Q2 2023: 5-Year-Record Revenue of $7.7 million, Non-GAAP EPS of $0.07, & EBITDA of $0.9 million; Trailing-Twelve-Month-Period:
Revenue of $25.5 million & EBITDA
of $2.5 million
TEL
AVIV, Israel, July 31,
2023 /PRNewswire/
-- SuperCom (NASDAQ: SPCB), a global provider
of secured solutions for the e-Government, IoT, and Cybersecurity
sectors, today reported financial and operating results for the
three and six months ended June 30,
2023.
Second Quarter Ended June 30,
2023, Financial Highlights (Compared to the Second
Quarter of 2022)
- Revenue increased by 141% to $7.7
million from $3.2 million,
marking a fourth consecutive quarter of high year-over-year ("YoY")
revenue growth.
- Gross profit increased by 77% to $2.3
million from $1.3
million.
- Positive EBITDA* improved to $0.9
million compared to -($0.7)
million.
- Net Income improved by 63% to a $1.1
million loss compared to a $2.8
million loss.
- Non-GAAP Net Income* improved to a $0.3
million profit compared to a $1.9
million loss.
- Non-GAAP EPS* improved to $0.07
compared to -($0.50).
- Working Capital at end of quarter was $21.2 million.
Trailing-Twelve-Month Period Ended June 30, 2023, Financial
Highlights (Compared to the prior twelve month period)
- Revenue increased by 106% to $25.5
million from $12.4
million.
- EBITDA* increased to $2.5 million
from -($0.25) million.
- Net Income increased to –($4.9) million from -($13.0) million.
First Half Ended June 30, 2023,
Financial Highlights (Compared to the First Half of
2022)
- Revenue increased by 126% to $14.1
million from $6.3
million.
- Gross profit increased by 47% to $3.9
million from $2.6
million.
- Net Income improved by 50% to a $2.6
million loss compared to a $5.2
million loss
- Non-GAAP Net Income* improved to $0.1
million profit compared to ($3.4)
million loss.
- EBITDA* improved to $1.3 million
profit compared to a ($1.0) million
loss.
- Non-GAAP EPS* improved to positive $0.02 compared to negative Non-GAAP EPS of
($0.70).
Recent Business Highlights:
- SuperCom is well on track with the implementation of the
recently awarded $33 Million national
electronic monitoring ("EM") project in Romania. SuperCom's PureSecurity EM Suite was
deployed for domestic violence monitoring, GPS Tracking of
offenders, and a home detention monitoring program. As the project
continues to progress, the company expects to see an upward trend
in gross margins on subsequent orders for this project.
- SuperCom's wholly owned subsidiary, LCA, won a $4.25 million contract to provide adult reentry
services in a Northern California,
USA county. The project began in Q1 2023, expanding LCA's
existing day reporting and electronic monitoring services to
include jail-based and community-based sites. The project is
actively servicing clients and generating recurring revenues.
- SuperCom launched a $3.6M
national EM project in Finland
with the national government in Q1 2023. By May 2023, the PureSecurity EM Suite was fully
deployed in Finland, covering all
EM offender programs – house arrest, GPS, and inmate
monitoring.
- SuperCom launched a new project in Iceland, upgrading the company's deployed
system to support secured issuance of National ID cards and
passports.
- SuperCom announced the integration of advanced AI technologies
into its PureSecurity platform, enhancing data analysis,
automation, and predictive monitoring capabilities. These
innovations aim to optimize decision-making, improve operational
efficiency, and redefine industry standards in electronic
monitoring for the criminal justice sector.
- SuperCom reached a significant milestone by completing the
development and multiple successful deployments of
PureProtect, a life-saving domestic violence monitoring
solution. This innovative solution addresses domestic violence
issues and further enhances the company's portfolio of products and
services.
- SuperCom successfully launched PureOne, its
best-of-breed all-in-one GPS tracking ankle-bracelet monitoring
solution. This product not only expands the Company's addressable
market but also may facilitate its rapid expansion into the US
market.
- The company is strategically prioritizing the expansion of
PureOne into new markets and geographies. It has already received
high praise during its introduction into various regions of the
USA, where PureOne has been
successfully deployed and is actively utilized to monitor live
offenders. Moreover, sales activities for PureOne have commenced in
promising new markets outside Europe and North
America.
Management Commentary:
"We are excited to announce breakthrough performance for Q2
2023, where we outperformed expectations on multiple fronts. Our
efforts have catapulted us to new heights, realizing a substantial
141% YoY revenue growth, as well as record breaking quarterly
revenue of $7.7 million and non-GAAP
EPS of $0.07. Furthermore, this
quarter closes an exceptional trailing-twelve-month period boasting
$25.5 million in revenue and
$2.5 million in EBITDA, underscoring
our focus on sustained growth and profitability," commented
Ordan Trabelsi, President and CEO of
SuperCom.
