Exhibit 99.1
BIO-key Reports 129% Revenue Increase
Record Quarterly Revenue Achieved With Continued Strong
Quarterly Sequential Revenue Growth
Minneapolis, Minnesota--February 10, 2004-- BIO-key International, Inc. (OTC
Bulletin Board: BKYI - News), the leader in finger-based biometric
identification technology for identity management security solutions, announced
today that it achieved record revenues for its fourth quarter ended December 31,
2003. Revenues for the quarter were $336,590 reflecting 129% growth over the
previous quarter ended September 30, 2003.
"Revenue results for 2003 and for the fourth quarter in particular reflect an
important milestone in the company's history as it demarcates transition of
Bio-key from a development company to a revenue generating company," said Mike
DePasquale, BIO-key's CEO. "Our significant increase in revenue reflects the
growing interest in our cutting-edge fingerprint biometric technology."
Since inception Bio-key has invested over $25 million primarily developing the
industry's most accurate and scalable finger-based biometric technology.
BIO-key's patent pending VST open technology is the only technology that is
vendor independent and is able to seamlessly operate with most industry
finger-based hardware scanning devices. VST has unmatched capability, not only
in highly accurate one-to-one authentication applications, but has unparalleled
capability for one-to-many identification solutions with the ability today to
scale to one million records.
In addition to previously announced new contracts and strategic partnerships
with premier integrators such as Oracle, Northrop Grumman, HP, and SAFlink, and
becoming a qualified supplier under a GSA contract, during the fourth quarter
the company announced several important new contracts and relationships:
- ChoicePoint, the leading provider of identification and credential
verification services, has selected BIO-key's technology to
integrate into an identity verification solution ChoicePoint will be
piloting with several of its check cashing and retail customers.
- The National Sheriffs' Association (NSA) and the Pegasus Research
Foundation (PRF) awarded a $3.0 million dollar contract to Maximum
Information Technology (MaxIT) and its Pegasus Technology Consortium
(PTC) to expand the NSA Pegasus Program to address critical data
interoperability issues for Sheriffs, law enforcement and
first-responders and to support local law enforcement database
sharing. The PTC, consists of MaxIT, Appriss Inc., Bio-Key
International, Inc., Business Communications Inc., Circadence
Corporation, Cquay Technologies, Dell, eLabs Inc., MS e-Center and
Sun Microsystems.
- Autodesk the world's leading design software and digital content
company, has chosen Bio-key to be part of its emergency response
solutions program for emergency response professionals to combine
digital maps, building drawings, and emergency response information
to quickly obtain and understand critical information in order to
make informed decisions with confidence.
- Netegrity, a leading provider of identity and access management
solutions, has partnered with Bio-key to create ID Director for
Netegrity SiteMinder, which integrates BIO-key's WEB-key biometric
architecture with the Netegrity SiteMinder product.
Additionally, several important technology and product milestones were
accomplished:
- Bio-key Achieved a 0.00% False Accept Rate (FAR) and a 0.00% False
Reject Rate (FRR) in the medium security category, in independent
testing done by the International Biometric Group. These key
measures mean that in the first visit, at the medium security
category, BIO-key Vector Segment Technology stopped every
unauthorized person from access and allowed every authorized person
access.
- Bio-key formed a joint venture with ClassifEye Ltd., to compress
it's flagship biometric identity algorithms into embedded security
solutions running on mobile and wireless devices. With Bio-key's VST
as its core, this new generation of software will enable biometric
technology to be utilized by stand-alone mobile devices such as cell
phones, PDA's, tablets, and other portable computing products.
- Bio-key a Certified Member of the Oracle(R) Partner Network,
demonstrated its new integrated biometric identification solution
for Oracle 9i and 10g platforms at the Oracle Apps World 2004 show.
Utilizing the true user identification capabilities of WEB-key,
Oracle E-Business suite customers can more securely and quickly
manage enterprise user access while insuring the validity of their
user population.
- Bio-key received a "Product of the Year Award" by BiometriTech, a
leading authority on biometrics and security. The independent
biometric industry publication cited updates to BIO-key's Vector
Segment Technology (VST) that allowed it to record outstanding False
Reject and False Accept rates, increased speed, and improved overall
accuracy.
During the fourth quarter, the company also reached agreement with its lender to
restructure more than $9 million of short debt to long-term debt, with no
additional cost or restrictions.
