Intrinsyc Reports Quarterly Revenue Growth of 7% over Prior

New Post Public Reply Private Reply Replies (0) Message Board
News Desk 2018
132
Intrinsyc Reports Quarterly Revenue Growth of 7% over Prior Year and Annual Revenue Growth of 39%

VANCOUVER, BC--(Marketwired - March 08, 2017) - Intrinsyc Technologies Corporation (TSX: ITC) (OTC: ISYRF) ("Intrinsyc" or the "Company"), a leading provider of solutions for the development of intelligent connected devices, today announced its financial results for the fourth quarter and fiscal year ended December 31, 2016. Intrinsyc achieved revenue growth of 7%, with revenue of US$4.3 million (CDN$5.7 million), net income of US$210,128 (CDN$327,171), and earnings per share of US$0.01 (CDN$0.02) in the three months ended December 31, 2016 over the same period in the prior year.

Increases in Embedded Computing Hardware revenue from the Company's expanding client base led to revenue growth over the same period in the prior year, and annually. Revenue was US$4.3 million (CDN$5.7 million) which was an increase from US$4.0 million (CDN$5.3 million) in the fourth quarter of fiscal 2015. Fiscal 2016 revenue was US$17.5 million (CDN$ $23.1 million), which was an increase of 39% over the prior year. Net income for Fiscal 2016 was US$1.7 million (CDN$2.2 million), with earnings per share of US$0.08 (CDN$0.11).

"During the fourth quarter and overall in Fiscal 2016, we made strong progress in increasing revenue from Intrinsyc's Open-Q™ computing modules, as existing customer's products mature in the market, as well as in gaining new design wins and production clients," stated Tracy Rees, President and Chief Executive Officer, Intrinsyc. "The Company increased design and production wins for Open-Q™ computing modules from 33 to 36 and 8 to 11, respectively, during the quarter. This contributed to a 44% increase in hardware revenue compared to the previous and year ago period. The increase in hardware revenue from production clients is an important measure of our progress as the company recently made a strategic shift to add products with repeat revenue potential to our existing non-recurring engineering services business. Adjusted EBITDA1 performance in the fourth quarter was negatively impacted by a combination of increased labor costs caused by the strengthening in the value of the Canadian dollar, additional costs to achieve long term client satisfaction on certain fixed-fee client projects and the reallocation of engineering resources to R&D development efforts to provide for the rapid advancement of several new computing platforms."

Quarterly Business Highlights

  • The Company announced that the subordinated, secured promissory note, valued at US$1.5 million, has been further amended to extend the maturity date from December 30, 2016 to March 30, 2017. In consideration for the extension Intrinsyc will receive 30,000 warrants convertible into Class A common shares in Stream TV Networks, Inc. on a 1 for 1 basis for a period of up to 5 years. The note was further amended on February 2, 2017 to extend the maturity date to February 1, 2018. Intrinsyc also received 120,000 warrants convertible into Class A common shares in Stream TV Networks Inc. on a 1 for 1 basis for a period of up to 5 years. In addition, Stream TV committed to acquire a minimum of US$2,000,000 in Intrinsyc products, services, and royalties to be purchased or generated between February 1, 2017 and February 1, 2018.
  • Signed development and supply agreement with innovative IoT health provider, Knit Health, Inc.
  • Received a follow-on order from an existing client valued at $572,500. Combined with two previous orders received over the last 60 days, the aggregate value exceeds $1.2 million. Delivery of the Open-Q™ embedded computing modules occurred in the fourth quarter of 2016, and first quarter of 2017.
  • Signed an agreement with a new client valued at US$447,000 for Intrinsyc's Open-Q™ 410 System on Module ("SOM") and is expected to launch in the second half of 2017.
  • Received orders from two new clients for Intrinsyc's Open-Q™ 410 SOM valued at US$76,800, and also signed a product development services agreement with a new client valued at US$327,525, and an extension of a services agreement with an existing client valued at US$374,035. The orders began shipping in early 2017. The product development services agreements covers a range of product management and software development services to be performed over the next year.
  • Received an initial order from Intrinsyc's distribution partner for a new client for Intrinsyc's Open-Q™ 410 SOM valued at US$66,000. The production order will ship during the first half of 2017. Intrinsyc also signed a product development services agreement with an existing client valued at $240,000, to be delivered in the first quarter of 2017.
  • Introduced of the Company's next generation Open‐Q™ 820 µSOM (micro) and its companion Open‐Q™ 820 µSOM Development Kit. Intrinsyc's 820 µSOM is an ultra-small form-factor commercially available SOM based on the 64-bit Qualcomm®Snapdragon™ 820 processor, a product of Qualcomm Technologies, Inc., a subsidiary of Qualcomm Incorporated.

