Iteris Holdings Inc. Reports Fiscal Fourth Quarter Results
ANAHEIM, Calif.--June 8, 2004--Iteris Holdings Inc. (OTCBB:ITRSA) (OTCBB:ITRSB), a leading provider of traffic optimization and safety technology, today reported financial results for the fiscal fourth quarter and 12-month period ended March 31, 2004.For the fourth quarter, Iteris reported net sales and contract revenues of $11.4 million, an increase of 4.5 percent compared to net sales and contract revenues of $10.9 million in the fourth quarter of the previous fiscal year. The company reported operating income of $454,000, compared to an operating loss of $1.5 million reported in the fourth quarter of the previous fiscal year. The increase in operating income reflects a 33 percent reduction in operating expenses in the current year fiscal fourth quarter. The net income for the current year fiscal fourth quarter was $117,000, or $0.01 per diluted share, compared to the net loss of $8.3 million, or $(0.55) per diluted share, in the previous year fiscal fourth quarter, which included losses of $5.7 million related to discontinued operations. Net income in the fourth quarter of fiscal 2004 included a tax benefit of $644,000 for the realization of deferred tax assets.
For the year ended March 31, 2004, Iteris reported revenue of $45.3 million, an increase of 9.4 percent compared to the $41.4 million reported for the comparable year-ago period. The company reported operating income of $1.0 million in the current year compared to an operating loss of $1.1 million reported in the comparable year-ago period. The net income for the year was $7,000, or $0.00 per diluted share, compared to a net loss of $13.1 million, or $(0.92) per diluted share for the same period last year.
Continuing operations in all periods have been restated to reflect only the operations of Iteris Holdings Inc. and its majority owned subsidiary, Iteris Inc.
Greg Miner, chief executive officer of Iteris Holdings, commented: "This was a very positive quarter for Iteris Holdings on a number of fronts. Operationally, we announced our first launch customer for AutoVue for the passenger car market; and we continued to post strong gains in AutoVue sales. The current fiscal fourth quarter continued to be difficult in the markets for Transportation Systems Services revenues. We are encouraged, however, with recent developments in California's budget status for new ITS projects. Similarly, although Congress continues to deliberate the highway bill, we expect that piece of legislation to be resolved in the near term. These two factors impacted our fourth quarter financial performance, but our tight focus on cost controls, coupled with the increase in AutoVue revenue, allowed us to meet our internal expectations."
Miner continued: "Organizationally, we made significant progress toward our goal of consolidating Iteris Holdings and its majority owned subsidiary, Iteris Inc. We started out the fiscal year with a 40 percent minority interest ownership in Iteris Inc. The preferred stock minority interest in Iteris Inc. was purchased in May 2004, and as of today, the minority interest in our Iteris Inc. subsidiary has been reduced to 17.3 percent. We believe the consolidation of Iteris Holdings with Iteris Inc. has multiple long term benefits for all stockholders, and anticipate having the process completed within the next 120 days."
Highlights:
-- Revenues from AutoVue in-vehicle safety systems increased 284% during the quarter compared to last year's fourth quarter, and increased 173% for the full fiscal year in 2004 compared to 2003. Testing is underway for AutoVue by a number of fleet operators in the commercial truck market.
-- In the fourth quarter of this fiscal year, Iteris reached a cumulative installed base of 25,000 Vantage cameras installed in intersections covering 49 states -- reflective of our continued leadership for vision-based traffic intersection control.
-- In May 20, 200404, we completed the placement of $10.1 million in subordinated convertible debentures and a $5.0 million senior term credit facility and purchased the preferred stock minority interest held by Daimler Chrysler and the Government Investment Corp. of Singapore for $17.5 million. Daimler Chrysler continues to be a common stock holder of the company.
We anticipate that consolidated revenues will be approximately $11.0 million in the first fiscal quarter ended June 30, 2004.
About Iteris Holdings Inc.
Iteris Holdings Inc. is the majority stockholder of Iteris Inc., a leading provider of outdoor machine vision systems and sensors that enhance driver safety and optimize the flow of traffic. We have combined outdoor image processing, traffic engineering and information technology to offer a broad range of transportation and safety solutions. Iteris Holdings and Iteris Inc. have headquarters in Anaheim. Investors are encouraged to contact the company at 714-774-5000 or at www.iteris.com.
