Precise Biometrics reports 2017 earnings and optimism after tumultuous year
Precise Biometrics reported net sales of SEK 14.2 million (approximately US$1.77 million) for Q4 2017, and SEK 61 million ($7.6 million) for the full year, steep declines from a year earlier, as the company pivots away from its mobile smart cards solutions business.
While the net sales represent a decline of 31.8 percent for the quarter from Q4 2016 and 26.7 percent for the year, the reported earnings are in line with the company’s revised guidance announced in October. Precise Biometrics’ gross margin in Q4 fell to 91.7 percent from 98 percent in the same quarter a year ago, and its Q4 2016 operating profit of SEK 4.4 million ($0.6 million) fell to a loss of SEK 5.3 million ($0.7 million). For the full year, the company had an operating loss of SEK 13.9 million ($1.7 million), after posting an operating profit of SEK 25.4 million ($3.2 million) in 2016.
Net sales for Q4 2017 were actually up significantly from SEK 10.1 million ($1.3 million) in Q3.
In an eventful quarter which saw CEO Håkan Persson resign and Stefan K. Persson appointed as new CEO, the company classified its mobile smart cards solutions business as a business held for sale, and transferred resources previously allocated to it to its fingerprint technology business.
Chairman of the Board Torgny Hellström acknowledged that the company and its customers did not win anticipated market share in the market for capacitive fingerprint sensors for mobile phones.
“We are now seeing a shift in the market for capacitive sensors, which is gradually being transformed into a volume market primarily for mobile phones in the lower price segments. This new market has been created as a consequence of the pressure on price that is prevailing, and it has opened up the opportunity to use capacitive sensors in cheaper mobile phones in several geographical markets. The company has several customers working in this segment,” Hellström commented.
“We are also seeing the design of mobile phones in the higher price segments moving towards displays that cover the entire front side, while at the same time induction charging (“wireless charging”), which requires a glass back, is growing. In both cases, optical or ultrasound sensors are the best alternative for a fingerprint solution. We have more than ten customers working with such sensors.”
Following the end of the quarter, Precise Biometrics announced two previously reported developments, the use of Precise BioMatch Embedded in the dual-interface biometric payment card pilot with Visa and Mountain America Credit Union, and an extended licensing agreement with Crossmatch, which offer cause for optimism.
“Our vision of convenient and secure authentication of identity for everyone, everywhere, is more relevant now than ever,” Hellström said. “Biometrics will increasingly replace passwords and other forms of authentication for cars, door locks and wearables, areas in which we are involved in several projects and intend to drive and continue to be part of developments in the future.”