SuperCom Reports Financial Results for the First Quarter of 2019 With $1.7 Million in EBITDA, 29% EBITDA Margin, and Non-GAAP EPS $0.06. IOT Product revenue up over 55% year over year – iCrowdNewswire
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Jul 7, 2019 10:40 AM ET

SuperCom Reports Financial Results for the First Quarter of 2019 With $1.7 Million in EBITDA, 29% EBITDA Margin, and Non-GAAP EPS $0.06. IOT Product revenue up over 55% year over year


iCrowd Newswire - Jul 7, 2019

TEL AVIV, Israel,  — SuperCom (NASDAQ: SPCB), a global provider of secure solutions for the e-Government, IOT, and Cybersecurity sectors reported income statement financial results for the first quarter of 2019.

First Quarter 2019 Financial Highlights (Compared to the First Quarter of 2018)

Management Commentary

“The financial results of this first quarter reflect significant progress in our multi-year strategy and business plan. We have been able to leverage our strong global brand of over 30 years as a government contractor in national security and our proprietary technology to shift most of our business to developed countries and recurring revenue based segments of IOT and Cyber security software. Our percentage of revenue from developed countries out of our total revenues, which was less than 5% in 2015 and approximately 67% in first quarter 2018, has reached a high of over 90%. We also continued to work very hard on optimizing our operational cost structure to reach record levels since 2015 with quarterly Non-GAAP operating expenses as low as $2 million and EBITDA margins as high as 29%,” commented Arie Trabelsi, President and CEO of SuperCom.

“While revenue has declined year over year, a closer look shows that it’s in line with our overarching strategy, with the decline coming from e-GOV as we have diverted focus and resources away from emerging countries towards North America and Europe and our IOT and Cyber segments. IOT segment revenues have grown significantly year over year, with a majority of that growth, over 55%, coming from IOT products mainly around our EM PureSecurity suite technology, which has been performing excellently in competitive tenders around the world. We have announced the launch of 6 new projects in this space in 2019 alone, and expect continued wins and success going forward as our global presence and technology improve with every new project,” continued Mr. Trabelsi.

“With a steady base of recurring revenues globally, a growing targeted pipeline of opportunities, a lean operating cost structure, and strong financial backing from Fortress, we are poised to grow our top line and cash flow generation in years to come,” concluded Mr. Trabelsi.

First Quarter of 2019 and Recent Operational Highlights:

e-Gov:

IoT:

Cyber Security:

SuperCom management will host the conference call.

Date: Monday, June 10, 2019
Time: 10:00 a.m. Eastern time (7:00 a.m. Pacific time)
U.S. toll-free: 877-407-9124 
Israel toll-free: 180-940-6247 
International: 201-689-8584

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization.

About SuperCom

Since 1988, SuperCom has been a global provider of traditional and digital identity solutions, providing advanced safety, identification and security solutions to governments and organizations, both private and public, throughout the world. Through its proprietary e-government platforms and innovative solutions for traditional and biometrics enrollment, personalization, issuance and border control services, SuperCom has inspired governments and national agencies to design and issue secure Multi-ID documents and robust digital identity solutions to its citizens and visitors. SuperCom offers a unique all-in-one field-proven RFID & mobile technology and product suite, accompanied by advanced complementary services for various industries including healthcare and homecare, security and safety, community public safety, law enforcement, electronic monitoring, livestock monitoring, and building and access automation. For more information, visit www.supercom.com.

Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements preceded or followed by or that otherwise include the words “believes”, “expects”, “anticipates”, “intends”, “projects”, “estimates”, “plans”, and similar expressions or future or conditional verbs such as “will”, “should”, “would”, “may” and “could” are generally forward-looking in nature and not historical facts. Forward-looking

statements in this release also include statements about business and economic trends. Investors should also consider the areas of risk described under the heading “Forward Looking Statements” and those factors captioned as “Risk Factors” in the Company’s periodic reports under the Securities Exchange Act of 1934, as amended, or in connection with any forward-looking statements that may be made by the Company. These statements are subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company’s filings with the Securities and Exchange Commission (SEC), including the Company’s Annual Report on Form 20-F filed with the SEC on May 21, 2017. The Company undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this press release.

