Total Revenue of $30.9 Million Represents Quarterly Record for Company
SANTA ANA, Calif. – June 9, 2020 – Iteris, Inc. (NASDAQ: ITI), the global leader in smart mobility infrastructure management, today reported financial results for its fiscal fourth quarter and full year ended March 31, 2020.
Fiscal Fourth Quarter 2020 Financial Highlights
- Record total revenue of $30.9 million, up 18% year over year
- Total net bookings of $28.7 million, up 19% year over year
- Total ending backlog of $67.2 million, up 21% year over year
- GAAP net income of $0.2 million, or $0.01 per share, a $2.6 million, or $0.08 per share, improvement year over year
- Non-GAAP net income of $1.8 million, or $0.04 per share, a $3.1 million, or $0.08 per share, improvement year over year
Fiscal Full Year 2020 Financial Highlights
- Record total revenue of $114.1 million, up 15% year over year
- Total net bookings of $121.9 million, up 14% year over year
- GAAP net loss of $5.6 million, or ($0.14) per share, a $2.2 million, or $0.09 per share, improvement year over year
- Non-GAAP net income of $1.2 million, or $0.03 per share, a $5.0 million, or $0.14 per share, improvement year over year
“Our record revenue for both the fiscal 2020 fourth quarter and full year demonstrates solid performance across all reporting segments and a critical inflection point for the company,” said Joe Bergera, president and CEO of Iteris. “Given the strength of our total net bookings and ending backlog, we anticipate further growth in revenue and profitability as we capture additional market share in the smart mobility infrastructure management market.
“Despite the many global disruptions from COVID-19, we continue to see favorable long-term, secular trends in the smart mobility infrastructure management market. Therefore, we look forward to introducing several exciting new product innovations, during our current fiscal 2021 year that began on April 1, 2020, which we expect to further enhance our market leadership and contribute to our financial results.”
GAAP Fiscal Fourth Quarter 2020 Financial Results
Total revenue in the fourth quarter of fiscal 2020 increased 18% to $30.9 million, compared with $26.1 million in the same quarter a year ago. This revenue increase was driven primarily by a 26% increase in Transportation Systems, a 10% increase in Roadway Sensors, and a 15% increase in Agriculture and Weather Analytics. The operations of Albeck Gerken, Inc. (“AGI”) contributed $2.5 million in revenue to the Transportation Systems segment in the quarter.
Operating expenses in the fourth quarter increased 13% to $13.9 million, compared with $12.3 million in the same quarter a year ago. This increase was primarily due to expenses related to the acquisition of AGI and retention costs for certain Agriculture and Weather Analytics employees. In connection with the AGI acquisition completed in July 2019, the company added general and administrative employees, which has increased its selling, general and administrative expenses in fiscal 2020.
Operating income in the fourth quarter was $0.1 million, compared with an operating loss of $2.5 million in the same quarter a year ago. Net income in the fourth quarter was $0.2 million, or $0.01 diluted per share, compared with a loss of $2.4 million, or $0.07 per share, in the same quarter a year ago.
GAAP Fiscal 2020 Full Year Financial Results
Total revenue in fiscal 2020 increased 15% to $114.1 million, compared with $99.1 million in fiscal 2019. The increase was driven primarily by a 16% increase in Transportation Systems, a 14% increase in Roadway Sensors, and a 15% increase in Agriculture and Weather Analytics year over year.
Operating expenses for fiscal year 2020 were $53.7 million, compared with $46.6 million for the previous year period. The increase was primarily due to expenses related to the acquisition of AGI, retention costs for certain Agriculture and Weather Analytics employees, and executive severance costs. In connection with the AGI acquisition completed in July 2019, the company added general and administrative employees, which has increased its selling, general and administrative expense in fiscal 2020.
Operating loss in fiscal 2020 was $6.0 million, compared with an operating loss of $8.0 million in fiscal 2019. Net loss in fiscal 2020 was approximately $5.6 million, or ($0.14) per share, compared with a net loss of approximately $7.8 million, or ($0.23) per share, in fiscal 2019.
Non-GAAP Fiscal Fourth Quarter 2020 Financial Results
In addition to results presented in accordance with generally accepted accounting principles in the United States (“GAAP”), the company has included the following non-GAAP financial measures: non-GAAP net income (loss) and non-GAAP basic and diluted net income (loss) per share. These non-GAAP financial measures exclude the following items: (a) stock compensation expense; (b) depreciation; (c) amortization; (d) the costs associated with the acquisition of AGI; (e) executive severance and transition costs; and (f) the estimated tax effect of the foregoing non-GAAP adjustments. A discussion of the company’s use of these non-GAAP financial measures is set forth below in the financial statements portion of this release under the heading “Non-GAAP Financial Measures and Reconciliation”, which also includes a reconciliation of such non-GAAP financial measures to their most comparable GAAP financial measures for the three and 12 months ended March 31, 2020 and 2019.