Financial Highlights

Three Month Comparative Results

The Company reported revenue of US$4.3 million (CDN$5.7 million), up 7% over the same period in the prior year of US$4.0 million (CDN$5.3 million). The increase in revenue over the same period in the prior year was due primarily to increased revenue from the sale of hardware products.

The Company had net income of US$210,128 (CDN$327,171) in the three months ended December 31, 2016 compared to net income of US$805,347 (CDN$1,110,513) in the same period in the prior year.

Gross margin2 in the fourth quarter of fiscal 2016 was 36%, which was lower than the 49% gross margin in the same period in the prior year and 43% in the previous second quarter of fiscal 2016. Decrease in gross margin over the same period in the prior year was due to the change in revenue mix, which saw a significant increase in revenues from the Company's Embedded Computing Hardware business which has a much lower gross margin and decrease in engineering services revenues. As well, gross margins in the Company's engineering services segment decreased due to increased labor costs due to the strengthening in the value of the Canadian dollar against the US dollar and higher cost on a couple of fixed-fee projects. Adjusted EBITDA was as follows:

      
   Three months ended
December 31, 2016
  
Three months ended
December 31, 2015
Operating income  US$ 252,203   CDN$ 336,541   US$ 814,767  CDN$ 1,062,940
Add: revenue recognized as interest income as per IFRS  33,750   45,036   33,750  45,063
Add back: Other operating expenses  (39,780 ) (53,082 ) 116,677  152,221
Adjusted EBITDA  US$ 246,173   CDN$ 328,495   US$ 965,194  CDN$ 1,260,224
           

Annual Comparative Results

The Company reported revenue of US$17.5 million (CDN$23.1 million), up 39% over the same period in the prior year of US$12.5 million (CDN$16.0 million). The increase in revenue was due to increased revenue from the sale of product development engineering services, as well as hardware products.

The Company had net income of US$1,662,782 (CDN$2,232,617) in the twelve months ended December 31, 2016, compared to net income of US$722,773 (CDN$1,000,312) in the same period in the prior year.

Gross margin for the twelve months ended December 31, 2016 was 39%, which was lower than the 44% gross margin in the same period in the prior year. Adjusted EBITDA was as follows:

     
   Twelve months ended
December 31, 2016
 Twelve months ended
December 31, 2015
Operating income  US$ 1,321,830  CDN$ 1,746,385  US$ 1,193,951  CDN$ 1,546,125
Add: revenue recognized as interest income as per IFRS  135,000  178,862  135,000  172,614
Add back: Other operating expenses  304,342  402,030  373,952  475,550
Adjusted EBITDA  US$ 1,761,172  CDN$ 2,327,277  US$ 1,702,903  CDN$ 2,194,289
         

Financial Position as at December 31, 2016

Working capital3 as of December 31, 2016 was US$11.7 million (CDN$15.7 million) inclusive of cash and short term investments of US$7.6 million (CDN$10.1 million). This is compared to net working capital of US$9.8 million (CDN$13.6 Million) as of December 31, 2015 inclusive of cash and short-term investments of US$7.0 million (CDN$9.7 million).