Use of Non-GAAP Financial Information

In addition to disclosing financial results calculated in accordance with United States generally accepted accounting principles (GAAP), this release of operating results also contains non-GAAP financial measures, which SuperCom believes are the principal indicators of the operating and financial performance of its business. Management believes the non-GAAP financial measures provided are useful to investors’ understanding and assessment of the Company’s on-going core operations and prospects for the future, as the charges eliminated are not part of the day-to-day business or reflective of the core operational activities of the Company. Management uses these non-GAAP financial measures as a basis for strategic decisions, forecasting future results and evaluating the Company’s current performance. However, such measures should not be considered in isolation or as substitutes for results prepared in accordance with GAAP. Reconciliation of the non-GAAP measures to the most comparable GAAP measures are provided in the schedules attached to this release.

[Tables to follow]

SUPERCOM LTD. CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands)

   
 

3 months ended

 

     March 31 
2019

March 31 
2018

 

Unaudited

Unaudited

REVENUES

5,673

7,014

COST OF REVENUES

2,600

3,127

 

GROSS PROFIT (LOSS)

3,073

3,887

 

OPERATING EXPENSES:

   

Research and development

961

1,341

Selling and marketing

893

1,701

General and administrative

1,088

1,348

Other expense (Income)

1

50

 

Total operating expenses

 

2,943

 

4,440

 

OPERATING INCOME(LOSS)

 

130

 

(553)

FINANCIAL INCOME (EXPENSES), NET

(403)

52

 

INCOME (LOSS) BEFORE INCOME TAX

 

(273)

 

(501)

INCOME TAX BENEFIT (EXPENSES )

42

181

     

NET PROFIT (LOSS) FOR THE PERIOD

(231)

(320)

SUPERCOM LTD.

Reconciliation Table of GAAP to Non-GAAP Figures and EBITDA to Net Income

(U.S. dollars in thousands, except per share data)

 

3 months ended

 

March 31
2019

March 31
2018

 

Unaudited

Unaudited

 

GAAP gross profit

 

 

3,073

 

 

3,887

Amortization of Software and IP

196

154

Stock-based compensation expenses

31

41

Non-GAAP gross profit

3,300

4,082

 

GAAP operating income (Loss)

 

 

130

 

 

(553)

Amortization of Software/IP, Customer Contracts and Brand, and Stock-     based compensation expenses

 

745

 

1055

Foreign Currency Loss

392

445


Non-GAAP operating income (Loss)

1,267

947

GAAP net (Loss)

 

(231)

 

(320)

   Amortization of Software/IP, Customer Contracts and Brand, and Stock- 
   based compensation expenses

 

745

 

1055

   Foreign Currency Loss

392

445

   Income tax benefit

(42)

(181)

Non-GAAP net Profit (Loss)

 

864

 

999

 

 

Non-GAAP EPS

 

0.06

 

0.07

NET (LOSS) FOR THE PERIOD

 

(231)

 

(320)

   Income tax benefit, net

(42)

(181)

   Financial expenses (income), net

403

(52)

   Depreciation, amortization and stock-based compensation expenses

1,135

1,321

   Foreign Currency Loss

392

445

EBITDA *

 

1,657

 

1,213

EBITDA is a non-GAAP financial measure generally defined as earnings before interest, taxes, depreciation and amortization.

     

SuperCom Corporate Contact: 
Ordan Trabelsi, President, Americas 
Tel: +1-212-675-4606
[email protected]

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Contact Information:

Ordan Trabelsi, President, Americas
Tel: +1-212-675-4606
[email protected]








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