BIO-key(R) International Inc. Reports Profitable Fourth Quarter and Full Fiscal
WALL, NJ -- (Marketwire) -- 04/01/13 -- BIO-key International, Inc.
(OTCQB: BKYI), a global leader in fingerprint biometric
identification solutions, advanced mobile credentialing and identity
verification technologies, today reported financial results for the
fourth quarter and full year ended December 31, 2012.
Total revenue for the three months ended December 31, 2012 was
$1,482,835 compared to $545,451 for the same period last year, an
increase of 172%. This increase is directly related to orders for new
business including expanded services and technologies for several
hospitals, reaching agreements with two blood centers to install
BIO-key's TruDonor ID and sales developed through growing OEM
Gross profit and gross profit margin for the three months ended
December 31, 2012 were $1,333,583 and 90%, respectively, as compared
to $353,325 and 65%, respectively, for the three months ending
December 31, 2011. The increase in gross profit percentage was driven
primarily by increased core license revenues and decreased third
party hardware sales and associated higher costs of goods sold.
Operating expenses for the three months ended December 31, 2012 were
approximately $842,000, a decrease of 36% as compared to operating
expenses of approximately $1,324,000 for the same period in 2011.
This decrease was driven by reversal of bad debt expense and reduced
R&D consulting expenses, offset by increased commission related to
increased revenue, and the legal and settlement fees related to the
alleged patent infringement suit.
Operating income for the period ended December 31, 2012 was $491,967
compared to an operating loss of ($970,590) for the same period in
2011. Total net income for the fourth quarter of 2012 was $485,797
compared to a net loss of ($1,003,286) for the comparable 2011
Michael DePasquale, BIO-key's Chief Executive Officer, stated, "The
Fourth Quarter of 2012 was strong and representative of the model we
are building. We grew revenue from a diversified customer base, while
keeping expenses in line, driving profitability in both the Quarter
and Fiscal Year 2012. It was a milestone for us and we are proud of
what we accomplished in Fiscal 2012."
Full Year Comparisons
Total revenue for the year ended December 31, 2012 was approximately
$3.8 million compared to approximately $3.5 million for the year
ended December 31, 2011, an increase of 9%. Driving this increase was
a higher core license sales, offset with lower third party hardware
sales which has a higher cost of goods sold.
Gross profit and gross profit margins for the year ended December 31,
2012 were approximately $3.3 million and 85% respectively, as
compared to approximately $2.7 million and 77% respectively, for the
year ended December 31, 2011. The increase in gross profit margin is
directly attributable to higher licensing fees as a percentage of net
sales for the comparable period.
Operating expenses for the year ended December 31, 2012 were
approximately $3.2 million, a decrease of 22 % as compared to
operating expenses of $4.2 million for the same period in 2011.
Adjusting for bad debt expense in both years and the patent
infringement legal and settlement charges in 2012, the normalized
decrease is 10%.
The Company reported an operating profit of $27,886 compared to an
operating loss of approximately ($1.45 million) for the periods ended
December 31, 2012 and December 31, 2011, respectively. BIO-key's net
income for the year ended December 31, 2012 was $3,267 compared to
net loss of approximately ($1.9 million) for the same period in 2011.
Highlights for the fourth quarter and Full Fiscal Year included the
Q4 2012 Highlights
-- Received orders in excess of $1 million from healthcare and blood
center customers in the fourth quarter.
-- Completed the installation and delivery of our technology for a large
scale international biometric identification project.
-- Launched integration efforts into Allscripts Professional EHR. Pro EHR
provides small to midsize healthcare organizations with electronic
health records management solutions and has the largest marketshare of
the Allscripts EHR solution offerings.
-- Initiated relationship discussions with InterDigital Communications
Inc. leading to completion of R&D collaboration agreement as well
as investment in BIO-key in the first quarter of 2013.
