86,966 (CDN$115,656)
Friday, May 12, 2017Company Profile | Follow Company
Company Achieved Record Orders and Backlog During Quarter
Vancouver, BC, May 12, 2017--(T-Net)--Intrinsyc Technologies Corporation (TSX: ITC), a provider of solutions for the development of intelligent connected devices, today announced its financial results for the first quarter ended March 31, 2017.
Intrinsyc achieved annual revenue growth of 4%, net income of US$86,966 (CDN$115,656), and earnings per share of US$0.00 (CDN$0.00), in the three months ended March 31, 2017.
Revenue was US$4.5 million (CDN$5.9 million) which was an increase from US$4.3 million (CDN$5.9 million) in the first quarter of fiscal 2016.
The increase in revenue over the same period in the prior year was due to increased revenue from the sale of hardware products.
“The Company signed several new product development projects and received significant orders for Embedded Computing Hardware during the quarter which led to our highest ever revenue bookings and order backlog at the end of the quarter,” stated Tracy Rees, CEO, Intrinsyc Technologies.
“Additionally, we increased design and production wins for Open-Q™ computing modules from 36 to 39 and 11 to 14, respectively. Adjusted EBITDA[1]and net income performance in the first quarter was reduced from the previous quarter due to a combination of a change in revenue mix, as well as investment in sales, marketing, and product development. We are optimistic that our investments in new product development and marketing will lead to additional design and production wins for our embedded computing hardware, which will fuel long-term revenue growth.
Quarterly Business Highlights
The Company announced agreements that will extend their strategic relationship with Stream TV.The arrangements provide for a purchase commitment by Stream TV of US$2.0 million in products, services, or royalties to be purchased or generated between February 1, 2017, and February 1, 2018.
Also, as part of the expansion of the strategic relationship, Intrinsyc received 120,000 warrants convertible into Class A common shares in Stream TV Networks, Inc. on a one for one basis for a period of up to five years.
Financial Highlights
Three Month Comparative Results
The Company reported revenue of US$4.5 million (CDN$5.9 million), up 4% over the same period in the prior year of US$4.3 million (CDN$5.9 million). The increase in revenue over the same period in the prior year was due primarily to increased revenue from the sale of hardware products.
The Company had net income of US$86,966 (CDN$115,656) in the three months ended March 31, 2017 compared to net income of US$490,738 (CDN$765,965) in the same period in the prior year.
Gross margin in the first quarter of fiscal 2017 was 35%, which was lower than the 38% gross margin in the same period in the prior year. Decrease in gross margin over the same period in the prior year was due to the change in revenue mix, which saw a significant increase in revenues from the Company's Embedded Computing Hardware business which has lower gross margin and decrease in engineering services revenues. Adjusted EBITDA was as follows:
Working capital[3] as of March 31, 2017 was US$11.8 million (CDN$15.7 million) inclusive of cash and short term investments of US$7.7 million (CDN$10.3 million). This is compared to net working capital of US$11.7 million (CDN$15.7 Million) as of December 31, 2016 inclusive of cash and short-term investments of US$7.6 million (CDN$10.1 million).
Financial Statements and Management Discussion & Analysis
Please see the unaudited interim condensed consolidated financial statements and related Management's Discussion & Analysis (“MD&A”) for more details. The unaudited interim condensed consolidated financial statements for the three months ended March 31, 2017 and related MD&A have been reviewed and approved by Intrinsyc's Audit Committee and Board of Directors. Intrinsyc recognizes that the majority of its investors are now accessing Intrinsyc's corporate and financial information either through pushed news services, directly fromwww.intrinsyc.com or SEDAR. Thus, Intrinsyc has prepared this truncated news release to alert investors to its results and that a more detailed explanation and analysis is readily available in the MD&A. These reports have been filed on SEDAR at www.sedar.com and also posted at www.intrinsyc.com.
Non-IFRS Measures
The following and preceding discussion of financial results includes reference to Gross Margin, Adjusted EBITDA and Working Capital, which are all non-IFRS financial measures. The measure of gross margin is provided as management believes this is a good indicator in evaluating the operating performance of the Company. Adjusted EBITDA is defined as operating income (loss) inclusive of revenue reclassified as interest income (as per IFRS) less other operating expenses. The measure is provided as a proxy for the cash earnings from the operations of the business as operating loss for the Company includes non-cash amortization and depreciation expense and share-based compensation which are classified as other operating expenses. The measure of working capital is provided as management believes this is a good indicator of the operating liquidity available to the Company.
Forward-Looking Statements
This press release contains statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking information under applicable Canadian securities legislation that involve risks and uncertainties. Such forward-looking statements or information may include financial and other projections as well as statements regarding the Company's future plans, objectives, performance, revenues, growth, profits, operating expenses or the company's underlying assumptions. The words “may”, “would”, “could”, “will”, “likely”, “expect,” “anticipate,” “intend”, “plan”, “forecast”, “project”, “estimate” and “believe” or other similar words and phrases may identify forward-looking statements or information. Persons reading this press release are cautioned that such statements or information are only predictions, and that the Company's actual future results or performance may be materially different.
Factors that could cause actual events or results to differ materially from those suggested by these forward-looking statements include, but are not limited to: the need to develop, integrate and deploy software solutions to meet the Company's customer's requirements; the possibility of development or deployment difficulties or delays; a customer's decision to cancel or fail to proceed with a commitment to purchase units of the Company's products contained in an executed purchase order; the dependence on the Company's customer's satisfaction; the timing of entering into significant contracts; customers' continued commitment to the deployment of the Company's solutions; reliance on products manufactured by other companies for resale or distribution and reliance on third-party suppliers; the performance of the global economy and growth in software industry sales; market acceptance of the Company's products and services; the success of certain business combinations engaged in by the Company or by its competitors; possible disruptive effects of organizational or personnel changes; technological change, new products and standards; risks related to international expansion; concentration of sales; international operations and sales; dependence upon key personnel and hiring; reliance on a limited number of suppliers; industry growth; competition; intellectual property; product defects and product liability; currency exchange rate risk; and other factors described in the Company's reports filed on SEDAR, including its Annual Information Form and financial report for the year ended December 31, 2016. This list is not exhaustive of the factors that may affect the Company's forward-looking information.
These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information. All forward-looking statements made in this press release are qualified by this cautionary statement and there can be no assurance that actual results or developments anticipated by the Company will be realized. The Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
About Intrinsyc Technologies Corporation
Intrinsyc Technologies Corporation is a product development company that provides comprehensive and tailored solutions that enable the development and production of next-generation embedded and IoT devices. Solutions span the development life cycle from concept to production and help device makers and technology suppliers create compelling differentiated products with faster time-to-market. Intrinsyc is publicly traded (TSX: ITC and OTC: ISYRF) and is headquartered in Vancouver, BC, Canada.
For more information, please contact:
George W. Reznik, CPA-CA, CBV, CFE
Chief Financial Officer
Intrinsyc Technologies Corporation
Email: greznik@intrinsyc.com
Phone: +1-604-678-3734
[1] Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. This measure does not have a comparable IFRS measure. Adjusted EBITDA referenced here relates to operating income (loss) inclusive of revenue reclassified as interest income (as per IFRS) less other operating expenses.
[2]Non-IFRS measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Gross margin referenced here relates to revenues less cost of sales.
[3]Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. This measure does not have a comparable IFRS measure. Working capital is defined as current assets less current liabilities.
Company Snapshot |
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Lantronix (Formerly Intrinsyc Technologies)
Vancouver, BC (Wireless)
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