Bioscrypt Reports Results for the Second Quarter Ended June 30, 2007
Bioscrypt business transition underway Robert M. Douglas appointed as Chief Executive Officer Stephen McDonald appointed as Chief Financial Officer 10% employee reduction completed Toronto, ON (August 2, 2007) – Bioscrypt Inc. (TSX: BYT), a leading provider of enterprise access control technology, today announced its financial results for the second quarter ended June 30, 2007. Bioscrypt’s second quarter revenue of US$4.2 million narrowed 12% from the US$4.8 million reported during the same period in the previous year. Product gross margin for the quarter was 41%, four percentage points less than the 45% in the prior quarter and three percent less than the same quarter in 2006. Overall gross margins were 47%. Loss before interest, tax, foreign exchange, depreciation and amortization (“EBITDA”)1 for the three months ended June 30, 2007 of US$3.9 million or $0.03 per share is approximately US$2.0 million greater than the same period the previous year. The second quarter net loss was US$3.9 million or $0.05 per share versus a net loss of US$1.3 million in 2006, or $0.02 per share. Bioscrypt revenue for the six months ended June 30, 2007 of US$8.5 million narrowed by 4% from the US$8.8 million reported during the same period of the previous year. Product gross margin for the six months was 43%, four percentage points less than the 47% in the prior quarter and two percent less than the same period in 2006. Overall gross margins were 49%. EBITDA loss for the six months ended June 30, 2007 of US$4.7 million or $0.07 per share is approximately US$3.8 million greater than the same period the previous year. The net loss for the six month period was US$6.6 million or $0.09 per share versus a net loss of US$2.7 million in 2006, or $0.05 per share. “The second quarter of 2007 was a period of significant transformation within Bioscrypt including a change in leadership, the consolidation of offices and the integration of an acquired company,” said Robert M. Douglas, president and CEO of Bioscrypt Inc. “Today we announced decisive action including the appointment of Stephen McDonald as CFO and a 10% reduction to our employee base. We are committed to taking the necessary steps in order to accelerate our leadership position and financial performance in the emerging biometric access control and identity management market.” “The majority of the greater EBITDA and net loss for the period can be attributed to the costs associated with the acquisition of A4 Vision and not achieving the revenue expectations that would compensate for the Company’s 2007 product development and sales expense requirement,” said Stephen McDonald, CFO of Bioscrypt Inc. “It is the intention of the organization to support continued investment in product development and sales activities, however, managing the expense to produce positive cash flow and earnings is the primary mandate for the Company.” Product sales represented 88% of total sales or US$3.7 million on approximately 10,250 units sold. Sales of the MV Series units represented approximately 58% of total unit shipments and 30% of product revenue; sales of Veri-Series™ products represented approximately 41% of unit shipments and 65% of product revenue and sales of 3D Vision products represented approximately 1% of total unit shipments and 5% of product revenue. The total number of units the Company has sold to date is now beyond 230,000. Licensing of software represented 12% of total sales. Q2 Corporate Announcements - Bioscrypt announced that Robert M. Douglas replaced Robert L. Williams as President and CEO to lead the Company to profitable growth.
- Bioscrypt was named Global Market Leader for Biometric Physical Access Control Readers by IMS, a leading market research provider to the global electronics industry.
Q2 New Client Announcements - Saferkidz, www.saferkidz.net, selected the Bioscrypt 3D face solution for their parent controlled online child identification system with the first deployment taking place at the U.S. Army’s Fort Bragg in North Carolina.
- Pictet & Cie, www.pictet.com, one of the renowned Swiss banks is expanding the deployment of the Bioscrypt 3D facial recognition solution in support of Card-Free Employee Access System to enable secure access for 2,100 employees to the bank’s new building.
Q2 New Product Developments - Bioscrypt Launched Version 2.0 of VeriSoft Single Sign On with support for user self-service password reset, a simplification of Enterprise SSO manageability and enhanced Smart Card capabilities.
- Bioscrypt brought the PIV Station to market, a product that has become the first biometric smart card reader to receive GSA approval as a FIPS 201-compliant contact and contactless CHUID reader.
Conference Call The Corporation will be hosting an earnings report conference call today at 8:00 a.m. Eastern Standard Time. The call can be accessed by phone by dialing 1-866-334-4934 or at www.vcall.com/IC/CEPage.asp?ID=119174. If you are unable to attend the original call, you may subsequently listen to the playback at 1-866-245-6755, pass code 155774, for one week after the call or by going to www.vcall.com/IC/CEPage.asp?ID=119174. Financial Statements Attached: Bioscrypt Second Quarter 2007 Financial Statements (PDF) About Bioscrypt Inc. Bioscrypt is an enterprise access control solution provider, enabling the unification of physical and logical access with its Door to Desktop® products. Bioscrypt’s hardware and software solutions deliver strong authentication processes to facilities, equipment, IT networks and computer applications and allow organizations to administer unified identities across the enterprise. Building on its proven expertise in biometric technology and its unique multi-factor authentication platform, Bioscrypt integrates all major secure authentication standards, transforming how organizations are bridging the gap between physical and logical access to create secure working environments. More information is available at www.bioscrypt.com. 1 - EBITDA is defined by the company as operating revenues less operating expenses and therefore reflects earnings before interest, foreign exchange, taxes, depreciation and amortization. Bioscrypt uses EBITDA, amongst other measures, to assess the operating performance of its on-going business, and applies the use of such measure consistently from quarter to quarter. The term EBITDA does not have a standardized meaning prescribed by Canadian generally accepted accounting principles and therefore may not be comparable to similarly titled measures presented by other companies. EBITDA should not be construed as the equivalent of net cash flows from operating activities. Forward-looking (safe harbour) statement Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statement containing words such as "believes," "plans," "expects," or "intends" and other statements which are not historical facts contained in this release are forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements. Bioscrypt and Door to Desktop® are registered trademarks and Veri-Series and VeriSoft are trademarks of Bioscrypt Inc. All other product and company names mentioned are the property of their respective owners and are mentioned for identification purposes only. For more information, contact:
|
