I.D. Systems Reports Record Second Quarter Revenue

I.D. Systems Reports Record Second Quarter Revenue

WOODCLIFF LAKE, N.J., Aug. 7, 2013 (GLOBE NEWSWIRE) -- I.D. Systems, Inc.
(Nasdaq:IDSY), a leading provider of wireless solutions for tracking, securing
and managing high-value enterprise assets, reported results for the three and
six months ended June 30, 2013.

Second Quarter 2013 Financial Results

  *Revenue increased 8% year-over-year to a Q2 record $9.4 million, from $8.7
    million in the second quarter of 2012, reflecting increased sales of the
    company's vehicle and transportation asset management systems.
  *Recurring revenue was $4.4 million, up 2% from $4.3 million in the second
    quarter a year ago.
  *Gross margin was consistent with historic levels at 52%.
  *Selling, general and administrative expenses and research and development
    expenditures of $5.6 million and $1.1 million, respectively, in the second
    quarter of 2013 decreased 1% from $5.7 million and $1.1 million,
    respectively, in the second quarter of 2012.
  *Excluding stock-based compensation and depreciation and amortization,
    non-GAAP net loss improved to $851,000, or $(0.07) per basic and diluted
    share, compared to $1.2 million, or $(0.10) per basic and diluted share,
    in the same period a year ago.
  *Net loss improved to $1.7 million, or $(0.14) per basic and diluted share,
    compared to $2.1 million, or $(0.18) per basic and diluted share, in the
    second quarter of 2012.
  *As of June 30, 2013, I.D. Systems had $14.7 million in cash, cash
    equivalents and marketable securities, and no debt.

Second Quarter 2013 Operational Highlights

  *Recurring business from core customers, including BASF, Bridgestone
    Firestone, Campbell's Soup, CH Robinson, Caterpillar, Ford Motor Company,
    General Mills, Kuehne + Nagel, John Deere, Meijer, Nestlé, Procter &
    Gamble, Rio Tinto Alcan, Toyota, Walgreens, and Walmart, among others.
  *Initial system implementations with new customers, including two Tier 1
    automotive suppliers, a global manufacturer of water heating and treatment
    systems, a leading U.S. specialty retailer, a U.S. forest products
    company, and a leading North American transportation and logistics service
  *Substantial revenue contributions from channel partners (industrial truck
    manufacturers and their dealers), which sold I.D. Systems' solutions to
    end users including a Fortune 100 retailer, a Fortune 500 retailer, and
    one of the world's largest food service companies.

Six Month 2013 Financial Results

  *Revenue was $17.4 million, compared to $18.5 million in the same period a
    year ago. The decrease was due primarily to lower than expected first
    quarter revenue from industrial vehicle management business in the U.S.
    and a shortfall of revenue from Europe, reflecting the economic climate in
    that region.
  *Recurring revenue was $8.7 million, up 4% from $8.4 million in the same
    period a year ago.
  *Gross margin was consistent with historic levels at 50%.
  *Selling, general and administrative expenses and research and development
    expenditures of $11.1 million and $2.3 million, respectively, in the six
    month period ended June 30, 2013, decreased 1% from $11.3 million and $2.2
    million, respectively, in the six months ending June 30, 2012.
  *Excluding stock-based compensation and depreciation and amortization,
    non-GAAP net loss was $2.7 million, or $(0.23) per basic and diluted
    share, compared to $2.0 million, or $(0.17) per basic and diluted share,
    in the same period a year ago.
  *Net loss was $4.3 million or $(0.36) per basic and diluted share, compared
    to $3.7 million or $(0.32) per basic and diluted share in the same period
    in 2012.

Management Commentary

"We are encouraged by our second quarter revenue growth, which increased 17%
sequentially over the first quarter of 2013 as well as 8% year-over-year,"
said Jeffrey Jagid, I.D. Systems' chairman and CEO. "We continue to be
optimistic about our prospects for the second half of 2013 and remain
committed to our revenue growth strategy, which has proven successful over the
past three years. We are working to build revenue vertically by expanding our
footprint with core enterprise customers, and diversify revenue horizontally
by establishing new customers, utilizing both channel partners and our direct
sales organization.

"We also remain committed to expanding and monetizing the intellectual
property behind our wireless solutions to maintain our technical leadership in
the markets we serve: industrial vehicle management, transportation asset
management, and rental car management.

