Identiv Reports Preliminary Fiscal Year 2019 and Fourth Quarter Results - Seite 3

The Company amended its Loan and Security Agreement with East West Bank (EWB). This is the twelfth such periodic amendment. This amendment to the Agreement retains the total credit amount of $20.0 million but includes a $4.5 million term loan component for a 12-month period and lowers the revolving credit line to $15.5 million. Additional details of the amended Loan and Security Agreement are included in a Form 8-K, which the Company filed today.

Management Commentary
“Throughout 2019, we focused on establishing our total security and advanced identity solutions as leading products in a transforming market,” said Identiv CEO, Steven Humphreys. “Despite the fact that we believe we remain in a uniquely strong position technically and strategically, our fourth quarter results were softer than expected. Approximately $1 million of Thursby software contracts and $3 million of federal government contracts related to our Premises business shifted into 2020.

“Additionally, we experienced customers considering migrating from systems purchases to subscriptions at year end due to the launch of our new SaaS products, Velocity Cirrus and secure mobile PDF signing. As we transition our business model from predominantly system sales to more SaaS-based revenues, predictability and visibility will increase, but revenue will be recognized over a longer period.

“While these circumstances negatively impacted our fourth quarter financial results, we believe our business overall remains robust. Based on our preliminary results, our Premises business grew 20% in 2019, which is approximately three times the industry’s growth rate, and in the fourth quarter, our RFID business grew 62% over Q4 2018. In 2019, we maintained stable operating expenses and solid gross margins, driving an 18% increase in non-GAAP adjusted EBITDA and positive free cash flow. We’ve carried this momentum into 2020 by building a strong backlog and by booking $2.0 million in orders during the first week of January alone. We’re building a broader pipeline, strong sales teams and diverse channels designed to ensure revenue resilience and predictability over time.

“While there are excellent opportunities ahead of us, we believe the key to mitigating variance and ensuring predictable financial results is greater scale and greater recurring revenues. Greater scale provides more options. It allows us to adapt and to absorb fluctuations more effectively. The independent members of the Board of Directors are working with management to ensure we’re pursuing the best path to realize the full financial potential of our business for our customers, partners, employees and investors.”