Public biometrics providers raising funds and cutting costs to prepare for opportunities on the horizon
Idex Biometrics has announced a successful private placement, while Next Biometrics and Ipsidy see new opportunities arising for 2021, and Mitek is participating in an investors conference this week.
Idex funds growth opportunities for medium term
Idex Biometrics has raised NOK 70 million (US$7.8 million) in a successful private placement of 42.5 million new shares at NOK 1.65 ($0.18), which is expected to meet the company’s capital needs for the medium term, funding growth opportunities and general corporate purposes.
“This additional capital will enable IDEX to deliver on our commitments to current customers and new customers when we are moving to large scale commercialization,” states Idex Biometrics CEO Vince Graziani. “This investment confirms the potential of IDEX’s fingerprint sensor technology in the biometric payment cards market.”
The shares were issued under the authorization granted the board at Idex’ annual general meeting in May. They were placed at a 3.1 percent premium on the closing price as of November 9, 2020, with Norwegian and international investors and existing shareholders. The board has judged it appropriate to waive the existing shareholders’ preferential right to subscribe for shares in the private placement.
Primary insiders participating include Chair Morten Opstad, Deputy Chair Larry Ciaccia, and Board Members Deborah Davis, Hanne Høvding, Steve Skaggs, Board Observer Tom Quindlen, Graziani, CFO Derek D’Antilio, CTO Anthony Eaton, and VP of Finance Erling Svela.
Next revenue up, cost-cutting ahead of schedule
Next Biometrics has reported a 12 percent increase in revenue on a quarterly basis to NOK 15.2 million ($1.7 million) for its fiscal third quarter of 2020, with a gross margin of 14 percent, up 3 percent form the same quarter a year earlier.
The company’s EBITDA excluding options was a loss of NOK 14.2 million ($1.6 million), compared to a loss of NOK 34.7 million ($3.8 million) in Q3 2019. The pandemic has extended sales cycles for Next, and delayed the closing of some deals, but the company is working on multiple opportunities it says could generate revenue in 2021.
The company’s cost-cutting efforts are a full quarter ahead of schedule, with operating expenses adjusted downwards by NOK 17.3 million per quarter, according to the CEO’s comments.
“Revenues are inching upwards delivering growth of 65 percent compared to our turn-around low-point in Q4 2019 and a 12 percent growth compared to Q2 2020,” comments Next Biometrics CEO Peter Heuman. “We had expected better revenue numbers than what we actually reported, but the pandemic has lengthened already long biometric sales cycles for many of our customers. Still, we remain steadfast in pursuit of higher revenue numbers and have confidence that our turn-around, systematic and intensive sales efforts should yield further results.”
Heuman also says COVID-19 has frustrated the company’s growth efforts, but its commercial activity level is very high. New potential growth areas have been established and Next’s fingerprint sensors have been designed into several innovative biometric devices and point of sale solutions in Asia, the U.S. and India.
Next has also received an initial purchase order for 10,000 biometric fingerprint sensors from Belgium-based partner Page Electronica. The order is expected to be followed by another 10,000 sensors within the next 24 months, which will be used for Page Electronica’s end customer Ngrave.
Ngrave provides secure password and cryptographic key storage for cryptocurrency owners, and Page Electronica has developed a secure blockchain wallet solution for Ngrave with a Next sensor.
Ipsidy expense reductions trim net losses
Ipsidy earned $0.5 million in Q3 and $1.6 million for the first three quarters of the year, slightly down from $0.6 million and $1.9 million, respectively, in 2019, with the difference principally attributed to the COVID-19 pandemic.
The company booked net losses before tax of $1.9 million in the quarter and $9.2 million for the first three quarters, compared to losses of $2.4 million in Q3 2019 and $6.8 million for the first nine months of 2019. The decreased loss in the last quarter is attributed to lower expenses. Basic and diluted net loss per share was $0.00 and $0.02 in the past three and nine months, respectively. Adjusted EBITDA loss was $1.3 million in the quarter and $4.1 million over the last three quarters
“The last quarter has seen continued progress for Ipsidy,” says Phillip Kumnick, CEO and Chairman of Ipsidy. “We started to roll out our products to customers, secured new customers in the financial services sector and operated a successful pilot with a major financial institution. We are excited by the prospects for growth into 2021 that appear in our robust new business pipeline, supported by the recent injection of capital from our existing as well as new stockholders. We greatly appreciate their confidence in our ability to execute our plan.”
Ipsidy raised $5 million in funding in October through issuances of common stock and warrants.
Mitek participates in Benchmark investor conference
Mitek has been invited to participate in the Benchmark Company Technology Virtual 1×1 Investor Conference on November 12.
Insitutional investors can book virtual meetings with Mitek CEO Max Carnecchia and CFO Jeff Davison throughout the day.