[LOGO]
FOR IMMEDIATE RELEASE
CONTACTS: For Financial Press For Trade Press
Ned Mavrommatis Greg Smith
Chief Financial Officer Director of Marketing
ned@id-systems.com gsmith@id-systems.com
General Phone: 201-996-9000. General Fax: 201-996-9144
I.D. Systems, Inc. Reports First Quarter Financial Results
Hackensack, NJ, May 9, 2004 --
I.D. Systems, Inc. (NASDAQ: IDSY) today announced its financial results for the
first quarter ended March 31, 2005. Revenues increased 12% to $3,033,000,
compared to $2,705,000 for the three months ended March 31, 2004, as sales of
the company's patented Wireless Asset Net(TM) system for tracking and managing
fleets of industrial equipment continued to grow. Selling, general and
administrative expenses increased to $1,853,000, up from $1,254,000 for the
three months ended March 31, 2004, as payroll and travel expenses increased to
support growing sales and prepare the company for upcoming system deployments
under a national contract from the United States Postal Service. Research and
development expenditures also increased to $395,000, compared to $155,000 in the
first quarter a year ago. As a result, net loss for the quarter was ($635,000),
or ($.08) per basic and diluted share, compared to net income of $95,000, or
$.01 per basic and diluted share, for the same period last year.
"We are pleased to report another significant increase in revenues this quarter,
in advance of the first system implementations we will be undertaking for the
U.S. Postal Service under their national contract with us," said Jeffrey Jagid,
I.D. Systems' chairman and chief executive officer. "With the USPS project just
starting, and with many other customer programs making excellent progress, we
are very excited about our prospects for the rest of the year. We expect to
continue rapidly expanding penetration of our wireless asset management
technology with both existing and new customers."
"We continue to meet the objectives of our strategic business plan," added Ned
Mavrommatis, I.D. Systems' chief financial officer. "In the first quarter of
2005, we again achieved double-digit year-over-year revenue growth and a gross
profit margin of more than 50%. At the same time, we added personnel and made
additional investments in our business to support our current pace of growth and
help win new business. The company's financial condition remains strong. As of
March 31, 2005, I.D. Systems had approximately $8.6 million in cash, cash
equivalents and investments, and approximately $12.1 million of working
capital."
Highlights of the first quarter ended March 31, 2005, included:
o A national contract awarded by the U.S. Postal Service (USPS) for
I.D. Systems to deploy wireless powered industrial vehicle
management systems at up to 460 USPS facilities over the next three
years. The contract was awarded to I.D. Systems after a competitive
bid process, which the company believes reflects its many
significant competitive advantages and the proven high return on
investment generated by its wireless asset management technology.
o A Phase II contract expansion of the company's wireless vehicle
security program at the Jacksonville, Florida, seaport, funded by
the Transportation Security Administration (TSA). I.D. Systems will
deploy the homeland security version of its Wireless Asset Net fleet
management system on several hundred additional vehicles at the
seaport.
o A grant from the TSA, announced in April 2005, for I.D. Systems to
integrate RFID (radio frequency identification)-based cargo tracking
capability into the company's wireless vehicle security system. I.D.
Systems will collaborate with Symbol Technologies, Inc. to develop
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and prototype a mobile, automated baggage tracking system in which
"intelligent" containers and vehicles identify and locate items
tagged with EPC (electronic product code)-compliant RFID tags, and
communicate that data through I.D. Systems' wireless vehicle
management network.
o A Federal Supply Service Information Technology contract awarded to
I.D. Systems by the General Services Administration. Under the
contract, which has a maximum duration of 20 years, any U.S.