"This restructuring is a significant vote of confidence by our lender in the
progress we have made, the efficacy of our plan and their belief in our future,"
said Tom Colatosti, BIO-key's Chairman. He concluded, "The Homeland Security
market is huge and it is exceeded by commercial opportunities. We are putting
all the pieces together - marketing partnerships,
magnificent technology, building an order pipeline, financial strength and
talented employees - to be positioned to take advantage of the burgeoning need
for biometric security solutions."
About BIO-key
BIO-key develops and licenses advanced biometric finger identification
technologies that are cost effective, scalable and easy to deploy. BIO-key
products provide "True User Identification(TM)" for the prevention of data and
identity theft while preventing false aliases. BIO-key pioneered the only finger
identification algorithm that has been certified by the ICSA, and today
continues that innovation by offering cost effective, high-performance
one-to-many finger and one-to-one identification solutions that provide security
and positive identification for both government and enterprise applications.
(http://www.bio-key.com)
BIO-key Safe Harbor Statement
This news release contains forward-looking statements that are subject to
certain risks and uncertainties that may cause actual results to differ
materially from those projected on the basis of these statements. The words
"estimate," "project," "intends," "expects," "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 Private Securities Litigation Reform Act of
1995. For a more complete description of these and other risk factors that may
affect the future performance of BIO-key International, see "Risk Factors" in
the Company's Annual Report on Form 10-KSB 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.
Contact:
Albert Maruggi
612-325-8126
amaruggi@providentpartners.net
BIO-key International, Inc.
BALANCE SHEET
(Unaudited)
December 31, December 31,
2002 2003
------------ ------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 16,748 $ 1,012,790
Accounts Receivable - (net) 67,998 409,803
Inventory -- 65,857
Prepaid expenses 50,897 165,928
------------ ------------
Total current assets 135,643 1,654,378
FIXED ASSETS - (net) -- 60,158
OTHER ASSETS 121,991 150,206
------------ ------------
$ 257,634 $ 1,864,742
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LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Current maturities of long-term obligations $ 6,507,286 $ --
Advances from shareholder -- 34,030
Accounts payable 354,694 351,742
Accrued liabilities 572,701 1,304,789
Deferred revenue -- 10,000
------------ ------------
Total current liabilities 7,434,681 1,700,561
LONG-TERM OBLIGATIONS, net of discount less current maturities -- 9,300,170
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIT
Preferredstock - authorized, 5,000,000 shares
of $ .01 par value (liquidation
preference of $100 per share): Series B
9% Convertible; issued and
outstanding, 18,430 and 4,180 shares, respectively 184 42
Common stock - authorized, 60,000,000 shares
of $.01 par value; issued and outstanding, 14,377,406
and 21,222,889 shares, respectively 143,774 212,229
Additional contributed capital 16,284,399 18,327,992
Deficit accumulated during the development stage (23,605,404) (27,676,252)
------------ ------------
(7,177,047) (9,135,989)
------------ ------------
$ 257,634 $ 1,864,742
============ ============
Footnote: Current maturities of long-term obligations has been moved to
LONG-TERM OBLIGATIONS per agreement which extends the maturity date of all debt
to September 30, 2005.
BIO-key International, Inc.
STATEMENTS OF OPERATIONS
(Unaudited)
Three months Twelve months
ended December 31, ended December 31,
------------------ ------------------
2003 2003
------------ ------------
Revenues
Product sales $ 94,690 $ 102,507
Licensing fees 239,900 410,900
Technical support
and other services 2,000 10,694
------------ ------------
336,590 524,101
Costs and other expenses
Cost of product sales 80,604 86,435
Cost of technical support
and other services 139 2,646
Selling, general
and administrative 569,379 2,118,122
Research, development
and engineering 315,931 1,037,330
------------ ------------
966,053 3,244,533
------------ ------------
Operating loss (629,463) (2,720,432)
Other income (deductions)
Interest expense (197,922) (1,109,786)
Sundry 1,400 4,145
------------ ------------
(196,522) (1,105,641)
------------ ------------
NET LOSS (825,985) (3,826,073)
============ ============
Net loss $ (825,985) $ (3,826,073)
------------ ------------
Loss per common share $ (.04) $ (.22)
============ ============
Weighted average number of
common shares outstanding 19,117,761 17,543,586
============ ============