ImageWare reports Q1 financial results, discusses biometric driver’s license program
ImageWare Systems, Inc. has issued financial results for the first quarter ended March 31, 2015, as well as confirmed the completion of its first SaaS installation for the Baja California driver’s license program.
The SaaS installation has begun generating revenue on a per transaction basis with its on-premise production version of GoCloudID, its cloud-based identity management platform that manages access to biometric enrollment and verification.
ImageWare provided fingerprint and facial recognition biometrics for over 80,000 current users of the Baja California driver’s license program. In addition, the company has kept up with the production pace of 15,000-20,000 new users per month.
In a conference call reporting its financial results for the first quarter ended March 31, 2015, ImageWare chairman and CEO Jim Miller said the firm’s “strategy to target large IT service providers and deliver security for their cloud customers remains on track,”
Additionally, Miller highlighted the company’s partnerships with Fujitsu, TransUnion, CA Technologies, IBM, Deutsche Telekom and, more recently, with Agility and Extenua, all of which are currently in the testing and implementation phase.
“We have also recently entered in to advanced discussions with other large, private sector organizations that would build on the seven commercial partners we have signed currently,” said Miller. “The size of many of our partners, and their ability to touch hundreds of millions of users around the globe, is what drives our strong outlook. As such, we remain undeterred by the pace of the rollout and steadfast in our goal to transition ImageWare in to a commercial-based provider of biometrics-as-a-service — a transition we expect to drive significant shareholder value.”
The firm’s total revenues in the first quarter were $1.0 million, resulting in a small decrease compared to the previous year’s $1.1 million.
The company attributes this slight decline primarily to lower hardware revenue and lower royalty revenue from its channel partners.
Gross margin in the first quarter saw a decline of 530 basis points down to 71.1% compared to 76.4% in the previous year.
ImageWare said this is primarily due to lower high margin software and royalty product revenues, and higher services revenue, which have inherently lower margins.
Net loss in the first quarter of 2015 was $2.3 million or $0.03 per basic share, compared to a net loss of $1.7 million or $0.02 per basic share in the first quarter of 2014.
At March 31, 2015, ImageWare’s cash and cash equivalents totaled $8.4 million compared to $0.2 million at December 31, 2014.
As previously reported, ImageWare completed a registered direct offering of convertible preferred stock for $12.0 million, in which the firm used about $2.0 million of the proceeds to repay all outstanding debt and the remaining $9.9 million going toward research and development, and other general corporate purposes.