Financial Statements and Management Discussion & Analysis

Please see the audited consolidated financial statements and related Management's Discussion & Analysis ("MD&A") for more details. The audited consolidated financial statements for the three months and year ended December 31, 2016 and related MD&A have been reviewed and approved by Intrinsyc's Audit Committee and Board of Directors. Intrinsyc recognizes that the majority of its investors are now accessing Intrinsyc's corporate and financial information either through pushed news services, directly from www.intrinsyc.com or SEDAR. Thus, Intrinsyc has prepared this truncated news release to alert investors to its results and that a more detailed explanation and analysis is readily available in the MD&A. These reports have been filed on SEDAR at www.sedar.com and also posted at www.intrinsyc.com.

Conference call

The Company will hold a conference call to discuss its fiscal fourth quarter and full year 2016 financial results at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) today. On the call, Tracy Rees, Chief Executive Officer and George Reznik, Chief Financial Officer, will discuss the financial results announced. This conference call may be accessed, toll-free, by dialing 1-877-340-8005, and internationally by dialing 1-416-641-6110 approximately 10 minutes prior to the start of the call. This conference line is operator assisted and an access PIN is not required. The conference call will also be broadcast live over the Internet and available for replay on the Company's Investor Relations Conference Calls web page (http://www.intrinsyc.com/company/investors/). Analysts and investors are invited to participate on the call. Questions may be submitted to invest@intrinsyc.com prior to the call.

Financial information is reported in United States dollars and in accordance with International Financial Reporting Standards ("IFRS").

Non-IFRS Measures

The following and preceding discussion of financial results includes reference to Gross Margin, Adjusted EBITDA and Working Capital, which are all non-IFRS financial measures. The measure of gross margin is provided as management believes this is a good indicator in evaluating the operating performance of the Company. Adjusted EBITDA is defined as operating income (loss) inclusive of revenue reclassified as interest income (as per IFRS) less other operating expenses. The measure is provided as a proxy for the cash earnings from the operations of the business as operating loss for the Company includes non-cash amortization and depreciation expense and share-based compensation which are classified as other operating expenses. The measure of working capital is provided as management believes this is a good indicator of the operating liquidity available to the Company.

Forward-Looking Statements

This press release contains statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking information under applicable Canadian securities legislation that involve risks and uncertainties. Such forward-looking statements or information may include financial and other projections as well as statements regarding the Company's future plans, objectives, performance, revenues, growth, profits, operating expenses or the company's underlying assumptions. The words "may", "would", "could", "will", "likely", "expect," "anticipate," "intend", "plan", "forecast", "project", "estimate" and "believe" or other similar words and phrases may identify forward-looking statements or information. Persons reading this press release are cautioned that such statements or information are only predictions, and that the Company's actual future results or performance may be materially different. Factors that could cause actual events or results to differ materially from those suggested by these forward-looking statements include, but are not limited to: the need to develop, integrate and deploy software solutions to meet the Company's customer's requirements; the possibility of development or deployment difficulties or delays; a customer's decision to cancel or fail to proceed with a commitment to purchase units of the Company's products contained in an executed purchase order; the dependence on the Company's customer's satisfaction; the timing of entering into significant contracts; customers' continued commitment to the deployment of the Company's solutions; reliance on products manufactured by other companies for resale or distribution and reliance on third-party suppliers; the performance of the global economy and growth in software industry sales; market acceptance of the Company's products and services; the success of certain business combinations engaged in by the Company or by its competitors; possible disruptive effects of organizational or personnel changes; technological change, new products and standards; risks related to international expansion; concentration of sales; international operations and sales; dependence upon key personnel and hiring; reliance on a limited number of suppliers; industry growth; competition; intellectual property; product defects and product liability; currency exchange rate risk; and other factors described in the Company's reports filed on SEDAR, including its Annual Information Form and financial report for the year ended December 31, 2016. This list is not exhaustive of the factors that may affect the Company's forward-looking information.