"With respect to our rental car business, we have deployed our systems on
approximately 30,000 rental vehicles in North America for Avis Budget Group,
our exclusive partner in this market. On August 1, 2013, we entered into a
memorandum of understanding with Avis Budget to cooperate on the development
of a new generation of in-vehicle wireless devices to automate all Avis Budget
car rental environments, including airport lots, virtual lots, and car sharing
applications. Under this MOU, we are negotiating an amendment to our 2011
master agreement with Avis Budget and, to facilitate those negotiations, have
agreed with Avis Budget to extend our mutual exclusivity until September 30,

Investor Conference Call

I.D. Systems will hold a conference call for investors and analysts today,
Wednesday, August 7, 2013, at 4:45 p.m. Eastern time.The company's chairman
and CEO, Jeffrey Jagid, will lead a discussion on the results for the period
and other recent developments, followed by a question and answer period. The
conference call will be broadcast live via the investors section of the
company's website at www.id-systems.com. To listen to the live call, go to the
website at least 10 minutes early to download and install any necessary audio

Non-GAAP Measures

To supplement its financial statements presented in accordance with Generally
Accepted Accounting Principles (GAAP), I.D. Systems provides certain non-GAAP
measures of financial performance. These non-GAAP measures include non-GAAP
net income/loss and non-GAAP net income/loss per basic and diluted share.
Reference to these non-GAAP measures should be considered in addition to
results prepared under current accounting standards, but are not a substitute
for, or superior to, GAAP results.These non-GAAP measures are provided to
enhance investors' overall understanding of I.D. Systems' current financial
performance. Specifically, I.D. Systems believes the non-GAAP measures provide
useful information to both management and investors by excluding certain
expenses, gains and losses that may not be indicative of its core operating
results and business outlook. Reconciliation of all non-GAAP measures included
in this press release to the nearest GAAP measures can be found in the
financial tables included in this press release.

About I.D. Systems

Headquartered in Woodcliff Lake, New Jersey, with subsidiaries in Texas,
Germany, and the United Kingdom, I.D. Systems is a leading global provider of
wireless solutions for securing, controlling, tracking, and managing
high-value enterprise assets, including industrial vehicles, rental cars,
trailers, containers, and cargo.The company's patented technologies address
the needs of organizations to monitor and analyze their assets to increase
efficiency and productivity, reduce costs, and improve profitability.For more
information, please visit www.id-systems.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward looking statements within the meaning of
federal securities laws. Forward-looking statements include statements with
respect to I.D. Systems' beliefs, plans, goals, objectives, expectations,
anticipations, assumptions, estimates, intentions, and future performance, and
involve known and unknown risks, uncertainties and other factors, which may be
beyond I.D. Systems' control, and which may cause its actual results,
performance or achievements to be materially different from future results,
performance or achievements expressed or implied by such forward-looking
statements.All statements other than statements of historical fact are
statements that could be forward-looking statements.For example,
forward-looking statements include: statements regarding prospects for
additional customers; market forecasts; projections of earnings, revenues,
synergies, accretion or other financial information; and plans, strategies and
objectives of management for future operations, including integration plans in
connection with acquisitions. The risks and uncertainties referred to above
include, but are not limited to, future economic and business conditions, the
loss of key customers or reduction in the purchase of products by any such
customers, the failure of the market for I.D. Systems' products to continue to
develop, the possibility that I.D. Systems may not be able to integrate
successfully the business, operations and employees of acquired businesses,
the inability to protect I.D. Systems' intellectual property, the inability to
manage growth, the effects of competition from a variety of local, regional,
national and other providers of wireless solutions, and other risks detailed
from time to time in I.D. Systems' filings with the Securities and Exchange
Commission, including its annual report on Form 10-K for the year ended
December 31, 2012. These risks could cause actual results to differ materially
from those expressed in any forward looking statements made by, or on behalf
of, I.D. Systems. Unless otherwise required by applicable law, I.D. Systems
assumes no obligation to update the information contained in this press
release, and expressly disclaims any obligation to do so, whether as a result
of new information, future events or otherwise.

I.D. Systems, Inc. and Subsidiaries
Condensed Statement of Operations Data
                     ThreeMonthsEnded          SixMonthsEnded
                      June30,                    June30,
                     2012          2013          2012           2013
Products              $4,761,000  $5,303,000  $10,472,000   $9,078,000
Services              3,920,000     4,067,000     8,021,000      8,306,000
                     8,681,000     9,370,000     18,493,000     17,384,000
Cost of revenue:                                              
Cost of products      2,810,000     3,005,000     6,273,000      5,699,000
Cost of services      1,321,000     1,515,000     2,724,000      2,999,000
                     4,131,000     4,520,000     8,997,000      8,698,000
Gross profit          4,550,000     4,850,000     9,496,000      8,686,000
Selling, general and  5,671,000     5,595,000     11,260,000     11,111,000
Research and          1,085,000     1,123,000     2,199,000      2,263,000
development expenses
                     6,756,000     6,718,000     13,459,000     13,374,000
Loss from operations  (2,206,000)  (1,868,000)  (3,963,000)   (4,688,000)
Interest income       130,000       159,000       219,000        324,000
Other income, net     10,000        2,000         31,000         35,000
Net loss              $(2,066,000) $(1,707,000) $ (3,713,000) $(4,329,000)
Net loss per share –  $(0.18)     $(0.14)     $(0.32)      $(0.36)
basic and diluted
Weighted average
common shares         11,701,000    11,887,000    11,710,000     11,863,000
outstanding – basic
and diluted

