BEAVERTON, OR--(Marketwired - Apr 27, 2015) - Digimarc Corporation (
Revenue for the first quarter of 2015 totaled $6.0 million compared to $7.2 million in the same quarter a year-ago. The decrease was due to lower license revenue, reflecting the end of the quarterly license fee payments from The Nielsen Company in the first quarter of 2014 and the end of the quarterly royalty payments from Verance Corporation in the fourth quarter of 2014. The decline in license revenue was partially offset by higher service and subscription revenue.
Operating expenses for the first quarter of 2015 decreased 8% to $7.7 million from $8.4 million the same quarter a year-ago. The decrease was due to lower investment in research and development, partially offset by higher investment in sales and marketing as the company continues its transition from research and product development to market development and delivery of Digimarc Discover and Barcode. Legal and third-party consulting costs were also lower during the first quarter of 2015.
Operating loss for the first quarter of 2015 totaled $4.2 million compared to an operating loss of $3.3 million in the same quarter a year-ago. The higher operating loss is largely due to lower license revenue, partially offset by lower operating expenses.
Net loss for the first quarter of 2015 totaled $4.2 million or $(0.52) per diluted share, compared to a net loss of $2.0 million or $(0.29) per diluted share in the first quarter of 2014.
Cash, cash equivalents and marketable securities totaled $37.1 million at March 31, 2015, compared to $39.1 million at December 31, 2014.
Conference Call Digimarc will hold a conference call later today (Monday, April 27, 2015) to discuss these results, as well as provide an update on market conditions and execution of strategy. Chairman and CEO Bruce Davis and CFO Charles Beck will host the call starting at 5:00 p.m. Eastern time (2:00 p.m. Pacific time). A question and answer session will follow management's presentation.
The conference call will be broadcast live and available for replay via the investor section of the company's website at www.digimarc.com/investors/investor-events-and-webcasts .
For those who wish to listen to the call via telephone, please dial the telephone number below at least five minutes prior to the scheduled start time:
Number: 866-562-9934 Conference ID: 27179681
If you have any difficulty connecting with the conference call, please contact Liolios Group at 949-574-3860.
About Digimarc
Digimarc Corporation (
Forward-looking Statements With the exception of historical information contained in this release, the matters described in this release contain various "forward-looking statements." These forward-looking statements include statements and any related inferences regarding increases in service and subscription revenue, decreased investment in research and development, increased investments in market development and delivery initiatives, and other statements identified by terminology such as "will," "should," "expects," "estimates," "predicts" and "continue" or other derivations of these or other comparable terms. These forward-looking statements are statements of management's opinion and are subject to various assumptions, risks, uncertainties and changes in circumstances. Actual results may vary materially from those expressed or implied from the statements in this release as a result of changes in economic, business and/or regulatory factors. More detailed information about risk factors that may affect actual results will be set forth in the company's Form 10-K for the year ended December 31, 2014 and in subsequent periodic reports filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date of this release. Except as required by law, Digimarc undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this release.
| Digimarc Corporation | ||||||||||
| Consolidated Income Statement Information | ||||||||||
| (in thousands, except per share amounts) | ||||||||||
| (Unaudited) | ||||||||||
| Three-Month Information | ||||||||||
| March 31, | March 31, | |||||||||
| 2015 | 2014 | |||||||||
| Revenue: | ||||||||||
| Service | $ | 3,501 | $ | 2,988 | ||||||
| Subscription | 1,716 | 1,412 | ||||||||
| License | 772 | 2,805 | ||||||||
| Total revenue | 5,989 | 7,205 | ||||||||
| Cost of revenue: | ||||||||||
| Service | 1,578 | 1,414 | ||||||||
| Subscription | 754 | 649 | ||||||||
| License | 84 | 83 | ||||||||
| Total cost of revenue | 2,416 | 2,146 | ||||||||
| Gross profit: | ||||||||||
| Service | 1,923 | 1,574 | ||||||||
| Subscription | 962 | 763 | ||||||||
| License | 688 | 2,722 | ||||||||
| Total gross profit | 3,573 | 5,059 | ||||||||
| Gross margin: | ||||||||||
| Service | 55 | % | 53 | % | ||||||
| Subscription | 56 | % | 54 | % | ||||||
| License | 89 | % | 97 | % | ||||||
| Percentage of gross profit to total revenue | 60 | % | 70 | % | ||||||
| Operating expenses: | ||||||||||
| Sales and marketing | 2,090 | 1,879 | ||||||||
| Research, development and engineering | 3,084 | 3,546 | ||||||||
| General and administrative | 2,206 | 2,421 | ||||||||