These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information. All forward-looking statements made in this press release are qualified by this cautionary statement and there can be no assurance that actual results or developments anticipated by the Company will be realized. The Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

About Intrinsyc Technologies Corporation

Intrinsyc Technologies Corporation is a product development company that provides comprehensive and tailored solutions that enable the development and production of next-generation embedded and IoT devices. Solutions span the development life cycle from concept to production and help device makers and technology suppliers create compelling differentiated products with faster time-to-market. Intrinsyc is publicly traded (TSX: ITC) (OTC: ISYRF) and is headquartered in Vancouver, BC, Canada.

1 Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. The closet comparable IFRS financial measure is Operating Income (Loss). Adjusted EBITDA referenced here relates to operating income (loss) inclusive of revenue reclassified as interest income (as per IFRS) less other operating expenses.

2 Non-IFRS measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Gross margin referenced here relates to revenues less cost of sales.

3 Non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. This measure does not have a comparable IFRS measure. Working capital is defined as current assets less current liabilities.

For more information, please contact:

George W. Reznik, CPA-CA, CBV, CFE
Chief Financial Officer
Intrinsyc Technologies Corporation
Email: greznik@intrinsyc.com
Phone: +1-604-678-3734

Scroll down for more posts ▼

Top 10 Most Recent News Articles

UWM Faces Class Action Deadline: Key Insights for Investors

Updated Category News Views 2

The High Stakes Reality for UWM Investors If there's one thing that's certain in this jittery world of investing, it's that losses have a way of waking you up. Right now, anyone tied up with UWM Holdings Corporation (NYSE: UWMC) shares needs to keep their wits about them; we're barreling toward an October 13, 2026 deadline for a class action lawsuit. The clock's ticking...

Continue Reading
GORGIE Unleashes Berry Burst: Target's New Drink Star

Updated Category News Views 5

GORGIE Targets Taste Buds with Berry Burst Ever feel like you're missing out on that energy drink everyone seems to be raving about? Well, GORGIE's out there making some noise again, and this time it's got a new punchy player in the game: Berry Burst. It's not just another drink; it's shaking things up in the energy aisle with its exclusive launch at Target. Modern style...

Continue Reading
Regeneron Faces Legal Heat: Lead Plaintiff Deadline Looms

Updated Category News Views 3

Regeneron’s Tight Spot: Legal Showdown Well, here we go again—Regeneron Pharmaceuticals (NASDAQ:REGN) is under some serious heat. If you're an investor who faced significant losses with this biotech juggernaut, remember that the clock’s ticking down to the wire. By tomorrow, September 14, 2026, you need to decide if you're going to throw your hat in the ring for...

Continue Reading
MRI Surveillance Gains Ground in Lung Cancer Care

Updated Category News Views 5

Shifting the Standard: MRI's Rise in SCLC Treatment Here's a twist that baffles the traditionalists—ditch the prophylactic cranial irradiation (PCI) and catch clearer days with MRI surveillance for small-cell lung cancer (SCLC). The latest international phase III MAVERICK trial might just redraw the lines on what's considered standard care in this relentless disease....

Continue Reading
First-Time Homeowners: Unseen Pitfalls of Insurance

Updated Category News Views 2

Understanding Homeowners Insurance: Beyond the Basics Most folks diving into homeownership for the first time get caught up in the whirlwind of price tags, loans, and knick-knacks for their new place. Meanwhile, the nitty-gritty of homeowners insurance often gets tossed to the side. But take it from a weary watchdog of financial storms—it’s those details in the policy...

Continue Reading
Ris-Rez May Set New Standard in Relapsed SCLC

Updated Category News Views 6

The Game-Changing Results Innovation in pharmaceuticals sometimes feels like a waiting game, but when a fresh breakthrough like this rolls in, it lights up the whole landscape. Risvutatug rezetecan, or Ris-Rez for short, has shown promising potential in the fight against relapsed small-cell lung cancer (SCLC) that has progressed after platinum-based therapy. Survival...