Non-GAAP net income in the fourth quarter was approximately $1.8 million, or $0.04 diluted per share, compared with a net loss of approximately $1.4 million, or ($0.04) per share, in the same quarter a year ago.
Non-GAAP Fiscal 2020 Full Year Financial Results
Non-GAAP net income in fiscal 2020 was approximately $1.2 million, or $0.03 diluted per share, compared with a net loss of approximately $3.7 million, or ($0.11) per share, in fiscal 2019.
Subsequent Event – Definitive Agreement to Sell Agriculture and Weather Analytics Segment
On May 4, 2020, Iteris announced that it had executed a definitive agreement to sell its Agriculture and Weather Analytics segment, composed of its ClearAg and ClearPath Weather product lines, to DTN, LLC, which is an operating company of TBG AG, a Swiss-based holding company. DTN is the leading independent provider of decision support solutions to global agriculture, oil and gas, and other weather-sensitive industries. Iteris will receive $12.0 million in total consideration in the all-cash transaction. The agreement includes normal working capital and other adjustments. Iteris will retain access to the weather and pavement data that it integrates into its market-leading transportation software products. Additionally, coincident with executing the definitive agreement, Iteris and DTN agreed to enter into a strategic partnership to pursue future joint opportunities in the global transportation market.
In conjunction with the sale, Iteris will take a restructuring charge in the range of $1.7 million to $1.9 million in the first quarter of fiscal year 2021, of which approximately 60% relates to the sale activities. The restructure includes separation costs for certain employees who will not transition to DTN and an additional 10 to 15 positions that are being eliminated to right-size the cost structure of the company. The annualized savings from the restructure charges, excluding those related to the sale, will be in the range of $1.2 million to $1.3 million.
Earnings Conference Call
Iteris will conduct a conference call today to discuss its fiscal fourth quarter and full year 2020 results.
Date: Tuesday, June 9, 2020
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)
Toll-free dial-in number: 1-800-367-2403
International dial-in number: +1 334-777-6978
Conference ID: 6698390
A replay of the conference call will be available after 7:30 p.m. Eastern time on the same day through June 16, 2020. To access the replay dial information, please click here.
About Iteris, Inc.
Iteris is the global leader in smart mobility infrastructure management – the foundation for a new era of mobility. We apply cloud computing, artificial intelligence, advanced sensors, advisory services and managed services to achieve safe, efficient and sustainable mobility. Our end-to-end solutions monitor, visualize and optimize mobility infrastructure around the world to help ensure that roads are safe, travel is efficient, and communities thrive. Visit www.iteris.com for more information and join the conversation on Twitter, LinkedIn and Facebook.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
This release may contain forward-looking statements, which speak only as of the date hereof and are based upon our current expectations and the information available to us at this time. Words such as "believes," "anticipates," "expects," "intends," "plans," "seeks," "estimates," "may," "will," "can," and variations of these words or similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to, statements about the Company’s anticipated demand and growth opportunities, conversion of bookings to revenue, the impact and success of new solution offerings, the Company’s recent acquisition, our future performance, growth and profitability, operating results, and financial condition and prospects. Such statements are subject to certain risks, uncertainties, and assumptions that are difficult to predict and 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, federal, state and local government budgetary issues, spending and scheduling changes, funding constraints and delays, including in light of the COVID-19 pandemic; the timing and amount of government funds allocated to overall transportation infrastructure projects and the transportation industry; our ability to replace large contracts once they have been completed; the effectiveness of efficiency, cost, and expense reduction efforts; our ability to achieve anticipated benefits from the sale of our Agriculture and Weather Analytics segment; difficulties and risks in restructurings; our ability to successfully complete and integrate acquired companies; our ability to specify, develop, complete, introduce, market and gain broad acceptance of our new and existing product and service offerings; risks related to our ability to recruit and/or retain key talent; the potential unforeseen impact of product and service offerings from competitors, increased competition in certain market segments, and such competitors’ patent coverage and claims; any softness in the markets that we address; and the impact of general economic and political conditions and specific conditions in the markets we address, and the possible disruption in government spending and commercial activities, such as the COVID-19 pandemic, import/export tariffs, terrorist activities or armed conflicts in the United States and internationally. Further information on Iteris, Inc., including additional risk factors that may affect our forward-looking statements, as 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 website (www.sec.gov).
Senior Vice President and Chief Financial Officer
Tel: (949) 270-9643
MKR Investor Relations, Inc.
Tel: (323) 468-2300