IBM Cloud Authors: Pat Romanski, Yeshim Deniz, Elizabeth White, William Schmarzo, Karthick Viswanathan

News Feed Item

BIO-key(R) International, Inc. Reports Second Quarter 2014 Financial Results

First Half 2014 Sales Growth of 44%, Strong Q3 Visibility

WALL, NJ -- (Marketwired) -- 08/13/14 -- BIO-key International, Inc. (OTCQB: BKYI), a leader in fingerprint biometric identification technologies, cloud-based mobile credentialing and identity verification solutions, today reported financial results for the second quarter of 2014, including strong visibility for Q3 2014.

Three Month Comparison

Total revenue for the three months ended June 30, 2014 was $402,788, compared to Q2'13 revenue of $422,257, a decrease of approximately 5%. Sales fell largely as a result of lower license sales and expected orders slipping out beyond Q2. "Despite disappointing Q2 sales, our pipeline continues to grow and our visibility of large opportunities continues to improve," stated Michael DePasquale, BIO-key Chairman and CEO. "In Q1, we reiterated the variable nature of our business and the potential impact to individual quarterly results. Thus, it's important to note that our sales for the first half of 2014 grew 44% year over year and our booked sales, thus far, for Q3'14 have already substantially exceeded total Q3'13 sales. Therefore we remain confident 2014 should represent a breakout year for BIO-key."

Q2'14 gross margin decreased to 60% from 78% in Q2'13. Operating expenses for Q2'14 increased 58%, quarter over quarter, to $1,366,000 from approximately $867,000 in Q2'13. Net loss for Q2'14 was ($1,026,286), which increased from Q2'13 net loss of ($554,831). Q2'14 EPS was ($0.01) versus Q2'13 EPS of ($0.01). Mr. DePasquale continued, "As planned, we invested in sales and marketing, hiring new sales executives and developing new marketing and lead generation programs to grow our pipeline. We hired or contracted engineering resources to support the multitude of new opportunities in our pipeline and we are starting to see the results of these investments and efforts."

Six Month Comparison

Total revenue for the six months ended June 30, 2014 was $1,770,311, compared to the first half of 2013 revenue of $1,226,900, an increase of approximately 44%.

First half 2014 gross margin increased to 84% from 83% in first half 2013. Operating expenses for the first half 2014 increased 45%, year over year, to $2,710,000 from approximately $1,862,000 in the first half 2013. Net loss for the six months ended June 30, 2014 was ($1,325,500), which increased from the first half 2013 net loss of ($870,409). First half 2014 EPS was ($0.01) versus first half 2013 EPS of ($0.01).

Liquidity and Capital Resources

The Company reported cash, cash equivalents, and accounts receivables of $902,578 as of June 30, 2014, as compared to $1.9 million at March 31, 2014. Mr. DePasquale concluded, "With our pipeline growing so quickly, we are supporting more opportunities that we expect to turn into sales. We need to stay the course and will continue to manage our resources as efficiently as possible with higher sales in sight."

Highlights from the second quarter included:

  • Announced collaboration agreement with Experian whereby BIO-key technology will provide fingerprint biometric authentication for Experian's next generation fraud platform, Precise ID.
  • Closed initial partner contract with Caradigm, to provide fingerprint authentication for Paulding County Hospital.
  • Closed initial partner contract with HealthCast, providing fingerprint authentication for Rady's Children's Hospital which is part of the University of California, San Diego School of Medicine.
  • IBM Reseller - iLantis closed their first sales opportunity with White Wave Foods, a consumer food & beverage manufacturer (Land O'Lakes products etc.).
  • Received Purchase Orders from 7 Eye Care Clinics through partner Medflow, we now have 57 customers in this category.
  • Reached agreements with five top-tier IAM channel partner resellers.
  • Continued restructuring and investing in the sales and marketing departments, including the addition of two new sales account managers.
  • Grew the sales opportunity pipeline by over $10M.

2014 Third Quarter Outlook

For the Q3'14, the Company expects revenue between $800,000 and $1.2 million, representing growth of 100%-200% over Q3'13. Gross margin is expected to exceed 85%. The Company expects to generate operating income with incremental revenue above $1.5 million in sales. Further, the Company expects a modest backlog at the end of Q3'14. The twelve-month opportunity pipeline value was approximately $20 million at the beginning of the quarter and is currently approximately $30 million.