Continue Reading
Trial Disappointment: No Significant Gains in NSCLC

Updated Category News Views 7

Dissecting the Nuances of the EVOKE-03/KEYNOTE-D46 Trial Every once in a while, we come across a trial that rattles cages in the research community. Today, it's the EVOKE-03/KEYNOTE-D46 trial, a collision of hope and hard-knock reality. This Phase 3 trial, which sought to explore the potential combo of sacituzumab govitecan (SG) and pembrolizumab on metastatic non-small...

Continue Reading
PANDAG G1 Debuts: Revolutionizing Lawn Care Efficiency

Updated Category News Views 4

The Future of Landscaping Unveiled Get this—PANDAG is set to shake things up at GaLaBau 2026 with their futuristic G1 autonomous mower. This isn't just another piece of lawn equipment; it's practically a tech marvel on wheels, weaving together LiDAR, AI Vision, RTK, and 4G tech to make it the ultimate multitasker for the landscaping industry. We're talking obstacle...

Continue Reading
PwC US and India Unite for Global Consultancy Powerhouse

Updated Category News Views 6

Rearranging the Consultancy Chessboard Piling onto the game of consultancy realignments, PwC just made a move reminiscent of playing strategy poker. They're tossing together PwC US and PwC India's advisory capabilities for a new joint venture. It’s like pushing two puzzle pieces to make a single colorful picture that stretches from the U.S. all the way to the...

Continue Reading
Surfing Dogs Ride Waves, Support Orphan Pets

Updated Category News Views 3

Waves, Paws, and Passion Who would've thought that dogs catching waves could also catch hearts and wallets? Well, that's exactly what's happening today at Del Mar Dog Beach with the 21st Annual Surf Dog Surf-A-Thon revving up the excitement. It's a sun-soaked day in Rancho Santa Fe, California, right in the thick of things at the longest-running dog surf competition. For...

Continue Reading

Top 5 Most Recently Viewed Articles

TCTM KIDS IT Education Inc. Announces 2024 Annual Report

Updated Category News Views 322

TCTM KIDS IT Education Inc. Issues 2024 Annual Report TCTM KIDS IT EDUCATION INC. (NASDAQ: VSA), a prominent leader in IT-focused supplementary STEM education, has officially filed its annual report on Form 20-F for the fiscal year ending December 31, 2024, with the Securities and Exchange Commission (SEC). This filing reflects the company’s ongoing commitment to...

Continue Reading
Polaris Celebrates Commitment to Community and Environment

Updated Category News Views 224

Polaris Revolutionizes Commitment Through Geared For Good Report Polaris continues to ensure sustainability and responsible stewardship across its operations, supporting its employees, riders, communities, and the environment. The recently released report illustrates Polaris Inc.'s (NYSE: PII) dedication to these values. Impacting Lives Through Corporate Responsibility...

Continue Reading
AgentCoach.AI Transforms Real Estate Coaching with AI Tools

Updated Category News Views 195

AgentCoach.AI Revolutionizes the Coaching Landscape Real Estate Professionals Gain Access to On-Demand Expertise and Tools for a Fraction of Traditional Coaching Costs AgentCoach.AI is excited to introduce its innovative AI-powered coaching platform tailored specifically for real estate agents. This groundbreaking service is designed to streamline everyday tasks, enhance...

Continue Reading
Unleash Creativity: LEGO's 2025 Workshop Series for Kids

Updated Category News Views 460

LEGO Group Launches Exciting 2025 Creativity Workshop Series The LEGO Group is thrilled to introduce its innovative 2025 Creativity Workshop Series, offering young creators a fantastic opportunity to unleash their imagination. Tailored for children aged 6 to 12, these engaging workshops will take place at select LEGO stores, providing both in-person and online...

Continue Reading
Kering Overview: Enhanced Share Liquidity Insights for Growth

Updated Category News Views 132

Kering Overview: Enhanced Share Liquidity Insights for Growth Kering has recently shared a detailed report on its share liquidity mandate which outlines the company's achievements during the first half of the year. This report sheds light on the performance and trading activity of Kering shares as per its engagement with Rothschild Martin Maurel. There is an evident...

Continue Reading