2012 Full Year Highlights
-- Awarded contract to provide the Provincial Government of British
Columbia Department of Corrections with fingerprint biometric
authentication solutions for inmates seeking to access personnel
-- IBM produced an IBM Redguide; "BIO-key Biometric Service Provider for
IBM Security" Redguide is the go-to resource for IBM sales and support
technicians seeking innovative customer solutions. IBM distributed the
Redguide to thousands of IBMers and hosts the guide on the IBM
-- IBM reseller Dancom installed BIO-key technology which is currently
integrated into the IBM TAM and ISAM ESSO platforms to provide
fingerprint biometric authentication solutions for Aeon Credit
-- BIO-key's biometric algorithm achieved top scores for accuracy during
the most recent evaluation conducted within the National Institute of
Standards and Technologies (NIST) PFT II testing suite.
-- BIO-key was awarded three new blood center contracts; expanding our
national footprint to include six blood centers and over three million
blood donor identification licenses.
-- Purchase orders for continued rollouts at LexisNexis, Identimetrics,
Solfed, Team Praxis, Union Pacific, Davlong, Medflow, Robinson
Memorial Hospital, Muskingum Valley Health Center, Children's Medical
Center of Dayton, Nationwide Children's Hospital, McKesson, NCR and
-- BIO-key was issued US Patent No 8,214,652 for the Company's "Biometric
Identification Network Security," an expanded method of network and
related network authentication security systems utilizing hardware
based support for encryption and key management for authentication
DePasquale continued, "We believe that the marketplace for biometrics,
including Mobile Credentialing and Payments, is finally emerging and
that we have strategically positioned the company to capitalize on
this opportunity. In line with our objectives we've hired strategic
development personnel, as well as additional technical support staff
to prepare for the next phase of growth. Although the landscape is
improving we recognize that the growth of our company and the growth
of the entire biometric industry will be choppy and unpredictable for
the foreseeable future. In line with this for 2013 we have set three
primary goals; first, we remain committed to growing the Company by
developing new partnerships in the Mobility, Healthcare and Services
markets as we are starting to witness the benefit of our leveraged
sales model. Also, the Company will continue to forward existing
strategic relationships and provide ongoing support to our customers.
Second, as much as possible, we intend to smooth the volatility of
our business to enhance shareholder value, within an emerging and
rapidly changing landscape. Our third objective, which we have
already taken the first step towards delivering, is to ultimately
drive shareholder equity through positive cash flow and more
consistent bottom line profitability."
Conference Call Details
BIO-key has scheduled a call for Monday, April 1, 2013 at 10:00 a.m.
Eastern Time to discuss 2012 fourth quarter and year end results. To
access the conference call live, dial 800-860-2442 (international:
412-858-4600) and ask for the BIO-key call at least 10 minutes prior
to the start time. The conference call will also be broadcast live
over the Internet by logging onto www.bio-key.com. A streaming audio
replay of the conference call will be available through April 29,
2013 and may be accessed by dialing 877-344-7529 (international:
412-317-0088) and using the pass code 10026640#.
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.
BIO-key Safe Harbor Statement
Certain statements contained in this
press release may be construed as "forward-looking statements" as
defined in the Private Securities Litigation Reform Act of 1995 (the
"Act"). The words "estimate," "project," "intends," "expects,"
"anticipates," "believes" and similar expressions are intended to
identify forward-looking statements. Such forward-looking statements
are made based on management's beliefs, as well as assumptions made
by, and information currently available to, management pursuant to
the "safe-harbor" provisions of the Act. These statements are subject
to certain risks and uncertainties that may cause actual results to
differ materially from those projected on the basis of these
statements. These risks and uncertainties include, without
limitation, our history of losses and limited revenue, our ability to
develop new products and evolve existing ones, the impact on our
business of the recent financial crisis in the global capital markets
and negative global economic trends, our ability to attract and
retain key personnel. For a more complete description of these and
other risk factors that may affect the future performance of BIO-key
International, Inc., see "Risk Factors" in the Company's Annual
Report on Form 10-K for the year ended December 31, 2012 and its
other filings with the Securities and Exchange Commission. Readers
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date made. The Company also
undertakes no obligation to disclose any revision to these
forward-looking statements to reflect events or circumstances after
the date made or to reflect the occurrence of unanticipated events.
Copyright Copyright 2013 by BIO-key International, Inc.
BIO-key International, Inc.
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