Government entity can order a combination of I.D. Systems' hardware,
software and services worth up to $2.5 million without seeking
further competitive bids.
o Continued expansion of business with Ford Motor Company to support
Ford's North America-wide roll-out of I.D. Systems' wireless
industrial vehicle electronic control systems.
o A new order for the Wireless Asset Net from Wajax Industries, a
leading Canadian distributor of mobile equipment and related
services, on behalf of a major Canadian retailer.
o The introduction of two new RFID-based products at the ProMat
material handling exhibition: the Machine Asset Communicator(TM)
(MAC), and the Battery Charger Monitoring Point(TM) (Battery
ChaMP(TM)). The MAC provides wireless monitoring and control of
fixed machinery, with functions such as automatic quality control
checks and real-time alerts on out-of-specification machine
parameters. The Battery ChaMP provides real-time asset visibility
and automatic data uploads for industrial battery fast-charge
systems deployed in factories, warehouses, and airports.
o A purchase order for the Battery ChaMP system from AeroVironment,
Inc., to support deployment of AeroVironment's PosiCharge(TM)
battery fast-charging system at a major automotive manufacturer.
o The naming of I.D. Systems to the "FL 100" list of 100 prominent
technology solution providers in food industry publication Food
Logistics.
Investor Conference Call
I.D. Systems will hold a conference call for investors and analysts at 4:45 p.m.
Eastern Standard Time on May 9, 2005. Jeffrey Jagid, chairman and CEO, Kenneth
Ehrman, president and COO, Ned Mavrommatis, CFO, and Rick Muntz, EVP of sales
and marketing, will discuss the results of the quarter and recent developments.
After opening remarks, there will be a question and answer period. The
conference call will be broadcast live over the Internet 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 software.
About I.D. Systems
Based in Hackensack, New Jersey, I.D. Systems, Inc. is a leading provider of
wireless solutions for corporate asset management. I.D. Systems' customers
include 3M Company, American Axle, Archer Daniels Midland, Daimler Chrysler,
Deere & Co., Ford Motor Company, General Dynamics, Hallmark Cards, Northrop
Grumman, Target Corporation, Walgreen Co., the U.S. Navy, the U.S. Postal
Service, and the U.S. Transportation Security Administration, among others.
Using local area networks, wide area networks, and the Internet, the company's
systems enable management to control and track the location and status of their
assets - from forklifts and cranes to automobiles and trucks to complex fixed
machinery - in real time. For more information on I.D. Systems, Inc., visit
www.id-systems.com.
Trademarks
I.D. Systems, Inc., Wireless Asset Net, Machine Asset Communicator, Battery
Charger Monitoring Point, and Battery ChaMP are registered or pending trademarks
of I.D. Systems, Inc. PosiCharge is a trademark of AeroVironment, Inc.
"Safe Harbor" statement under the Private Securities Litigation Reform Act of
1995
This press release contains forward looking statements that are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995 and that are subject to risk and uncertainties, including, but not limited
to, the impact of competitive products, product demand and market acceptance
risks, fluctuations in operating results and other risks detailed from time to
time in I.D. Systems' filings with the Securities and Exchange Commission. These
risks could cause I.D. Systems' actual results to differ materially from those
expressed in any forward looking statements made by, or on behalf of, I.D.
Systems. I.D. Systems assumes no obligation to update the information contained
in this press release.
-- Tables to Follow --
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I.D. Systems, Inc.
Condensed Statements of Operations
(Unaudited)
Three months ended
March 31,
2004 2005
------------ ------------
Revenues $ 2,705,000 $ 3,033,000
Cost of Revenues 1,274,000 1,506,000
------------ ------------
Gross Profit 1,431,000 1,527,000
Selling, general and administrative expenses 1,254,000 1,853,000
Research and development expenses 155,000 395,000
------------ ------------
Income (loss) from operations 22,000 (721,000)
Interest income 54,000 62,000
Interest expense (18,000) (13,000)
Other income 37,000 37,000
------------ ------------
Net income (loss) $ 95,000 $ (635,000)
============ ============
Net income (loss) per share - basic $ 0.01 $ (0.08)
============ ============
Net income (loss) per share - diluted $ 0.01 $ (0.08)
============ ============
Weighted average common shares outstanding- basic 7,170,000 7,719,000
============ ============
Weighted average common shares outstanding- diluted
8,114,000 7,719,000
============ ============
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I.D. Systems, Inc.
