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Identix Posts Steep Loss
The leading biometrics company lost $55.4 million for fiscal 2002, but it is record growth for fiscal 2003.
Aug 09, 2002—August 9, 2002 -- This year has been a tough one for companies in the auto-identification and security fields. But at least one company has closed the books on it and is looking forward to a much better 2003.
Identix Inc. (Nasdaq: IDNX), a Minnetonka, Minn.-based provider of biometrics technology, reported a net loss of $55.4 million for its fiscal year ended June 30. Revenue for the year fell to $73.2 million, from $81.8 million in fiscal 2001.
But the company is forecasting record growth in the coming fiscal year, based on strong demand for biometrics, as governments and companies look to upgrade their security systems. Identix president and CEO Joseph Atick told analysts during a conference call that revenue is expected to increase to approximately $120 million, which would be more than a 60 percent increase over 2002.
Identix recently completed its acquisition of Visionics. The two were among the biggest U.S. companies in the biometrics industry. The company clearly believes that the combined product line -- which covers facial recognition, mobile and desktop live-scan finger print technology and middleware for linking system -- will be attractive to companies looking to beef up security in the wake of the Sept. 11 terrorism attacks.
Government agencies, the military and airports are all looking to deploy biometrics technology. Airports, for example, are interested in both facial recognition technologies to spot wanted terrorists, and fingerprint technology to secure access to airplanes. It was the need to provide both kinds of technologies that led the two companies to merge.
CEO Atick says Identix is aggressively integrating Visionics and restructuring the combined company to position it as the U.S. market leader in biometrics. "The new strategic market-focused organizational structure we announced at the end of July enables us to focus on the needs of our current and target customers in specific markets with a comprehensive multi-biometric product offering encompassing every one of our products and solutions," he says
Identix net loss included write-offs and charges of $23.5 million related to the acquisition of Visionics and the restructuring. Despite the large loss, the company has a significant amount of cash on hand. As of June 30, its balance sheet showed working capital of $63.2 million, cash and investments of $69 million, long- term liabilities of $9.6 million and shareholders' equity of $393.3 million.
Identix says it expects to reach EBITDA profitability by the end of its 2003 fiscal year and said that it expects to reach positive cash flow shortly thereafter. Despite the upbeat forecast, Identix's stock fell 9 percent on Thursday to $4.54.
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