"Our achievements are a testament to the unwavering dedication
of our global multidisciplinary team in pursuing and executing
groundbreaking public safety projects. Notably, the first national
electronic monitoring project in Romania, valued at $33
million, and other lucrative recent new projects in
Sweden, Finland, Croatia and California have contributed significantly to
our success. When combined with a high recurring revenue base, a
rapidly-growing track record of excellence, and our
state-of-the-art proprietary technology suite, these
accomplishments reinforce the positive trends driving our
business," continued Ordan.
"SuperCom's proprietary technology has been a game-changer in
competitive tenders worldwide, enabling us to displace incumbent
vendors and make a significant impact on public safety around the
globe. Our steadfast commitment to technology superiority is
evident in our recent incorporation of AI capabilities into our
products, along with the continuous launch of innovations such as
the recent PureProtect and PureOne solutions. These efforts propel
our business growth and solidify our path towards industry
leadership. Our astute investments in research & development
and sales & marketing have paved the way for global
opportunities, enabling us to deliver exceptional value to our
clients as we charge ahead resolutely towards our long-term
strategic objectives," Ordan concluded.
Conference Call
SuperCom will hold a conference call today (July 31, 2023) at 8:30 a.m. Eastern
time (3:30 p.m. Israel time) to discuss the company's
financial and operating results for its quarter ended June 30, 2023, followed by a question and answer
session.
Conference Call Dial-In Information:
Date:
Monday, July 31, 2023
Time:
8:30 a.m. Eastern time (5:30 a.m. Pacific time)
U.S. toll-free:
888-506-0062
Israel toll-free:
1-809-423-853
International:
973-528-0011
Link:
https://www.webcaster4.com/Webcast/Page/2259/48786
Please call the conference telephone number 5-10 minutes prior
to the start time. An operator will register your name and
organization.
About SuperCom
Since 1988, SuperCom has been a global provider of traditional
and digital identity solutions, providing advanced safety,
identification and security solutions to governments and
organizations, both private and public, throughout the world.
Through its proprietary e-Government platforms and innovative
solutions for traditional and biometrics enrollment,
personalization, issuance and border control services, SuperCom has
inspired governments and national agencies to design and issue
secure Multi-ID documents and robust digital identity solutions to
its citizens and visitors. SuperCom offers a unique all-in-one
field-proven RFID & mobile technology and product suite,
accompanied by advanced complementary services for various
industries including healthcare and homecare, security and safety,
community public safety, law enforcement, electronic monitoring,
livestock monitoring, and building and access automation.
For more information, visit https://www.supercom.com/
SuperCom Investor Relations:
ir@supercom.com
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Statements preceded or followed by or that otherwise
include the words "believes", "expects", "anticipates", "intends",
"projects", "estimates", "plans", and similar expressions or future
or conditional verbs such as "will", "should", "would", "may" and
"could" are generally forward-looking in nature and not historical
or current facts. These forward-looking statements are subject to
risks and uncertainties that could cause our actual results to
differ materially from the statements made. Examples of these
statements include, but are not limited to, statements regarding
business and economic trends, the levels of consumer, business and
economic confidence generally, the adverse effects of these risks
on our business or the market price of our ordinary shares, and
other risks and uncertainties described in the forward looking
statements and in the section captioned "Risk Factors" in our
Annual Report on Form 20-F for the year ended December 31, 2022, filed with the U.S. Securities
and Exchange Commission (the "SEC") on April
20, 2023, our reports on Form 6-K filed from time to time
with the SEC and our other filings with the SEC. Except as required
by law, we not undertake any obligation to update or revise these
forward-looking statements, whether as a result of new information,
future events or otherwise, after the date of this press
release.
*Use of Non-GAAP Financial Information
In addition to disclosing financial results calculated in
accordance with the generally accepted accounting principles in
the United States ("GAAP"), this
release also contains non-GAAP financial measures, which SuperCom
believes are the principal indicators of the operating and
financial performance of its business.
Management believes the non-GAAP financial measures provided are
useful to investors' understanding and assessment of SuperCom's
ongoing core operations and prospects for the future, as the
charges eliminated are not part of the day-to-day business or
reflective of the core operational activities of the
company. Management uses these non-GAAP financial measures as
a basis for strategic decisions, forecasting future results and
evaluating the Company's current performance. The presentation
of these non-GAAP financial measures is not intended to be
considered in isolation from, or as a substitute for, or superior
to, operating loss and or net income (loss) or any other
performance measures derived in accordance with GAAP or as an
alternative to net cash provided by operating activities or any
other measures of our cash flows or liquidity.
Non-GAAP EPS is defined as earnings before amortization and
other non-cash or one-time expenses divided by weighted average
outstanding shares.