Condensed Balance Sheets
December 31, 2004 March 31, 2005
(Unaudited)
------------ ------------
ASSETS
Cash and cash equivalents $ 8,440,000 $ 5,073,000
Short-term investments 3,195,000 3,488,000
Accounts receivable, net 1,432,000 3,609,000
Unbilled receivables 402,000 --
Inventory 1,739,000 2,321,000
Investment in sales type leases 39,000 40,000
Interest receivable 50,000 52,000
Officer loan 10,000 10,000
Prepaid expenses and other current assets 225,000 82,000
------------ ------------
Total current assets 15,532,000 14,675,000
Investments -- --
Fixed assets, net 1,009,000 1,094,000
Investment in sales type leases 34,000 24,000
Officer loan 20,000 18,000
Deferred contract costs 476,000 386,000
Other assets 88,000 87,000
------------ ------------
$ 17,159,000 $ 16,284,000
============ ============
LIABILITIES
Accounts payable and accrued expenses $ 2,541,000 $ 1,799,000
Long term debt - current portion 199,000 201,000
Line of credit -- 500,000
Deferred revenue 95,000 96,000
------------ ------------
Total current liabilities 2,835,000 2,596,000
Long term debt 449,000 398,000
Deferred revenue 191,000 167,000
Deferred rent 112,000 116,000
------------ ------------
3,587,000 3,277,000
------------ ------------
STOCKHOLDERS' EQUITY
Preferred stock; authorized 5,000,000 shares, $.01 par value; none issued Common
stock; authorized 15,000,000 shares, $.01 par value; issued and
outstanding 7,690,000 shares and 7,735,000 shares 77,000 77,000
Additional paid-in capital 24,994,000 25,064,000
Treasury stock; 40,000 shares at cost (113,000) (113,000)
Accumulated deficit (11,386,000) (12,021,000)
------------ ------------
13,572,000 13,007,000
------------ ------------
$ 17,159,000 $ 16,284,000
============ ============
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I.D. Systems, Inc.
Condensed Statements of Cash Flows
(Unaudited)
Three months ended
March 31,
2004 2005
-------------- --------------
Cash flows from operating activities:
Net income (loss) $ 95,000 $ (635,000)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization 59,000 84,000
Deferred rent expense 6,000 4,000
Deferred revenues (21,000) (23,000)
Changes in:
Accounts receivable (850,000) (2,177,000)
Unbilled receivables -- 402,000
Inventory (17,000) (582,000)
Prepaid expenses and other assets 41,000 144,000
Investment in sale type leases 9,000 9,000
Deferred contract costs (28,000) 90,000
Accounts payable and accrued expenses 90,000 (742,000)
-------------- --------------
Net cash used in operating activities (616,000) (3,426,000)
-------------- --------------
Cash flows from investing activities:
Purchase of fixed (75,000) (169,000)
assets
Purchases of investments (386,000) (500,000)
Increase in interest receivable (8,000) (2,000)
Maturities of investments 550,000 225,000
Amortization of (discount) premium on investments 42,000 (18,000)
Officer loan 3,000 2,000
-------------- --------------
Net cash (used in) provided by investing
activities 126,000 (462,000)
-------------- --------------
Cash flows from financing activities:
Proceeds from line of credit -- 500,000
Repayment of term loan (46,000) (49,000)
Proceeds from exercise of stock options 332,000 70,000
-------------- --------------
Net cash provided by financing
activities 286,000 521,000
-------------- --------------
Net decrease in cash and cash equivalents (204,000) (3,367,000)
Cash and cash equivalents - beginning of period 3,179,000 8,440,000
-------------- --------------
Cash and cash equivalents - end of period $ 2,975,000 $ 5,073,000
============== ==============
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