Important Notice
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
This news release contains forward-looking statements based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us. Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," "may," "will" and variations of these words are intended to identify forward-looking statements. These statements include, but are not limited to, statements about our future prospects and restructuring. Such statements speak only as of the date hereof and are subject to change. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors.
Important factors that may cause such a difference include, but are not limited to, our ability to specify, develop, complete, introduce, market and transition our products and technologies to volume production in a timely manner; the timing and successful completion of customer qualification of our products and the risks of non-qualification; our customers' ability to obtain market acceptance of the products that incorporate our technologies; the potential unforeseen impact of product offerings from competitors and other competitive pressures; the effectiveness of our cost and expense reduction efforts; warranty and support issues; our ability to obtain stockholder approval of the restructuring, and the general economic and political conditions and specific conditions in the markets we address, including the general economic slowdown and volatility in the technology sector, and the possible disruption in government contracting and commercial activities related to terrorist activity or armed conflict in the United States and other locations. Further information on Iteris Holdings Inc., including additional risk factors that may affect our forward looking statements, is contained in our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K and our other SEC filings that are available through the SEC's Web site (www.sec.gov).
ITERIS HOLDINGS INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March March
31, 31,
2003 2004
ASSETS:
Cash $ 437 $ 2,612
Trade accounts receivable and notes receivable 8,167 8,379
Costs and estimated earnings in excess of billings
on uncompleted contracts 2,398 2,653
Total inventories 3,903 3,598
Prepaid expenses 355 324
Assets of discontinued operations 5,237 --
Total current assets 20,497 17,566
Restricted cash 2,516 --
Property, plant and equipment, net 1,941 1,642
Goodwill 9,807 9,807
Other assets 81 1,177
Total assets $34,842 $30,192
Total current liabilities $17,129 $ 9,089
Revolving line of credit -- --
Deferred gain on sale of building 6,025 1,774
Revolving line of credit with related party 1,250 100
Notes payable 15 791
Minority interest 14,711 17,745
Total stockholders' equity (deficit) (4,288) 693
Total liabilities and stockholders' deficit $34,842 $30,192
ITERIS HOLDINGS INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per share amounts)
Three Months Year
Ended Ended
March 31, March 31,
2003 2004 2003 2004
Net sales and contract revenues:
Net sales $5,112 $5,862 $19,112 $23,470
Contract revenues 5,773 5,513 22,283 21,813
Total net sales and contract
revenues 10,885 11,375 41,395 45,283
Costs and expenses:
Cost of sales 2,570 3,267 9,366 12,758
Cost of contract revenues 3,885 3,685 15,110 14,712
Gross profit 4,430 4,423 16,919 17,813
Selling, general and
administrative expense 4,754 3,090 14,105 12,844
Research and development expense 1,150 879 3,908 3,923
Total operating expenses 5,904 3,969 18,013 16,767
Operating income (loss) (1,474) 454 (1,094) 1,046
Non-operating income (expense):
Other income (expense) (223) 33 417 1,003
Interest expense, net (67) (31) (761) (123)
Income (loss) before income taxes (1,764) 456 (1,438) 1,926
Income tax benefit -- 644 -- 100
Income (loss) from continuing
operations before minority
interest (1,764) 1,100 (1,438) 1,826
Minority interest in earnings of
subsidiary 826 516 3,818 3,034
Income (loss) from continuing
operations $(2,590) 584 (5,256) (1,208)
Income (loss) from discontinued
operations (5,735) (467) (7,892) 1,215
Net income (loss) $(8,325) $117 $(13,148) $7
Income (loss) per share:
Basic:
Income (loss) from continuing
operations $(0.17) $0.03 $(0.37) $(0.06)
Income (loss) from discontinued
operations (0.38) (0.02) (0.55) 0.06
Income (loss) per share $(0.55) $0.01 $(0.92) $0.00
Diluted:
Income (loss) from continuing
operations $(0.17) $0.03 $(0.37) $(0.06)
Income (loss) from discontinued
operations (0.38) (0.02) (0.55) 0.06
Income (loss) per share $(0.55) $0.01 $(0.92) $0.00
Shares used in calculating income
(loss) per share:
Basic 15,117 20,438 14,276 19,454
Diluted 15,117 21,756 14,276 19,680