EBITDA is defined as earnings before interest, taxes,
depreciation, amortization, and other non-cash or one-time
expenses.
SUPERCOM
LTD.
CONSOLIDATED BALANCE
SHEETS
(U.S. dollars in
thousands)
|
|
|
As of June 30,
|
|
As of December
31,
|
|
|
2023
|
|
2022
|
|
|
Unaudited
|
|
Audited
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
Cash and cash
equivalents
|
1,139
|
|
4,042
|
Restricted bank
deposits
|
382
|
|
463
|
Trade receivable,
net
|
12,431
|
|
10,852
|
Patents
|
|
5,283
|
|
5,283
|
Other accounts
receivable and prepaid expenses
|
2,353
|
|
2,239
|
Inventories,
net
|
3,059
|
|
3,411
|
|
|
|
|
|
Total current
assets
|
24,647
|
|
26,290
|
|
|
|
|
|
LONG-TERM
ASSETS
|
|
|
|
Severance pay
funds
|
459
|
|
482
|
Deferred tax long
term
|
201
|
|
501
|
Property and
equipment, net
|
2,397
|
|
1,640
|
Other intangible
assets, net
|
5,504
|
|
5,617
|
Operating lease
right-of-use assets
|
260
|
|
484
|
Goodwill
|
|
7,026
|
|
7,026
|
|
|
|
|
|
Total long-term
assets
|
15,847
|
|
15,750
|
|
|
|
|
|
Total
Assets
|
40,494
|
|
42,040
|
|
|
|
CURRENT
LIABILITIES
|
|
|
Trade payables and
other credit
|
1,149
|
|
2,167
|
Employees and payroll
accruals
|
1,075
|
|
1,339
|
Related
parties
|
142
|
|
168
|
Accrued expenses and
other liabilities
|
283
|
|
469
|
Short-term Operating
lease liabilities
|
295
|
|
381
|
Deferred revenues
ST
|
507
|
|
715
|
|
|
|
|
|
Total current
liabilities
|
3,451
|
|
5,239
|
|
|
|
|
|
LONG-TERM
LIABILITIES
|
|
|
|
|
|
|
|
Long-term
loan
|
32,909
|
|
32,600
|
Deferred
revenues
|
-
|
|
269
|
Deferred tax liability
LT
|
170
|
|
170
|
Accrued severance
pay
|
497
|
|
523
|
Long-term Operating
lease liabilities
|
-
|
|
108
|
|
|
|
|
|
Total long-term
liabilities
|
33,576
|
|
33,670
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
Ordinary
shares
|
4,910
|
|
3,057
|
Additional paid-in
capital
|
104,073
|
|
103,000
|
Accumulated
deficit
|
(105,516)
|
|
(102,926)
|
|
|
|
|
|
Total shareholders'
equity
|
3,467
|
|
3,131
|
|
|
|
|
|
Total liabilities and
equity
|
40,494
|
|
42,040
|
SUPERCOM
LTD.
|
CONSOLIDATED STATEMENTS
OF OPERATIONS
|
(U.S. dollars in thousands)
|
|
|
|
|
|
|
Three months ended
|
|
|
June 30, 2023
|
June 30, 2022
|
|
|
Unaudited
|
Unaudited
|
|
|
|
|
REVENUES
|
|
7,748
|
3,218
|
COST OF REVENUES
|
|
(5,482)
|
(1,936)
|
|
|
|
|
GROSS PROFIT
|
|
2,266
|
1,282
|
|
|
|
|
OPERATING EXPENSES:
|
|
|
|
Research
and development
|
|
849
|
933
|
Selling
and marketing
|
|
556
|
762
|
General
and administrative
|
|
1,290
|
1,346
|
Other
expense (income), net
|
|
229
|
-
|
|
|
|
|
Total operating
expenses
|
|
2,924
|
3,041
|
|
|
|
|
OPERATING LOSS
|
|
(658)
|
(1,759)
|
FINANCIAL EXPENSES, NET
|
|
(397)
|
(1,055)
|
|
|
|
|
LOSS BEFORE INCOME TAX
|
|
(1,055)
|
(2,814)
|
INCOME TAX EXPENSE
|
|
-
|
-
|
|
|
|
|
NET LOSS FOR THE
PERIOD
|
|
(1,055)
|
(2,814)
|
Net Loss Per Share:
|
|
|
|
Basic and Diluted
|
|
(0.21)
|
(0.77)
|
Weighted average
number of ordinary shares
Used in computing basic & diluted net loss per
share
|
|
5,042,117
|
3,651,285
|
SUPERCOM
LTD.