Conference Call and Webcast

In conjunction with this release, BIO-key has scheduled a conference call, which will be broadcast live over the Internet on Wednesday, August 13, 2014 at 10:00 a.m. Eastern Daylight Time. Participate live via phone by dialing 1-877-317-6789 (U.S.) 412-317-6789 (International) and asking for the BIO-key Call at least 10 minutes prior to the start time. A streaming audio replay of the webcast will be available shortly after the call on www.bio-key.com for a period of thirty days. You can also access the recorded call by dialing 1-877-344-7529 (U.S.) 412-317-0088 (International) and using access code 10050818


                                                   June 30,    December 31,
                                                     2014          2013
                                                 ------------  ------------
Cash and cash equivalents                        $    517,759  $  2,023,349
Accounts receivable, net of allowance for
 doubtful accounts of $20,526 at June 30, 2014
 and December 31, 2013                                384,819       284,025
Due from factor                                        21,127         2,449
Inventory                                              22,249         9,376
Prepaid expenses and other                             74,191        73,482
                                                 ------------  ------------
  Total current assets                              1,020,145     2,392,681
                                                 ------------  ------------
Equipment and leasehold improvements, net             110,547       125,062
Deposits and other assets                               8,712         8,712
Intangible assets--less accumulated amortization      168,147       174,950
                                                 ------------  ------------
  Total non-current assets                            287,406       308,724
                                                 ------------  ------------
TOTAL ASSETS                                     $  1,307,551  $  2,701,405
                                                 ============  ============

Accounts payable                                 $    352,062  $    540,912
Accrued liabilities                                   377,645       338,321
Deferred revenue                                      505,724       528,160
                                                 ------------  ------------
  Total current liabilities                         1,235,431     1,407,393
                                                 ------------  ------------
Warrant liabilities                                   307,219       243,077
                                                 ------------  ------------
TOTAL LIABILITIES                                   1,542,650     1,650,470
                                                 ------------  ------------

Commitments and contingencies

Common stock -- authorized, 170,000,000 shares;
 issued and outstanding; 116,052,320 of $.0001
 par value at June 30, 2014 and 115,842,315 as of
 December 31, 2013                                     11,605        11,584
Additional paid-in capital                         55,949,368    55,909,923
Accumulated deficit                               (56,196,072)  (54,870,572)
                                                 ------------  ------------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT)                 (235,099)    1,050,935
                                                 ------------  ------------
 (DEFICIT)                                       $  1,307,551  $  2,701,405
                                                 ============  ============

The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.


                         Three months ended           Six months ended
                              June 30,                    June 30,
                     --------------------------  --------------------------
                         2014          2013          2014          2013
                     ------------  ------------  ------------  ------------

  Services           $    281,711  $    257,452  $    530,942  $    534,412
  License fees and
   other                  121,078       164,805     1,239,369       692,488
                     ------------  ------------  ------------  ------------
                          402,789       422,257     1,770,311     1,226,900
Costs and other
  Cost of services        113,105        28,150       152,280        68,864
  Cost of license
   fees and other          48,146        66,815       126,195       143,914
                     ------------  ------------  ------------  ------------
                          161,251        94,965       278,475       212,778
                     ------------  ------------  ------------  ------------
Gross Profit              241,538       327,292     1,491,836     1,014,122
                     ------------  ------------  ------------  ------------

Operating Expenses
  Selling, general
   and administrative     895,147       581,309     1,752,143     1,313,385
   development and
   engineering            470,888       286,166       957,545       548,975
                     ------------  ------------  ------------  ------------
                        1,366,035       867,475     2,709,688     1,862,360
                     ------------  ------------  ------------  ------------
    Operating loss     (1,124,497)     (540,183)   (1,217,852)     (848,238)
                     ------------  ------------  ------------  ------------
Other income
  Interest income
   (expense)                    2       (14,648)            3       (22,171)
  Gain (loss) on
   liabilities             98,209             -      (106,739)            -
  Income taxes                  -             -          (912)            -
                     ------------  ------------  ------------  ------------
Total other income
 (expenses)                98,211       (14,648)     (107,648)      (22,171)
                     ------------  ------------  ------------  ------------
    Net loss         $ (1,026,286) $   (554,831) $ (1,325,500) $   (870,409)
                     ============  ============  ============  ============

                     ------------  ------------  ------------  ------------
Basic and Diluted
 Loss per Common
 Share               $      (0.01) $      (0.01) $      (0.01) $      (0.01)
                     ============  ============  ============  ============

Weighted Average
 Shares Outstanding:
  Basic and diluted   116,003,664    87,182,348   115,940,414    84,339,612

The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.