I.D. Systems, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures

                  Three Months Ended June 30,  Six Months Ended June 30,
                  2012           2013           2012           2013
Net loss
attributable to                                              
                  $(2,066,000) $(1,707,000) $(3,713,000) $(4,329,000)
Depreciation and   553,000        505,000        1,107,000      1,044,000
Stock-based        327,000        351,000        580,000        604,000
Non-GAAP loss      $(1,186,000) $(851,000)   $(2,026,000) $(2,681,000)
Non-GAAP net loss
per share – basic  $(0.10)      $(0.07)      $(0.17)      $(0.23)
and diluted

I.D. Systems, Inc. and Subsidiaries
Condensed Balance Sheet Data
                                             December 31, 2012* June 30, 2013
Cash and cash equivalents                     $1,614,000         $3,261,000
Restricted cash                               300,000            300,000
Investments – short term                      4,794,000          3,228,000
Accounts receivable, net                      8,814,000          7,475,000
Financing receivable – current                3,143,000          3,749,000
Inventory, net                                7,512,000          8,088,000
Deferred costs – current                      2,380,000          1,813,000
Prepaid expenses and other current assets     1,043,000          971,000
Deferred tax asset – current                  662,000            --
Total current assets                          30,262,000         28,885,000
Investments – long term                       9,064,000          7,942,000
Financing receivable – long term              10,814,000         10,752,000
Deferred costs – long term                    2,651,000          3,382,000
Fixed assets, net                             2,401,000          2,116,000
Goodwill                                      1,837,000          1,837,000
Intangible assets, net                        3,230,000          2,684,000
Other assets                                  307,000            307,000
                                             $60,566,000        $57,905,000
Accounts payable and accrued expenses         $5,638,000         $5,929,000
Deferred revenue                              4,689,000         4,156,000
Total current liabilities                     10,327,000        10,085,000
Deferred rent                                 343,000           336,000
Deferred revenue                              5,869,000         7,535,000
Total liabilities                             16,539,000        17,956,000
Commitments and Contingencies                                   
STOCKHOLDERS' EQUITY                                            
Preferred stock; authorized 5,000,000 shares, ----             ----
$0.01 par value; none issued
Common stock; authorized 50,000,000 shares,
$0.01 par value; 12,678,000 and 12,779,000
shares issued at December 31, 2012 and June   122,000           122,000
30, 2013, respectively; shares outstanding,
12,088,000 and 12,151,000 at December 31,
2012 and June 30, 2013, respectively
Additional paid-in capital                    103,135,000       103,772,000
Accumulated deficit                           (56,102,000)      (60,431,000)
Accumulated other comprehensive income (loss) 53,000            (131,000)
                                             47,208,000        43,332,000
Treasury stock, at cost                       (3,181,000)       (3,383,000)
Total stockholders' equity                    44,027,000        39,949,000
Total liabilities and stockholders' equity    $60,566,000        $57,905,000
*Derived from audited balance sheet as of December 31, 2012.

I.D. Systems, Inc. and Subsidiaries
Condensed Statement of Cash Flows Data
                                                Six Months Ended June 30,
                                                2012           2013
Cash flows from operating activities:                          
Net loss                                         $(3,713,000) $(4,329,000)
Adjustments to reconcile net loss to cash used                 
in operating activities:
Bad debt expense                                 208,000       212,000
Proceeds from sale of N.J. net operating loss    390,000       662,000
Stock-based compensation expense                 580,000       604,000
Depreciation and amortization                    1,107,000     1,044,000
Deferred rent expense                            21,000        (7,000)
Changes in:                                                    
Accounts receivable                              219,000       1,103,000
Note and lease receivable                        (814,000)     (546,000)
Inventory                                        (128,000)     (576,000)
Prepaid expenses and other assets                1,165,000     72,000
Deferred costs                                   (301,000)     (164,000)
Deferred revenue                                 1,294,000     1,133,000
Accounts payable and accrued expenses            (4,108,000)   291,000
Net cash used in operating activities            (4,080,000)   (501,000)
Cash flows from investing activities:                          
Expenditures for fixed assets including website  (215,000)     (213,000)
Purchase of investments                          (3,135,000)   (3,677,000)
Proceeds from sales and maturities of            3,943,000     6,267,000
Net cash provided by investing activities        593,000       2,377,000
Cash flows from financing activities:                          
Proceeds from exercise of stock options          25,000        10,000
Purchase of treasury shares                      (183,000)     --
Net cash (used in) provided by financing         (158,000)     10,000
Effect of foreign exchange rate changes on cash  (93,000)      (239,000)
and cash equivalents
Net (decrease) increase in cash and cash         (3,738,000)   1,647,000
Cash and cash equivalents - beginning of period  8,386,000     1,614,000
Cash and cash equivalents - end of period        $4,648,000     $3,261,000

CONTACT: Investor Relations
         Liolios Group, Inc.
         Scott Liolios or Matt Glover
         949-574-3860, IDSY@liolios.com

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