SANTA ANA, Calif. – November 6, 2018 – Iteris, Inc. (NASDAQ: ITI), the global leader in applied informatics for transportation and agriculture, today reported financial results for its fiscal second quarter 2019 ended September 30, 2018.
Fiscal Second Quarter 2019 Financial Summary
- Total revenue of $24.4 million, down 3.3% year over year
- Total backlog of $59.2 million, up 18.6% sequentially from Q1 FY19
- Transportation Systems revenue of $12.4 million, down 5.6% year over year
- Transportation Systems backlog of $48.4 million, up 18.9% sequentially from Q1 FY19
- Roadway Sensors revenue of $11.0 million, down 2.5% year over year
- Roadway Sensors backlog of $5.4 million, down 13.8% sequentially from Q1 FY19
- Agriculture and Weather Analytics revenue of $1.1 million, up 21.1% year over year
- Agriculture and Weather Analytics backlog of $5.4 million, up 83.9% sequentially from Q1 FY19
“As anticipated, the company’s consolidated second quarter results were down year over year due to the timing of a recent transition of a large Virginia Department of Transportation contract and continued issues in the Texas market,” said Joe Bergera, president and CEO. “Despite these temporary headwinds, we continue to experience overall strong demand across both the smart transportation and digital agriculture markets as evidenced by our solid backlog growth, which will drive improvements in our performance in the second half of FY19.”
“Indeed, Iteris remains a net beneficiary of a structural shift in transportation infrastructure spending that is increasingly directed at our core strengths – smart cities, data analytics, and enhanced safety and mobility,” continued Mr. Bergera. “For example, our Transportation Systems segment alone added $20.0 million in new backlog in the second quarter, bringing our total company-wide net ending backlog for Q2 FY19 to $59.2 million.”
GAAP Fiscal Second Quarter 2019 Financial Results
Total revenue in the second quarter of fiscal 2019 decreased 3.3% to $24.4 million, compared with $25.2 million in the same quarter a year ago. This decline was due to a 5.6% decrease in Transportation Systems and a 2.5% decrease in Roadway Sensors, which was partially offset by a 21.1% increase in Agriculture and Weather Analytics revenue.
Operating expenses in the second quarter were relatively consistent with the same quarter a year ago at $11.1 million.
Operating loss in the second quarter was $1.4 million compared with an operating loss of $1.1 million in the same quarter a year ago. Net loss in the second quarter was $1.3 million, or ($0.04) per share, compared with a net loss of $1.0 million, or ($0.03) per share in the year-ago quarter.
From a balance sheet perspective, cash and short-term investments decreased $5.6 million from the start of the fiscal year, however, this was offset by an increase in accounts receivable of $2.5 million. The decrease in cash and increase in accounts receivable was due to the launch of our new ERP system in April 2018, which resulted in a temporary delay in customer billing during the first half of the fiscal year.
Non-GAAP Fiscal Second Quarter 2019 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 operating expenses, non-GAAP operating loss, non-GAAP net loss and non-GAAP basic and diluted net loss per share. These non-GAAP financial measures exclude the following items: (a) stock compensation expense; (b) depreciation; (c) amortization; and (d) 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 months ended September 30, 2018 and 2017.
Non-GAAP operating expenses in the second quarter decreased to $10.3 million, compared with $10.4 million in the same quarter a year ago. Non-GAAP operating loss in the second quarter was approximately ($409,000), compared with operating loss of approximately ($281,000) in the same quarter a year ago. Non-GAAP net loss in the first quarter was approximately ($364,000), or ($0.01) per share, compared with net loss of approximately ($174,000), or ($0.01) per share, in the same quarter a year ago.
Earnings Conference Call
Iteris will conduct a conference call today to discuss its fiscal second quarter 2019 results.
Date: Tuesday, November 6, 2018
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)
Toll-free dial-in number: 1-877-260-1479
International dial-in number: 1-334-323-0522
Conference ID: 2419239
A replay of the conference call will be available after 7:30 p.m. Eastern time on the same day through November 13, 2018. To access the replay dial information, please click here.
About Iteris, Inc.
Iteris is the global leader in applied informatics for transportation and agriculture, turning big data into big breakthrough solutions. We collect, aggregate and analyze data on traffic, roads, weather, water, soil and crops to generate precise informatics that lead to safer transportation and smarter farming. Municipalities, government agencies, crop science companies, farmers and agronomists around the world use our solutions to make roads safer and travel more efficient, as well as farmlands more sustainable, healthy and productive. 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 potential revenue growth for the upcoming quarters, the impact of natural disasters to our business, and our future performance, growth, operating results, 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, the potential impact of natural disasters in our strategic markets; federal, state and local government budgetary issues, constraints and delays; the timing and amount of government funds allocated to overall transportation infrastructure projects and the transportation industry; third-party supply shortages and technology issues; the potential unforeseen impact of product and service offerings from competitors, increased competition in certain market segments and other competitive pressures; our ability to secure additional Transportation Systems consulting contracts and successfully complete such contracts on a timely basis; our ability to specify, develop, complete, introduce, market and gain broad acceptance of our new and existing products and technologies the timing and successful completion of customer qualification of our products and the risks of non-qualification; the effectiveness of efficiency, cost, and expense reduction efforts; our ability to successfully identify, complete and integrate acquisitions of products, technologies and companies; our ability to retain, integrate and incentivize our new management team and their ability to shape the strategic direction of the company and implement change; any softness in the real estate development market, 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 related to terrorist activity or armed conflict 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).
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