| Intellectual property | 367 | 534 | ||||||||
| Total operating expenses | 7,747 | 8,380 | ||||||||
| Operating loss | (4,174 | ) | (3,321 | ) | ||||||
| Other income, net | 23 | 27 | ||||||||
| Loss before income taxes | (4,151 | ) | (3,294 | ) | ||||||
| Benefit for income taxes | 1 | 1,308 | ||||||||
| Net loss | $ | (4,150 | ) | $ | (1,986 | ) | ||||
| Earnings (loss) per common share: | ||||||||||
| Loss per common share - basic | $ | (0.52 | ) | $ | (0.29 | ) | ||||
| Loss per common share - diluted | $ | (0.52 | ) | $ | (0.29 | ) | ||||
| Weighted average common shares outstanding - basic | 7,960 | 7,000 | ||||||||
| Weighted average common shares outstanding - diluted | 7,960 | 7,000 | ||||||||
| Cash dividends declared per common share: | $ | - | $ | 0.11 | ||||||
| Digimarc Corporation | |||||||||||
| Consolidated Balance Sheet Information | |||||||||||
| (in thousands) | |||||||||||
| (Unaudited) | |||||||||||
| March 31, | December 31, | ||||||||||
| 2015 | 2014 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents (1) | $ | 5,064 | $ | 6,122 | |||||||
| Marketable securities (1) | 32,031 | 32,201 | |||||||||
| Trade accounts receivable, net | 3,620 | 4,545 | |||||||||
| Other current assets | 2,518 | 2,611 | |||||||||
| Total current assets | 43,233 | 45,479 | |||||||||
| Marketable securities (1) | - | 749 | |||||||||
| Property and equipment, net | 2,895 | 2,976 | |||||||||
| Intangibles, net | 6,692 | 6,720 | |||||||||
| Goodwill | 1,114 | 1,114 | |||||||||
| Other assets | 337 | 378 | |||||||||
| Total assets | $ | 54,271 | $ | 57,416 | |||||||
| Liabilities and Shareholders' Equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable and other accrued liabilities | $ | 1,473 | $ | 1,379 | |||||||
| Deferred revenue | 2,984 | 3,660 | |||||||||
| Total current liabilities | 4,457 | 5,039 | |||||||||
| Deferred rent and other long-term liabilities | 158 | 203 | |||||||||
| Total liabilities | 4,615 | 5,242 | |||||||||
| Commitments and contingencies | |||||||||||
| Shareholders' equity: | |||||||||||
| Preferred stock | 50 | 50 | |||||||||
| Common stock | 9 | 8 | |||||||||
| Additional paid-in capital | 61,853 | 60,222 | |||||||||
| Accumulated deficit | (12,256 | ) | (8,106 | ) | |||||||
| Total shareholders' equity | 49,656 | 52,174 | |||||||||
| Total liabilities and shareholders' equity | $ | 54,271 | $ | 57,416 | |||||||
| (1) Aggregate cash, cash equivalents, short- and long-term marketable securities was $37,095 and $39,072 at March 31, 2015 and December 31, 2014, respectively. | |||||||||||
| Digimarc Corporation | |||||||||||
| Consolidated Cash Flow Information | |||||||||||
| (in thousands) | |||||||||||
| (Unaudited) | |||||||||||
| Three-Month Information | |||||||||||
| March 31, | March 31, | ||||||||||
| 2015 | 2014 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net loss | $ | (4,150 | ) | $ | (1,986 | ) | |||||
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||
| Depreciation, amortization and write-off of property and equipment | 328 | 231 | |||||||||
| Amortization and write-off of intangibles | 277 | 308 | |||||||||
| Changes in allowance for doubtful accounts | 10 | (7 | ) | ||||||||
| Stock-based compensation | 1,217 | 1,259 | |||||||||
| Deferred income taxes | - | (509 | ) | ||||||||
| Excess tax benefit from stock-based awards | - | (72 | ) | ||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Trade accounts receivable | 915 | 1,809 | |||||||||
| Other current assets | 93 | (699 | ) | ||||||||
| Other assets | 41 | 84 | |||||||||
| Accounts payable and other accrued liabilities | (99 | ) | (314 | ) | |||||||
| Deferred revenue | (668 | ) | (1,484 | ) | |||||||
| Net cash used in operating activities | (2,036 | ) | (1,380 | ) | |||||||
| Cash flows from investing activities: | |||||||||||
| Purchase of property and equipment | (125 | ) | (117 | ) | |||||||
| Capitalized patent costs | (194 | ) | (295 | ) | |||||||
| Maturity of marketable securities | 21,976 | 11,192 | |||||||||
| Purchase of marketable securities | (21,057 | ) | (9,266 | ) | |||||||
| Net cash provided by investing activities | 600 | 1,514 | |||||||||
| Cash flows from financing activities: | |||||||||||
| Exercise of stock options | 874 | 712 | |||||||||
| Purchase of common stock | (496 | ) | (850 | ) | |||||||
| Cash dividends paid | - | (824 | ) | ||||||||
| Excess tax benefit from stock-based awards | - | 72 | |||||||||
| Net cash provided by (used in) financing activities | 378 | (890 | ) | ||||||||
| Net decrease in cash and cash equivalents (2) | $ | (1,058 | ) | $ | (756 | ) | |||||
| Cash, cash equivalents and marketable securities at beginning of period | 39,072 | 34,964 | |||||||||
| Cash, cash equivalents and marketable securities at end of period | 37,095 | 32,282 | |||||||||
| (2) Net decrease in cash, cash equivalents and marketable securities | $ | (1,977 | ) | $ | (2,682 | ) | |||||
Company Contacts: Charles Beck Chief Financial Officer 503-469-4721 Email Contact Matt Glover Liolios Group, Inc. Investor Relations for Digimarc 949-574-3860 Email Contact