Reconciliation Table
of GAAP to Non-GAAP Figures and EBITDA to Net Income
(U.S. dollars in
thousands)
|
|
|
|
|
|
|
|
Three months ended
|
|
|
June 30,
2023
|
June 30,
2022
|
|
|
Unaudited
|
Unaudited
|
|
|
|
|
GAAP gross profit
|
|
2,266
|
1,282
|
Amortization of
intangible assets
|
89
|
89
|
Non-GAAP gross profit
|
2,355
|
1,371
|
|
|
|
GAAP Operating Loss
|
(658)
|
(1,759)
|
Amortization of
intangible assets
|
452
|
472
|
Foreign
Currency Loss
|
378
|
395
|
Non-cash or
one-time expenses
|
559
|
-
|
Non-GAAP operating profit
|
731
|
(892)
|
|
|
|
|
|
GAAP net Loss
|
|
(1,055)
|
(2,814)
|
Amortization of
intangible assets
|
452
|
472
|
Foreign
Currency Loss
|
378
|
395
|
Non-cash or
one-time expenses
|
559
|
-
|
Non-GAAP net Loss
|
|
334
|
(1,947)
|
Non-GAAP E.P.S
|
|
0.07
|
(0.5)
|
|
|
|
Net loss for the period
|
(1,055)
|
(2,814)
|
Financial
expenses (income), net
|
397
|
1,055
|
Depreciation and
Amortization
|
609
|
643
|
Foreign Currency
Loss
|
378
|
395
|
Non-cash or one-time
expenses
|
559
|
-
|
EBITDA *
|
|
|
888
|
(721)
|
* EBITDA
is a non-GAAP financial measure generally defined as earnings
before interest, tax, depreciation
and amortization and other non-cash or
one-time expenses.
|
SUPERCOM LTD.
|
CONSOLIDATED STATEMENTS OF
OPERATIONS
|
(U.S. dollars in thousands)
|
|
|
|
|
|
|
Six months ended
|
|
|
June 30, 2023
|
June 30, 2022
|
|
|
Unaudited
|
Unaudited
|
|
|
|
|
REVENUES
|
|
14,124
|
6,264
|
COST OF REVENUES
|
|
(10,276)
|
(3,648)
|
|
|
|
|
GROSS PROFIT
|
|
3,848
|
2,616
|
|
|
|
|
OPERATING EXPENSES:
|
|
|
|
Research
and development
|
|
1,662
|
1,792
|
Selling
and marketing
|
|
1,128
|
1,463
|
General
and administrative
|
|
2,374
|
2,488
|
Other
expense (income), net
|
|
405
|
-
|
|
|
|
|
Total operating
expenses
|
|
5,569
|
5,743
|
|
|
|
|
OPERATING LOSS
|
|
(1,721)
|
(3,127)
|
FINANCIAL EXPENSES, NET
|
|
(869)
|
(2,032)
|
|
|
|
|
LOSS BEFORE INCOME TAX
|
|
(2,590)
|
(5,159)
|
INCOME TAX EXPENSE
|
|
-
|
-
|
|
|
|
|
NET LOSS FOR THE
PERIOD
|
|
(2,590)
|
(5,159)
|
SUPERCOM
LTD.
Reconciliation Table
of GAAP to Non-GAAP Figures and EBITDA to Net Income
(U.S. dollars in
thousands)
|
|
Six months ended
|
|
June 30,
2023
|
June 30,
2022
|
|
Unaudited
|
Unaudited
|
|
|
|
GAAP gross profit
|
3,848
|
2,616
|
Amortization of
intangible assets
|
177
|
177
|
Non-GAAP gross profit
|
4,025
|
2,793
|
|
|
|
GAAP Operating Loss
|
(1,721)
|
(3,127)
|
Amortization of
intangible assets
|
983
|
927
|
Foreign
Currency Loss
|
898
|
884
|
Non-cash or
one-time expenses
|
788
|
-
|
Non-GAAP operating profit
|
948
|
(1,316)
|
|
|
|
|
|
|
GAAP net Loss
|
(2,590)
|
(5,159)
|
Amortization of
intangible assets
|
983
|
927
|
Foreign
Currency Loss
|
898
|
884
|
Non-cash or
one-time expenses
|
788
|
-
|
Non-GAAP net Loss
|
79
|
(3,348)
|
Non-GAAP E.P.S
|
0.02
|
(1.01)
|
|
|
|
Net loss for the period
|
(2,590)
|
(5,159)
|
Financial
expenses (income), net
|
869
|
2,032
|
Depreciation and
Amortization
|
1,307
|
1,263
|
Foreign Currency
Loss
|
898
|
884
|
Non-cash or one-time
expenses
|
788
|
-
|
EBITDA *
|
1,272
|
(980)
|
* EBITDA
is a non-GAAP financial measure generally defined as earnings
before interest, tax, depreciation and
amortization and other non-cash or one-time
expenses.
|
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