About BIO-key
BIO-key International, Inc., headquartered in Wall, New Jersey, develops and delivers advanced identification solutions to commercial and government enterprises, integrators, and custom application developers. BIO-key's award winning, high performance, scalable, cost-effective and easy-to-deploy biometric finger identification technology accurately identifies and authenticates users of wireless and enterprise applications. Our solutions are used in local embedded OEM products as well as some of the world's largest identification deployments to improve security, guarantee identity, and help reduce identity theft. BIO-key's technology is offered directly or by market leading partners around the world. (http://www.bio-key.com)

BIO-key Safe Harbor Statement

Certain statements contained in this press release and in other public statements by the Company and Company officers include or may contain certain forward-looking statements. All statements other than statements of historical facts contained in this press release, including statements regarding our future financial position, business strategy and plans and objectives of management for future operations, are forward-looking statements. The words "anticipate," "believe," "estimate," "will," "may," "future," "plan," "intend" and "expect" and similar expressions generally identify forward-looking statements. These forward-looking statements are not guarantees and are subject to known and unknown risks, uncertainties and assumptions that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Although we believe that our plans, intentions and expectations reflected in the forward-looking statements are reasonable, we cannot be sure that they will be achieved. Particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include: our history of losses and limited revenue; our ability to raise additional capital; our ability to protect our intellectual property; changes in business conditions; changes in our sales strategy and product development plans; changes in the marketplace; continued services of our executive management team; security breaches; competition between us and other companies in the biometric technology industry; market acceptance of biometric products generally and our products under development; delays in the development of products and statements of assumption underlying any of the foregoing, as well as other factors set forth under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2013 filed with the Securities and Exchange Commission. All subsequent written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the foregoing. Except as required by law, we undertake no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Investor & Media Contact:
BIO-key International, Inc.
Jay Meier
Vice President Corporate Development
Phone: 651-789-6116
eMail: Jay.meier@bio-key.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
Poor data quality and analytics drive down business value. In fact, Gartner estimated that the average financial impact of poor data quality on organizations is $9.7 million per year. But bad data is much more than a cost center. By eroding trust in information, analytics and the business decisions based on these, it is a serious impediment to digital transformation.
The standardization of container runtimes and images has sparked the creation of an almost overwhelming number of new open source projects that build on and otherwise work with these specifications. Of course, there's Kubernetes, which orchestrates and manages collections of containers. It was one of the first and best-known examples of projects that make containers truly useful for production use. However, more recently, the container ecosystem has truly exploded. A service mesh like Istio addr...
Predicting the future has never been more challenging - not because of the lack of data but because of the flood of ungoverned and risk laden information. Microsoft states that 2.5 exabytes of data are created every day. Expectations and reliance on data are being pushed to the limits, as demands around hybrid options continue to grow.
Business professionals no longer wonder if they'll migrate to the cloud; it's now a matter of when. The cloud environment has proved to be a major force in transitioning to an agile business model that enables quick decisions and fast implementation that solidify customer relationships. And when the cloud is combined with the power of cognitive computing, it drives innovation and transformation that achieves astounding competitive advantage.
As IoT continues to increase momentum, so does the associated risk. Secure Device Lifecycle Management (DLM) is ranked as one of the most important technology areas of IoT. Driving this trend is the realization that secure support for IoT devices provides companies the ability to deliver high-quality, reliable, secure offerings faster, create new revenue streams, and reduce support costs, all while building a competitive advantage in their markets. In this session, we will use customer use cases...
Digital Transformation: Preparing Cloud & IoT Security for the Age of Artificial Intelligence. As automation and artificial intelligence (AI) power solution development and delivery, many businesses need to build backend cloud capabilities. Well-poised organizations, marketing smart devices with AI and BlockChain capabilities prepare to refine compliance and regulatory capabilities in 2018. Volumes of health, financial, technical and privacy data, along with tightening compliance requirements by...
The best way to leverage your Cloud Expo presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering Cloud Expo and @ThingsExpo will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at Cloud Expo. Product announcements during our show provide your company with the most reach through our targeted audiences.
DevOpsSummit New York 2018, colocated with CloudEXPO | DXWorldEXPO New York 2018 will be held November 11-13, 2018, in New York City. Digital Transformation (DX) is a major focus with the introduction of DXWorldEXPO within the program. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of bus...
With 10 simultaneous tracks, keynotes, general sessions and targeted breakout classes, @CloudEXPO and DXWorldEXPO are two of the most important technology events of the year. Since its launch over eight years ago, @CloudEXPO and DXWorldEXPO have presented a rock star faculty as well as showcased hundreds of sponsors and exhibitors! In this blog post, we provide 7 tips on how, as part of our world-class faculty, you can deliver one of the most popular sessions at our events. But before reading...
DXWordEXPO New York 2018, colocated with CloudEXPO New York 2018 will be held November 11-13, 2018, in New York City and will bring together Cloud Computing, FinTech and Blockchain, Digital Transformation, Big Data, Internet of Things, DevOps, AI, Machine Learning and WebRTC to one location.
DXWorldEXPO | CloudEXPO are the world's most influential, independent events where Cloud Computing was coined and where technology buyers and vendors meet to experience and discuss the big picture of Digital Transformation and all of the strategies, tactics, and tools they need to realize their goals. Sponsors of DXWorldEXPO | CloudEXPO benefit from unmatched branding, profile building and lead generation opportunities.
DXWorldEXPO LLC announced today that ICOHOLDER named "Media Sponsor" of Miami Blockchain Event by FinTechEXPO. ICOHOLDER give you detailed information and help the community to invest in the trusty projects. Miami Blockchain Event by FinTechEXPO has opened its Call for Papers. The two-day event will present 20 top Blockchain experts. All speaking inquiries which covers the following information can be submitted by email to info@dxworldexpo.com. Miami Blockchain Event by FinTechEXPO also offers s...
Dion Hinchcliffe is an internationally recognized digital expert, bestselling book author, frequent keynote speaker, analyst, futurist, and transformation expert based in Washington, DC. He is currently Chief Strategy Officer at the industry-leading digital strategy and online community solutions firm, 7Summits.
Digital Transformation and Disruption, Amazon Style - What You Can Learn. Chris Kocher is a co-founder of Grey Heron, a management and strategic marketing consulting firm. He has 25+ years in both strategic and hands-on operating experience helping executives and investors build revenues and shareholder value. He has consulted with over 130 companies on innovating with new business models, product strategies and monetization. Chris has held management positions at HP and Symantec in addition to ...
Cloud-enabled transformation has evolved from cost saving measure to business innovation strategy -- one that combines the cloud with cognitive capabilities to drive market disruption. Learn how you can achieve the insight and agility you need to gain a competitive advantage. Industry-acclaimed CTO and cloud expert, Shankar Kalyana presents. Only the most exceptional IBMers are appointed with the rare distinction of IBM Fellow, the highest technical honor in the company. Shankar has also receive...
Enterprises have taken advantage of IoT to achieve important revenue and cost advantages. What is less apparent is how incumbent enterprises operating at scale have, following success with IoT, built analytic, operations management and software development capabilities - ranging from autonomous vehicles to manageable robotics installations. They have embraced these capabilities as if they were Silicon Valley startups.
The IoT Will Grow: In what might be the most obvious prediction of the decade, the IoT will continue to expand next year, with more and more devices coming online every single day. What isn’t so obvious about this prediction: where that growth will occur. The retail, healthcare, and industrial/supply chain industries will likely see the greatest growth. Forrester Research has predicted the IoT will become “the backbone” of customer value as it continues to grow. It is no surprise that retail is ...
Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settlement products to hedge funds and investment banks. After, he co-founded a revenue cycle management company where he learned about Bitcoin and eventually Ethereal. Andrew's role at ConsenSys Enterprise is a mul...
DXWorldEXPO LLC announced today that "Miami Blockchain Event by FinTechEXPO" has announced that its Call for Papers is now open. The two-day event will present 20 top Blockchain experts. All speaking inquiries which covers the following information can be submitted by email to info@dxworldexpo.com. Financial enterprises in New York City, London, Singapore, and other world financial capitals are embracing a new generation of smart, automated FinTech that eliminates many cumbersome, slow, and expe...
Cloud Expo | DXWorld Expo have announced the conference tracks for Cloud Expo 2018. Cloud Expo will be held June 5-7, 2018, at the Javits Center in New York City, and November 6-8, 2018, at the Santa Clara Convention Center, Santa Clara, CA. Digital Transformation (DX) is a major focus with the introduction of DX Expo within the program. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive ov...